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South Australia hits EV owners with road user charges

After much speculation in recent times as to how governments would tackle road funding amid the transition from petrol-powered cars to electric vehicles, the South Australian government has made the first move. In doing so, the government has effectively set down a precedent that could have implications for the rest of the country, if others follow suit.

 

What has been announced

Starting from July 1, 2021, electric car owners in South Australia will be required to pay road user charges that cushion the blow from a slow but steadily growing gap in the budget for road funding.

Fuel excise has long been the revenue raiser for the federal government, which is then distributed to the states for the upkeep, maintenance and upgrade of roads. With cars not only more fuel efficient in this day and age, but society also contending with alternative fuel technologies such as hybrid and pure electric vehicles, fuel excise hasn’t been keeping up with the nation’s population growth.

The move will bring EV owners into alignment with their motoring peers, ensuring all drivers contribute towards road funding across the state.

 

 

What will be the charge?

At this stage, specifics of the road user charge are yet to be finalised.

The government will need to crunch the numbers over the coming months and come to a figure that is deemed fair and proportionate, yet at the same time, not go so far as to disenfranchise prospective buyers of electric vehicles.

Budget papers from the South Australian government indicate the charge will likely include two components – a fixed charge, as well as a distance-based charge.

For now it remains to be seen whether the charges will have an impact on the adoption of electric vehicles. To date, the sector has seen sluggish growth, with local motorists favouring gas-guzzling SUVs. However, while it might not necessarily be a punishment of any sort, the advantage that may have been there is set to be no more, which ultimately isn’t going to help the cause.

What’s your take on road user charges for electric vehicle owners?

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