Germany has announced it will put about $1 billion towards electric vehicles in a new push to increase clean transportation. Car buyers will see a 4,000-euro discount (U.S. $4,530) on electric vehicles and a 3,000-euro discount ($3,398) on hybrids. In addition, the country will spend 300,000 euros to install more vehicle charging stations.
The government and car makers will share the cost of the rebates, which are only available on cars costing less than 60,000 euros (about $67,960), Reuters reported Wednesday.
“With this, I believe we will be able to give a boost to quickly move the number of vehicles (sales) to a considerable level,” Finance Minister Wolfgang Schaeuble said.
Germany has a goal of a million electric vehicles on the road by 2020, but it is well short of that goal. Currently, there have been only about 50,000 electric vehicles sold.
The United States has also tried to increase the number of electric vehicles on its roads — and has also fallen short. In January, Secretary of Energy Ernest Moniz pushed back the date for a million electric cars to 2020 from the administration’s earlier goal of 2015. As of January about 400,000 of the United States’ 250 million cars and trucks were electric. The lack of uptake has been blamed on low gas prices — which have halved over the course of Obama’s presidency. Generally speaking, low gas prices disincentivize consumers from buying electric vehicles.
But gas prices are expected to bounce back — and car manufacturers are getting ready. Volvo announced last week that all of its models will be available in a hybrid version and that it will release its first all-electric vehicle in 2019. The company aims to sell a million electrified cars — which includes hybrids — by 2025.
Meanwhile, Tesla recently unveiled its long-awaited Model 3, a low-cost model expected to be priced starting at around $35,000. So far, there have been nearly 400,000 preorders for the vehicle, CEO Elon Musk told reporters.
It’s a big deal to transition the transportation sector off fossil fuels. In the United States, transportation accounts for roughly a quarter of total emissions — second only to the electricity sector.
But moving toward electric vehicles is only part of the solution. Electric vehicles need to be charged — which means they are only as green as the grid is. So with the rise of electric vehicles, investment in renewable energy is more important than ever.