Norway became the first country to sell more electric cars than petrol, hybrid and diesel engines put together last year, new data shows, with battery electric vehicles (BEVs) accounting for two-thirds of sales in the final months of 2020.

Norway has one of the world’s most ambitious green targets, planning to phase out sales of all new fossil-fuel vehicles by 2025, five years earlier than the UK.

It is quite a contradiction in a country that has become one of the richest in the world on the back of its oil and gas revenues, has made itself dependent on oil, and clings to further production even as the world increasingly rejects fossil fuels in pursuit of zero emissions.

While on the one hand the government is auctioning oil exploration licences for fields in the fragile Arctic, on the other it is aiming for a carbon-neutral national vehicle park by 2030. On Friday, it submitted its national plan on climate, which included this ambitious aim and the promise that, from next year, the public sector would be required to procure zero-emission vehicles only.

While Norway is still one of the world’s big oil producers, it gets more than 90% of its power from hydroelectric sources. This goes some way to explain why the introduction of electric vehicles has been such a winner: as long as the rivers and waterfalls don’t run dry, this is an infinite source of power that can also be applied to vehicles. Even up north, where distances between settlements are vast and the winter cold extreme, the electric car is gaining a stronghold.

Christina Bu, head of the Norwegian Electric Vehicle Association, said: “During the autumn of last year, we saw an increase of up to 40% of the market share in the northernmost districts of Norway, Troms and Finnmark.”

Behind the success lay a long-term political strategy, she said. “One might assume this is all about subsidies. It is not. It’s all about taxing what we don’t want and promoting what we do want.”

Greenpeace activists boarding an oil rig in a fjord off the West coast of Norway in 2018.
Greenpeace activists boarding an oil rig in a fjord off the West coast of Norway in 2018. The country is one of the world’s biggest oil producers. Photograph: Reuters

Norway has some of the highest taxes in the world on what it regards as luxury goods, which includes cars. So reduced taxes on vehicles, with numerous incentives, is bound to entice car buyers. There is a range of incentives and exemptions including:

• No vehicle purchase tax (a big levy which helps push up the average price for a vehicle in Norway to £43,000-£46,000, compared with an EU average of £26,000-£29,000)

• No VAT – usually 25%

• Zero road tax

• Free parking in some municipal car parks

• Reduced tax on company electric cars (at a lower rate than fossil-fuel vehicles)

• Reduced or free tolls in some areas

• Driving in a bus lane if carrying a passenger

• 50% discount on some car parks, tolls and ferry fares

The ambitious political strategy goes back to the late 1990s, when it was introduced to stimulate production of Norwegian electric cars and to reduce emissions.

It hasn’t entirely worked out that way. Norwegian-produced BEVs are still noticeable by their absence, to the delight of foreign car producers. But the number of electric cars sold has soared, from 3% of total sales in 2012, to 54% in 2020. There are 2.8m vehicles on Norway’s roads and more than 260,000 are fully electric, nearly 9% of the total car stock. Next year nearly 40 new BEV models will go on the market in Norway, more than the number of fossil-fuel and hybrid models.

“Norway has certainly paved the way for the industry,” said Per Espen Stoknes, who is an MP for the Green party, a TED global speaker and an assistant professor at BI Norwegian business school as well as a psychologist, whose latest book is on the psychology of climate action.

Stoknes described the process of expanding the national BEV park as “a green tax shift”, which he thought any country could afford if they focused on the right things. As a psychologist, he also emphasised the power of social pressure, in particular in densely populated cities.

“We have been able to prove statistically that there is a keeping-up-with-the-Joneses effect. That is to say, if someone in a street buys a BEV, the neighbours are more likely to follow suit. It can turn into a greener-than-thou competition in which envy, as always, is a powerful driving force.”

As in the UK, the big challenge is the installation of charging points around the country. There are now 3,200 rapid charge points, run by about 10 companies, which are working to develop ever faster chargers. There are still problems, particularly on the busiest travel days, with BEV drivers facing long queues and chargers that are out of commission. Bu said: “We have to constantly encourage the development of further and more reliable chargers.”

The more electric cars are sold, the harder it is for critics to be heard. However, although BEVs are environmentally friendly in a local context, globally they still leave big climate footprint. The manufacture of BEV batteries requires expensive and rare metals, while the secure disposal of used and broken batteries is a problem. Both concerns are conveniently palmed off on poor, vulnerable countries – such as the Democratic Republic of Congo, which produces 60% of the world’s Cobalt – that lack the legislation to deal with them.



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