Here’s some great news for our environment lovers! The tiny oil rich Norway in northern Europe (Scandinavia) might be the last country one would expect to give a huge boost to Tesla, yet it appears that the wealthy Nordic nation is poised to make a dramatic change that could be the start of a new trend.
Norwegian legislators are reportedly preparing an energy policy to ban or at a minimum significantly reduce the allowable sales of cars and trucks that run on fossil fuels by 2025 – less than a decade from now. That policy, while designed to help combat climate change and usher in a future of emissions free vehicles, is a huge boost to the company most closely associated with those vehicles today, Tesla.
Øyvind Korsberg, an MP for the Progress Party, explained how far-reaching the consequences of the new plan could be. “After 2025 new private cars, buses and light commercial vehicles will be zero-emission vehicles. By 2030, new heavier vans, 75% of new long-distance buses, 50% of new trucks will be zero emission vehicles,” he said, referring to the targets stated in the white paper on the energy policy mapped by the Norway’s Petroleum and Energy Ministry drafted in April this year.
All of this is a longer-term boost for Tesla that does very little for sales right now, but these types of actions do make it clear that electric cars are more than just a temporary fad. They appear to be here to stay. To be fair of course, Norway has a very small automotive market with only about 150,000 cars sold in the country last year.
Nonetheless, 150,000 cars that were all electric would be a meaningful slice of demand for Tesla. For Tesla, which is the world’s most iconic manufacturer of electric cars, Norway is one of the most attractive markets. That is largely because the country offers generous incentives and rebates related to electric vehicles and the country is a leader consumer of environment-friendly products. Tesla cars are actually quite popular in Norway.
The move toward electric vehicles is part of a dream shared by those concerned about climate change and about fossil fuel depletion (especially oil depletion), namely, to turn the world into one big all-electric paradise, run everything that we can on electricity!
Theoretically, this is possible, but getting there will not be easy. First, such a transition will take time. The transition to an all-electric private car fleet would take about 15 years based on Norwegian private car registrations in 2015 and the current total number of registered private cars.But the ban would not take effect until 2025.
While Norwegian electric car registrations are rising, so are total car registrations. Even if we generously assume that the rise in electric car registrations between now and 2025, will shave five years off the transition, that would still means that Norway won’t achieve an all-electric private automobile fleet until 2035. And, Norway is already a leader in the move toward all-electric transportation. Other countries lag far behind.
The Norwegian MP leader also pointed out a second difficulty in the transition to an all-electric world. Norway gets 95.9% of its electricity from hydroelectric dams. It gets another 1.6% from wind turbines. Only 2.5% of its electricity comes from thermal power plants, the kind that burn fossil fuels such as coal and natural gas and that provide 66% of the world’s electricity. Last year, Toyota pledged to stop producing gasoline-only vehicles over the next 35 years and instead focus on hybrids and fuel cells.
But Norway’s stance on green energy is an interesting one. Though the Scandinavian country generates more than 90% of its energy from renewable hydropower, it is also Europe’s largest petroleum producer. Fossil fuels make up 45% of Norway’s exports and 20% of its GDP. Norway already has the highest percentage of electric vehicle market share of any country.
Speaking about the possible 2025 ban on non-electric cars, Elon Musk, chief executive of USA electric car company Tesla Motors, lauded the announcement – “Just heard that Norway will ban new sales of fuel cars in 2025. What an amazingly awesome country. You guys rock!!”, he tweeted.
What’s probably most remarkable here is that Norway is currently one of the world’s largest oil exporters. India confirmed that it is evaluating a similar energy scheme for all its fleet to be fully electric by 2030 and the Dutch and German governments are discussing the possibility to ban gas-powered car sales and only allow electric vehicle sales starting also by 2025.