This bill became law on May 31st, 2024.
Climate, energy & environment
From 1 January 2025, Australia starts a new rule for new passenger cars, SUVs, utes and vans that makes suppliers count emissions when those vehicles first enter the approved vehicles register.
Australians were left behind because new cars sold here had no legal fuel-efficiency standard, and the voluntary scheme did not push manufacturers to bring more efficient vehicles to Australia. The bill creates a mandatory vehicle emissions standard with yearly fleet targets, tradeable credits and penalties to drive cleaner cars into the market.
Australia had no mandatory fuel-efficiency standard for new vehicles, even as the Climate Change Act 2022 locked in national emissions targets and other major markets already pushed manufacturers to supply cleaner cars, leaving Australians with higher-emitting vehicles and higher fuel costs while the voluntary approach failed to shift supply. The New Vehicle Efficiency StandardThe new Australian scheme that sets emissions targets for new vehicles and rewards or penalises suppliers based on how their fleet performs. Bill 2024 responded by creating binding fleet emissions targets, credits and penalties, passed Parliament in May 2024, and the new scheme began on 1 January 2025 for newly entered passenger cars, SUVs, utes and vans.
The main recorded criticism was that the scheme's penalties and timetable were too hard on vehicle suppliers, with opponents trying to remove the emissions-shortfall penalty and delay key deadlines. That criticism appears limited rather than broad, coming through a defeated opposition amendment package rather than wider parliamentary opposition in publicly available sources here.
Hon Catherine King MP introduced this bill. In the House final vote, support came from Labor, Greens, some crossbench members; opposition came from Liberal Party, Nationals, Centre Alliance, some crossbench members.
Did it become law?
Yes
Became law 31 May 2024
Final passage
Recorded final vote
2 counted final-passage votes were recorded.
Passage speed
65 days
From introduction to the latest recorded parliamentary step
Meaning
From 1 January 2025, Australia starts a new rule for new passenger cars, SUVs, utes and vans that makes suppliers count emissions when those vehicles first enter the approved vehicles register.
Vehicle suppliers must get their fleet result to zero or better by the third 1 February after each year, or face a civil penaltyA financial penalty for not meeting the scheme's requirements; it is treated as a regulatory penalty, not a criminal sentence. based on how far above the target they are.
Suppliers that beat their yearly target earn tradeable credits that they can save for another year or sell to another supplier to help cover higher-emitting vehicles.
The law sets annual emissions limits for 2025 to 2029, then lets the minister set later limits by instrument, with the scheme to be reviewed in 2026.
The minister can later update key settings like future emissions limits and mass-based formula parameters, but must consult the public first and publish reasons for the decision.
The standard applies to any person who has a covered vehicle for a year beginning on or after 1 January 2025. Generally, a covered vehicle for a year is a passenger or light commercial vehicle that is entered on the Register of Approved Vehicles for the first time during the year (or during the second half of the year in the case of a covered vehicle for 2025).New Vehicle Efficiency Standard as-passed bill text
A person to whom the standard applies in a particular year must ensure that, on the third 1 February after the end of the year, their final emissions value for the year is zero or less. Failure to achieve this may result in a civil penalty.New Vehicle Efficiency Standard as-passed bill text
If a person has a negative interim emissions value for a year, the Secretary must issue units to the person. The person may extinguish some or all of those units to reduce their final emissions value for another year. Alternatively, they may transfer some or all of those units to another person who may extinguish them to reduce their own final emissions value for that year or another year.New Vehicle Efficiency Standard as-passed bill text
The Bill provides emission targets for a supplier’s fleet of regulated road vehicles for the calendar years 2025 to 2029, gradually increasing in stringency. For later years, the Bill enables targets for vehicle suppliers to be set by the Minister in a legislative instrument. A review of the scheme will be undertaken in 2026 to determine the effectiveness of the legislation.New Vehicle Efficiency Standard explanatory memorandum
The use of legislative instruments in this way enables the Minister to update the inputs to the formulae to reflect changes in the mix of vehicles supplied to Australia. This means if vehicles supplied to Australia become heavier or lighter, the Minister can adjust these parameters to ensure the CO2 target for an average vehicle by mass continues to align the headline CO2 target for that vehicle type. The Minister is also able to adjust the headline limits after the initial period specified. To maintain the integrity of the framework, strong governance structures have been included in the Bill. Before adjusting parameters, the Minister will be required to consult on a draft determination (in most cases for 60 days, and in the case of reference MIRO and MAF, for 30 days) and publish reasons when making a determination. In addition, new headline limits set by the Minister must be less than previous headline limits, meaning that the stringency of the targets beyond 2029 must increase.New Vehicle Efficiency Standard explanatory memorandum
Context
Australia had no mandatory fuel-efficiency standard for new vehicles, even as the Climate Change Act 2022 locked in national emissions targets and other major markets already pushed manufacturers to supply cleaner cars, leaving Australians with higher-emitting vehicles and higher fuel costs while the voluntary approach failed to shift supply. The New Vehicle Efficiency StandardThe new Australian scheme that sets emissions targets for new vehicles and rewards or penalises suppliers based on how their fleet performs. Bill 2024 responded by creating binding fleet emissions targets, credits and penalties, passed Parliament in May 2024, and the new scheme began on 1 January 2025 for newly entered passenger cars, SUVs, utes and vans.
Climate Change Act 2022 locks in national emissions targets
The Act put Australia’s 43 per cent by 2030 and net zero by 2050 targets into law, increasing pressure to cut emissions from light vehicles as well as other sectors.
New Vehicle Efficiency Standard explanatory memorandum ↗Government introduces Australia’s first New Vehicle Efficiency StandardThe new Australian scheme that sets emissions targets for new vehicles and rewards or penalises suppliers based on how their fleet performs. bill
When introducing the bill, the minister said it followed a quarter of a century of failed attempts and was needed because Australia still had no legal fuel-efficiency standard for new cars.
Hansard ↗Parliament passes the bill
Both houses passed the bill in the same form, clearing the way for a mandatory scheme that would reward lower-emissions fleets and penalise suppliers that stayed above their targets.
Parliamentary timeline ↗Royal Assent makes the standard law
Royal Assent turned the bill into an Act so the new compliance system could be implemented through the existing road vehicle regulatory framework.
Parliamentary timeline ↗New Vehicle Efficiency StandardThe new Australian scheme that sets emissions targets for new vehicles and rewards or penalises suppliers based on how their fleet performs. starts for new vehicles
From this date, suppliers had to count emissions from new passenger cars, SUVs, utes and vans when those vehicles first entered the approved vehicles register.
User payload summary bullets ↗Legislative route
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
Introduced and read a first time
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
Second reading moved
The chamber agreed to the bill at second reading, meaning it accepted the bill in principle and allowed it to continue.
Second reading agreed to
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Third reading moved
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Third reading debated
Recorded vote: 90 to 58.
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Third reading agreed to
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
Introduced and read a first time
Recorded vote: 34 to 26.
The Senate agreed to the remaining stages and passed the bill in a counted vote under the compressed procedure recorded for that sitting.
Third reading agreed to
Both houses passed the bill in the same form, completing parliamentary passage.
Finally passed both Houses
The Governor-General gave Royal Assent, turning the bill into an Act.
Key criticism
The main recorded criticism was that the scheme's penalties and timetable were too hard on vehicle suppliers, with opponents trying to remove the emissions-shortfall penalty and delay key deadlines. That criticism appears limited rather than broad, coming through a defeated opposition amendment package rather than wider parliamentary opposition in publicly available sources here.
No wider public case against the bill is clearly recorded in this material.
Penalties and deadlines may be too strict
The clearest objection was to the enforcement design of the scheme rather than its overall goal: opponents sought to scrap the emissions-shortfall penalty and push back several compliance deadlines, indicating concern that the bill could impose an overly harsh or rushed compliance burden on suppliers.
Further sources
Votes
The chamber-passage votes come first. Expand a vote to see the party breakdown.
Passed 90 to 58. Support came from Labor and Greens. Opposition came from Liberal Party, Nationals, and Centre Alliance. Minor-party and independent votes were split.
Passed 34 to 26. Support came from Labor, Greens, and minor parties and independents. Opposition came from Liberal Party, Nationals, One Nation, and UAP. Minor-party and independent votes were split.
Earlier bill-stage votes
Passed 34 to 27. Support came from Labor, Greens, and minor parties and independents. Opposition came from Liberal Party, Nationals, One Nation, and UAP. Minor-party and independent votes were split.
Recorded amendment and procedural votes grouped by chamber. Expand a vote to see the party breakdown.
House
Passed 81 to 66. Support came from Labor and Greens. Opposition came from Liberal Party, Nationals, Centre Alliance, and minor parties and independents. Minor-party and independent votes were split.
This cleared the way for the final House stage to proceed immediately.
Passed 81 to 67. Support came from Labor and Greens. Opposition came from Liberal Party, Nationals, Centre Alliance, and minor parties and independents. Minor-party and independent votes were split.
This forced the House to vote on the third reading straight away.
Passed 74 to 63. Support came from Labor. Opposition came from Liberal Party, Nationals, Centre Alliance, Katter's Australian Party, and minor parties and independents. Minor-party and independent votes were split.
This forced an immediate decision on whether the bill should be referred to a committee.
Defeated 56 to 80. Support came from Liberal Party, Nationals, Centre Alliance, and Katter's Australian Party. Opposition came from Labor. Minor-party and independent votes were split.
This defeated the attempt to send the bill to a committee and kept the House on the normal bill path.
Senate
Passed 34 to 27. Support came from Labor, Greens, and minor parties and independents. Opposition came from Liberal Party, Nationals, One Nation, and UAP. Minor-party and independent votes were split.
A committee-stage vote that kept the bill’s emissions-shortfall penalty machinery in place.
Defeated 27 to 34. Support came from Liberal Party, Nationals, One Nation, and UAP. Opposition came from Labor, Greens, and minor parties and independents. Minor-party and independent votes were split.
A committee-stage amendment vote. The Senate rejected changes that would have softened timing and governance settings for the standard.
Defeated 27 to 34. Support came from Liberal Party, Nationals, One Nation, and UAP. Opposition came from Labor, Greens, and minor parties and independents. Minor-party and independent votes were split.
Defeating the package left the bill's committee-stage amendments uncarried and allowed the bill to move on in its existing form.
This list includes amendment votes, procedural votes and votes on the bill itself.
Parliamentary debate
Start here — lead voices
Ms King supports the bill, saying it will help Australians access more efficient vehicles, save money on fuel and maintenance, and cut emissions without limiting the cars people can still buy.
Read in Hansard ↗All speeches by bloc
1 speaker · 1 support
“This bill will make a substantial difference to the way in which consumers are able to access the most efficient vehicles, save money at the bowser and reduce emissions at the same time as ensuring that you can still buy the cars that you love to drive here in Australia. I commend the bill to the House.”Read the full speech in Hansard ↗
Record
House · Introduced and read a first time
Introduced
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
House · Second reading moved
Second reading opened
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
House · Second reading agreed to
Second reading agreed
The chamber agreed to the bill at second reading, meaning it accepted the bill in principle and allowed it to continue.
House · Third reading moved
Third reading agreed
The chamber agreed to the bill at third reading, which completed passage through that chamber.
House · Third reading debated
Third reading agreed
The chamber agreed to the bill at third reading, which completed passage through that chamber.
House · Third reading agreed to
Recorded vote: 90 to 58.
Third reading agreed
The chamber agreed to the bill at third reading, which completed passage through that chamber.
Senate · Introduced and read a first time
Introduced
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
Senate · Third reading agreed to
Recorded vote: 34 to 26.
Final stages agreed
The Senate agreed to the remaining stages and passed the bill in a counted vote under the compressed procedure recorded for that sitting.
Parliament · Finally passed both Houses
Passed both houses
Both houses passed the bill in the same form, completing parliamentary passage.
Assent · Assent
Assent
The Governor-General gave Royal Assent, turning the bill into an Act.
