You may know that Norway is an oil-rich country within the European continent. But did you know that as a percentage of its population, Norway has 4x the green car sales of California, and in March 2018, green cars accounted for 55.8% of all new registrations? And throughout Europe, over one million plug-in cars have been registered up until June 2018 - almost 30% of which (275,000 vehicles) have been from Norway.

So how - and why - is this small Scandinavian country with a population of 5.2 million leading the World in per capita levels of green car sales? (We say per capita - aka per person - because China and the US sell more green cars overall, due to their much larger population)

Why

Lets start with the why. As you’re no doubt aware, climate change has meant that various Governments are taking coordinated action to reduce their greenhouse gas emissions. To help meet their goals, Norway set themselves a target of having 100% of their car sales be from green cars by 2025 (just 7 years away!).

Flag of Norway Norway EV Key Stats

  • 5,200,000 - population
  • 55.8% - March 2018 EV sales
  • 25% - VAT on gasoline cars
  • 0% - VAT on electric cars
  • $3,100 - extra cost for gasoline version of VW Golf
  • 70% - electric car fans who also own a gasoline car
  • 578 - number of citizens per charging station
  • 3rd - total electric car sales (c.f. other countries)
  • 119th - population of Norway (c.f. other countries)

How

To meet their ambitious target, Norway firstly suspended the import taxes on cars (for zero emission vehicles) in 1990, then made this change permanent in 1996 whilst also reducing the annual registration tax. Later on, they made green cars exempt from parking charges in 1999 and scrapped VAT on them in 2001. In addition to other ‘green car benefits’ (such as being able to use bus lanes in 2005 and using ferries freely in 2009), Norway quickly became one of the most financially rewarding countries for green cars.

Because hydrogen cars weren’t mainstream from 1990 - 2010, more readily available electric cars became the beneficiary of these generous green car measures.

Cost of buying an electric vs gasoline car

Because gasoline cars had import taxes levied on them, and also 25% VAT (whilst electric cars do not), the cost of buying cars in Norway are opposite to many countries:

  • An electric VW e-Golf would cost approximately $36,317 in Norway, whilst the petrol VW Golf 1.2L would cost $39,417 (with current exchange rates) - $3,100 more. This is because the petrol version incurs $7,531 in import/registration fees, and a further $6,376 in VAT.
  • In the UK, the e-Golf would cost £29,230 ($37,531); compared to the petrol Golf costing £19,755 ($25,365).

In other words, due to Government policies within Norway, buying an electric car works out much cheaper than a petrol car - especially when compared to countries without great electric-vehicle subsidies (like the UK, which recently cut their EV subsidy by one-third).

As we analysed previously, the fuel costs for any particular journey is substantially less with an electric car. So in the case (like Norway) where it’s cheaper to buy an electric car in the first place, it’s financially a better decision overall to purchase an EV compared to a gasoline-powered car.

Do they have enough charging stations?

Since there’s no financial reason not to buy an electric car in Norway, the only other main reason people might be put-off is if there’s a lack of charging stations. So what’s the situation in Norway?

Well range anxiety is an issue, and according to Christina Bu of the NEVA, 70% of its members also own a gasoline-powered car because of concerns about not being able to rely purely on an electric car (especially when travelling into the mountains to go skiing or to their mountain cabins).

Looking at the statistics, Norway has 7,141 standard charging stations as at 2017, then 1,500+ fast charge 50 kWh chargers (Chademo and CCS), and also 338 Tesla superchargers. Oslo has the lions share of charging stations, with 1,996 points, compared to Akershus with 1,117 points and Hordaland with 932 charging points. This does, however, mean that these 3 cities have 36% of all Norway’s charging stations (whilst having 33% of Norway’s population)

With approx 9,000 total charging stations (including bespoke ones like Tesla’s superchargers) and a 5.2 million population, there is 1 charging stations per 578 Norwegian citizens. This compares to electric cars holding around 10% of the overall car market, and having over 50% recent month-by-month sales. So unfortunately it does seem as though the charging infrastructure is lagging behind the EV sale growth, meaning that a (relative) lack of charging stations is a valid concern for Norwegians.

To conclude

Despite this possible concern however (citizens can naturally have at-home charging points too, which aren’t counted in the figures), Norway has been an exceptional example of how a country can increase green car ownership. They’re the third biggest seller of electric cars in absolute terms (behind China and the US) despite only having the 119th biggest population in the World, and selling more than half electric cars in recent months is a great achievement.