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Norway leads the way in electric vehicles

Norway, a pioneer in electric vehicles (EVs), is showing a remarkable increase in new electric car sales. According to Christina Bu, secretary general of the Norwegian Electric Vehicle Association, the percentage has increased from 3% in 2012 to nearly 80% by 2022.

Causes of the growth

Norway is leading the way in the adoption of electric vehicles due to a combination of policy measures and the country’s wealth, which comes from its large oil reserves. The country levies high import duties and taxes on cars, making cars significantly more expensive than in most other countries. By not applying these taxes to electric vehicles, Norway effectively subsidizes the purchase of EVs at a level that other countries cannot afford. Moreover, electric driving in Norway is made even more attractive by free parking facilities.

What makes Norway’s electric vehicle growth even more remarkable is that the country uses hydropower almost exclusively for electricity generation. This makes driving an electric car in Norway even cleaner than in countries that rely heavily on coal.

Fossil fuel

Despite these impressive numbers, Norway continues to struggle to completely stop using fossil fuels. Gas and oil still play an important role alongside electric sedans. In their report, the Norwegian EV Association acknowledges that the transition to EVs in Norway requires significant efforts. The country is investing $1.8 billion annually to support this transition.

While the transition to electric cars has had a positive impact on fuel consumption in Norway, the report’s findings also show the limitations of EVs in reducing overall fossil fuel use and achieving net zero emissions. Currently, more than 20% of cars in the country run on batteries, which has led to a reduction in gasoline consumption. However, diesel still accounts for 43% of the distance traveled in Norway, and heavier trucks continue to run largely on diesel.

Oyvind Solberg Thorsen, director of the Norwegian Road Federation, said that diesel consumption is only 10% below the 2015 peak, despite the advancement of battery vehicles. Terje Aasland, Norway’s Minister of Petroleum and Energy, acknowledged that Norway is still dependent on petroleum products, due to several industries and systems for which there is no easy replacement yet. He pointed out that although fossil fuel use can be reduced in the transportation sector, oil will still be needed for industrial purposes.

Challenges

Although Norway has made great strides in the adoption of electric cars, the report highlights that challenges remain in fully replacing fossil fuels. It also highlights the importance of understanding the limitations of electric cars in achieving net zero emissions and reducing overall fuel consumption.

Sources: Bloomberg, OFV

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