POLITICS & INSTITUTIONS - ECONOMY

E-mobility: Chicken and egg question solved



Chair of the British Chamber of Commerce in Luxembourg Daniel Eischen is pictured plugging in his electric hybrid Mike Zenari

Chair of the British Chamber of Commerce in Luxembourg Daniel Eischen is pictured plugging in his electric hybrid Mike Zenari

In 2020, Luxembourg energy minister Claude Turmes estimated that in 2021, most cars in Luxembourg showrooms would be electric or hybrid.

Critics say that Claude Turmes’ electric vision to have half of the country’s private vehicles as EVs is “utopian” but the green party energy minister’s optimism is not blind. Faced with EU pressure to reduce carbon emissions (CO2 capped at 95g/km in 2020 and 65g/km in 2025) manufacturers (OEMs), among them luxury and muscle brands like Bentley and Harley-Davidson, are racing to release new electric and hybrid plugin (PHEV) models. At the same time, models at the cheaper end of the market are driving much of the change. According to Jato Dynamics, Europe’s best-selling Renault Zoe helped the EV segment grow 34% in the first half of 2020.

Overtaking diesel

“OEMs are really coming with models--I think the chicken and egg question is solved,” says Philippe Vangeel of the European electric vehicle federation Avere. If EVs and PHEVs don’t dominate showrooms, they will be more numerous than their diesel counterparts--across Western Europe PHEV and EV sales in 2020 are outstripping those of diesel. Vangeel credits the empty roads at the start of the pandemic for inspiring this change of mindset. “Worldwide, we have seen what it means to have silent cities and clean cities. This is a side effect of e-mobility.”

In Luxembourg, diesel fuel duty hikes and a €2,500 cashback on new PHEVs and €5,000 on electric and hydrogen-fuelled vehicles have helped push e-mobility transition, but progress is slow. At the start of 2020, EVs and PHEVs made up 2.5% of the nation’s fleet. According to automotive sector federation Fedamo, they accounted for 16.5% of the 4,073 vehicles sold up to September.

The Bentley EXP 100 GT, an electric and autonomousgrand touring car at the Festival Automobile Internationnal in Paris, in January 2020. Photo: Shutterstock

Norwegian strategy

Further inspiration could be found in Norway, where EVs make up 80% of sales. Its government has spent over a decade developing incentives to ease transition, for instance scrapped tolls, VAT, road tax and parking fees for EVs, effectively making it more expensive to drive an internal combustion engine vehicle (ICE). If that weren’t enough, Norway will ban the sale of ICE vehicles by 2025.

The behaviour changes required to transition remain challenging in Luxembourg, particularly when it comes to charging. Batteries will have to be topped up more frequently and charging will be done anywhere “like with a mobile phone”, says Vangeel. But there is a perception of a scarcity of charging points. The Luxembourg government came under fire for lagging behind in its pledge to roll out 800 public “Chargy” charging stations, having reached just 43% of the target in May 2020.

Although the European Alternative Fuels Observatory recorded that in 2020 Luxembourg had 965 charging points--one for every seven vehicles--many of these may be private.

The game changer

The EU’s alternative fuel infrastructure directive, which aims to have 1 million charging points on the road by 2025, could help diminish battery anxiety. Another consideration is the lack of harmony between charging systems across Europe. Large fuel sale operators are also rolling out solutions. In November, Shell rolled out a single card that can be used across 1,000 NewMotion charging stations within Luxembourg.

Arguably, the biggest change will come in 2024 when the cost of owning an EV or petrol vehicle will reach parity. Vangeel says: “In many ways the total cost of ownership [for an EV] will be cheaper in a few years.”

This article was originally published in the January 2021 edition of Delano Magazine