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The Norwegian support and subsidy of electric cars. Should it be adopted by other countries?


  • Anders Skonhoft

    () (Department of Economics, Norwegian University of Science and Technology)

  • Bjart Holtsmark

    () (Statistics Norway)


As a result of generous policies to increase the use of electric vehicles (EVs), the sales of EVs in Norway are rapidly increasing. This in sharp contrast to most other rich countries without such generous policies. Due to the subsidies, driving an EV implies very low costs to the owner on the margin, probably leading to more driving at the expense of public transport and cycling. Moreover, because most EVs’ driving range is low, the policy gives households incentives to purchase a second car, again stimulating the use of private cars instead of public transport and cycling. These effects are analysed in light of possible greenhouse gas (GHG) emission benefits as well as other possible benefits of utilizing EVs versus conventional cars. We discuss whether the EV policy can be justified, as well as whether this policy should be implemented by other countries.

Suggested Citation

  • Anders Skonhoft & Bjart Holtsmark, 2014. "The Norwegian support and subsidy of electric cars. Should it be adopted by other countries?," Working Paper Series 15814, Department of Economics, Norwegian University of Science and Technology.
  • Handle: RePEc:nst:samfok:15814

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    1. Ander Pijoan & Oihane Kamara-Esteban & Ainhoa Alonso-Vicario & Cruz E. Borges, 2018. "Transport Choice Modeling for the Evaluation of New Transport Policies," Sustainability, MDPI, Open Access Journal, vol. 10(4), pages 1-22, April.
    2. González Palencia, Juan C. & Araki, Mikiya & Shiga, Seiichi, 2016. "Energy, environmental and economic impact of mini-sized and zero-emission vehicle diffusion on a light-duty vehicle fleet," Applied Energy, Elsevier, vol. 181(C), pages 96-109.
    3. Fanchao Liao & Eric Molin & Bert van Wee, 2017. "Consumer preferences for electric vehicles: a literature review," Transport Reviews, Taylor & Francis Journals, vol. 37(3), pages 252-275, May.
    4. Berkeley, Nigel & Bailey, David & Jones, Andrew & Jarvis, David, 2017. "Assessing the transition towards Battery Electric Vehicles: A Multi-Level Perspective on drivers of, and barriers to, take up," Transportation Research Part A: Policy and Practice, Elsevier, vol. 106(C), pages 320-332.
    5. Geir H. M. Bjertnæs, 2017. "The efficient combination of taxes on fuel and vehicles," Discussion Papers 867, Statistics Norway, Research Department.
    6. Ross Milligan & Saioa Etxebarria & Tariq Muneer & Eulalia Jadraque Gago, 2019. "Driven Performance of Electric Vehicles in Edinburgh and Its Environs," Energies, MDPI, Open Access Journal, vol. 12(16), pages 1-22, August.
    7. Bahamonde-Birke, Francisco J. & Hanappi, Tibor, 2016. "The potential of electromobility in Austria: Evidence from hybrid choice models under the presence of unreported information," Transportation Research Part A: Policy and Practice, Elsevier, vol. 83(C), pages 30-41.
    8. Stef Proost & Mads Greaker & Cathrine Hagem, 2019. "Vehicle-to-Grid. Impacts on the electricity market and consumer cost of electric vehicles," Discussion Papers 903, Statistics Norway, Research Department.
    9. Sousa, Nuno & Almeida, Arminda & Coutinho-Rodrigues, João, 2020. "A multicriteria methodology for estimating consumer acceptance of alternative powertrain technologies," Transport Policy, Elsevier, vol. 85(C), pages 18-32.
    10. Geir H. M. Bjertnaes, 2017. "The Efficient Combination of Taxes on Fuel and Vehicles," CESifo Working Paper Series 6789, CESifo.
    11. José Manuel González-González & Alicia Triviño-Cabrera & José Antonio Aguado, 2018. "Design and Validation of a Control Algorithm for a SAE J2954-Compliant Wireless Charger to Guarantee the Operational Electrical Constraints," Energies, MDPI, Open Access Journal, vol. 11(3), pages 1-17, March.
    12. Vassileva, Iana & Campillo, Javier, 2017. "Adoption barriers for electric vehicles: Experiences from early adopters in Sweden," Energy, Elsevier, vol. 120(C), pages 632-641.

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