Road User Charge Changes: Climate Expert Warns Electric Vehicle Owners of Increased Costs

Changes in Road User Charges: EV Owners May Pay Double, Climate Expert Warns


The recent adjustments to road user charges by the government have raised concerns, particularly from climate and energy expert, Christina Hood. According to Hood, the alterations might lead to some Electric Vehicle (EV) owners paying twice as much per kilometer compared to their petrol counterparts.

While acknowledging the fairness of charging EVs for road use, Hood emphasizes that the current approach could unfairly penalize those opting for electric cars. The disparity arises from the fact that EVs (similar to diesel vehicles) are charged per kilometer, whereas petrol cars incur taxes per liter of fuel. This structure can give highly efficient petrol cars an advantage over similarly sized EVs.

Road user charges are grouped broadly by weight, causing all plug-in electric vehicles weighing under 3.5 tonnes to pay the same rate per kilometer, regardless of their size.

To illustrate this point, Hood compared two comparable cars: a new Kia Niro, non plug-in petrol/electric hybrid, and the fully electric Kia Niro. Her findings revealed that the government collects $39 per 1000km in taxes from the petrol version, while the fully electric vehicle pays over $80 per 1000km in road user charges—twice as much as its petrol counterpart.

Transport Minister Simeon Brown has yet to comment on the matter.

The government has expressed intentions to transition petrol cars to the same road user charges system as diesel and electric vehicles, but no specific date has been set. Hood argues that, in the interim, this move could work against EVs on the car dealer forecourt.

Hood stresses the importance of comparing the kind of people buying EVs with those opting for fuel-efficient cars, highlighting the need for fairness in this comparison.

Recently, the government announced that as of April 1, EVs and plug-in hybrid vehicles will no longer be exempt from road-user charges. Owners of light EVs will pay $76 per 1000 kilometers, matching the fees for equivalent diesel-powered vehicles. Plug-in hybrid owners will face a reduced rate of $53 per 1000km, recognizing their payment of excise duty on petrol.

Kirsten Corson, Drive Electric chairperson, expressed disappointment over the decision, stating that it, along with losing the EV clean car discount, will significantly impact sales and hinder progress towards meeting the Paris Agreement target.

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