The Clean Energy Finance Corporation (CEFC) aims to drive Australian EV ownership further through a new $40 million investment to provide discounted finance for the retail Green Car Loan offered by Australian non-bank lender Firstmac.
CEFC investments to advance EV ownership in Australia have already supported about $230 million of retail and commercial green finance, putting more than 3000 EVs and plug-in hybrids (PHEVs) onto Australian roads.
This latest CEFC investment with Firstmac is expected to finance at least a further 900 EVs, with the discounted finance saving customers between an estimated $1400 and $2500, depending on the size and length of the loan.
The CEFC finance will enable eligible Firstmac customers to benefit from a 0.5% discount for the life of their loan with a further 0.5% discount provided by Firstmac, resulting in a total discount of 1% compared to the equivalent interest rate charged to Firstmac borrowers buying internal combustion engine (ICE) vehicles.
To encourage manufacturers to make more EV models available to the market, Firstmac is extending the discount to EVs priced under $90,000, provided strong emissions standards are met.
The CEFC finance will only be available for the lowest emissions EVs, with the criteria for ‘green EVs’ raised to exclude low emission ICE vehicles, conventional hybrid vehicles and plug-in hybrid vehicles with tailpipe emissions of more than 50g CO2/km.
“Electric vehicles are no longer only for early adopters,” says CEFC debt markets head Richard Lovell.
“We know the dynamics of EV ownership are changing dramatically and more Australians want to buy EVs.
“However just 6.8% of all new cars purchased in Australia in February were electric, pointing to a big gap between buyer preferences and vehicle availability,” Lovell adds.
“Australia’s uptake of new low emissions vehicles is also nearly five times lower than the global average, partly due to supply constraints.
“This is an important factor behind our decision to target our finance to EVs priced under $90,000, subject to strong emissions standards, as well as to back the agnostic approach to vehicle manufacturer adopted by Firstmac,” he explains.
“Together these factors should encourage manufacturers to make a broader range of EV models available to Australian buyers.”
Firstmac managing director Kim Cannon says it has a policy of minimising the impact of its operations on the environment and leading the way on climate change.
“These popular loans are a valuable tool in the fight to cut vehicle-based emissions, because they mean that people can save money and help the environment at the same time.”
Transport is Australia’s second largest source of national emissions, accounting for more than 18% of Australia’s emissions.
Reducing these emissions is critical to achieving Australia’s emissions reduction target of 43% on 2005 levels by 2030 and reaching net zero emissions by 2050.
Making EVs more affordable and expanding uptake and choice is an important part of meeting Australia’s net zero targets.
The CEFC has previously committed $40 million in asset finance to offer Firstmac customers a 0.7% discount on low and zero emission vehicles, contributing to some $70 million in loans and the purchase of more than 1800 EVs and low emissions vehicles.
