Four purchase subsidies being planned for buying a low‑emission vehicle — new purchase subsidies for the electric vans and heavy‑duty vehicles

The new subsidies, as well as the continuation of the existing purchase and conversion subsidies and an increase of the subsidy amount, are part of the roadmap for fossil‑free transport, on which the Government adopted a resolution on 6 May 2021. The roadmap for fossil‑free transport aims to halve transport emissions by 2030 compared to the level in 2005. The financing of the subsidies has not been decided yet. Appropriations for the subsidies would be dealt with in the context of the 2022 budget and the government financial plan for 2023-2026. 

The aim is to accelerate the technological transition so that the share of zero‑ and low‑emission cars out of new passenger cars sold would increase from the current approximately 20% to as close to 100% as possible by 2030. In addition, the aim is to promote the share of zero- and low‑emission vans and heavy‑duty vehicles in transport. The majority of vans and heavy‑duty vehicles still run on diesel or petrol. Heavy‑duty vehicles account for a large share of greenhouse gas emissions from transport, and the purchase subsidy could facilitate the transition of companies away from fossil fuels. Passenger cars account for approximately 54 per cent and vans and heavy‑duty vehicles for approximately 41 per cent of emissions in domestic transport.

The energy efficiency and power source of cars play a key role in reducing greenhouse gas emissions from transport. The power sources of vehicle are undergoing global transition, and internal combustion engine cars are being phased out.

Four subsidies under preparation in the project

1) New purchase subsidy for electric and gas‑operated vans, for the years 2022-2025

2) New purchase subsidy for electric heavy‑duty vehicles, and extension and increasing the amount of the present purchase subsidy for gas‑operated heavy-duty vehicles, for 2022-2030

3) Continuation of the present purchase subsidy for fully electric cars, for the years 2022-2025, and an increase in the support amount

4) Continuation of existing conversion supports for converting a petrol‑operated car to ethanol or gas, for 2022-2030

What next?

The bill is being prepared by the Ministry of Transport and Communications in cooperation with stakeholders. During the preparation, a consultation round will be held in late summer 2021. Appropriations for the subsidies would be dealt with in the context of the 2022 budget and the government financial plan for 2023-2026.

The intention is to introduce the subsidies in 2022.

Inquiries:

Maria Hyvönen, Senior Specialist, +358 295 342 090, maria.hyvonen(at)lvm.fi

Päivi Antikainen, Director of Unit, tel. +358 50 382 7101, paivi.antikainen(at)lvm.fi, Twitter @PaiviAntikainen

Press release, 6 May 2021: Government decided on means of reducing emissions from road transport - emissions to be halved by 2030
Gateway to Information on Government Projects: Government proposal for a law on purchase subsidies