Why EVs Are Good for the Grid — and Your Pay Packet
Australia's energy market operator says EVs could strengthen the grid, not strain it. Here's what that means for novated lease buyers. Read more.
The loudest argument against buying an electric vehicle in Australia has always been: "you'll kill the grid." It turns out the experts disagree — and their reasoning has direct implications if you're weighing up an EV on a novated lease.
According to a recent EVcentral report [Source 1], Australia's energy market operator now considers EVs critical to the future health of the grid, not a threat to it. The logic is straightforward: when managed well, EV batteries can store cheap off-peak renewable energy and feed it back during peak demand. That's a grid asset, not a liability.
What this means for novated lease customers
If you've been sitting on the fence about an EV novated lease, the grid concern is becoming harder to justify as a reason to wait. The structural argument is shifting — and policy tends to follow expert consensus.
On the financial side, the FBT exemption for eligible zero or low-emission vehicles (which covers most battery EVs under the luxury car tax threshold) already makes an EV novated lease one of the most tax-effective ways an Australian PAYG employee can package a car. Add in lower running costs and the improving public charging network, and the case stacks up on multiple fronts.
We won't throw specific dollar figures at you here — every person's salary, tax bracket, and driving habits are different, and a calculator that uses your actual numbers will always beat a headline saving. What we can say is that the potential tax savings for employees in higher income brackets are material enough to be worth a proper look.
Common questions
Will charging my EV at home really strain the electricity grid?
Australia's energy market operator's position, as reported by EVcentral [Source 1], is that EVs — especially when charged off-peak or equipped with vehicle-to-grid capability — can actually support grid stability rather than undermine it. Smart charging managed overnight or during solar-heavy periods is the key.
Which EVs qualify for the FBT exemption on a novated lease?
Broadly, battery electric vehicles and plug-in hybrids first held on or after 1 April 2025 that fall below the luxury car tax threshold for fuel-efficient vehicles are currently eligible. The rules have had some recent movement, so check with a licensed adviser — or us — before assuming a specific model qualifies.
Is a novated lease better than buying an EV outright?
For most PAYG employees, a novated lease lets you pay for a car with pre-tax salary, which reduces your taxable income. Whether it beats outright purchase depends entirely on your individual tax position, how much you drive, and the total lease cost. Run the numbers before deciding.
What happens to my novated lease if EV policy changes?
Your lease agreement locks in the terms at signing. Policy changes — like adjustments to the FBT exemption — generally apply to new leases, not existing ones. That's one reason many people aren't waiting around.
Does millarX only do EV novated leases?
No — millarX arranges novated leases for all vehicle types. EVs get a lot of attention right now because of the FBT exemption, but petrol, hybrid, and PHEV vehicles can still make sense depending on your situation.