Are we there yet? Australia and the future of transport and mobility

Praveen Thakur, Partner, Management Consulting, InfraTech and Future Mobility Lead
Praveen Thakur, Partner, Management Consulting, InfraTech and Future Mobility Lead

Transport is in transition. I see this in my daily commute where, from an app or two, I can choose from public transport, ride sharing and other mobility options to get from A to B.

On top of this, a whole range of new transport technologies, particularly electric and autonomous vehicles (AVs) that will transform how we travel, are coming with more on the horizon,.

Recent announcements show this ‘future transport’ is quickly becoming reality.

New methods of transport bring opportunities for governments, the private sector and most importantly citizens: emissions reductions, reduced congestion, and helping mobility-constrained members of the community to become more mobile and better participate in everyday life.

While the technology is making an on-demand, low carbon, connected, and autonomous transport future possible we need to ask – are we ready?

Autonomous Vehicle Readiness Index 2019

KPMG’s second annual Autonomous Vehicle Readiness Index ranks 25 countries’ AV readiness using four pillars: Policy & Legislation, Technology & Innovation, Infrastructure and Consumer Acceptance.

Australia ranked 15 and performed well in policy and infrastructure.

But while Australia performed well in certain areas there’s plenty of room for improvement in others. Our lower rating on technology and innovation will hopefully be boosted in the future by the recent establishment of a federal body for transport technologies, which aims to unify the states and territories government and agencies in delivering future transport technologies.

Australia’s future transport and mobility

In Australia’s future transport and mobility we outline the policy implications and actions that governments will need to take in order to make the most of this historic transition in transport.

A detailed investigation by KPMG for Infrastructure Victoria looking forward to 2046 found that, without action, the introduction of AVs and Electric Vehicles (EVs) could hit some speed bumps. These could be extrapolated across other Australian cities.

Energy markets

An increase in total electricity consumption by about 50 percent

Typically, our daily energy demand reaches its peak in late afternoon/ evenings when people get home from work/ school. We need to ensure there are appropriate mechanisms in place and policy certainty to maintain reliability and promote efficient investment signals. We also need appropriate policies and pricing mechanisms to incentivise consumers to charge their EVs at non-peak time to avoid stress on the grid.

Government finances

Up to $12.8 billion per annum reduction to government in vehicle related revenues.

As AVs and EVs become more common we need to actively consider alternative funding models such as distance or area-based vehicle charges and road pricing mechanisms. These will help fill the funding gaps and also help manage road demand.

Road congestion

If AVs and EVs are privately owned then congestion could get worse and we’d see a 27% increase in average car trip times in the inner metro area.

AVs help with congestion, but not if we send them home empty or just let them drive around by themselves to avoid parking fees. Without regulating empty trips, cities could face serious congestion. Finding a solution to discourage people from empty running would help avoid this problem, especially in the inner city.

It’s critical to find ways to minimise waiting times, particularly in outer suburbs so that more people choose to use on-demand or shared AVs. The more we use on-demand AVs, the more benefits we can unlock for our existing road infrastructure.

As with any period of change, governments have a vital role to play in laying out a long-term vision including policy and regulatory framework.

Governments will need more detailed analysis across a range of issues including future demand, consumer sentiment, behavioural change, technology transition as well as economic and environmental impacts. Without this, there is a risk that many of the benefits of our transport and mobility future will not be fully realised.

 

One thought on “Are we there yet? Australia and the future of transport and mobility

  1. Hi Praveen, the statement “An increase in total electricity consumption by about 50 percent” had me do a double take. I have no reason to suspect this is not correct, but there should be comment that fossil fuel consumption will drop correspondingly. Electricity from renewables will have a much wider tariff/cost profile, and in summer during the 11am to 3pm peaks will be sometimes negative cost.

    Re: Government Funding revenues, this will be absolutely critical to the transition to EV’s. It needs serious effort and policy development and agreement on what should be a bi-partisan issue. Road users should be able to generate the same revenue in principle as current fuel taxes. However, there is the benefit of generating electricity domestically in Australia’s economy versus importing oil. How are places like California and Germany tackling this ?

    regards, Michael Nolan

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