Rising petrol prices and pressure on household budgets are pushing more Australians towards electric vehicles and home electrification, as concerns grow over fuel shortages and cost-of-living impacts.
Experts from Monash University say interest in EVs is increasing during the current fuel crisis, even as questions remain around affordability and the pace of transition for vulnerable households.
Professor Yolande Strengers said demand for electric vehicles and home energy systems was climbing as households look for greater control over energy use. “We’re seeing a significant increase in interest and sales for EVs in the current fuel crisis. Australians are already at the forefront of seeking energy resilience and independence through their investment in rooftop solar PV and home batteries, and the crisis has given households who can afford it another push in that direction.”
At the same time, she warned that rising fuel costs are adding pressure for many Australians. “With fuel prices putting extra pressure on cost of living, we need to be careful that the most vulnerable members of society don’t get left behind. More households are likely to face energy hardship by experiencing difficulty in paying their bills in the current climate.”
She said lower-income households, renters and apartment residents face limits in responding to rising energy costs. “Vulnerable households like low-income households, renters and people living in apartments are also less able to shelter from the impact and risks through investment in EVs, rooftop solar PV and home batteries.”
Professor Strengers added that households are adjusting their behaviour as economic conditions tighten. “The home becomes a safe haven in times of crisis. Australian households are already well-versed at working from home where they can, and prepping or storing for significant disruptions like covid and extreme weather events. They are likely to turn to these strategies again in the current crisis, to shelter from cost-of-living impacts and build resilience.”
The shift towards electrification comes as Australia deals with fuel supply disruptions linked to conflict in the Middle East. Dr Terrence Mak said shortages are already emerging. “Currently the country is experiencing crude oil and refined fuel shortages due to the Iranian conflict. The effect of these shortages may soon be felt in the transport and manufacturing sector in Australia.”
Our plan is all about securing more supply. It’s about getting distribution, particularly to regional areas. It’s about cracking down on rip-offs, and it’s also about helping with the cost of living in other ways
Despite the supply issues, he said electricity availability is unlikely to be affected. “Oil is used for only 1.7 per cent of the electricity generated in Australia so the crisis is unlikely to impact the availability of power in the country.”
Dr Mak described the situation as a turning point for energy policy and household decisions. “The fuel crisis is a wake up call for the country to move to more electrification and better contingency management on fuel supply. We are already seeing higher demand for electric vehicles and households electrifying gas-based appliances.”
He said existing infrastructure is capable of handling increased demand. “Australia’s power grids are well-equipped to handle the potential increased uptake of EVs and electrification in the coming months.”
The larger issue, he noted, is energy storage rather than supply. “The key issue here is actually about the storage of excess solar and wind-powered energy produced in Australia. Essentially, we are generating more electricity through renewable sources than we can store. Increased adoption of EVs will actually help this issue since the cars essentially are mobile storage batteries.”
Dr Mak added that greater EV uptake could strengthen the system over time. “This surge in EV adoption will also help to better leverage the existing Vehicle-to-Grid infrastructure and technologies. It will also help improve and evolve the capabilities of Australia’s power grids as we transition towards potentially 100 per cent renewable energy.”
The pressure on fuel supplies has triggered policy responses across the country. Victoria will forgo $71 million in revenue to make public transport free for April, covering trains, trams and buses.
At the federal level, Treasurer Jim Chalmers said the government is focused on stabilising supply and easing pressure on households. “Our plan is all about securing more supply. It’s about getting distribution, particularly to regional areas. It’s about cracking down on rip-offs, and it’s also about helping with the cost of living in other ways.”
He said additional measures remain under review as the situation develops. “Obviously, we have a range of contingencies and fallbacks that we keep under more or less constant review … our government is always looking for ways – responsible ways – to help people with the cost of living, to try and alleviate some of this pressure which is coming at people.”
Opposition figures have called for a temporary reduction in the fuel excise, currently set at 52.6 cents per litre, as households and businesses respond to higher petrol prices.
National Cabinet is expected to consider coordinated responses to the crisis, including supply management and voluntary changes such as working from home, as governments aim to avoid stricter restrictions while managing demand and maintaining economic activity.
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