Senate Rural and Regional Affairs and Transport Legislation Committee, , 6:21:09 to 7:03:02
The committee reviews the regulatory framework for autonomous vehicles and the implementation of the New Vehicle Efficiency Standard (NVES) for emissions.
Topics: Infrastructure, Manufacturing, Emissions reduction
Speakers: Matthew Canavan, Karen Najjar, Mike Makin, Melissa Cashman, Marisa Purvis-Smith, Anita Langford, Jessica Hall, Jim Betts, Matt O'Sullivan, Senator Matthew Canavan, Speaker 11, Speaker 36, Tristan Kathage
>> Uh okay. Thank you, chair. Uh, look, I first want to ask some questions about full service driving. Uh, is that the right term? The FSD. Is that right? Is that self? Full self-driving. Sorry. Yes. I thought it didn't sound right. Uh, thank you to my resident Tesla expert to my right. Uh, uh, full self-driving. Uh, I believe that sort of is available now in Australia. Supervises it. Is that what it stands for? Or maybe some self. >> It is self-driving. Oh, okay. Gotcha. FSDS. Uh so I just want to understand the regulatory landscape in Australia with
>> Uh Mike Min assistant secretary um full self drive supervised is available at
>> Right. So what's the regulatory arrangements? Is there >> is this approved under Australian design rules or >> full self? the cars have to get approval or what how does it work?
>> Yeah. So, full self drive is a package within the advanced driver assistance uh technology group. So, it fits within the current driving rule, a current ADR
>> Okay.
>> Uh Senator Anita Langford, first assistant secretary, road vehicle regulation. Um in this context because this is emerging technology the design rules tend to follow emerging technology once technology has been tested in the market. Um whereas uh the sort of full self drive starts to get into broader questions around um vehicles operating with less driver involvement um and then that is managed through development of other regulatory policy.
>> So, okay, let's just take the cars are available right now on Australian roads. >> My colleague reminds me, I think that's FSDS, is it? Is that correct? Is that what's sort of used right now? What does that just to make it clear to me, what does that stand for?
>> Uh, so it's full self-drive and then in brackets supervised.
>> Supervised, right? So, this is you got to put your hands on the wheel or every so and so amount of time.
>> Well, you have to maintain uh focus on the driving task. You might not have to have your hands on the wheel, but you are monitored to ensure you are.
>> So, do the regulations dictate? My understanding of the I haven't done it myself, but when I watch videos say take the Teslas, they require you to put the hand your hands on the on the wheel every so often. Is that a requirement of the regulations or is that something Tesla's done to make sure you're attentive?
>> That's the way Tesla has met the regulations.
>> Okay. >> Yeah. >> Okay. So, there's not a minimum amount you have to do that for. uh is apart from Tesla, are there other uh vehicles on the road that use this technology in
>> Uh I might I don't know if Miss Cashman wants to add, but I don't believe there's anyone that quite has a product like this at the moment in Australia.
>> Yeah. Right. Okay. Uh so there hasn't been any updates to our regulations to tackle the issues of these this particular technology. They just come in under the what was already there.
>> Yeah. So it's complying with the current ADR suite as it exists now.
>> Right. these cars when you get a new car now putting aside the FSDS you've got this lane stuff is that a requirement now for new cars lane adjust control that sort of stuff
>> so Australia actually um Senator um I'm I'm actually quite proud to say that that um uh members of my team led the development of an international standard for emergency landkeep assistance systems >> uh and that is just being finalized into a draft ADR for ministerial com um uh consideration shortly >> uh so yes as as Mr. Mak says, there's a range of um advanced driver assistance systems that are coming into the to the um uh suite of ADRs now and where a vehicle wants to provide a mandatory um feature, they have to demonstrate compliance. Uh otherwise, they must otherwise comply with the general safety requirement for vehicles.
>> Right. Okay. Um so, do you have just on that one, do you have to I was just talking to the Comco driver on the way back at lunch. Um, does does do you can you turn does the regulations make it such that you can only turn off that assisted lane technology every time? You can't just switch it off permanently.
>> So, general um,
>> yes, you know where I'm going with this,
>> the emergency, the one that I just spoke about, Senator, is the emergency lanekeeping system. So if the car detects that you're about to cross the center line or drive off the road, it it brings you back onto the lane. The general lanekeeping system, just the one that is helping you just steer, which is one of these advanced um convenience systems. It is not mandated by the Australian design rules. So it is provided by the manufacturer,
>> but the emergency one is mandated.
>> The man the emergency one will be mandated. Not yet, but uh we're hoping that
>> is there anything in the rules that make it that you can't permanently switch. My my complaint to be and it seems like it's one shared is that sometimes when you're particularly in rural areas, it's actually worse. It's I actually think it's making it more unsafe. It's not terrible, but just jerks you in all the time and it doesn't really know where you want to go. Uh uh on normal roads, amazing amazing technology. No problem with it. But yes, is there do you have to in my car and most others I've seen, you have to turn it off every time. It's another thing you got to try and look for and find. And yeah,
>> the general lane keeping um >> system that that helps you steer basically that that's up to the manufacturer. We don't set a standard. >> The standard for the emergency lanekeeping system follows an international standard. That's what we do in Australia so that we're not adding additional costs to vehicles that are intended for the Australian market. the international standard uh which is closely aligned with a previous European standard. It does have that general requirement that it uh reactivates every time you start the car. And the purpose of that is it's intended to save as many lives as possible. >> And that's why we want it on as much as possible, but still give um users the option to turn it off if they're in a situation where it just doesn't suit their driving needs.
>> Yeah. Okay,
>> if I may, um, the Australian new car assessment program takes feedback from drivers where advanced driver assistance uh, technology is relatively new and is being deployed in different ways by car manufacturers. if um they're getting feedback from members of the public that for example the correction's too sharp or um something's distracting, they get enough comments back, they will then feed that back to the manufacturer and um incorporate that in their ratings assessment.
>> I think we've got some feedback from the table this afternoon. >> Yes. I've exactly as you've summed up, sometimes it's quite violent and >> Yeah, go for it. Go for it.
the the new mandate. Is that for that it will actually steer or is it just warnings?
>> So it does two levels. First of all, it warns, then it will give you feedback generally through the steering wheel. But they are all designed that the driver can continue to drive as they are intended to by using the steering wheel. >> Um so sometimes you have a reason to cross a line without necessarily having your um your blinker on. >> Um so it's always intended that the driver will remain in control of the car. So if if we always say to people that if your car is operating in a in a way that makes you feel unsafe or it's not doing that sort of thing, talk to the manufacturer first, then you can always advi um send a a report into the department that you think that your car is not meeting the the um Australian design rules uh because it is intended
>> Okay. Going back to the FSDS, uh um I think the evidence was it's only Tesla at the moment. Is there any assessment being done about its uh safety outcomes or performance on Australian road so
>> So, no, I was just going to say Tesla engages with us um quite regularly and has provided us previously, not not just recently, but previously provided us with the number of kilometers that have been driven under full self-drive. They still fall under the general provisions of a recall. So, if a vehicle is unsafe, it would be expected to fall under the provisions of a recall. if we were to become aware of that. Um and and again, people are able to make reports to the department if their vehicle is operating in an unsafe way.
>> Presumably Tesla, cuz it's a connected car, they they have almost live uh feedback on how many kilometers have been driven um using this technology a
bit closer to it.
>> Yes. So I believe there's some collect some information. Um I know they have a internal uh incident reporting and monitoring type structure that they use. I don't know the details and it certainly would be a question for Tesla as to how many incidents and how much they've looked at that but
>> have they provided it sounds like they have provided you data on how many kilometers? No,
>> in a general sense they haven't provided provided any of that information around incidents but definitely they've sort of given us a general comment on how many kilometers have been driven so far. Um,
do you has the department asked any questions or have any concerns about whether there's a safety issue here based on I suppose more that the the there is uh would be much more data in the United States for example than here on this stuff. But have you looked at that at all?
>> Yeah, so there would be more data where the vehicles have been used for a longer period on the road with that technology. um we've asked and they've talked us through their safety system around it and that's why I'm aware that they do monitor incidents and they do look to improve the system but we don't have any of that data specifically shared with us um that there's no particular requirement for them to do that uh unless there would be a recall process or something but at the moment under the system it's more that my team is focused on sort of the future technology and we are very interested in how they manage these things but we haven't been shared
any of that data Okay, moving on. Oh, sorry. Yep. Jump in. Senator,
>> in terms of uh in America now there's full self-driving unsupervised robo taxis uh is an example. What what uh is is Tesla or other manufacturers looking at doing that in
>> So,
>> and what would be required for them to do that?
>> Yeah, at this stage I understand Tesla has been testing full selfdrive unsupervised. I don't know that it's in operation anywhere
>> in Australia
>> anywhere. Um I think in the US they've been testing out here. They haven't
>> been running it for
>> So they're testing it not here though. >> No, sorry. I just want to clarify that.
Right. >> Yeah. Um for an automated vehicle trial at the moment and that would fall in an automated vehicle uh uh sort of consideration. It would have to go through one of the state trial processes at the moment. We have work underway and it was uh announced in uh the meeting in November that we're aiming to have the um first stages of the regulatory framework in place by 2027. But at the moment if they were any automated vehicle company were to trial here and it would be a trial. It would be down under the current state frameworks for triing automated vehicles.
>> That 2027 legislation would be national
vehicle framework has a few components to it, but the ITM agreement is to target some particular uh automated vehicle types in particular locations. To get to the regulatory framework, there's an oil automated vehicle safety law at the federal level which accredits the companies uh as being safe to operate. The vehicles still go through the the um uh design standards checks uh and the states need to amend their road laws to com to create the right
>> And there's also a suite of um international standards for the vehicle itself that are being developed at the international standard and they will be translated into Australian design rules subject to the government's consideration. So there's standards on the vehicle, standards on the company and then the road rules as well are being looked at.
>> So are there any trials occurring at the state level of the unsupervised?
>> Uh definitely not of the unsupervised as in the Tesla product. Um there has been trials. I don't know that there's
>> I'm not just restricted to Tesla though or no one else
>> at the moment. I don't think there's anyone running an active trial, but they come and go. There's certainly been trials over the years in various I think most states have run trials at some point. Um but certainly nothing live that I'm aware of at the moment.
>> Okay. All right. Um what about Whimo? Have they spoken to you?
>> We've had a number of meetings with Whimo over the years. Um they are one of the automated vehicle companies out there. They've been quite successful in the US and they're operating in a few other places now. Uh so yes, we have met with Weno.
>> Are they interested in bringing the technology or the cars I suppose to Australia?
>> Yeah, they are looking at Australia at some point in the future,
>> right? >> But they can't right now because there's not the regulatory.
>> So there's not the regulatory framework for it. If they were to come now, it would have to be done under a trial arrangement >> under one of the state systems.
>> Do they operate any right-hand drive
markets? They're testing in both London and Tokyo at the moment.
>> Sorry, we're left here, aren't we? Left hand drive. No, I always suppose right hand driving the car. Okay. Okay. Sorry. Yep. Go.
>> Yeah. So, testing in both Tokyo and London which are right-hand drive like
>> Okay. All right. We're the first that Tesla have rolled out in though, haven't they? From a right-hand drive.
>> Uh, we were the first. I don't know if they've rolled out anywhere else now, but um, yes, I believe we were the first.
>> Are there much challenges in switching from the left hand drive to the right hand drive for these vehicles? I think
the challenges the different side of the road is one of many. I think like our road signage, our uh driving cultures that these systems react to, all of those things are different depending on which country you're in. But definitely a left hand to right-hand drive is one of the things they have to plan for and adapt to.
>> Okay. Um All right. Uh uh I suppose there's potentially huge productivity benefits of all this. I mean, are we moving quick enough here for the regulatory landscape? You say we're not going to have these regulations in for another year. How long have Whimo been operating anywhere? It's been there for a long time now.
>> Uh yeah, a number of years. I don't know when Whimo first started testing, but it has been quite a number of years. Yeah.
>> I mean, is there any Maybe it would be good just to have the ACT or somewhere to do some trials. Is there any consideration of that that rather than try and do it across the whole country like a bit like the US? I mean, one one good thing about the US system is there's so many states, they all go and do different things and competition and innovation in this sort of space. Are we holding things back by trying to do everything through a national sort of model legislation here?
>> I think that uh the process so far has been done under the guidance of Edom and it's being done in quite a structured way to build the right environment so that we have a safe uh operation of these things. As far as the speed I mean those are decisions for government both at the federal level and the state and territory level.
>> Okay. Has has way when you met with Whimo, have they expressed any concerns about the lack of regulatory support
>> They've been interested in understanding the regulatory system we're building and they certainly put in a submission in our consultation process in 2024. Uh our system, these are being built, regulatory approaches are being built across the world at about the same rate. Our system's not dissimilar to a system like what the UK have put in. Um so they have provided comment in submission. I think the submission is public. I would have to check but I think so.
>> What was that process in 2024?
>> In 2024, we ran a consultation process around the automated vehicle uh regulatory framework. We had a number of u aspects of that that we consulted on. Uh I can't remember the exact questions. I'd have to look that up. But um
>> I suppose my point say it's going to be 3 years from that consultation before we've got a legislative framework in
place. I think this is a reasonably large reform and work has continued since that point but yes that I mean that's where it's all being done through IDM as I said there's a lot of pieces to the framework that need to be
>> Okay. All right. Okay. Um
>> just before you do sorry sorry I I should also just let those listening out there that the committee has um decided to release National Intermodal Corporation just for anyone listening. Sorry cab.
>> Yeah, I'll try to with my remaining questions. I'll try to group them in some kind of uh um sorry chair. I was looking at my questions. Who who did you dismiss? Was there any more?
>> National Intermodal Corporation.
>> Yeah, that's the one we discussed. I just wondered if there was any more. Okay. Um so I might go to Enve next. Um uh I believe the first reporting period is now complete. Is that right? Right. Okay. >> So, have have have have you received reports from the entities that are liable under this scheme?
you say received reports uh we have it's it's us actually advising entities how they performed in the 2025 performance period. And you're you're quite right in saying earlier we we finished it was 1st of July 2025 to the
>> okay so well okay take a step back. How do you know how they performed?
>> So from that period of the 1st of July RAV, that's when they actually provided us those those bits of what we call ENBZ data. So the the uh emissions number, the myro or the mass in running order, um the type of vehicle, so type one or type two vehicle, um and uh for some of those vehicles, a rated towing capacity.
>> So you're getting those reports almost constantly. Is this as cars are sold effectively?
>> So as every vehicle is entered onto the
>> just technically okay what's the RAV and what happens there?
>> So the when a vehicle is um bought into uh Australia for it to be made available
>> So is it sold when it's on the RAV? So
uh the ENVZ is actually um about um when when vehicles first u supplied within Australia, we don't actually go follow through to the sale point.
>> Right. Okay. So someone can bring in cars, put them in a car park and and that qualifies them under the NVEST. Is
So the the regulation works by um when the vehicle's first supplied into Australia and entered onto the RAV that is when they have to provide us the NVES data and that's the point when yes they their their reported um performance is is measured from um and then at the end of the performance period we aggregate up the fleet results for all of the vehicles for the VTA. Um, so the VTA is a vehicle type approval holder and that's the regulated entity under the NBS.
>> Okay. All right. Well, um Okay. So, how many in this RAV for this reporting period >> July 1st July 31st December, how many um uh cars or vehicles were entered into the RAV that are NV uh uh liable had a zero emission um
number. Uh so senator total of all the vehicles entered for that um period 1st of July to 31st of December covered by the NVZ was um just under 621,000 and I'm just showing you the number for the zero emissions segment. So the zero emissions segment u represented around 72.3,000
>> Just give me a second. Sorry. While I >> uh Well, I'm working out the percentage now. Sold there.
>> Uh Senator, I can tell you it works out at around about 12% of vehicles.
>> 12%. Right. So, okay. Um how many cars do we have data on how many cars are sold in Australia?
>> Uh I might refer to my colleague, Mr. Kath.
>> Tristan Kath, assistant secretary reducing surface transport emissions branch. Um so, Senator, in 2025 around 1.2 2 million cars were sold.
>> How many of those were electric cars?
>> Uh so from the information that I have um electric there were um 8.7% uh electric vehicles sold in 2024 up from 7.7% in 20 20 sorry let me say that again. 8.7% in 2025 up from 7.7 in 2024. >> That's correct. Senator
>> Yep. So it's fully electric. Yeah.
>> Yeah. No hybrid.
>> So I'm just wondering here now, do you have the data for the second half of the year or is it only for
>> calendar? That that was for calendar year. >> Calendar year.
>> But there does seem to be a little bit of discrepancy here because the sales data for the full year roughly 9% electric. But the RAV data seems to be saying it's about 12%.
probably >> we could have monthly d we receive the data as it's entered into the RAP. I don't have it with me today.
>> Sales.
>> Well, I'm just trying to understand why is there a discrepancy?
>> Uh Senator, I might ask Mr. Cathich to go to these numbers, but we have seen variation across the year in terms of the electric car sales u within the data. So while 8.7% is the average across the year, we're just trying to find
>> that that is one explanation, but does seem >> a uh 30% increase in 6 months seems
>> I think um I think the other thing Senator is that um it's for vehicle manufacturers to manage their own inventories. So from time to time, for example, BYD sales have gone up by 150%. And so they need to find places to store their cars as they can kind of shift that inventory on. Um I do have um the total percentage of um EV sold from March 2025 through to December. Um if that's helpful.
>> Doesn't really probably change too much, but what's that figure? I suppose from July to to December, but yeah.
>> Oh, so July to December is um 7.2% in July 2025 and December was 10.6%.
>> But sorry, I'm after the full six months. Was that just for months?
>> Uh yeah, I've got I've got it per month. I can
>> well it'll probably I won't be able to average it because I won't have the waitings but okay give it to me by month.
>> Sure. Okay. So in March 2025 the
>> Do you have the Do you have the absolute numbers? That would be better. >> Uh I do. Okay. Give me those. Give me
those. >> T total sales.
>> Hang on. Let me put in a spreadsheet. So >> go for it. Right.
>> Okay. Uh March was 8385. April 6,10 May 10,055. June 13,169 July 7,219 August 10,04 September 12,76 October 7361
>> 1276 sorry yep I just missed that one up what was the next one6
>> uh October 7 361 November 981 and then December 10,384
>> right so I've got that from July to December I've got us selling 56,125 electric vehicles yet on the RAV 72,300 were registered. Why is there a
say one hypothesis there, Senator, would be that there's a there's a gap between when a person or puts a a vehicle on the RAV and then the time at which it's sold. Um, and as I'd say, um, Senator, uh, it's for vehicle manufacturers to like
>> wouldn't a simpler explanation be people just banking these credits? Oh,
>> That's a question.
>> That's a possibility. >> Has there been I mean, it seems a bit of a loophole here in the system. cuz they can sell these credits, can't >> That's correct. So, they can sell >> they make money out of them and we've created incentives just to park cars that aren't going to be sold. There's probably possibly an excess supply of electric vehicles around the world, too. >> Yeah. Yep. Okay. But we don't know. We don't Has anybody asked the manufacturers about what they're doing? Why are you importing 16,000 more cars
>> I'm sure there's probably other cars though that are imported that
>> Well, have you got the data? I mean, you you've got the data. I we could go through the non-electric cars and see if there's such a similar discrepancy. Have
>> So, Senator, I think various people at the table have said it's up to the manufacturers to manage their own inventory. We don't tell them how to manage that inventory. We we do talk to manufacturers and we're interested about what's happening in the market uh and uh and what they're doing, but they manage
>> Okay. So, have you have you done the analysis on the non-electric cars to see if there's a similar excess uh registration on the RAV compared to what
>> We I haven't we haven't
>> I don't have that in front of me. I don't have that to hand, Senator.
>> So, yeah. Um All right, let's go through it. What's the What's the What's the sales of um non-electric cars for the second half of
>> uh July to December? I don't have um none electric cars by month. Um Senator,
>> well, give me the total then I can just take the difference. That's
>> Sorry, I've only got I've only got the 2025 um total year.
>> You don't have to. You don't have by month by month for total.
>> No, I don't. But I we can probably
>> all right. Provided I notice.
>> That's equivalent same time frame as the 621,000 for battery electric vehicles.
>> If it's helpful, Senator, we can provide a table that just goes over the whole
2025. All I need is now all I need is a total sale sales from July to December by month.
>> Y
>> and then I compare that to the 621. Yeah. >> Well, 621 - 72 300. >> Um Okay. All right. But does seem to seems to be a little bit of abuse here in the system. Um okay. What was the what was the total you don't have the total sales of cars from July to December? >> No. No, I don't got to work out the percentage there as well. Okay. All right. Um, right. So, you've you want to go back to where you started there actually. You said you've given uh I think presumably the manufacturers are interim values or some such. Was that what did you refer to that as?
>> Yes, Senator. So, the regulated entity under the NVES is the VTA holder. That's the vehicle type approval holder. So, it's it's not actually the manufacturer. Yeah. Um, and so, um, I know that when we talk about this, it might, uh, become a bit confusing because the VTA holder name doesn't always align or contain a brand name in them. Um, so, but every one of those VTA holders who has entered a vehicle, that's the type one or type two has been doing that reporting since 1st of July, there's 59 of those entities in total, right? >> And we have provided all of them with their interim emissions value now. Um and that value tells them how they performed against their target across that first performance period.
>> So what was the target again for the first reporting period?
>> So the target it is actually uh slightly um it's not a single number senator. So there is a headline limit set in the act for the type one vehicle and the type two vehicles and I think we've discussed before they're different numbers but that that um actual target is adjusted then by the weight of the vehicle. So each vehicle actually gets its own target that it's compared against to then see how it performed and then it's aggregated up to the fleet level for the VTA holder for their overall IEV or interim emissions value.
>> Right. Okay. Um well um how how do you determine that? How does a what do you what do you call them? BTA
>> the VTA holder if it's if it's easier. Yeah. That vehicle type approval holder. I'm very happy to talk about entities or regulated entities if that helps.
>> No, that's right. I've got it now. VTA. So, uh, in the data you provide the VTA, do you give them, have they got presumably an average, uh, target value?
>> So, um,
>> across their sales.
>> So, what happens is when they enter the vehicle, they enter each of those four um elements I talked about before. And so, they obviously have that data and and are tracking that themselves. uh we then apply the the change by by weight um that is set out in the legislation of of a um the the adjustment from the headline limit. So so if we take a type one vehicle the headline limit set in the act was 141 g per kilometer of CO2 uh for the the previous performance period
>> that's the type one
>> that's the type one yes set out um set out in the legislation. Um so for for the vehicle that comes in that's the sort of starting point and then it's adjusted by the the weight the myro mass in running order of that vehicle and that provides the actual target for that vehicle. So the the manufacturers have provided all of that detail themselves. And when we provide them their IEV, it's actually the total for that VTA holder to say across all of the vehicles that you've imported under this VTA, we've done that calculation, we've added them all up and this is where you've landed.
>> so
>> so it's a single figure that we give
them. I suppose the key question is of the 59 >> how many are below their target and how
>> So Senator of the 59 40 of the entities beat their targets or above and 19 of the entities uh didn't beat their target.
>> 19 didn't.
>> They did not. That's correct.
>> Have you weighted that like in terms of percentage of sales?
>> Uh no senator. So as as I said before the NVZ is not u doesn't follow through to the sales point. So I
>> Well, okay. Sorry. You could wait it by their registrations. Have you done that?
>> Sorry, Senator. No, no. So the IV actually stops with the data they provide us when they import the vehicle into Australia.
>> Yeah. Okay. I might not be being understood, but yeah. Um it's what Senator Sullivan said. So um on the on your data, on the raw data of numbers, a third or so have uh have not beaten their target 19 59. Um but but I suppose the issue is yeah the issue is that presumably this distribution of sales is there's a few a few VTAs that account for the vast majority of of cars. So I'm I'm trying to find a weighted average um what percentage of the 50 of the cars registered uh have been uh imported by VTA that has uh been
>> the 19 make up 60% of vehicles.
>> Yeah.
Sorry.
>> So, do do you get where I'm going now?
>> I I think I understand where you're going. So, I'm not sure if I'll have all of the detail that that you're looking for and happy to take take someone notice. >> Um uh I would say that um all of so that there is a long tale of entities. So, it is because it is weighted basically on on the every vehicle. So, um as you've broadly pointed out, some of the bigger vehicles um uh importers, the VTA holders, the much larger number of vehicles bought in. Um I I haven't got the the sort of breakdown at the moment. We will be publishing all of the IEV results as soon as we can. Uh we're aiming for Thursday. Um
>> Thursday this week.
>> That's right. We've been working as hard as we can. I would have liked to have um had it done, but we are publishing as quickly as we can. Uh and so it will be
>> publishing them by entity then or
>> Yes, that's correct. So the act requires us to publish the VTA holder, >> what their IEV or or final point is and then we also have to publish who holds a reg uh registry account. So for the NVES units who's actually opened a registry account and if they hold any units in that account.
>> What's an NV unit?
>> So that's the result of their IEV. So the entities that have outperformed or or beaten their targets will be um eligible for units to the amount that they've beaten their target by.
>> Okay.
>> So that those units are tradable.
>> Ask again.
>> Those units are tradable.
>> Those units are tradable within the ENV. So only between the VTA holders. It's not an open market available outside of the ENVZ.
>> Do you keep a record of trades?
>> Yes. And in fact um for the a trade to happen what what occurs is our entities have a one sort of front door um entry a portal uh we call the NBZ portal. So um when they they have visibility in there of all of their units and their um all of their performance actually across uh the time when they wish to make a trade what happens is they actually will negotiate a deal outside of the ENV with another ENV entity. Uh once they've actually reached agreement that they want to actually sell or or buy units, the holder of the units has to actually go into the registry and it's a two-step process where they initiate a trade. So one person in their company says please transfer these units to entity X and then a second person is an authorizer in their company has to say yes please um give action to that uh to that transfer and uh we then have 15 business days as the regulator to review that transfer make sure that there's nothing going on that we think would be problematic to the um system um and then approve the transfer of the units. So the units themselves are held in a registry that um is within the NBS regulator sort of cohort I guess.
>> And then and then at what point is the credit or the penalty applied like when when do the when does the person that's in credit receive money and when do when will the the the company that's uh going to get the penalty when do they get the >> Money change hands.
>> Yeah. Yeah. So the the way the ENVEZ works is that this 2025 uh performance period doesn't sort of hit its final point. So we've just issued what we call the IEVs, the interim emission value. The entities now have the next two years to take action about those. And so in >> That's exactly right. Um or change their own fleet mix, bring in uh you know different vehicles and create their own units. And then in 2028, if they haven't um you know found enough units or in some other way um managed their their number their IEV down to a zero, that's the point. So in February 2028 where we'd be looking at issuing infringements if they haven't met that zero. So there's quite a few years to go for entities to actually do that trading in terms of them. It is it is a a matter of
>> is that then is it always sort of working in a re in that way like it's so ongoing >> beyond that date is it always looking at a few years pre previous
>> yeah so the the way the ENV is set up is it's sort of I think of almost like a threeear cycle >> so um every every so that's correct rolling forward so right now we have you know we began on the 1st of January 2026 the second performance period the 2026 performance period and so the cycle will continue moving moving forward.
>> Okay. Thank you. Um so, when when Okay. What's stopping this? So, if I'm a VTA that that has a deficit that needs to buy some um some ENV units, what's stopping me importing a bunch of uh battery electric vehicles? registering them, getting the credits, meeting my my obligation, and then just exporting them to another country in the
>> I'm not sure that that I can sort of give an answer that um I don't know if Mr. Kathy just got anything to to add other other than to say I guess um that there's costs for the manufacturer.
There's absolutely transaction costs, but I don't know. Depends. Then it depends now depend on how much the units are, whether it's worth their while or not that they could just import some cars, register them, get the credit, bang, done, then move them onto the other market. They're not going to sell them in the first place.
>> Uh, Senator, I if I if I might, I mean, it's a it's a hypothetical question which which we can't answer, but I can tell you a couple of things about the viability of of that. uh in the sense that um it it might not be viable for a company to do that. The other thing that that might uh be something for them to take into account is that if they're exporting back out from Australia, uh then it may not be classified as a new vehicle to whichever country they are are exporting it to. Uh so it might then be classified as a secondhand vehicle and which case that they wouldn't be able to sell it as a new vehicle. So again I I I don't I don't know the the exact
in some things like that to take into account. >> It does obviously go to the core of the design here of the regulations. Though obviously when we design regulations we should be uh uh mindful of hypothetical responses from the private sector to uh to get around any loopholes we leave and I'm just a bit concerned there were quite a few mites and may in that answer. So is that something we've actually looked at that this could be a strategy that and there have been reports of massive amounts of electric vehicles being parted and we do have data now which shows that a huge number of more electric cars have been imported to this country during this reporting period that have been sold.
>> I think the Australian market is quite a big market though in regards that it is right-hand drive they have to meet Australian ADRs. It is
>> do they have to be right-hand drive in the RAV? do
>> or they need to get unless they're a special enthusiast vehicle for example, they'd actually have to get special.
>> Does it say that in the road? Do they have to identify whether it's right or
>> Absolutely. Coming in on a BT has to be right. That's exactly right. So it it is quite a it would be a very expensive hypothetical to go through all of those things and be very specific for the Australian market and then export out >> and then meet the requirements of that other market that it was actually going into and meet their design rules and their um petrol requirements.
>> India, Japan, New Zealand.
It's probably not a very smart
>> Yeah. Well, I'm just no one seems to be able to explain why there's so many more electric cars being imported than sold.
>> Well, except that we're seeing surges in vehicle purchases and that may well be a sensible inventory management strategy for the manufacturers.
>> Yeah, it's a 30% above the sales. We've >> it seems it does it seems my concern is that no one's looking at this and no one has a good explanation. Um and so is there any reason why I I come back to the original design here. Why are the MV units or the in emission values calculated off the RAV? Why aren't they calculated off when the cars are sold? Cuz isn't that what we like that's the the policy intent here,
>> Senator? that the government that the way that the government decision and the way that the legislation has been set up is in relation to imports. Uh when the uh legislation and policy was announced, the minister did say that she would look at point of sale uh and we are undertaking that work uh to around point of sale. um uh it was designed in relation to import because that is how we import all of our vehicles in Australia. That is how we access vehicles in Australia. So uh we that that's the way the scheme and the government decided to set up the scheme. Uh we are looking as as the minister has said that uh she would ask us to do around point of sale. that work is is is ongoing and progressing.
>> Does it see as difficult to implement it
>> it creates there are a whole lot of challenges that and issues that we need to work through in relation to
>> the luxury car tax is charged on point of sale. So why couldn't it be the same?
>> It's not based on so so the NBS is not based on price. >> Um it's it's based on CO2 emissions. Uh and so uh we are working through and we are are doing work on point of sale.