EV Parallel Insights Series: A Vision to the Future - Norway

Leading the Electric Revolution, Norway now boasts the highest share of new EV purchases worldwide.??

Imagine that tomorrow the government announced that in 2025 the sale of new ICE (internal combustion engine) vehicles would be banned.??That’s just two and a half years away - think you’d be prepared?

For Norway, that deadline is a reality.??It’s the earliest country in the world to ban sales of all new fossil fuel-based cars and light commercial vehicles (LCVs) in 2025, and so far, they’re on track to achieve it.??In the first two months of 2022, 80% of all new cars sold in Norway were electric.??

So, why has Norway been so successful in its endeavour to go all-electric???And what can we all learn from the EV adoption strategies promoted??

Taxes, Clean Energy Solutions and Serious Incentives?

From as far back as the late 1990s to the early 2000s, and after much campaigning, rules were introduced to exempt EVs from all toll charges and parking fees, and allowed them to evade traffic by using bus and taxi lanes.??More significantly, purchases of new EVs were exempt from heavy taxes, including 25% VAT and purchase tax.??Put into context, this made a brand new Volkswagen e-Golf cost ￡690 less than its ICE counterpart.?

The response of the Norwegian public to the policy was so overwhelmingly positive that it inspired the EV revolution at the core of Norway’s vehicle market today.??Fast-forward to 2022 and BEVs now account for 77.5% of all new cars sold in the country, and the government now finds itself in a situation where it’s running out of ICE vehicles to tax.??As a result, in 2017 the EV toll charge exemption was revoked, and in the coming years, further taxes are projected to be reintroduced.?????

Clean energy is at the heart of Norway’s infrastructure

Another area in which Norway excels is its renewable energy sector.??Currently, 98% of electricity production comes from renewable energy, the majority of which is in the form of hydropower.??Moreover, on a national level, the country has nearly 17,000 charging stations, including 3,300 fast chargers, and has established fast-charging EV stations every 50km on all main roads.??With the infrastructure in place forging the foundational base for electric vehicles to be supported, Norway was already in a strong position to cope with EV demand increasing as significantly as it did.???

Incentives that are difficult to refuse

While the national incentives of zero purchase tax or VAT, and exemption from road traffic insurance tax already offer a persuasive reason to transition to an EV, there are a number of EV charging and EVSE (electric vehicle supply equipment) incentives available too.

The Norwegian Electric Car Association offers a charging chip for users to access charging units at a reduced price, and the Charge and Drive chip from energy firm Fortum allows users to charge at almost any charging station across the country.

The centrepiece for Norway’s EVSE investment strategy is its grants for housing associations.??For instance, those living in Oslo can benefit from an EVSE grant for a maximum of 20% of the cost of EVSE purchase and installation; those in Asker can receive up to 50%.

What can aspiring zero emission countries learn from Norway?

1.?????Government investment in infrastructure and renewable energy is key.

Despite being a major gas and oil producer, the fact that Norway’s domestic energy comes from its single and renewable source of hydropower makes it significantly easier for their population to switch to EVs.??For countries who are still predominantly coal dependant, it becomes a 2-step process - their transport sector must be green to begin with before successful integration of EVs can be considered.

2.?????Incentives should be realistic, but plentiful to achieve successful behaviour change.

The story behind Norway’s incentives for EVs actually spans back into the 1990s, and starts, peculiarly enough, with the lead singer Morten Harket of 80s band A-ha.??During a trip to Switzerland in 1989, Harket bought a Fiat Panda that had been converted to be powered by battery – in other words, an early electric vehicle.??On their arrival in Oslo, the band began to break the rules – parking it illegally, driving in bus lanes, and whizzing through toll booths without paying.??

Their argument???That people should be allowed to drive electric cars – which weren’t allowed to be registered in Norway at the time – and as such, should be exempt from parking fees, tolls and driving in bus lanes.??The band’s antics caused such a sensation across the country that the following year, the Norwegian government began legalising those very incentives for EVs.

While there have been some incentives for EVs in the UK, notably free road tax, the plug-in car grant, workplace charging schemes, and the Electric Vehicle Homecharge Scheme (EVHS), these are far from the scope of Norway’s equivalent offering.?Moreover, EV road tax from 2022/23 will increase to 2% (a meagre percentage, however it is still an increase) and most recently, the government decided to scrap the EV plug in car grant – a financial benefit which once reduced the purchase of an EV by ￡2,500.?

Currently, only 1.3% of UK vehicles are EVs; a number that is eclipsed by Norway’s 80%.??With such a small percentage of electric vehicles on UK roads, the government’s choice to reduce existing incentives, appears undeniably premature.

Can we ever realistically emulate Norway’s success by 2035?

Evidently, the consistent offering of government grants and tax incentives for EVs, as opposed to changing legislations every few years as the UK government is wont to do, is a more effective way of gaining the public trust required to purchase an EV.?

As a nation, the UK still lacks a national plan to not only increase the number of public charging points, but to also ensure that they are strategically in the correct places – working with and supporting local authorities by providing official guidance on implementation. Moreover, the country can also learn from current user experience issues at charging points.??It’s crucial that charging points are supported by a reliable system where faults can be resolved quickly, such as 24/7 user hotlines as well as hardware that is high quality and can withstand bad weather. These steps will be essential for early users of EVs to feel secure and cement trust in the infrastructural system at the outset.????????

If the above can be tailored into the government’s strategic plans for the Road to Zero, and if new incentives can be introduced (or brought back), only then can the UK realistically achieve the 2035 deadline.??To achieve actual behavioural change in the public, planning is indeed crucial, but taking the time to action those plans becomes the difference between living up to those expectations, or not…??

While currently the Road to Zero appears long and strenuous, nations can take inspiration from others who are pioneering the EV transition.??It encourages innovative thinking on an international level, and ultimately makes what was once a solitary journey, one that is collaborative in scope.????????