Which Australian Cities Are Most EV-Friendly in 2026?
Canberra tops the list but EV uptake tells a different story. Here's what Australia's city-by-city EV landscape means for novated lease drivers. Read on.
A new analysis from The Driven has ranked Australia's capital cities by EV friendliness — and the results are worth a look if you're considering an electric vehicle on a novated lease. Canberra claims the top spot, which makes sense given the ACT government's aggressive EV incentives and relatively dense charging infrastructure. But here's the twist: the city with the cleanest and cheapest charging rates isn't seeing the EV uptake you'd expect. That gap between infrastructure quality and actual adoption is the interesting part.
For PAYG employees thinking about an EV novated lease, where you live genuinely matters. Charging access, local government incentives, and electricity costs all affect the real-world experience of running an electric vehicle — even if the federal tax treatment is the same regardless of your postcode.
What this means for novated lease customers
The federal FBT exemption for eligible EVs under the Treasury Laws Amendment (Electric Car Discount) Act applies nationally — your city doesn't change that. But your day-to-day running costs absolutely shift depending on where you charge, how often public charging is available, and what local tariffs look like. According to the analysis from The Driven [Source 1], some cities offer structurally cheaper and greener charging than others, which feeds directly into the operating cost side of a novated lease budget.
If you're in a city with strong charging infrastructure, the case for going electric on a novated lease gets easier to make — lower fuel costs, lower servicing costs, and the FBT exemption stacking on top. If your city is lagging, it's not a dealbreaker, but it's worth factoring in potential savings on running costs realistically rather than assuming the best case. The novated lease structure already takes care of the tax efficiency side; the city you're in shapes everything else.
Common questions
Does my city affect whether my EV qualifies for the FBT exemption?
No. The FBT exemption for eligible zero or low-emission vehicles is a federal measure and applies equally across all Australian states and territories. Your postcode doesn't change your eligibility.
Which Australian city ranks highest for EV friendliness?
According to The Driven's 2026 analysis, Canberra ranks as the most EV-friendly capital city in Australia. However, the city with the cheapest and cleanest charging rates has surprisingly low EV uptake — suggesting infrastructure alone doesn't drive adoption.
How does charging infrastructure affect my novated lease budget?
Running costs — including charging — are typically bundled into your novated lease budget. Lower local charging costs can reduce the fuel component of your lease, which may improve the overall value. Your millarX consultant can model this based on your location.
Is an EV novated lease worth it if I live in a city with limited charging?
It depends on your situation. Home charging covers most everyday needs for most drivers, so limited public infrastructure is less of a barrier than it sounds. The tax benefits apply regardless, but it's worth having an honest conversation about your driving patterns before committing.
What EVs are currently eligible for the FBT exemption under a novated lease?
Eligible vehicles are those below the luxury car tax threshold for fuel-efficient vehicles, emitting zero or low emissions. The ATO and Treasury maintain guidance on eligible vehicle types — your novated lease provider should confirm eligibility for any specific model before you sign.