3FOOD

Third Industrial Revolution Consulting Group
- Establishing a “demand report” for public charging stations in urban and suburban areas
for the next 10 years as a basis for EV infrastructure development within the country.
- Assuring the standardized accessibility of charging points by providing the necessary
regulations. Access could be provided by NFC, Passports, credit card or by QR-code.
- Developing a roadmap on charging infrastructure along highways and promoting its
implementation by regulation or incentives if needed.
Technical innovation will lead to the rise of e-mobility over the next five to ten years. The price
of EVs will become increasingly reasonable, and even cheaper than that of conventional cars
from mid-2020 onwards. Therefore, Luxembourg should take its size and flexibility as well as its
strength to quickly establish the regulatory framework to work in its favor.
1.4 Financial Measures
1.4.1 Subsidize the purchase price of EVs.
To ensure an EV purchase price at the same level of that of conventional cars from the mid-
2020’s, aggressive incentivation is necessary to address the cost barrier in this early stage of EV
development. During this transition period, a significant subsidy should be given until the
purchase price for EV becomes competitive with fossil fuel powered cars.
In 2017, the government will introduce a tax refund of 5,000 euros for zero emissions cars
(Battery electric and fuell cell hydrogen cars) and will also reevaluate taxation of company cars
to favor the shift to zero and low emission vehicles. A different taxation based on emissions will
be applicable for leasing cars and will take into account three main categories: 100% electric or
fuel cell hydrogen vehicles, diesel and hybrid diesel, as well as petrol and compressed natural
gas (CNG) engine. 88 Diesel vehicles will be penalized compared to electric or gasoline cars.
These new incentive measures introduced in 2017 will be a good starting point. However, a
more drastic game-changing measure is recommended: an ambitious incentive scheme
whereby EV purchase price does not exceed the price of traditional cars. In the short run, new
fiscal instruments taxing polluting vehicles and incentivizing emission-free vehicles have to be
put in place following the bonus-malus approach (fiscally neutral and polluter-pay principle). In
order to avoid an export market based on subsidy arbitrage, it should be on the condition that
the owner will not sell the car within a defined period or mileage. The incentive could be tied to
investment in renewable energy systems within the country. Energy suppliers could offer “EV
electricity” based on RES, and EV buyers could be bound to use it.
88 See: www.reforme-fiscale.public.lu
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