Lower Danish taxes backed for home electric car charging

A commission appointed to facilitate conversion to electric cars in Denmark has said motorists should pay less tax for charging them at home.

Lower Danish taxes backed for home electric car charging
File photo: Emil Helms/Ritzau Scanpix

The so-called Car Commission (Bilkommission) has recommended that all private motorists should be offered a reduced tax rate on electricity of 0.8 øre per kilowatt hour when charging their vehicles.

Formed in 2019 to support efforts to increase the proportion of electric cars on Danish roads, the commission looks into how charging station infrastructure can be developed in a report released on Friday.

A previous report by the commission was released last year.

Under current rules, private consumers are allowed to pay the lower rate for electricity for use above 4000 kWh annually if their homes have pre-existing electric heating.

Homes on the heating grid or with gas heating are therefore likely to incur costs of 2,000-3,000 more annually if they charge electric cars at home, the report said.

As such, the commission has recommended a secondary meter for electricity consumption for charging cars.

However, the system could face difficulties enforcing and administrating, it said.

The cheapest way to charge an electric car is by using commercial charging stations, which are taxed at 0.4 øre per kWh.

That charged has been fixed until 2030 as part of reforms to Denmark’s car registration taxes designed to favour electric vehicles.

The commission said that this commercial advantage does not encourage motorists who drive more infrequently to switch to electric.

READ ALSO: How will Denmark's new transport proposal affect the cost of cars?

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Denmark announces plan to put 775,000 electric cars on roads by 2030

Denmark’s government has announced a political deal which it estimates will increase electric and hybrid car ownership to 775,000 by 2030.

Denmark announces plan to put 775,000 electric cars on roads by 2030
Photo: Emil Helms/Ritzau Scanpix

The agreement, between the governing Social Democrats and allied minority parties, was confirmed by the Ministry of Finance on Friday.

Although the overall ambition in relation to green cars is to increase their numbers on Danish roads to one million, a budget is now secured for 775,000, the agreement states.

“This will be a completely decisive reorganisation of road transport so we can take very important steps towards realising climate goals for 2030. The agreement takes us a big step forwards,” finance minister Nicolai Wammen said in at a press briefing.

Denmark aims to reduce its greenhouse gas emissions by 70 percent within 10 years.

READ ALSO: Danish parliament blocks new North Sea oil extraction

“We have an ambition to see a million green cars driving around in Denmark in 2030. We are starting by setting aside finance for 775,000 cars. That reduces CO2 emissions by two million tonnes,” Wammen said.

The government originally put forward a plan to secure 500,000 electric cars within the next ten years, but that number was pushed upwards during negotiations with the left wing support parties.

The opposition Liberal and Conservative parties were also involved in the negotiations until the later stages, but withdrew. The primary criticism of the two parties was the agreement’s increase in taxes and costs on motorists who still drive traditionally-powered cars.

“We want more green cars… but we don’t want Danes to pay more for their cars,” Conservative business spokesperson Mona Juul said.

“It’s rather expensive to buy a car in Denmark as it is. There are a huge number of fees and taxes and so we don’t think a bill worth billions should be sent to people with completely normal cars,” Juul added.

Specific details of the deal’s budget are yet to be published at the time of writing.