EV ADOPTION BY YEAR
Major Developments in 2020
The effects of the Covid-19 pandemic on society and the global economy are unprecedented, the consequences for the automotive industry are significant and the recovery is still expected to be slow and complex. The reduction in economic activities, as well as frequent lock-downs, curfews and travel restrictions, including working from home, immediately generated a collapse in industrial demand and production in the first half of the year. This situation was difficult to recover in the second half of the year because the virus began circulating again in the fall. Nonetheless, the forecasts and targets for development objectives of electric mobility have not changed and continue indicating a massive introduction of electric vehicles that will be significantly felt from 2025.
New policies, legislation, incentives, funding, research, and taxation
In Italy, the “Budget” Law 2019 introduced a “bonus-malus” system for purchasing new vehicles.
Direct incentives for purchasing new passenger cars
From 1 March 2019 to 31 December 2021:
- Anyone who purchases (even with a lease) and registers a new passenger car in Italy with CO2 emissions below a given threshold value, will be provided with a bonus (in the form of a discount) depending on the amount of CO2 emissions per km.
With the “Recovery” Law-Decree and the “August” Law-Decree establishing urgent measures on health, job and economy support, as well as social policies related to the epidemiological emergency due to COVID-19, funds for purchasing EVs were increased and the number of beneficiaries was extended.
Taxation for purchasing polluting cars
On the other hand, anyone who purchases (even with a lease) and registers a new passenger car in Italy, that exceeds the threshold value of 160 gCO2 per km, will be charged with a tax depending on the amount of CO2 emissions per km.
New cars with CO2 emission values between 111 and 160 g/km are exempt from the incentive as well as from any taxation.
Indirect incentives on EVs
Indirect incentives are mainly issued at a regional level. The reduction of the annual registration tax is the most used type of indirect incentive. Usually, electric vehicles are exempt from the annual registration tax for a time period of five years starting from the date of the first registration. After this initial five year period, they benefit from a 75 % reduction of the value that would be applied to the equivalent petrol vehicles of the same power. On the other hand, hybrid vehicles are exempt from the yearly registration tax for a time period of two - five (usually three) years from the date of the first registration. After this period the full conventional tax will be applied.
Incentives on charging points
According to the “Balance” Law 2019, taxpayers are granted a tax deduction (to be distributed in 10 years) for costs incurred from 1 March 2019 to 31 December 2021 regarding the purchase and installation of EVs charging infrastructures. Initial costs for demanding additional power up to 7 kW are also included. This tax deduction is in the amount of 50 % of the costs on a total amount not exceeding 3,000 EUR. The charging infrastructures must have one or more not publicly accessible standard charging points.
On October 2020, the Italian Polytechnic Institute in Milano published the “Smart Mobility Report” that, beside reporting a detailed analysis of technologies, regulations and current car market, presented forecast results from 3 market scenarios that can be summarized as follow:
- “base” scenario: this scenario foresees an adoption of electric vehicles that does not go beyond 3.5 million vehicles in 2030;
- “moderate” scenario: in this scenario, electric vehicles reach 5.5 million in 2030, over 14 % of the fleet total;
- “accelerated development” scenario: this scenario foresees that in 2030 the registrations of electric vehicles will amount to 65 %, reaching about 7 million (almost 20 % of the total).
A common factor between these three scenarios is that the real impact of electric vehicles will start giving its result around 2025. It should be noted, the value foreseen by the moderate scenario in 2030 is close to that envisaged by the Integrated Energy and Climate National Plan, equal to 6 million electric vehicles. With regard to public charging points for electric vehicles by 2030, forecasts show a minimum of 47,000 in the "base" scenario, to a maximum of 70,000 in the most developed scenario, passing by approximately 60,000 in the moderate scenario. With regard to private charging points for electric vehicles, the "base" scenario foresees a diffusion that does not go beyond 1.8 million units by 2030, while in the moderate scenario the private charging points exceed 3 million and, in the accelerated development scenario, private charging points exceed 3.9 million units. Similarly to what is shown in the forecasts on the market of electric cars, the spread of private charging points shows a very sustained growth between 2025 and 2030.