I am a ware of the Australia Institute report…and the inclusion of standard business tax deductions and concessions as a subsidy…meaning the government in effect subsidises all businesses.
I also recall their main arguement (or demonstrated subsidity) was fuel excise…which I have raised above and doesn’t relate to ICE or EV comparison. Any government could mandate fuel excise on non-road going equipment should they chose to ensure everyone/business pays the tax (it is applying a tax not removing a subsidity).
I also am aware how user pays (community) infrastructure works and the Australia Institute are wrong on saying use of this infrastructure is a subsidity as the government paid for it (even though the mining companies pay for it ultimately through user pay agreements and provides a nice revenue stream and return to the owner if the infrastructure). This reasoning can be applied elsewhere such as banking…saying a bank who gives a home loan is actually providing a subsidity as they gave the home owner the capital to buy the home…but one must ignore the repayments like the AI did). This shows the absurdity of their arguement.
The $2B is about Australia long term fuel security. You can call it a subsidity if you want to, but it isn’t subsidising the fossil fuel industry. It is ensuring these refineries remain functional in the future when the owners may close them due to reduced levels of production…namely when production becomes uneconomic. I suppose the car manufacturing grants to Ford, Toyota, Holden etc to keep them manufacturing but later not continued by government is another special ‘fossil fuel subsidity’ as the cars they made run on fossil fuels. It is no different…keeping an industry, jobs and Australia’s longterm economic security. Tge government will also potentially recoup their investment in these refineries.
That’s part of the problem. What is a subsidy? Is there a universally agreed definition? I don’t think there’s a simple answer to the first question. The second question probably explains a good amount of the disagreement.
As far as I am concerned every expense incurred in earning income is a deduction, and it is not a subsidy to allow that deduction.
It is difficult to determine whether a fuel excise exemption is a subsidy because it is simply impossible to tax the competing technology (an EV) in the same way.
That’s another part of the problem. Once something is defined as a “security” issue then it is no longer solely an economic question. The government may intentionally cause the raising of the effective price of something, on security grounds.
But, like many words…their definition have been changed for marketing, political or emotive reasons. It appears the term has been broadened to include concessions, deductions, tax or levy exceptions, exclusions and anything else one wants to call a subsidy.
We know for a fact that continuing to perpetually sell fossil fuel vehicles is not an option. Under a regulation approach the simple answer would simply be to begin banning cars over a certain pollution threshold until eventually all cars are EVs. Or other similar change.
Personally, I would argue this stands to be more harmful to ‘Joe Taxpayer’ as that would make ALL vehicles more expensive until the technology was more mainstream. Surely subsidising electric vehicles for those who can afford it, thereby driving development is a better option.
This. It’s a subsidy if I call it one. Even more so in online discussion.
For me, a more pertinent question, if either taxpayer money is going to be put into something or tax revenue is going to be foregone (you’ll notice I carefully avoided the s word), is: Is it effective?
Government policies are replete with examples of ineffectiveness, usually because either
there is poor take-up (which then at least doesn’t have much budget impact), or
the take-up is solid but there are unintended consequences, or
the take-up is solid but it just doesn’t achieve the desired outcome.
Governments often (intentionally) don’t attempt to measure effectiveness - because the announcement achieves a political end and, well, what happens after that is someone else’s problem.
There’s no problem to sell fossil fuel vehicles forever. We just need to stop selling fossil fuel.
That raises the question as to whether renewable fuel cars that are not pure EVs is permissible.
Examples:
diesel vehicles where the diesel is bio-diesel
hydrogen-powered vehicles e.g. hydrogen fuel cell replaces the Lithium battery of a conventional EV but the resulting electrical energy powers an electric engine
There are genuine pollution reasons to prefer to avoid bio-diesel (and other reasons) but CO2 emissions should not be one of those reasons.
Conversely, pure EVs are actually bad for emissions if the electricity used to charge the vehicle comes from burning fossil fuel (coal / gas). Just because the emissions don’t come out of the tailpipe doesn’t mean they aren’t there. Likewise, a hydrogen-powered vehicle is bad for emissions unless the hydrogen is created in a way that avoids CO2 emissions (e.g. ‘good’ could be PV panels produce electricity which is used to electrolyse water).
The ideal combination for a pure EV is that you charge the vehicle at home, you have solar panels, you generate more than you need for household use. However that doesn’t work for many families because they, and their EV, are out at work during peak generation time or indeed during any generation time. There are various workarounds for this e.g. a global pandemic
So it requires a holistic change, not just a change to one aspect (car engines).
This applies to a lot of things. An example is the word ‘saving’. It now appears to be if you were going to spend money, but didn’t, it is a monetary saving and appears as extra revenue item to be spent on your accounts. Don’t know how, but it now is.
Or another example is promise. If anyone says anything like…we hope to achieve, we are looking into this, the target is etc, these automatically become promises which can’t be broken.
There are heap more examples. Are we trying to break the English language to suit our own ‘marketing, political or emotive reasons’.
This is the key question. What does it mean and what is the return for the taxpayer…and is it in the general public interest?
Like government financial support or policies to promote BEVs/HFCEVs, I would like to see a public interest test like what should be done for any other policy. In days gone by, public servants had to provide such tests as part of the process for making decisions within government…why shouldn’t be government be transparent and do likewise.
However effectiveness can only really be measured once the program is in place. Sure, some public servant or expert can express a genuinely-held belief that the policy will be effective but there is no substitute for measuring actual results afterwards, and being obliged to publish the results.
Regardless of what is ideal policy (as proven effective after the fact), the policy also has to be politically achievable - in the parliament and in the electorate. That I think is where Australia has really failed over the last almost 2 decades.
It doesn’t matter what I think is ideal policy if it would not be politically achievable.
ethanol-powered vehicles where the ethanol is bio-sourced
electrochemically powered vehicles which can be refuelled at a “petrol” station i.e. very quickly like pumping petrol, not slowly like charging a pure EV (the one I have seen talked about most is something like this: Vanadium redox battery - Wikipedia but maybe better options are available)
One further comment: In seeking alternatives to fossil fuel vehicles we also don’t want too much fragmentation of the market, with the resulting difficulties in providing infrastructure and the increased cost to the customer due to lack of scale, not to mention potentially orphaned vehicles when some technologies inevitably die out. So the government faces a difficult balance between “picking winners” and “market fragmentation”.
Sometimes though we expect government to ban a product that is unsafe rather than just requiring it to be labelled as unsafe. The various participants in this topic won’t agree on exactly how unsafe a fossil fuel vehicle is but I think we can all agree that, at a certain point, if a product is toxic and fatal, it gets banned. It might take society some time to realise how toxic. Think thalidomide, asbestos, DDT, …
Perhaps there is some confusion. That text was in response to
and it was a question not a claim or statement.
In other words, what exactly would be banned? and would it actually have the effect that eventually all cars are EVs?
(Incomplete combustion is a possibility so that even though the combustion of ethanol might in theory just close the loop, with no net emissions and no pollution, reality is sometimes somewhat different and it is beyond my expertise to answer your question. Maybe ask someone in Brazil.)
For Ethanol production to be 100% green, the assumption is all the inputs come exclusively from sugar cane, and the CO2 etc produced or released in it’s use is absorbed back into the next crop. Some will suggest this still results in elevated CO2 levels and is not truely green as it still relies on increasing atmospheric CO2 levels in the short term compared to ongoing 100% sequestration through accumulation of biomass.
In addition?
There are numerous inputs that are carbon overheads in the growing and ethanol production process. These include transport, fertiliser, the agricultural machinery used, factory and machinery creation carbon footprints, the personal carbon footprints of all the labour and industry dependent families. I’ve not seen a balance for all these extras. The last, our human footprint scales with decarbonisation of our society.
As there is no immediate practical solution for most air travel needs, it’s currently suggested aircraft will still rely on carbon based fuels up to and including 2050. Two likely sources are biofuels, and CO2 capture with conversion using green hydrogen. Given a choice between using bio sourced ethanol for air travel or road vehicles, which use will the future favour? Battery technology needs to improve two orders of magnitude to replace jet-A or av-gas in long haul aviation.
That is of course potentially true but then when you look into the details of other technologies they too may have embodied CO2 emissions.
We are probably looking more at the emissions from use rather than the total life cycle. That level of detail might be best left to experts and actual research, rather than internet armchair commentators.
Isn’t that the same article that was posted as post 10 above?
Digressing: Even today I am still buying incandescent globes - for niche situations where I can’t get a match with an LED globe. (Match means: cap type, cap size, globe size and shape.) So Malcolm might have banned them but you can still buy them.
I’m still to find a suitable LED replacement for the skinny TF bulbs in the oyster fan lights. One that does not require the luminaire to be left off because it is too large or off Centre and rattles as the fan rotates. The CFL options were never practical either due to poor light output or too bulky.
The solution, new oyster style LED light assemblies with those pesky built in non replaceable circuit boards! Another electrician call out!
