If you’re looking for a way to accelerate the transition to zero emission energy sources and zero-emission vehicles, then making them more affordable is probably the best thing you could do.
The ACT Government is doing just that, with the announced that included in their 2020-21 budget, is $307 million over 5 years help ACT transition to net zero emissions.
One of the most significant and immediate courses of action is to provide interest-free loans of up to A$15,000. While many like the idea of adding rooftop solar, home battery storage or buy a zero-emission vehicle, the up-front cost often means this isn’t obtainable.
By lowering the cost of entry, more households will make the move, it’s smart, easy and simple to get your head around and a move I’d love to see repeated across the country.
ACT will spend $150 million on the scheme. After adding a 6.5kW solar system to our home in 2020, the cost was around A$12k (inc installation), well under this threshold for an interest-free loan.
The typical home battery installation costs between A$8-15,000, so it would also be possible to add a battery, great for those who already have solar.
When it comes to the electric car, buying an EV now does come at a premium and reducing the initial outlay by A$15,00 would definitely bring some cars into the price bracket of a lot more buyers. Let’s take the example of Australia’s cheapest electric vehicle, the MG ZS EV which has a drive-away price of $43,990. Under this new budget, ACT residents could have this in their driveway for just $28,990 and there’s an awful lot of Australians who buy cars in that price bracket.
Assuming the interest-free loans run for the 5 years the program does, you’d need to make 60 payments of $250 per month to pay it back, assuming you took the entire $15,000. Many Australian families don’t have the savings to account for sticker price of EVs, but with a steady income, could afford $250pm, or $57.69 per week in repayments.
Naturally you will still need to pay back the loan, but in the example of the electric car, you’ll have much lower ongoing costs, with cheaper recharging and lower service costs, which will mean this should be manageable.
In the solar example, a lower quarterly power bill will free up cash flow that can be redeployed to paying back the loan. Given the loan would be paid back