Senator Lyn Allison
Portfolio: Energy and Resources
Related: Environment & Animal Welfare
| Dated: 27 Sep 2007
Location: Melbourne
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Is Australia's auto industry imperilled by ignoring climate change and peak oil? |
The future of the Australian Car Industry
Centre for Public Policy Symposium
27 Sept 2007
Senator Lyn Allison
Is Australia's auto industry imperilled by ignoring climate change and peak oil?
Since 2005 the overall the sales of SUVs are up 16.6% but the big ones are down 13.5% and Australians are buying more smaller, more fuel efficient cars. Non petrol passenger cars are now 6% of sales up 50% from last year.
Australian cars in 1980 had 66% of the market, now it is 23% and almost a third less in actual numbers of vehicles.
Exports have gone up by 1.7% since 2003 but imports have risen by 7.5% in the same period.
The fact that Australian made vehicles continue to lose market share locally came as no surprise to me.
My proposition today is that the auto industry in Australia has, with a few exceptions, ignored the threats of climate change and peak oil and I see no end in sight to this myopia.
The Saturday Age is as good an indicator as any.
The article on page one of Drive by Bruce Newton is a small piece on four of the cars rated at the top of the Australian Greenhouse Office's Green Vehicle Guide. This guide is the result of a Democrats negotiation some years ago that was a follow up to our GST deal. The Government didn't much want to produce it and it certainly wasn't top of the wish list of the auto industry and by all accounts they won’t use it.
The top rated 5 star Prius gets only three stars by Newton because it's expensive at $37,400, the Fiat Punto 1.4 gets 3 1/2 stars but lacks the punch of Fiat diesels and the Citroen C3 and Mercedes Benz A150 get only 3 for also lacking punch and being uninspiring.
Mercedes C280 on the other hand gets four stars with 9.6 litres/100k at a cost of $85,000.
A survey of the following 28 pages of mostly car ads shows what auto manufacturers and retailers think Australians value.
Audi promotes sports seats, sports suspension, sports steering wheels, 17" alloy wheels and an S line body enhancement package of rear spoiler etc.
Alfa offers Italian designer accessories and says performance is going fast.
BMW has high beam assistance, adaptive headlights, Bi-Xenon headlights, satellite navigation, metallic paint, usb/audio interface and electric sunroof.
Toyoto is more pedestrian with air bags, cruise control, fog lamps leather steering wheel and dual zone climate control, power windows, and CD player with MP3 compatibility. The efficiency of the Yaris is not mentioned but its metallic paint is.
Mitsubishi's Outlander has blue tooth connectivity and a nudge bar
For its New Focus SR5 the deal is 2.5 litre turbo, ABS brakes, 18" alloy wheels, sports suspension, side air curtains, power windows and prestige paint.
Holden VE Omega has a V6 engine, electronic stability program and break assist, passenger safety cell, traction control airbags, side impact airbags with active head restraints, a six speaker CD system, power windows cruise control and a trip computer.
You get the picture?
It took some searching to find references to fuel efficiency and I am still looking for GVG ratings.
Kia's Cerato has amazing economy at 6.7 litres per 100 km and a tiny ad for Fiat includes its 5.7 litres/100k efficiency.
Renault's Megane series have the eco-nomical/eco-logical tag but no efficiency detail.
I know that Volkswagen Golf and New Beetle are efficient but the only selling point in the full page ad is a free iPod adapter.
Perhaps it's true that drivers are not interested in fuel economy but the interest in small cars tells me otherwise, as does the polling which puts climate change very close to the top of the list of problems that need to be addressed.
And it should. Australia has a very high rate of car ownership and most passenger trips are single person. In 2005 our passenger vehicle greenhouse emissions had soared 23% above 1990 levels and in 3 years this will reach almost 30%.
And passenger cars are responsible for more than half of all transport emissions.
Now none of this is surprising. Australia does not apply standards or incentives for fuel efficiency and has kept petrol prices artificially low since freezing the excise some years ago so that wage increases are well and truly outstripping petrol cost rises, even with the price of crude rising.
There are at least some abatement measures in the electricity sector with MRET and GGAP but it seems passenger cars are politically untouchable. The $4 billion in government subsidies to the auto has neither secured the future of the industry in Australia nor leveraged the manufacture of cars that people now be buying.
This is not sustainable and at least some motorists – probably those who don’t get petrol cards thrown in with their wages – are ignoring the ads and the lack of government leadership on the issue and are moving away from gas guzzlers.
But this shift to small cars over some years is not enough. There are more small cars on the road than ever and baby steps in technology have improved efficiency but it’s clear that much more must be done.
We can blame some of that on the lack of progress in arresting the declining share of passenger trips by public transport, cycling and walking. But the auto industry in Australia also has a lot to answer for in not taking up the technological advances being made, particularly in hybrid vehicles.
It is still not possible to buy a locally produced petrol-electric vehicles like the Toyoto Prius - cars that are equivalent in performance, comfort and accessories but use less than half as much fuel. And this is despite a decade of ground-breaking work by CSIRO to engineer two home-grown versions of hybrids – ECOmmodore and the aXessaustralia Low Emission Vehicle.
Holden could have produced ECOmmodores – the world’s first full sized hybrid - years ago but not in the absence of Government policy demanding higher fuel efficiency or tax incentives that discriminate in favour of such vehicles. So the ECOmmodore remains just one demonstration show car. It did the rounds of international auto fairs promoting component parts manufacturing and led the torch relay for the Sydney Olympics – one of many great symbols of environmental progress in the green games - but has still not made it onto our roads!
According to CSIRO the technologies they developed for ECOmmodore – energy management strategies, high-power advanced lead-acid batteries, super capacitors and an electric traction motor that is unique - made manufacturing costs much lower than previous hybrids. ECOmmodore is lighter and its aerodynamics more advanced.
Break throughs continue in battery design and a new automotive research unit is exploring hybrid fuel cells, high performance computing systems, lighter materials but there is still no sign that these will go into production.
CSIRO’s energy section has developed motors that achieve greater than 95% energy efficiency, improved reliability and high torque-to-weight and power to weight ratios. They are smaller, cooler, quieter and cleaner.
In the polluted air city-dwellers breath, around 90% of carbon monoxide, 80% of nitrous oxide, 50% of benzenes and a third of all tiny particles are currently produced by cars. If just 20% of cars were hybrids like the ECOmmodore it would cut this pollution by 30%, so say CSIRO Atmospheric Research.
The aXcessaustralia concept car was released almost 20 years ago and generates just 80 grams of CO2 for every kilometre travelled compared with the average car’s 270 grams. This vehicle could make a big dent in the 80 million tonnes or so of CO2 generated by transport in Australia every year.
So how is it that despite a $8.5 million investment by the Commonwealth in CSIRO’s excellent work, Holden has stuck to the Commodore that now fewer motorists now want?
Holden’s website tells us ECOmmodore’s 4 cylinder engine is in most respects, highly conventional. Its batteries – an expensive component in other hybrids - are ‘affordable and long-lasting’. The average motorist would save more than $1,100 a year in fuel costs at current prices.
Perhaps now that sales of big the Aussie so-called family cars are going down, our auto industry will finally respond to local consumer demand and stop asking us to buy yesterday’s technology.
We've made only baby steps towards alternative fuels too. The promised network of compressed natural gas service stations never eventuated.
All our taxis are on LPG but while it is produced locally and is marginally better on emissions, it is still a fossil fuel.
The Howard Government's miserable and voluntary target of 350 ML of biofuel by 2010 doesn't look like being achieved and there is still great resistance to requiring oil retailers to offer motorists the choice of ethanol or biodiesel. We currently ban blends of more than 10% ethanol, even though we export cars capable of 85% ethanol.
The current drought, feedstock prices and the food versus fuel dilemma will limit production until the technology is developed to make viable the conversion of cellulose in agricultural waste to biofuel.
Of great concern is research published in 2005 showing that reducing oil dependence on both the supply and demand sides must be initiated more than 20 years in advance of oil peaking to avoid a global economic meltdown. However, it is likely that oil peaking may occur much earlier than that.
According to a US Department of Energy report there are three possible outcomes. (Hirsch 2005)
1. In the bleakest outcome peak oil occurs before 2010 inducing a world wide depression, collapsing world food production, and wrecking the Australian economy. As urban economies collapse business can no longer afford to move goods and people. People struggle to survive in increasingly isolated outer urban communities that have to learn to become self-sufficient, with most journeys made by bicycle, on foot or by limited public transport services. The Association for the Study of Peak Oil predicts that oil will peak around 2010 and that oil peaking is a risk management problem of global proportions that is not being addressed by governments.
2. If oil peaks between 2015 and 2025 a less painful adaptation is possible; provided that most developed nations agree to reduce oil dependence with strong government market intervention, including the introduction of fuel rationing and fuel efficiency standards..
3. If oil peaks after 2025 a timely adaptation with mutually agreed supply and demand side oil conservation measures as recommended by the International Energy Agency (IEA) will be feasible. Sadly this optimistic scenario envisages that alternatives to conventional oil are available in abundance, allowing the
present trend towards greater globalisation to continue apace.
This outcome is far from certain and assumes that non-conventional oil can be produced from shale and tar sands without large increases in greenhouse gas emissions, or from coal or gas using unproved carbon sequestration and other technologies yet to be developed.
So how should the industry respond to the need for at least 60% cuts in emissions and for survival with limited supplies of oil?
The Rocky Mountain Institute says we need new ways of thinking about automotive design. We need ultra light construction such as carbon fibre used in formula 1 cars, low drag design, hybrid electric drive and efficient accessories.
Cars need to be smaller and lighter and so do their engines, gearboxes and braking systems. Carbon fibre can be mixed with pigments, pressed into moulds and the pieces snapped or glued together saving the energy that goes into steel and welding. Combined these basic ingredients of the hypercar would make vehicles 5 times more fuel efficient than current cars of the same size and performance.
The exciting developments in the auto industry are all overseas
Chevrolet is making a hybrid called Volt configured to use ethanol and biodiesel. It sells for less than $30,000 and uses Li-ion batteries and has a combined electric combustion range of 750 miles
The long awaited Daimler Chrysler hydrogen car – a Mercedes Benz A-Class car is being tested in Japan, Germany and the US and will finally go on sale in 2012. However, there are still technical obstacles to overcome such as extending fuel cells' reliability and durability; ensuring that they start at sub-freezing temperatures; reducing costs, and storing enough hydrogen in a small enough space to be workable. And there is the chicken and egg problem of hydrogen filling stations.
Arne Schwazenegger started building a Hydrogen Highway Network in 2004 to support and catalyse a rapid transition to a clean, hydrogen transportation economy in California and reduce dependence on foreign oil, reduce greenhouse emissions, improve air quality and grow the economy, and it has a budget of $13 billion.
Australia has a hydrogen powered bus in Perth – one of 11 or so around the world trialling this technology.
But I’m now interested in fully electric vehicles.
The Tesla Roadster is being made in the US and the UK by the end of the year – a sports car running on 100% electricity delivering 322 km per charge (3.5 hours). It runs on 20 US cents per mile, generates one third the carbon dioxide emissions of hybrids is six times as efficient and produces one tenth the pollution of other sports cars but with the same performance and acceleration. The catch is the cost at $US98,000.
The Electric Smart by Daimler Chrysler has a top speed of 70 mph and a range of 72 miles.
And there are now a range of vans on the market and there's a new Plug In Prius with a bigger battery pack giving 35 miles on pure electric mode.
There's Think City Car with a range of 100 miles even with air conditioning.
The all electric Reva is made in India and selling well in London where it is exempt from the congestion tax but not approved for use in Australia on safety grounds.
The Kurrent now made in the US costs just $US9,800 and less than 2c/mile to run, needs virtually no maintenance and no oil. It runs on 4 deepcycle batteries and drives at about 70km ph.
The US provides a tax credit for electric vehicles.
Here in Australia, there are no tax credits and electric vehicles are not even entitled to the alternative fuels conversion grant.
I formally requested their inclusion a few weeks ago and have just received a response from the minister saying they might run on coal fired power and would therefore have no greenhouse benefit.
Is Australia very last century in auto design – you bet.
Will the major parties do anything about it any time soon? Not without people knowing what's going on in other countries.
The oil majors of course deny this altogether in case governments get the idea that they should be looking for alternatives and they can’t wring the last dollar out of what’s left. Why else would they resist so vigorously the idea of blending petrol with ethanol or selling biodiesel at their bowsers.
We need to change our ways on transport and while the reasons right now are greenhouse, I suspect the impetus for change is likely to come, as usual, from self interest. Congestion will become insufferable and oil prohibitively expensive to waste in this way.
If we hadn’t turned our cities into great sprawling metropolises we might have turned whole lanes into dedicated bikeways for commuters with their own traffic light systems as in the Netherlands.
But we’ve become accustomed to comfort, speed and the safety that comes with being encapsulated in a tonne or so of metal.
I hope we can change all this but we are running out of time to turn out auto industry around and make it sustainable.
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Post script:
CSIRO advise that the battery supercapacitor combination turned out to be too expensive, however they are continuing the research and succeeded in combining a capacitor into a lead-acid battery. That gives it the performance and life of a much higher tech battery such as used in the Prius, but at a much lower cost. In a back-to-back test in the UK in a Honda car, CSIRO’s battery is out-performing the Honda battery and heading for production in Japan and the US soon.
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