The transport sector is hailing the government’s Low Emissions Heavy Vehicle Fund as a game changer, saying it could be a pivotal moment in New Zealand’s transition to emissions-free transport.

The Government has launched the Low Emissions Heavy Vehicle Fund in a move to offset the cost of hundreds of heavy vehicles powered by clean technologies.

The fund, worth $27.75 million, will go towards offsetting the purchase prices of low and zero-emissions heavy vehicles.

Energy Minister Simeon Brown and Climate Change Minister Simon Watts said high upfront costs and the unknown total cost of ownership are the main barriers to the uptake of zero and low-emissions heavy vehicles.

“To address this barrier, the LEHVF will contribute up to 25% of the cost of new zero and low-emissions heavy vehicles, and up to 25% of the cost to convert existing higher-emitting heavy vehicles to be powered by low-emissions technology,” they said.

“Boosting economic growth and productivity is a key part of the Government’s plan to rebuild the economy. The LEHVF will offset upfront costs for businesses, enabling them to increase productivity with vehicles that are cheaper to operate.

“By offsetting up to a quarter of these vehicles’ purchase price, the Government is encouraging businesses to trial these new technologies to reduce day-to-day operating costs, ultimately saving money for consumers at the checkout.”

Hyundai New Zealand says two of its zero emissions heavy vehicles are eligible for grants under the Government’s Low Emissions Heavy Vehicle Fund (LEHVF).

Hyundai New Zealand’s Mighty electric light-duty truck and the Xcient hydrogen heavy-duty truck are both approved for a grant through the LEHVF.

“This initiative represents a significant step forward for New Zealand’s transport sector,” says Grant Doull, national manager of hydrogen and eco commercial vehicles for Hyundai NZ.

“We are proud to offer these advanced electric and hydrogen solutions and support businesses in making a positive environmental impact.”

Hiringa Energy said the fund is an important first step for lowering the cost barrier for transport operators to purchase hydrogen vehicles.

“Businesses all over the world are increasingly looking to partner with organisations that can decarbonise their supply chains,” said Hiringa CEO and co-founder Andrew Clennett.

EECA has published a list of approved zero and low emission trucks on its website.

“It’s a great start to see these clean vehicles available for funding assistance, and we know there are other hydrogen options available, including hydrogen dual fuel trucks,” said Clennett.

“We look forward to seeing these options added to the list soon, furthering the impact of this grant.”

Climate Change Minister Simon Watts said the fund will provide emissions benefits for years to come.

“Transport accounts for 18 per cent of New Zealand’s total emissions, which is why the Government wants to remove barriers and accelerate businesses to switch to lower-emission technologies,” he said.

“EECA’s modelling estimates up to 500 diesel-only vehicles would likely be replaced by mostly zero-emissions vehicles by 2028, as well as some low-emissions hybrid vehicles as a result of the Low Emissions Heavy Vehicle Fund.

“While this is a one-time initiative, there will be cumulative emissions benefits over the lifecycle of these low-emissions heavy vehicles. Initial estimates indicate that switching 500 diesel-only vehicles to zero and low-emissions alternatives will prevent 366,622 tonnes of carbon dioxide equivalent emissions,” Watts said.

The LEHVF will be reviewed in six months’ time to ensure it is meeting its objectives and captures ongoing market advancements.