Strong Financial Support For EVs In New Dutch Climate Accord

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A broadly supported “climate accord” presented to the Dutch government on Friday, December 21, by civil society organizations envisions strong financial support for the purchase of electric vehicles (EVs). The accord proposes a subsidy of €6,000 on EV purchases in 2021. This amount will be lowered by €400 per year to €2,200 in 2030.

Although the plans have yet to be adopted by the government and approved by Parliament, the accord is the result of a process initiated and coordinated by the Dutch government at the start of 2018. The aim was to unite as many stakeholders as possible, including industry, business, NGOs, labor unions, and local government, behind a comprehensive plan that will see a fundamental transformation of the economy, much like the Energiewende in Germany. The overriding goal is to reduce greenhouse gas emissions by 49% in 2030 compared to 1990.

A first draft of the plan was presented to the government in July 2018. The final version presented now for the first time takes into account the financial implications of the various proposals. Disappointingly, at the very last moment, environmental NGOs and labor unions refused to sign the accord. However, the NGOs object because they believe heavy industry pays too little in the plan and consumers too much. They are fully behind the proposals around EVs and other proposals stimulating a transition towards renewable energy, which are thus likely to be welcomed by the government.

In addition to the subsidies for EV purchases, the accord proposes an increase in road taxes and sales taxes on gasoline and diesel cars starting in 2021, as well as higher taxes on gasoline and diesel at the pump. EV owners will start paying road taxes in 2025. The accord also contains plans to transform the mobility infrastructure to make more room for EV charging and to reduce road traffic. The Dutch government has said it intends to ban the sale of new diesel and gasoline cars by 2030.

The accord includes many other far-reaching plans. In 2021, all municipalities must identify for each neighborhood when houses will be disconnected from the gas grid. Homeowners will be able to get inexpensive loans to enable them to adapt their houses. The loans will be attached to the house, not the owner, so that they can be sold with the house if necessary. Taxes on natural gas use will go up, and taxes on electricity consumption will be reduced.

Building corporations, which are the largest owners of houses in the Netherlands, will play a key role in transforming the built environment. Each corporation will receive money to renovate 30,000 to 50,000 houses a year. Landlords will be legally obliged to make their houses more “sustainable.” The energy performance of houses will play a larger role in determining maximum rent increases.

The political debate around the climate accord is expected to centre on the costs. Although the aims of the accord have broad political support, there are worries that the plans will be too costly for lower-income households and small businesses.

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Karel Beckman

Energy journalist, analyst and moderator since the turn of the century. Former editor-in-chief of Energy Post and European Energy Review, former reporter at the Dutch Financieele Dagblad (major financial newspaper). I look for the big picture and cover the entire energy sector in all its breadth and depth. Independent, but not ideological (when it comes to energy).

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