10 things you need to know about Victoria’s new EV road user charge

Electric car on the road

Tim Nicholson

Posted June 02, 2021

EV owners will be charged to use the road from July 1. Here's what you need to know. 

The Victorian government’s road user charge for zero and low-emissions vehicles (ZLEV) was passed by parliament late last month. That means from July 1 this year, any Victorian who owns a ZLEV will be charged a fee to use the road. Here are 10 things you need to know about road user charging and what the new laws mean for Victorian owners of electric and plug-in hybrid vehicles. 

Victoria's new EV road user charge explained

What is road user charging? 

Road user charging simply means charging users for the use of roads they drive on. The Victorian example is a distance-based charge applied to zero and low emissions vehicles such as electric cars. They will be charged a set amount per kilometres driven.

Why should ZLEVs pay road user charges?  

All motorists that drive petrol and diesel-powered cars – also known as internal combustion engine (ICE) vehicles – pay the fuel excise, which is about 42 cents per litre. Much of the revenue the government collects from the fuel excise is used to pay for new roads, road maintenance and infrastructure.   

Given EVs are battery powered and don’t require fuel, EV owners don’t pay the fuel excise. The government says it introduced the road user charge as a way for EV owners to pay their fair share for road maintenance and infrastructure.

How much will it cost? 

Owners of battery electric (EV) and hydrogen fuel-cell electric vehicles (FCEV) will be charged 2.5 cents per kilometre driven, while plug-in hybrid electric vehicles (PHEV) will be charged 2.0 cents per kilometre.  

According to Vicroads, light vehicles in Victoria travel an average of 13,100km per year. That means EV owners are looking at an annual charge of about $330 and PHEV owners will pay about $260.

Will plug-in hybrids still pay fuel excise as well as the road user charge? 

Yes, they will. Plug-in hybrids use an internal combustion engine (usually petrol) combined with a battery or batteries that powers the electric motor. Most PHEVs have an electric only driving range of about 50km. When the electric charge is depleted, the PHEV uses its engine for propulsion. As part of the road user charge, PHEVs are charged a lower per kilometre rate than electric vehicles because they incur both costs.

Will owners of regular hybrid vehicles have to pay the road user charge? 

No, they will not. Regular hybrid vehicles don’t require external electrical charge. The batteries are charged by the petrol engine and through regenerative braking and the vehicles still require fuel. 

Can I still get a discount on vehicle registration for a ZLEV? 

Yes, you can. Owners of EVs, PHEVs and FCEVs are still eligible for a $100 discount on their annual registration fees through Vicroads. Regular hybrids, however, are no longer eligible for the discount.

Hyundai Kona next to an old petrol pump

Victorian owners of EVs and ZLEVs will be required to pay 2.5 cents for every kilometre they drive, and owners of plug-in hybrids pay 2.0 cents from July 1.

What will the road user charge revenue be used for? 

The Victorian government says the money raised from the charge will be used to help fund a $100 million package of policies and programs designed to encourage the uptake of ZLEVs.  

The proposed package includes funds for subsidies for purchasing an electric vehicle, increasing electric vehicle charging infrastructure across the state, an electric public bus trial, a study looking at EV readiness of new buildings, and more.

How do you pay the road user charge? 

The charge will be payable through Vicroads. ZLEV owners will need to provide Vicroads with their odometer readings to determine the charge, and it will be payable quarterly, half-yearly or annually. Vicroads says it will contact owners with more information on how to report odometer readings and the billing and payment process.

What happens if I don’t pay the charge? 

You may receive an invoice with additional charges, or your registration could be suspended or even cancelled.

Will I have to pay the road user charge if I drive in another state/territory?

Yes. According to the Department of Transport, motorists driving a ZLEV that is registered in Victoria are required to pay the road user charge for all kilometres travelled within Victoria and interstate. 

There will be no road user charges for travel off-road (such as on private property farm tracks), but drivers must provide evidence of off-road use.