Smith Nick: Road User Charges Amendment Bill — First Reading 
Smith Nick: Road User Charges Amendment Bill — First Reading 
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Hon Dr NICK SMITH (Minister for the Environment) 
: 
 I am very enthusiastic about supporting the Road User Charges Amendment Bill which has been brought to Parliament by the Hon Steven Joyce. About this time last year New Zealand was in gridlock as a consequence of the mismanagement by the previous Government of the relationship with the road transport industry over the issue of road-user charges. New Zealanders and truckies were angry that the previous Government had gone back on its word to provide notice of increases in the road-user charges and it was an issue that caused New Zealand great grief. The member who triggered that protest needs to take some responsibility for the way in which she mismanaged that issue and the way in which the new Minister is now fixing it up. 
I speak with particular enthusiasm about the exemptions from road-user charges that are provided in this bill for electric cars as an incentive for that new technology to be taken up. The provision in this bill very much provides a contrast between the approach of this Government and that of its predecessor. Let us remind ourselves of what the previous Government did around electric car technologies: it came out with a strategy. You see in every area that the previous Government moved there was always a strategy. There were dozens of them—hundreds of them! It had a strategy that 40 percent of the car fleet by 2040 would be electric. The problem: was there any element of policy that would actually achieve that? The answer is: not a single iota. We searched under the desks. We looked under the chairs. We looked in the nooks and crannies right through the Government bureaucracy to try to find whether there was anything the previous Government had to be able to meet this big bold target of 40 percent of the New Zealand car fleet being electric by 2040. The answer was that it was a hollow empty strategy without anything to achieve it. The second feature is that in so many areas of the climate change debate the previous Government went for regulation. It went for the good old nanny State. It decided to tell New Zealanders how to live their lives in so many ways. This bill contrasts with that approach. This bill tells people to look at the new exciting technologies out there like electric cars which provide a way forward for a cleaner transport fleet. We are not going to compel people to buy them but we are going to provide an incentive. This bill in exempting those electric cars from road-user charges for a period of 4 years—it would then be reviewed—is a good way in which to give a kick-start to those new technologies. 
I will debate for the House a number of the reasons why I think electric car technology has great potential. The first is that the electric motor is an order of magnitude more efficient than the internal combustion engine. A revolution occurred 100 years ago from the old steam engine that had about 6 percent efficiency to the internal combustion engine that had about 20 percent efficiency. It is my personal view that this change to electric technology moves that efficiency from 20 percent to 75 percent. The truth is that the vast bulk of the energy in our cars is produced in heat not in motion. The first big gain from electric car technology is an order of magnitude more efficient in converting energy into motion for our traffic fleet. The second thing that is quite exciting about electric car technology is that normally when we put our foot on the brake all that energy is wasted in the brake pads. With electric car technology that energy is used to revert the electric motor into a generator to recharge the batteries. That adds another order of magnitude of efficiency to electric cars. The third gain that electric cars offer us is the issue around not carbon dioxide but particulate pollution. If we look at a city like Auckland one of the big contributors to air pollution particulate pollution is vehicles. Electric cars have absolutely zero contribution in terms of particulate pollution and that has a big flow-on benefit for people’s health and also in terms of the broader issue of New Zealand living up to its clean green reputation. 
The last point I want to make about electric cars is that they are beautifully quiet. I have one of the Hyundai Getz electric cars which was manufactured and altered in Australia by Blade Electric Vehicles. The greatest danger of this car is that it cannot be heard. It is as silent as a baby. One has to be quite careful when one is around pedestrians. It is so quiet and that is an added advantage. I also note that New Zealand is in a unique position to be able to advance electric car technology. The reason is that if someone has an electric car and the electricity that is used to charge its batteries is produced from burning coal we are going backwards. Sure we do not have the emissions going out the tailpipe of the car; we have it going out of the coal-fired power station. Where New Zealand is uniquely placed is that it has a higher proportion of its electricity produced from renewables than anywhere in the world. If there is any country that can get real climate change benefits and reductions in greenhouse gas emissions from the transport fleet in moving to electric cars it is New Zealand. That is why it makes good sense. I acknowledge some of the innovators around New Zealand whom I have met who have developed their own electric car technology. There are people like Rex Nowland in my own constituency who raised this issue with me. His frustration was that as the owner of a Volkswagen that has been converted to electrics the previous Government’s policy required him to have a sticker on his electric car saying “This is a diesel vehicle”. We can understand the frustration. Someone goes to all this effort to convert a car to electrics and such an identification has to be carried. 
The further point I wish to make is that this policy provides some equity with other technologies. This Government also has a policy of exempting ethanol that is produced sustainably from the equivalent of the petrol excise tax. The Minister of Energy and Resources Gerry Brownlee has brought in an initiative that will provide for a grant scheme for bio-diesel. Effectively this policy as provided for in this bill provides the same financial incentive for ethanol for bio-diesel and for electric cars. It provides a kick-start for those new sustainable transport technologies so that we might sensibly make the shift. I note that the benefit of this is probably about $400 or $500 per year for those electric car owners and that $400 or $500 a year over the life of a vehicle comes to quite a substantive amount. We are hopeful that it will see more New Zealanders able to purchase those vehicles and the likes of those companies such as Hyundai and Mitsubishi that have produced electric vehicles able to come up with an affordable technology that will be more sustainable. I note that 20 percent of New Zealand’s greenhouse gas emissions come from the transport sector. It has been increasing strongly. This initiative of exempting those electric cars from road-user charges is one of a package of complementary measures that the Government will be advancing as part of its broader climate change package. 
The last point I want to make is about the other part of this bill with regard to road-user charges. This bill enables the Government to give notice to road transport operators. What is unfair about the old law applied by the previous Government is that when charges are increased overnight it makes it very difficult for the pricing of those road transport operators in terms of the service charges they pass on. This bill is a sensible provision that provides for a period of notice for those— 
Hon Annette King 
: It was changed in 1999 actually. You don’t know that but you changed it. 
Hon Dr NICK SMITH 
: The previous Minister of Transport triggered the biggest protest by truckies that we have seen in decades and now we have the new Minister of Transport Steven Joyce sensibly fixing up the law to ensure that there is such notice given. I hope it will be a measure that all members of this House support.