Policy incentives for electric mobility

Published by on 04.15.2021 - 5 min

Driven by increasingly ambitious political impetus, there are a growing number of measures to promote electric mobility in Europe. For owners of electric or hybrid cars, whether individuals or companies, this translates into numerous financial benefits, such as purchase bonuses and tax exemptions, as well as facilitated everyday use. The financial aids, which are regularly revised as the electric vehicle market matures, are not intended to last forever — so it’s time to make the most of them!

Supported by public policies implemented by most of the twenty-seven member states of the European Union, the electric and hybrid vehicle market is booming. These policies aim to accelerate the transition of the automobile to “green” mobility using increasingly carbon-free energy. Another objective is to promote new forms of transport (carsharing, alternative modes, etc.). From purchase support to the exemption from certain taxes and help with the installation of charging stations, considerable efforts are being made to encourage potential buyers to choose an electric or hybrid vehicle. Read on to discover the most illustrative measures.

Ever more motivating purchase aids

Among all the European incentive measures, purchase aids are essential as they have immediate, visible effects on the sales price of a vehicle. While they differ per country, the amount of the various bonuses available to drivers can be significant. 

In France, a motorist looking to buy a vehicle emitting less than 20 g of COcan receive a bonus of up to 7,000 euros (depending on the sales price of the vehicle.) Car owners exchanging their old car in favor of a new or second-hand electric or plug-in hybrid vehicle can benefit from a conversion bonus of up to 5,000 euros.

In 2020, the British government approved the “PiCG” (Plug-in Car Grant) which, from March 2021, offers up to 2,500 pounds (around 2,900 euros). Through such incentives, the United Kingdom wants to make headway on its plan to ban the sale of new combustion-powered vehicles from 2030.

In Germany, politicians and major players in the automotive industry have agreed on a manufacturer’s bonus of up to 3,000 euros, without which a potential buyer would not be able to access state support of up to 6,000 euros.

Of course, these national-scale bonuses can also be complemented with local incentives by cities and regions.

Megane E-TECH plugin hybrid charging

Exemption from registration fees and tax on company vehicles

Driving electric can be profitable for individuals and businesses alike. As well as purchase aids also available to company vehicles, the majority of European countries are making efforts in tax exemption, and these are by no means insignificant.

In multiple countries, electric vehicle owners are exempt from paying for official vehicle registration documentation. In France, depending on the region, an electric car benefits from the almost total-exemption from all costs associated with issuing a registration certificate.

In Greece, with the government’s recent “E-Moving” initiative to structure the new mobility market, companies are offered more advantageous tax reductions and specific measures for vehicle fleets and electric taxis. In France, businesses also come off well, as the “TVS” (tax on company vehicles) still applies to electric company vehicles. Meanwhile, in the United Kingdom, tax on benefits in kind has been set at 1% of the value of an electric vehicle from April 2021 for companies opting this type of purchase.

Exemption from road tax

In terms of tax exemption, owners of electric vehicles are also exonerated from paying annual road taxes in several countries such as the United Kingdom, Greece and Hungary, with terms obviously varying between nations. In Germany, there is an exemption period of ten years. In Sweden, the tax exemption has no duration limit but is calculated according to CO2emissions. In Italy, tax exemptions are decided at regional levels — electric vehicles are permanently exempt from road tax in Lombardy and Piedmont, for example. In Spain, it is the largest cities who have taken the initiative: Madrid, Barcelona and Valencia are reducing the amount of annual road tax for electric vehicles by almost 75%, with Bilbao offering a reduction of 95%.

Renault ZOE on the road

No limit to driving electric

It’s no coincidence that large cities are looking to promote more sustainable mobility. A persuasive figure, more than two-thirds of humanity will live in cities by 2050. Urban electricity policies are therefore a major issue. This is evidenced by the measures being taken to limit, restrict and even ban the circulation of combustion-powered vehicles in many major European cities. In London’s ULEZ (ultra-low emissions zone), diesel cars registered prior to 2015 (2006 for petrol cars) have to pay a daily charge of 12.50 pounds (just over 14 euros per day.) Heavier vehicles, such as trucks and coaches, have to pay 100 pounds per day (around 115 euros).

Using a different approach, Berlin is one of the first cities to have, in 2018, introduced a system of stickers to distinguish between vehicles and their right, or not, to circulate according to emissions standards for polluting gases. This type of scheme has since become more widespread, and is now used in hundreds of permanent LEZs (low emissions zones) throughout Europe. Northern European cities such as Oslo, Copenhagen and Amsterdam, considered figureheads of sustainable mobility, are continually tightening legislations on combustion-powered vehicles. In most of Europe’s large cities, like Paris, Budapest and Lisbon, more occasional measures are applied in the event of pollution spikes.

Prioritized driving status

In Europe, public authorities facilitate the circulation of electric and hybrid cars with free parking and privileged access to certain districts and roads. In Norway, for example, electric vehicles are allowed to use bus lanes, municipal car parks are free, and no urban congestion charges apply. Similar advantages exist in Germany. In Spain, the United Kingdom and the Netherlands, electric and hybrid vehicle drivers have a nice surprise in the form of dedicated traffic lanes.

Obviously, to really encourage motorists to go electric, all these measures to facilitate driving need to be combined with the largest possible charging infrastructure. This explains why support for the installation and rollout of charging stations is on the rise. Due to the scale of allocated investments, 200,000 charging points are now accessible in public spaces across Europe (not counting home terminals, private car parks etc.) In 2020, there were 43,700 charging stations in the Netherlands, 33,00 in Germany, nearly 30,000 in France and almost 25,000 in the United Kingdom. Short-term objectives have also been set in many countries, such as France’s “Objectif 100 000 bornes” (100,000 stations objective). Fast charging points (50 kilowatts and above) now represent 10-15% of Europe’s charging infrastructure.

That’s right, potential electric and hybrid vehicle purchasers: public authorities are invested in your venture — there’s never been a better time to drive electric!

 

Copyrights : Teamroad Studio , LEMAL Jean-Brice, ADDITIVE MAGROUND