Clean Car Discount changes revealed: 'High-emitting' vehicles like utes hit with increased fees

The Government has revealed changes to the Clean Car Discount policy it says will keep bringing emissions down.

There have been over 100,000 rebates granted since the scheme began in 2021, Transport Minister Michael Wood said. In 2022 alone, 20 percent of all new passenger car sales were electric vehicles.

There have now been changes to help maintain the scheme's momentum, Wood said, including reductions in rebates and increases in fees paid by higher-emitting vehicles, such as utes.

Additionally, the Government is targeting rebates for new and used imports emitting less than 100 grams of CO2 per kilometre, compared to 146 grams under the original scheme. This will include battery electric vehicles and plug-in hybrids.

The rebates for zero-emission used import vehicles will also increase from $3450 to $3507, which Wood said will help low and middle-income families get into lower-emitting vehicles they otherwise couldn't afford.

"To fund the changes to make it easier for New Zealanders to purchase cleaner imports, we're adjusting charges on high emissions vehicles. This includes vehicles like utes which are amongst the highest emitting vehicles within our fleet," Wood said.

"The threshold vehicles will be subject to charges will reduce from 192 grams of CO2 per kilometre to 150 grams, and charges will increase. New and used imports that meet or exceed the threshold will attract charges."

The price change is $575 for vehicles that emit 150 to 191 grams plus $57.50 for each gram for new vehicles above 150 grams. Used imports will be charged one-half of the dollar amount of new vehicles. The same for vehicles that emit 192 grams or higher.

The maximum charge for vehicles with very high emissions will rise, from $5175 to $6900 for new vehicles and from $2875 to $3450 for used imports.

Visual summary of the changes.
Visual summary of the changes. Photo credit: Waka Kotahi NZTA
Visual summary of the changes.
Visual summary of the changes. Photo credit: Waka Kotahi NZTA

It's estimated the Clean Car Discount will save New Zealand from importing 1.4 billion litres of petrol. At current prices, the economy will save an average of $325 million a year on fuel, out to 2035, Wood said.

"Our transition away from fossil fuels to New Zealand-generated renewable energy is crucial to tackling the cost of living crisis long-term. Switching to an EV is like buying petrol for 40c/litre, which can make a big difference to household budgets," he said.

Another change includes a new special rebate for new and used low-emission disability vehicles. This will be $11,500 if it is an EV and $5750 if plugin-hybrid or hybrid. Brand new and used imports receive the same dollar amounts.

"The scheme is also now forecast to reduce emissions by 3.4 million tonnes by 2035. That's an additional 50 percent out to 2035 over and above what was forecast when it started. It will deliver twice the emissions reduction forecast between the start of the scheme and 2025," Wood said.

"The Clean Car Discount is doing what we set out to achieve, which is reduce transport emissions and provide transport options to New Zealanders that will lower household costs is the long term."