Macquarie Leasing and the Clean Energy Finance Corporation agree to a $100 million package to drive the uptake of electric vehicles in Australia.

Update: The Australian Government provides a fringe benefit tax discount for cars that are eligible as zero or low emissions and fall below the luxury car tax threshold (currently set at $84,916). The vehicle must be first held and used from 1 July 2022 and is applicable to novated car leases.

THE CLEAN ENERGY Finance Corporation (CEFC) is partnering with Macquarie Leasing to speed up the uptake of electric vehicles in Australia via a $100 million asset finance program. What that means, is that anyone wanting to purchase an electric vehicle will receive a 0.7% discount on finance for electric vehicles, as well as plug-in hybrid electric vehicles, and a range of eligible energy efficient and renewable energy equipment. Customers who choose eligible lower emissions passenger vehicles can also benefit from the program, with a 0.5 per cent finance discount.

CEFC CEO Ian Learmonth said, “Through similar programs with other financiers, we have already helped businesses, consumers and farmers invest in more than 2000 energy efficient, low emissions and renewable energy projects, valued at more than $250 million.

“By making this discounted CEFC finance available through major financiers such as Macquarie Leasing, we are making it easier for Australians to prioritise clean energy options when they make major investment decisions.

“Clean energy technologies are developing quickly, and become more cost effective as they reach scale. By supporting the more widespread adoption of exciting clean energy solutions, such as electric vehicles, we can accelerate the decarbonisation of our economy.”

Government lobby group, ClimateWorks estimates Australia can reduce carbon emissions by around 9 million tonnes by 2030 through the increased use of electric vehicles, coupled with the ongoing decarbonisation of the electricity grid. The potential emissions savings swell to 27 million tonnes by 2050.  

The Macquarie Leasing program extends to new energy efficient vehicles and equipment, as well as rooftop solar and battery storage. Investment in equipment to upgrade the energy efficiency of buildings, such as energy efficient lighting, building management systems and better air conditioning, will also benefit from the discounted finance.

CEFC modelling is targeting carbon savings of more than 200,000 tonnes of carbon emissions over the life of the program.

Jon Moodie, Head of Macquarie Leasing, said: “We are delighted to be working with the CEFC on this program and to be providing an extra level of support to individuals and businesses seeking to make their own contribution to reducing carbon emissions through their choice of vehicle and other equipment.”

Macquarie Leasing will initially make the discounted finance available to customers through its existing relationships with car manufacturers. Customers will receive a discount to Macquarie Leasing’s standard interest rate when they enter arrangements to hire or lease or finance the purchase of vehicles that satisfy the criteria for qualifying contracts.

Approximately 1200 vehicles will be financed under the arrangement.

“An agreement such as this provides important support to Australia’s electric vehicle industry,” said Behyad Jafari, CEO of the Electric Vehicle Council. “The greening of Australia’s vehicle fleet represents extraordinary untapped opportunity to cut carbon emissions.

“Unfortunately, we lag advanced developed nations in the uptake of electric vehicles because we are not providing concessions in areas such as registration charges and fringe benefit tax.

“However, it’s not too late. By getting our tax and investment policies right, Australia can support the development of electric vehicle infrastructure, win a slice of a booming global market and support a cleaner, healthier environment.

“Minister Frydenberg and the CEFC have made an excellent decision in supporting electric vehicles and Macquarie Group has provided a powerful demonstration of support for the industry with this investment.

“We hope to see more agreements like this one.”

Find a full run down of the potential savings via the Electric Car Discount bill here.