Polish government presents its Plan for Electromobility Development - One million electric vehicles on Polish roads by the end of 2025?

28.09.2016

On 20 September, the Minister of Energy released the National Policy Framework for Alternative Fuels Infrastructure Development for public consultation. The objective of the programme is to encourage Polish consumers and businesses to purchase alternative fuel vehicles (AFVs). The government plans to introduce a wide range of incentives for this purpose.

Plenty of room for AFVs on the market

There are over 23 million vehicles in Poland. Around 99% of them have conventional fuel engines (56% petrol, 28% diesel, 15% LPG) while the rest are mainly hybrids. The number of fully environmentally friendly cars is just several thousand. Fewer than 20 electric buses are being tested across the whole country. The Plan for Electromobility Development is intended to radically change this situation.

The cost of a traditional car remains significantly lower than the cost of an AFV, which ranges from PLN 80,000 to 220,000. However, the most serious barrier to the popularity of electric cars is the small number of charging points (approx. 300, all located in major cities).

The carrot approach

Later this year, pilot projects will be launched in the largest metropolitan areas, with wider expansion planned for the years after 2018. The government’s ambitious target is to install 6,000 charging points, which would create a convenient infrastructure for 1 million AFVs in 2025.

Implementing this strategy requires an appropriate legal framework for the dynamic development of electromobility. Ministerial experts propose an incentive in the form of a sensible tax policy for electric cars, in particular a significant reduction in VAT and registration fees as well as an exemption from excise duty. The plan also envisages creating a convenient infrastructure for AFV users, including providing free public car parks and allowing AFVs to drive in bus lanes. At a later stage, a programme of direct subsidies covering the first 100,000 electric cars for consumers will be established. Purchases of new vehicles would be supported by the Low-Carbon Transport Fund, which will start in 2018.

Made in Poland

On 22 September, the President of the Polish Office of Competition and Consumer Protection approved the founding of a special-purpose vehicle by the four largest Polish energy companies (Enea, Energa, PGE and Tauron). Such a vehicle is intended to create an economic, organisational, technological and scientific basis for the development of electromobility in Poland. The main goal of this entity is to finance the construction and launch of large-scale AFV production. The first proposals have already been presented by teams of scientists from AGH University of Science and Technology in Krakow and Warsaw Technical University. In addition, three copies of a prototype electric bus built by the company Solaris have already begun test service.

Challenges and opportunities

The preliminary assumptions made by experts under the auspices of the Minister of Energy and Minister of Development will become the nucleus of a broad debate, the conclusions of which will be reflected in the draft Electromobility Act. The adoption of the new law is planned for next year.

Implementation of the plan, involving huge financial and organisational efforts, will be a tough challenge for the already overburdened Polish energy grid. Electricity suppliers are counting on the use of transmission capacity in the night-time troughs, when demand for power is much lower. Furthermore, anticipated state aid and tax benefits must be approved by the European Commission as well. However, successfully boosting the trend for electric cars in Poland may prove to be a substantial stimulus for the whole power and industrial sector.