From December, all new and used-vehicle importers in New Zealand will have to operate a Government "CO2 account" that keeps track of all new registrations, recording emissions ratings to ensure their compliance with the new Clean Car Standard (CCS) that comes into effect on January 1, 2023.
New-to-NZ vehicles won't be allowed on the road from next year unless they are part of the register; that includes a vehicle being brought back from overseas for personal use, in those or similar circumstances there is provision for the car to be allocated to an existing account not necessarily belonging to the owner of the vehicle.
The CCS is in addition to, not replacing, the Clean Car Discount (CCD) introduced in July 2021. So what's the difference?
The existing CCD is a "feebate" scheme aimed at consumers, with individual vehicles getting a fine or rebate (they can also fall in a "zero band", no feebate) depending on how they stack up against a single emissions standard - the same for any vehicle. The car buyer (not the importer or dealer) has to pay the fine; but they also get to pocket the rebate.
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The new CCS is aimed at the car industry. For new-vehicle importers, it will work mainly on averages accumulated over a year (although the default is a "pay as you go" plan). Vehicle importers are expected to meet CO2 targets with the ratings of each vehicle registered, but higher-emissions models can be offset by lower-emissions ones if they use a "fleet average" scheme. If the importer's annual CO2 average ends up over the limit, there are fines; if it's under the limit, it will have credits which can be used as a buffer or traded.
So the CCD is designed to encourage buyers to purchase cleaner vehicles; the CCS is designed to encourage the industry to import cleaner vehicles.
The other key difference is the way the values are calculated. Under CCD, if a new car is below 146g/km according to the 3P-WLTP fuel consumption/emissions standard used by the Government, it gets a rebate on a sliding scale up to $8625 (as long it it costs less than $80k). If it's over 192g/km, it attracts a fine on a sliding scale up to $5175. It doesn't matter what the vehicle is, the same rules apply. The rebate figures for used imports are less - $3450 rebate and a $2875 fine - but the system is the same.
But the CCS uses what even the Government calls a "complex calculation of weights and targets" to establish a CO2 value for individual vehicles. Because the CO2 ratings are adjusted according to the weight of the vehicle, a heavier model like a one-tonne ute gets some dispensation, whereas a light vehicle is held to a very high standard indeed (or rather, an extremely low CO2 figure).
Because the CCS is aimed at the car industry rather than consumers, the theory is that buyers shouldn't be affected by price rises because importers are expected to balance their books and offset higher-emitting vehicles with cleaner ones. Those best placed to do that will likely have a range of electrified vehicles - especially battery electric (BEV), because zero-emissions cars have a drastic effect on overall averages.
The CCS targets are aggressive and get tougher as each year goes by. Milestones include 112.6g/km for cars and 155g/km for utes from 2025, and 63.3g/87.2g respectively from 2027. Importers will have to pay a fine for every gram they are over the target – applied right across the fleet.