Policy impetus, such as support programmes and tight environmental targets, are now driving the market globally. Many programmes aim at encouraging and supporting the adoption of electric vehicles (EVs). Benefits of EVs to a country would a healthier environment through reduced air pollution and greenhouse gas emissions, lower liquid fuel imports and in the long run, the higher energy efficiency of EVs, combined with the use of renewable energy technologies, would also enhance resource preservation.
Motor vehicles sold in South Africa (either imported or manufactured locally) are subject to an ‘’environmental levy on carbon dioxide emissions of motor vehicles’’. The levy is set at R120 per g/km CO2 emissions exceeding 95g/km (R160 per g/km CO² emissions exceeding 175g/km for commercial vehicles).
Heightened environmental regulations, to mitigate greenhouse gas emissions from transportation as well as improve air quality in urban areas, have initiated the transition to cleaner forms of transportation. Globally, road transport is responsible for about 16% of man-made CO2 emissions. It is a common misconception that global warming is mainly caused by cars and trucks. It is important to understand that there are other, larger, contributors and all sources of CO2 emission must be addressed if the problem is to be solved.
The world is changing to EVs, and fast, with several of South Africa’s top export destinations announcing their intentions to ban the sale of new internal combustion engine vehicles from 2030 onwards. The long-term outlook for EVs remains bright, as fundamental cost and technology improvements outweigh the short-term impacts of the pandemic. OEMs are accelerating their EV launch plans, partly to comply with increasingly stringent regulations in Europe and China, along with a raft of new model launches and government-sponsored incentives. China and Europe combined would represent 72% of all passenger EV sales in 2030, driven by European vehicle CO2 regulations and China’s EV credit system, fuel economy regulations and city policies restricting new internal combustion vehicle sales. OEMs will continue to focus their passenger EV efforts on the markets with the most stringent regulations for the next 10 years, leading to low rates of EV adoption in the rest of world. Price parity between EVs and internal combustion vehicles is projected to be reached by the mid-2020s in most segments, but there is a wide variation between geographies. Until these tipping points are reached, policy support is still required in most markets.
The Department of Transport (DoT) has implemented a Green Transport Strategy (GTS-DoT) to lower GHG emissions and develop policy and regulations. Important focus areas for the department include promoting sustainable green mobility and more efficient technologies, transport systems integration and the development of infrastructure for e-mobility.
The GTS-DoT’s short term strategy aims to convert 5% of the public and national sector fleet to green cleaner alternative fuel vehicles, including the use of CNG, biogas and biofuels, and renewable energy to provide electricity for transport in the next 5-7 years. The government notes that the strategy and implementation plans will depend on financial support and resources, infrastructure investment, coherent policy framework and regulatory environment alignment. The DoT, DTIC and National treasury are working on implementation plans, supporting relevant research work such as the Auto industry EV roadmap and assessing the policy implications of the proposed GTS-DoT plans.
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