Strong fuel efficiency standards the key to $13 billion benefit for Australians

04.07.23 By

Australians can individually save up to $1,200 a year on vehicle running costs if the federal government delivers strong fuel efficiency standards, new modeling commissioned by the Climate Council and Electric Vehicle Council shows.

The analysis found that Australians could collectively share in up to $13.6 billion in net benefits by 2035 from reduced vehicle running costs, cleaner air and less environmental damage if we design new fuel efficiency standards well. 

Importantly, strong fuel efficiency standards would result in up to 31 million fewer tonnes of harmful pollution over the next decade, and rapidly increase the number of low and zero emissions vehicles available to buy.

Australia is lagging behind as one of the only wealthy countries lacking fuel efficiency standards, which already cover 80 percent of the global car market.

Climate Council Head of Advocacy, Dr Jennifer Rayner, said: “This modeling underlines that a strong fuel efficiency standard will deliver huge benefits for Australians in cheaper running costs for vehicles, while also reducing pollution and climate harm from transport emissions.

“This means Australians can keep more of their hard-earned cash – instead of watching it rapidly drain away at the petrol bowser.

“Australia cannot remain a dumping ground for expensive, polluting vehicles that cost our hip-pockets, health, and environment. Every day we wait to put in place strong fuel efficiency standards means Australians are paying more than they should for fuel, and pumping out more harmful pollution.”

Climate Councillor and energy expert, Greg Bourne, said: “Australian drivers will win from strong fuel efficiency standards – whether they’re buying a more efficient vehicle or an electric one. 

“These standards are a critical policy lever the federal government can pull to help us catch up to the rest of the world, but the benefits will only be as good as the strength of the policy we settle on.

“The government can rev Australia out of the mud and implement robust fuel efficiency standards. This will help accelerate supply and stimulate a fall in the price of low and zero emissions vehicles that Aussie drivers can choose from. It will also have widespread flow-on benefits of cleaner air, cheaper running costs, and fewer emissions we can all share.”

The Australian Government can help unlock these benefits by delivering fuel efficiency standards that:

Background: What are Fuel Efficiency Standards? Fuel efficiency standards are the key to unlocking the supply of lower and zero emissions vehicles in Australia. They aim to limit the greenhouse gas emissions from Australia’s fleet of cars. They do this by setting a maximum average level of carbon emissions allowed across a manufacturer’s overall new car sales. In short, they provide incentives for car makers to supply lower and zero emissions vehicles – and penalise them for failing to do so. Over time, as the fuel efficiency standard is tightened (meaning the maximum amount of CO₂ that can be emitted is reduced), car makers must sell higher numbers of lower and zero emissions vehicles to avoid penalties.

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The Climate Council is Australia’s leading community-funded climate change communications organisation. It was founded through community donations in 2013, immediately after the then-Abbott Government dismantled the Climate Commission. We provide authoritative, expert and evidence-based advice on climate change to journalists, policymakers, and the wider Australian community. For further information, go to: Or follow us on social media: and