The automotive sector is hopeful Labor's election win has revived the prospect of an emissions cap on vehicles being imposed.
A new report has found if an emissions cap on car-makers that was proposed by former prime minister Malcolm Turnbull had been implemented, it would have saved consumers $5.9 billion in fuel costs.
Australia is an outlier on fuel efficiency standards, with more than 80 per cent of the global car market being subject to one. It's left car-makers in the unusual position of asking for their carbon dioxide emissions to be regulated.
The nation also has some of the least efficient and most polluting cars of any developed country, emitting on average 169.8 grams of CO2 per kilometre, compared to 129.9 in the US and 120.4 in Europe, according to 2018 figures.
The Australia Institute's climate and energy director, Richie Merzian, is hopeful the new government will soon move to implement a standard, as the group prepares to co-host an electric vehicle summit being attended by the federal Climate Change and Energy Minister, Chris Bowen, next month.
Mr Merzian said it was the sector's "expectation" that Mr Bowen would put forward a plan to improve fuel efficiency standards.
"With record-high oil prices you can't help but think it's a bit crazy that we don't have a mandate for more efficient vehicles to come here," Mr Merzian said.
"Right now, the Albanese government is sticking closely to what they perceive as the mandate they have been given … [but] there have been some relatively positive signals from the Labor government that this is a policy they could pick up this term of government."
In a report released ahead of the summit, The Australia Institute determined a year's worth of domestic flight emissions would have been avoided if Australia had adopted a fuel efficiency standard when it ratified the UN Paris climate agreement.
The institute's modelling found it also would have saved Australia $48.70 for every tonne of carbon dioxide emissions avoided.
"The car manufacturers are telling us that, 'if you mandate robust fuel efficiency standards we will bring over better vehicles, we will have more models available,' Australians will ultimately save at the bowser and it won't really cost that much more on the sticker price," he said.
Last week, motor industry groups released a joint statement calling on the new government to mandate carbon targets to replace a voluntary standard the sector has set for itself.
The sector says it is at a competitive disadvantage when trying to import electric vehicles because car-makers prefer to send their limited supply to nations that reward car fleets that fall below an emissions cap or penalise those that exceed it.
The Federal Chamber of Automotive Industries (FCAI) has also been encouraged by the government's openness to a standard in meetings before and after the election.
Research commissioned by the chamber found with a business-as-usual approach, zero-emission vehicles would only make up about 18 per cent of new car sales by 2030, with other estimates putting the figure even lower.
Australian Automobile Association chief executive Michael Bradley said the industry was unified in supporting a mandatory emissions target, but it would need to be carefully calibrated.
"There's lots of people out there saying Australia needs a CO2 standard, not least because we need it to fix our supply constraints, but that doesn't fix the challenges for the government of doing this. This is a big change," Mr Bradley said.
"There is a really delicate balancing act to be done here by the government."
Change politically fraught even with widespread support
Labor has advocated for an emissions standard on vehicles on-and-off for a decade and took a policy to implement one to the 2019 election.
At that time, it faced fierce opposition from then-prime minister Scott Morrison, who said a CO2 standard would "end the weekend".
The government did not include a standard as part of its 2022 election policy platform but has not ruled out introducing one.
Mr Merzian said an emissions standard on vehicles could be the next cab off the rank for the government's climate agenda, because a policy framework had largely been developed.
Mr Bradley and the FCAI have both warned of devils in the design that would need careful attention.
As just one example, Mr Bradley pointed to the fact some more fuel-efficient cars required higher quality fuel — but a key ingredient of that fuel is banned in Australia because of the risk it poses to groundwater.
"This is the riddle that is sitting on Chris Bowen's desk at the moment. Angus Taylor worked on this for a long time and didn't solve it, this work is ongoing," he said.
"[But] we need to start something to get into the game."
There are broad admissions that implementing a target would likely become contentious, and the industry warns going too hard too quickly would lead to the price of new cars rising by thousands of dollars.
The Climate Change Minister and Industry Minister Ed Husic are due to attend the EV summit later this month, alongside billionaire Mike Cannon-Brookes and state ministers.
The ABC has contacted Mr Bowen and Mr Husic for comment.
