Is an Electric Vehicle Boom About to Take Off in Finland?

Nothing More Certain than Taxes

Unlike some other countries, electric vehicles do not, at the moment, have special tax benefits in Finland. However, EVs belong to the lowest tax class in all three tax groups: car tax, motor vehicle tax and tax on driving power. Nevertheless, actual financial incentives to promote electric transportation remain few. At the moment there is no CO2 tax, but the topic is brought up regularly.

On the other hand, companies investing in electric vehicles may be eligible for energy investment support from the Ministry of Employment and the Economy. The support is only available for companies leasing an electric car or building a charging station on their premises. The support period of 36 months is expected to end in 2017, and companies that want to benefit from the 35% funding for cars and 30% for charging stations should apply at the latest in April 2015.

Battery Low?

Finland currently has some 250 EV charging stations, 35 of which are located in Helsinki. The stations are built and operated mainly by private operators, since the government does not actively participate in the construction of charging networks, but focuses instead on coordination and support. The charging station network is expected to expand in 2015 when the first Tesla Supercharger stations are opened in Southern Finland. Auto-Outlet Oy, the company that imports Teslas into Finland, looks like it’s going to have a busy year!

In Helsinki, regular parking is also cheaper for clean vehicles such as EVs. Some parking operators even provide free downtown parking for EVs. A general 50% discount on parking fees in city-operated areas requires a special sticker available at the city engineer’s office. Even cheaper parking and the right to drive in bus lanes are being discussed in Finland, but there are no concrete plans yet.

Even though there is political will to encourage electric transportation in Finland, some legal obstacles still need to be removed. For example, in housing companies, parking and charging electric vehicles easily collides with the general principle of equality between residents when it comes to sharing parking spots and investing in additional electricity services. In addition, the Limited Liability Housing Companies Act provides no clear opinion in cases where residents wish to install charging facilities on their own to parking spots they are using.

Residents with electric cars do not, in general, have priority to plug-in parking spots. On the contrary, the general meeting of residents may even decide to forbid charging electric vehicles in parking spots altogether. In addition, the charging costs may require payment either according to consumption or by monthly instalments.

Vroom Goes the European Electric Car

EU incentives in the EV field also have an effect on the Finnish market. Many European countries are promoting electric transportation by funding a comprehensive charging network or offering investment support for EVs. For example, France plans up to grant EUR 10,000 in support to drivers who switch their old diesel car to a new electric one.

On the other hand, state aid, even when given for environmental reasons, may restrict competition in the Union, since building an extensive network of charging stations requires cooperation with a broad range of actors. For example, contracts between car manufacturers and energy suppliers can exclude other actors from the market. However, the environmental advantages of promoting electric transportation are often emphasised in the EU over market issues, and even state aid has exceptionally been accepted in several cases.

The Union has also taken important legal steps in order to develop and enhance a Europe-wide charging station network. By 2020, the network should be extensive enough make commuting in cities and along main roads by electric means feasible. Also, EV plugs have been harmonised on the continent so there’s no need for adapters between, for example, Utsjoki and Gibraltar. Safety and recycling issues have also been taken care of. For example, by 2021, pedestrians will be better aware of the currently quiet EVs, since they will be equipped with warning sound systems. At the moment EVs are already subject to the same security requirements as other cars.

All in all, the increase in the number of EVs on the roads is making life interesting, even for lawyers. The upcoming years will likely bring new developments both at the Finnish and European level, hopefully making green driving even more attractive.