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Janet asks questions on freight movements and vehicle emissions

Estimates & Committees
Janet Rice 23 Oct 2017

Senator RICE: I understand there's been a discussion paper for the development of the national freight strategy, and submissions closed on 28 July—is that the case?

Mr Foulds: That is correct.

Senator RICE: How many submissions were received?

Mr Foulds: Over 120.

Senator RICE: Were they received from across the board?

Mr Foulds: They were received from across the board from some jurisdiction governments, from industry, from individuals, from all sectors of the supply chain.

Senator RICE: From communities affected by freight movements?

Mr Foulds: I can't recall—we'll take that on notice.

Senator RICE: In my home patch—Footscray and Yarraville—there is the Maribyrnong Truck Action Group, for example.

Mr Foulds: It doesn't ring a bell. We don't have anything from the Truck Action Group.

Senator RICE: There are similar groups in Sydney—there's the Blue Mountains community that's concerned about freight movements through their area.

Mr Foulds: We had no submissions from them.

Senator RICE: And in Melbourne there was the community in Rosanna concerned about freight movements through there.

Mr Foulds: Nothing from them.

Ms Zielke: We have a number from local councils and various smaller groups, but I can't see anything of that nature.

Senator RICE: What outreach did you to do to local communities to encourage submissions?

Mr Foulds: Other than the website and other than ministerial announcements, and the talking to regional industries—when I say regional industries, for example down in regional Victoria—that's the outreach we did. But directly to communities we did not do outreach.

Senator RICE: Is it too late for those communities to input into the development of the strategy?

Ms Zielke: In looking at the list again I've noticed several that I will mention so that you are aware: The Wheatbelt Railway Retention Alliance, the Wollongong Neighbourhood Forum 5 and the Wollongong Transport Coalition; we also have Bindaree Beef Group and others from the Wheatbelt. My apologies—had I looked further I would have seen those.

Senator RICE: But it doesn't sound like there are any from urban Melbourne or Sydney. There are some major issues and they are very well known and very high profile in terms of their engagement with freight issues so I'm surprised that you didn't reach out to them to get their input.

Ms Zielke: The panel is due to report to government with a draft report by the end of this year with a final report by March in the new year.

Senator RICE: Will that draft report be a public document? Will you be asking for submissions responding to that draft report?

Ms Zielke: No, but there are consultations still under way at the moment by the panel.

Senator RICE: Right. So can you take on notice whether the panel could engage with local communities in Melbourne and Sydney.

Ms Zielke: Happy to.

Senator RICE: We've got a final report by March, so that will be a public document, presumably?

Ms Zielke: Yes.

Senator RICE: That then feeds into the development of the strategy?

Mr Foulds: That's correct.

Senator RICE: What is the timeline expected for the strategy?

Mr Foulds: The strategy will be developed during 2018.

Senator RICE: I noticed in the discussion paper there was talk about the need to develop a national performance freight framework and likely key indicators.

Mr Foulds: That's correct.

Senator RICE: I presume the strategy will have objectives and targets and reflect those key indicators, then? Is that the plan?

Mr Foulds: The intention will be to take those things into account. It'll be developed in consultation with states and territories, and the strategy will be agreed also through the COAG Transport and Infrastructure Council.

Senator RICE: I was looking through the terms of reference for the inquiry at the moment and I noticed that there didn't seem to be any reference to reducing carbon emissions from freight vehicles. Is that the case? How is reducing carbon emissions going to be considered in the strategy? How important is it going to be?

Ms Zielke: I suppose we are highly focused on the ministerial task force in relation to vehicle emissions and the work that's going on in that area. Obviously it will need to be considered in coming up with the national freight strategy, but the work going on in that area would inform it more than anything else.

Mr Foulds: We've spoken to close to 200 people and a large number of peak bodies. The panel have spoken to others as well. One of the biggest issues that's come up in all the consultations is urban congestion and dealing with that for freight and supply chains. If you can improve that, you will, by definition, improve emissions as well without any other changes.

Senator RICE: Yes, although there are other ways of reducing your carbon emissions.—

Mr Foulds: There are.

Senator RICE: particularly mode shift, where you have the choice of road freight, rail freight or shipping. I'm wondering how much the driver of reducing vehicle emissions will actually drive consideration in the strategy of the desirability of mode shifting?

Mr Foulds: The strategy's designed to improve freight and supply chains. It's designed for economic benefit and to improve the economic output of supply chains and the companies that deal with it—import, export and just the getting of goods to where they need to go in the most efficient manner and at the least cost.

Senator RICE: So you're saying the strategy isn't going to then have a focus on reducing vehicle emissions?

Mr Foulds: I'm not saying that that is the case, but the main driver of the strategy is to improve freight and supply chain and the efficiency for the economy.

Senator RICE: But will reducing carbon emissions from freight be considered as part of the strategy?

Mr Foulds: Mode-shift will be part of that strategy or, rather, the advantages of mode-shift and things that need to happen to make freight and supply chains more efficient will be part of that strategy.

Senator RICE: Will the role that reducing vehicle carbon emissions will need to play as part of the government reaching its Paris carbon reduction targets be considered in the strategy?

Ms Zielke: Again, that's a key focus of the ministerial task force on vehicle emissions. That work is going on.

Senator RICE: But would you agree that, if you've got a national freight strategy that is covering the whole gamut of emissions associated with freight, that it should be a significant part of this freight strategy also?

Ms Zielke: In the same way as the vehicle emissions ministerial task force's focus is vehicle emissions, it will consider other issues.

Senator RICE: How do you see the two of them intersecting then?

Ms Zielke: The priority for both are different.

Senator RICE: If you are having a strategy that’s looking overall at the whole gamut of things that need to be considered when you are planning freight, what I want assurance about is whether reduction of vehicle emissions and in particular the role that reducing vehicle emissions is going to play to enable us to meet our Paris targets is going to be a factor in the development of the freight strategy.

Ms Zielke: It will be an input, but I don't think, at this stage, think it will be a key priority of the strategy. That being said, we don't know as yet what the panel will actually present to government at this stage. They're an independent panel in relation to what their recommendations are in that regard.

Senator RICE: Moving on to vehicle emissions more generally, the ministerial forum released draft regulation impact statements for both carbon dioxide and pollutant emissions in December last year, which is almost a year ago. So when will the forum be releasing its final recommendations?

Ms Wieland: The government is continuing to consult with stakeholders in relation to those regulation impact statements you spoke about. On 10 July, the department released a draft model for light-vehicle fuel-efficiency standards in consultation with key stakeholders. We got 17 responses in total in relation to those consultations. We are continuing to talk with our stakeholders on the issues that were raised in that feedback, including decarb discussions on technical issues in relation to fuel quality, European and US fuel efficiency standards and how design elements from those countries might be applied in Australia. I cannot give you a definitive time frame at the moment because we are in the middle of those conversations.

Senator RICE: Do you have an expectation that it would be by the end of the year?

Ms Wieland: As I said, I can't give you a definitive timetable for that. The government made announcements when it put out the terms of reference for this review. We are certainly trying to work as quickly as we can to finalise that work.

Senator RICE: When the forum makes its final recommendations, will that be a public announcement or will it be recommendations only for the relevant ministers?

Ms Wieland: I expect that the process would be that the usual policy advice is the advice that would be provided to ministers. They will take that through the cabinet process, and there would be announcements following that.

Senator RICE: Why was 2025 chosen as the preferred date for the end of the phase in of the standards?

Ms Wieland: That timetable was following on from the work of the Climate Change Authority that had been publicly released previously. The announcements that were made were trying to give a reasonable time frame to industry to implement, bearing in mind that the intersecting issues of fuel quality, standards, vehicle emission standards by pollutants and fuel-efficiency all intersect and have impacts on which cars are supplied to market, how fuel is supplied in Australia and what refineries have to do to change the way they operate et cetera. So that time frame was a reasonable time frame that is pretty much in line with what we do with other processes when we impose new mandatory requirements on manufacturers.

Senator RICE: So it is mostly relating to the changes in fuel quality that would be required rather than the availability of the vehicles?

Ms Wieland: As you would have seen from the proposal and the fuel efficiency standard, the one that has the greatest net benefit is the one that aligns with international standards. That's actually going to be quite a stretch for manufacturers to get to. The government would be concerned about a loss of vehicle choice in supply to market. We have a fleet that's very much like the US fleet. Bringing that down to the most fuel-efficient possible is something that the government wants to achieve. They want to achieve fuel-cost savings.

Senator RICE: In the draft statement, you argued that the 105 grams per kilometre standard was similar to the US 2025 targets and similar to the 2020-21 European Union targets. Basically, the European Union will be in compliance with the standards that are being proposed by 2020-21.

Ms Wieland: They also announced them a lot earlier than the work we are currently doing, and they gave the industry a long lead time to implement that. At the moment, 2025 is actually quite a compressed timetable compared to others. It will require renegotiation of contracts with global manufacturers about what supply—

Senator RICE: But you have 17 million new light-vehicle sales a year in Europe. So, essentially, there would be an awful lot of cars available by 2021 that would meet these standards?

Ms Wieland: Yes, that's correct.

Senator RICE: Yes. Is there any reason why those cars can't be required to be here by 2020-21 rather than waiting until 2025—other than, as you're saying, potentially, for fuel standard reasons and that's why you've chosen 2025? You are going to have cars that are being produced globally, and they are the cars that we are going to be importing here. We are not producing any of our own.

Ms Wieland: As you indicated, there is a relationship with fuel quality. They have been brought together as a package. That is what all of the stakeholders we've consulted with today are arguing. You need an approach that takes into consideration Australia's quality of fuel and when that will be available to the market.

Senator RICE: Can you outline, then—or perhaps take on notice—what changes to fuel quality are going to be required and why it's going to take longer, why it is not possible to have those changes in fuel quality by 2021?

Senator GALLACHER: Don't we import both the cars and the fuel?

Ms Wieland: No. We have fuel refineries in Australia still.

Senator GALLACHER: I beg your pardon. We are refining our own fuel here in Australia?

Ms Wieland: In Victoria, yes. There are four refineries in Australia.

Senator GALLACHER: And they're not to international standards?

Ms Wieland: The sulphur levels of petrol are higher than best practice overseas. I can give you details of that, Senator, if you want.

Senator RICE: Yes, please, if you could give me the details of that and why it's not going to be possible to have that change in place by 2021, given the cars will be available by 2021—why it's going to take us until 2025 to change our fuel standards.

Ms Wieland: Yes.

Senator RICE: On to electric vehicles: can you please outline what incentives the federal government currently provides for the uptake of electric vehicles?

Ms Wieland: I think we provided that to you on notice in the last hearings. It was question No. 135 that we took on notice at the last hearings, and we've provided those details.

Senator RICE: Nothing has changed since then? I don't think you had a target at last estimates. Is there currently a target for electric vehicle uptake?

Ms Wieland: No.

Senator RICE: How much has the government engaged with the Electric Vehicles Initiative?

Ms Wieland: I would suggest a fair amount. I know we've had numerous conversations with the Electric Vehicle Council, ClimateWorks and others, providers of infrastructure and those who are seeking additional government support for electric vehicles.

Senator RICE: Given the Electric Vehicles Initiative, my understanding is that one of the easiest or most straightforward ways of encouraging uptake is for fleet uptake to be a priority. Is the government looking at planning for increasing the penetration of electric vehicles in government car fleets?

Ms Wieland: Most of the government car fleets are actually not federal government; they are at state and local levels. We don't mandate what goes into state and federal fleet purchasing requirements.

Senator RICE: So essentially you're not—

Ms Wieland: What I'm saying to you is: we're looking at the full range of options that will affect reducing vehicle emissions and we're providing that advice to government. But I just note with you, in terms of the particular issue of fleet ownership, it's largely a state and local government issue, in terms of the volume of vehicles supplied.

Senator RICE: Would you see the federal government actually setting targets for electric vehicle uptake?

Ms Wieland: I think that's a policy question for the government.

Senator RICE: Okay. Minister?

Senator Nash: I'm sorry. What was the question again?

Senator RICE: Whether the government is considering setting targets for electric vehicle uptake.

Senator Nash: That I'd need to take on notice for you.

Senator RICE: Okay. What work's been done so far towards harmonising charging infrastructure standards?

Ms Wieland: As I understand it, there are a range of electric vehicle charging standards at the moment, and we accept all of the international standards. There are different standards around the world. Essentially, though,the industry itself is indicating a preference for a rapid charge and a standard time charge, one particular standard. I do understand that the manufacturers aren't all necessarily aligned about which way to go in future, and there's a Standards Australia technical committee that are looking at trying to get consensus on that issue.

Senator RICE: Does the government have a view as to what its preference would be—whether they should all be harmonised?

Ms Wieland: It's difficult for me to speak on behalf of the government, but I would expect that they would—the industry sorts that out.

Senator RICE: Your advice to government?

Ms Wieland: I would expect that they would want the industry to sort that out through that Standards Australia process.

Senator RICE: Do you see a role for government in facilitating harmonisation?

Ms Wieland: That's what the Standards Australia process does. It has government representatives on it as well.

Senator RICE: Through the Standards Australia process being the only role for government to have?

Ms Wieland: That's currently the process.

CHAIR: Senator, when I said you had one more question, I decided to give you 10 before I intervened. Are you done?

Senator RICE: Yes, I am.

 

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