Policy incentives for electric mobility

Published by The Editorial Committee on 06.27.2018 - 5 min

In Europe, the majority of countries have made a strong commitment to more sustainable transportation. For electric car owners, this means a whole host of benefits for their everyday lives.

The fleet of electric cars in Europe can look forward to a bright future. The market for new energy vehicles has shown exponential growth, the public infrastructure for recharging them is expanding at the same pace, and most of the 28 member countries of the European Union are, for environmental reasons, demonstrating an unprecedented willingness to embrace electromobility. The policies in support are having direct and concrete consequences for anyone who wants to drive electric. From subsidising purchases to certain tax incentives, without forgetting the increasing ease of movement and access to electric power, everything is being done to make everyday life easier for this new generation of drivers. Let’s review the most representative measures.

More attractive financial support

Clien en concession Renault

Out of all the incentives that have been passed in Europe, payment assistance programmes are probably the ones attracting the most attention. The fact is, the amount of different bonuses afforded to purchasers of electric vehicles is hardly negligible. In France, drivers that want to travel more sustainably, in a vehicle that emits less than 20 g of CO2/Km, can expect a bonus of 6,300 euros. As for drivers wanting to rid themselves of a diesel-powered vehicle in order to buy an electric one, they could receive a super-bonus of up to 8,500 euros.

Slovenia has been equally ambitious, with totals ranging from 3,000 to 7,500 euros, while Germany is offering 4,000 euros to anyone that chooses to go electric. As for Austria and Portugal, they have opted for a VAT deduction at the time of purchase. This advantageous tax system is just as effective at making green mobility particularly enticing.

Exemption from vehicle registration fees and company vehicle taxes

The economic benefits do not stop there. Because even though not all European countries have implemented buying bonuses, the majority of them have committed to tax exemptions. And once again, the aforementioned cuts are not minor.

In Greece, owners of electric vehicles are exempt from car registration fees, while in Finland, this tax is reduced for anyone driving electric. In France, depending on the region, an electric car is either exempt from registration fees, or eligible for a 50% reduction in cost.

In France, as in England, businesses are equally well off because the decision to drive electric exempts them from tax on company vehicles, while in Sweden, they benefit from a 40% reduced rate. In Belgium, individuals and businesses also enjoy tax benefits, whether it be in Wallonia or the Flemish Region.

Exemptions from paying road taxes

In Norway, where the market share of electric vehicles is around 30%, the government has made them exempt from import taxes.

Owners of electric vehicles are exempt from paying annual road taxes in several countries, including Bulgaria, Hungary, Romania and Slovakia. The length of this exemption from annual road taxes is 10 years in Germany, compared to 5 years in Sweden or Italy.

In Spain, the country’s largest cities have taken the initiative: Madrid, Barcelona, Zaragoza and Valencia have reduced initial registration taxes for electric vehicles by almost 75%.

For a quick and simple comparison of all the different provisions currently in effect in Europe, explore the ACEA’s interactive map.

No limits for electric

Indeed, it’s no coincidence that large cities are seeking to promote more sustainable forms of transportation. Consider this: more than 2/3 of the world’s population will live in cities by 2050. Urban electric vehicle policies are therefore a key focus. For proof, look to the limitations, restrictions, or even prohibitions placed on driving combustion powered cars in numerous European capitals and major cities. Thus, in London, in addition to the congestion charge, the oldest and often most polluting cars have to pay a surtax of £10 per day (or around €11.4).

In a different vein, Berlin is one of the first cities to have put in place, in 2008, a system of badges to distinguish between different types of vehicles, allowing them to drive in certain locations, or not, based on the level of their emissions. In order to regulate traffic flow on peak pollution days, Paris has had the same measure in place since 2015. And this legislation regarding combustion powered cars is even more restrictive in northern Europe, be it in Oslo, Copenhagen, or Amsterdam.

Privileged driving rights

In Europe, public authorities tend to favour the use of electric cars. Again, in Norway, an electric vehicle can use bus lanes when there are two people on board. Public car parks are also free, just like tolls and maritime transport (by ferry). Drivers in Germany enjoy roughly the same benefits. In Spain, the United Kingdom and the Netherlands, the motorway networks have become particularly welcoming.  Lanes dedicated to new energy vehicles are already being tested.

Of course, all these enhancements depend on having the most access possible to charging infrastructure.  As public authorities are aware of this, assistance for the installation and expansion of charging stations is becoming more common. It’s clear from the size of the investments that the countries of the European Union are meeting the challenge. As the pace of development picks up, the density of charging areas is increasing. The goal of having 500,000 charging stations by the end of 2020 is, admittedly, ambitious.

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