When it comes to vehicles, the future is electric, Juhan Härm, co-founder and CEO of electric vehicle charger company VOOL believes. But if current trends continue, Estonia will fall behind its Nordic and Baltic neighbors, he argues.
Recently, Stockholm announced that gasoline and diesel vehicles will be banned in the heart of the city from 2025. The reasons? According to the deputy mayor, air pollution leads to lung diseases in infants and premature death in the elderly.
Stockholm's decisive action against poor air quality extends across a 20-block area in the city center, including its shopping streets and high-rise offices. The ban taking effect on December 31, 2024, will only have exemptions for police, ambulance, and other first responders vehicles. Furthermore, there's talk about extending this ban to more districts in the coming years.
With Stockholm setting the precedent, Estonia needs to step up the game in the electric vehicle (EV) revolution. Even with our introduction of the car tax, which incentivizes lighter and cleaner vehicles, notably offering a gentler tax structure for EVs, there's still room for more aggressive policies.
Other major European cities have also implemented or are considering restrictions or taxes on combustion engines to combat air pollution and encourage a shift to greener vehicles. This aligns well with the EU's "Fit for 55" initiative which aims to reduce greenhouse gas emissions by 55 percent by 2030. Also, we should keep in mind that from 2035 onwards, the sale of new cars equipped with an internal combustion engine will be officially prohibited within the EU.
Some examples. Paris has rolled out plans to become entirely free of gasoline-powered cars by 2030. There are many cities in France, where you need to pay to enter with a combustion engine car. The same applies to Germany. Madrid has designated a sizable "zero-emissions zone", prohibiting older, polluting vehicles from entering. London has expanded its Ultra Low Emission Zone (ULEZ), levying steep charges on those driving polluting vehicles within this area. This list goes on and on, with new initiatives added monthly, if not weekly.
The Nordics provide a wealth of inspiration in terms of different state subsidies and incentives. The clear leader position is held by Norway where over half of new car sales were EVs already in 2021, and by now, an impressive 86 percent. This remarkable shift was driven not only by their expansive charging infrastructure but also by substantial tax breaks, free city tolls for EVs, and the advantage of using bus lanes in congested areas.
Sweden, on top of its capital's significant decision, has committed to having one million electric cars on its roads by 2030. It isn't merely an ambitious plan but a commitment backed by various incentives like generous purchase subsidies, tax reductions, and prioritized lane access for EVs.
Meanwhile, Denmark aims to ban new petrol and diesel car sales by 2030. To achieve this, the government is bolstering its infrastructure, offering financial incentives for EV owners, and significantly, investing in educational campaigns highlighting the environmental and economic benefits of transitioning.
Returning home, we have started the journey but are far from our Nordic peers. The need of the hour isn't merely incentives but a more comprehensive strategy – both in terms of state involvement in favoring choosing an EV over a combustion engine and a pressing need to develop public EV infrastructure.
There is room for development in the Baltic countries
Our Baltic neighbors have also started to act. Lithuania hopes to see 50,000 electric cars on its roads in two years, and an ambitious goal of 240,000 has been set by 2030. Considering that the number of electric cars on Lithuanian roads has increased sixfold in the last three years, this goal does not seem unattainable. The state of Lithuania supports the purchase of an electric car.
Currently, Latvia has become a benchmark among the three Baltic states. In the European Union, Latvia ranks seventh in the growth of the share of electric cars, the share of electric vehicles has increased tenfold in the last four years and doubled compared to the previous year. Growth continues. The Latvian state also supports the purchase of electric cars.
What is the situation in Estonia? We also have the state's financial support for electric car buyers, and the market share of electric cars has gradually increased. However, their size is still ridiculous: 5,000-6,000 of the nearly one million registered vehicles are fully electric. However, electric cars already make up a very considerable part of the sales of new cars, about half of the new vehicles currently sold are at least partly electric. But while infrastructure is growing, and although the planned car tax favors the owner of an electric car, the gap with cars with an internal combustion engine is still not large enough.
Unfortunately, we are still very far from our Nordic neighbors. The experience of the Nordic countries teaches that the road to preferring electric cars requires political decisions and cultural shifts at the grassroots level. At the same time, the sensible decisions of policymakers encourage our willingness to bend our views. The countries around us have decisively chosen a more environmentally friendly and healthy path.
In any case, the future is electric. The question is, will Estonia charge ahead or lag behind?
Editor: Helen Wright