Electric car warning signals as Denmark calculates cost of switch By Reuters

Electric car warning signals as Denmark calculates cost of switch

© Reuters.

COPENHAGEN (Reuters) – A rapid switch from to electric cars to meet Denmark’s ambitious climate targets will leave a massive gap in its finances, a government commission said on Monday.

Moving to electric vehicles from those powered by fossil fuels is central to Denmark’s goal of cutting emissions by 70% by 2030 and becoming climate neutral no later than 2050.

However, the Nordic country relies heavily on car and road taxes worth some 50 billion Danish crowns ($7.95 billion) a year, or 2.3% of GDP, to fund its welfare system.

In March, the Danish Council on Climate Change, an independent advisor to the Danish government, said the number of electric cars should rise to at least 1 million by 2030 from less than 20,000 now in order to meet the targets.

“This would create a significant problem for the economy,” commission head Anders Eldrup told a press briefing.

Increasing the number of electric cars to 1 million through raised subsidies and higher taxes on fossil-fueled cars would result in a total net loss to society of 5.7 billion crowns in 2030, the commission said.

Under the current tax system, proceeds from car and road taxes are already set to drop by 10 billion crowns each year in 2030, it said.

The commission was asked by the government to suggest how to switch from fossil fueled cars to electric cars in the coming decade without jeopardizing the state budget.

The transport sector contributes about 40% of Denmark’s carbon dioxide (CO2) emissions, with less than 1% of cars powered by electricity.

With favorable conditions and early support from the government, Denmark now gets about half of its power from wind turbines and is seen as a pioneer in addressing climate change.


Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

About us

InvestLab is a financial services technology company focused on the global trading market. Founded in 2010 in Hong Kong, the company develops trading, market data, and social research products that enable individual investors and small to mid-size brokers to access global markets. We provide brokers and financial institutions cross border capabilities for retail investors into 43 markets globally.