Transport Research: The number of electric cars would grow faster in Finland if the support policy were changed according to the Swedish or Norwegian model

In Norway, the electric motorist receives a significant tax advantage, while in Sweden, charging hybrids are also preferred. A recent study lists ways to electrify passenger cars.

Finland there could be as many as 360,000 fully electric cars in road transport in 2030 if the same incentives for electrification were introduced as in Sweden.

This is stated in a recent study carried out by the Demos Helsinki think tank and the University of Tampere. The study was commissioned by Sähköautoilijat ry.

The aim was to find out how the transport electrification support measures used in Sweden, Norway and the Netherlands would affect the development of the electric car fleet and the reduction of traffic emissions in Finland.

The number of all-electric cars would grow the fastest on Norwegian cones, while the number of rechargeable hybrids on the Swedish model would also increase significantly, the study says.

At the moment The forecast for the development of Finland’s electric car fleet is based on the Ministry of Transport and Communications’ Road Map for Fossil-Free Transport, which aims to halve traffic emissions by 2030 compared to 2005.

The basic forecast in the roadmap estimates that there will be 144,000 fully electric cars and 129,000 charging hybrids in traffic in 2030. An increase in rechargeable vehicles would significantly reduce traffic emissions, which together account for about 20 percent of all Finnish greenhouse gas emissions.

A Finnish electric car buyer is supported with a purchase subsidy of 2,000 euros, which is available for a car costing a maximum of 50,000 euros. A total of EUR 24 million has been allocated for procurement support for 2018-2021.

For example, last year, 4,245 all-electric cars were first registered in Finland, half of which applied for procurement support. By the end of January, the support had been applied for a total of 3,710 times in three years, or about 7.4 million euros, says Traficom.

If the pace does not accelerate significantly, a large part of the procurement aid budget will remain unused.

“Currently, procurement aid is not sufficiently incentive and excludes a large proportion of electric cars, especially long-range ones, from the aid,” says the President. Kirsi Immonen Electric Electricians Association.

At the end of 2020, there were about 10,000 all-electric cars and more than 45,000 rechargeable hybrids in Finland. Electrification has been clearly slower than in other northern European countries.

Particularly there has been strong support for electric cars in Norway, where 54.3 per cent of new cars are fully electric cars. In 2020, there were 330,000 all-electric cars in the country.

Electrification has been rapid, with three years earlier the corresponding figures were 138,000 all-electric cars and just over 20 per cent of new car sales.

“In Norway, the rapid growth in the number of electric cars is based on three support measures. No car tax or VAT is paid on the purchase of a new all-electric car. In addition, electric cars are supported locally, for example by exempting them from tolls and parking fees, ”says Immonen.

Extensive support measures in Norway have led to the purchase of a full electric car in some cases even being cheaper than the purchase of an internal combustion engine car.

Also In Sweden, the electric car fleet has grown faster than in Finland. At the end of last year, there were 56,000 all-electric cars in service and just under 123,000 charging hybrids.

Once it has been decided in Norway that all new cars must be emission-free as early as 2025, it is planned to ban the sale of internal combustion cars in Sweden by 2030.

The electrification of transport is supported by taxation and procurement aid. An additional tax has been imposed on vehicles emitting more than 95 grams of CO2 per kilometer. It covers the majority of internal combustion engines, in addition to which an additional environmental tax has been imposed on diesel cars.

The procurement of all-electric cars and hybrids has been supported in Sweden since 2012 with procurement support. At the beginning of April, a new support system was introduced in the country, which supports the purchase of a zero-emission car with a maximum amount of SEK 70,000 (EUR 6,850).

“A significant difference between Finland and Sweden is that there is no upper limit on the purchase price of a car in the new support system. This means that the incentive for the subsidy also contributes to the purchase of more expensive and longer-range all-electric cars, ”says Immonen.

In the Netherlands, more than 172,000 fully electric cars were first registered in 2020, up from just over 20,000 three years earlier. Emission-free cars will be exempt from vehicle tax until 2024.

Procurement support is EUR 4,000 for the purchase of a new and EUR 2,000 for a used electric car.

Electric motorists and the researchers’ report states that the fastest growth in the electric car fleet in Finland would be achieved through measures in accordance with Norway.

The abolition of vehicle tax and VAT would have a strong impact on purchase prices and thus on the attractiveness of electric cars to consumers.

Therefore, with the Norwegian model, the number of all-electric cars would increase to 580,000 by 2030. The Dutch model, on the other hand, would bring an estimated 285,000 all-electric cars to Finnish roads in nine years.

The report calculated how the subsidy policies of different countries would affect emission reductions. The biggest impact would be with the Norwegian model, which would reduce emissions by more than a million tonnes of CO2, while following Dutch policy would reduce emissions by about a third compared to Norway.

With Swedish means, emission reductions would be slightly better than with Dutch policy.

Researchers It is important to consider how the support for different rechargeable cars contributes to the achievement of the desired emission targets.

Kirsi Immonen reminds that the emissions of charging hybrids are often higher than reported, as long-distance driving is mainly driven by an internal combustion engine. In addition, a car equipped with a traction battery weighs more than a regular internal combustion engine car, so when driving without battery electricity, consumption also increases.

The Swedish model would also greatly increase the number of charge hybrids, which would be 230,000 in 2030.

“This means that support measures like Sweden will achieve emission reductions, but significantly less than the Norwegian model, where support is focused on all-electric cars,” says Immonen.

Report According to the Commission, the most effective way to achieve emission reductions in Finland would be to target support specifically to all-electric cars.

At present, all-electric cars are subject to a 2.7% tax on acquisition, which does not differ significantly from the taxation of charging hybrids.

“For example, a fully electric car that costs 40,000 euros is subject to about a thousand euros of car tax. By removing this tax, a fully electric car would become much more attractive from the consumer’s point of view, ”says Immonen.

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