Productivity Commission’s net zero report misses the biggest productivity win; electrification
Rewiring Australia has criticised the Productivity Commission’s interim report on climate and energy, arguing it has missed the biggest productivity opportunity available to the nation; rapidly replacing fossil fuel machines with clean, efficient electric alternatives.
“This should be a report about how to do more with less. Instead, it gives us spreadsheet carbon accounting and incremental fixes and misses the enormous, structural efficiency gains on offer through electrification," Rewiring Australia CEO Francis Vierboom said.
Rewiring Australia will this week be calling on the federal government to commit to a national plan to electrify homes, vehicles, freight and neighbourhood energy systems when it attends Minister Chris Bowen’s Climate and Energy Roundtable.
The organisation has long-argued that electrification delivers permanent reductions in operating costs, energy use, and infrastructure duplication, which are core drivers of long-term productivity.
“Electric homes, cars and trucks slash energy bills, reduce reliance on volatile fuel imports, and allow us to do more with our existing grid. That’s real productivity reform. Not offsets, not credits, not accounting tricks. Just better machines powered by Australian sunshine,” said Vierboom.
Rewiring Australia has welcomed several positive signals in the report, including the call to fast-track approvals for renewable energy projects, strengthen environmental planning, and create a national climate risk information database.
“We support efforts to speed up clean energy development and make the system more transparent. These are good steps. But we need to match these reforms with the ambition to electrify everything, not just create smoother pathways for business-as-usual,” said Francis Vierboom.
The Commission's report emphasised the use of carbon credits (ACCUs) and emissions “cost effectiveness” benchmarks - a framing Rewiring Australia has warned distorts the path to net zero.
“We don’t build national prosperity with offsets. That’s spreadsheet zero. Real zero is about upgrading the actual machines our economy runs on, and doing it now. ACCU offsets might play a temporary role, but they are not a substitute for transition, or a real industry that will create jobs and wealth for our kids. Let’s stop pretending they are,” Francis Vierboom said.
The Commission's report has also proposed winding down the Fringe Benefits Tax (FBT) exemption for electric vehicles; a move Rewiring Australia said would directly undermine one of Australia’s most effective and popular electrification policies.
“The FBT exemption is working. It’s helping everyday Australians, especially high-kilometre workers such as nurses, tradies, teachers and our truck drivers, switch to cheaper-to-run EVs. We should be expanding it, not scrapping it. If we want a more productive economy, let’s back the drivers who are clocking up the most kilometres with targeted support and get them off the petrol pump for good,” Francis Vierboom said.
Rewiring Australia's submission to the Productivity Commission’s roundtable has outlined a practical pathway to accelerate electrification, including:
-
Flexible, property-secured finance for households to upgrade to electric
-
Electrification for renters, continued FBT-backed EVs, and incentives for high-kilometre drivers
-
Reforms to streamline neighbourhood battery and EV charger deployment
-
An extension of solar subsidies to include electric hot water, cooking and vehicles
“Australians are leading this transformation with rooftop solar, EVs, batteries and efficient, electric appliances. Policy needs to catch up and back the upgrade to an electrified economy that can do more with less. That’s the job of the Productivity Commission,” said Vierboom.
Read the submission: Rewiring Australia - Let’s Do More With Less and Electrify Everything: https://www.rewiringaustralia.org/report/lets-do-more-with-less-and-electrify-everything
Contact details:
Kathleen Ferguson - 0421 522 080