Norway, the EV canary in the coalmine
A few years ago, Norway decided that of the new 8,000 cars sold yearly, not a single one should be using fossil fuel by 2025. They might make it so.
Ott Ummelas
To get there, Norway has been shrewdly playing four strategic cards for more than twenty years:
- Prime the market with generous tax incentives: Since 2001, the VAT on new electric vehicles has been forfeited by the governments; in 2015, the VAT was also brought at 0% on leased vehicles, and EV drivers pay 50% less parking and toll fees across the country since 2017 (it's free in Olso). Many more incentives exist for companies and car insurance that further strongly nudge the market to EVs.
- Infrastructure before cars: While not yet the best in class in Europe (that would be the Netherlands), Norway has been an early adopter of a cheap and widely accessible public charging infrastructure. In 2021 the country had about 10% of the total charging stations in Europe for a population of only 5.4m people. This network is highly standardized, and a unique payment system works across all stations. And another simple nudge is that all bus lanes are accessible to EV drivers.
- National oil producers are playing ball: Not that they really have the choice, but Norway is, to my knowledge, the only country where oil producers don't lobby or drag their feet but are actively participating in transitioning out of fossil fuel consumption. The national oil company directly funded a significant amount of the VAT break and various financial support to EV owners.
- Becoming an international test market: Lastly, Norway reinvented its national car market as a very accessible and enticing test market for foreign carmakers and energy companies. Soft landing a business in Norway is as seamless as possible in Europe, qualified tech and non-tech workers abound, and above all, laws and regulations and extremely proactive to develop new automotive offers in the country (this has been a long-term global politic held by the country for more than a decade on many topics from telecoms, to foodtech).
What is key for me here is that Norway is creating a global positive feedback loop around EVs. Inventing the future of electric mobility ahead of the global market curve is easier in this country than anywhere else. But just like with biking in the Netherlands, this hasn't been an overnight miracle. It's been an ongoing relentless political vision begrudgingly shared by the population at first and then enthusiastically until it became a new normal.
For the majority of the other European nations, this transition will happen too, but sadly in crisis mode and with vast economic destruction of incumbent industries and infrastructures.
