The Ultimate Guide to EV Incentives In Germany
ELECTRIC VEHICLES
MANUEL BALZER
Head of Mid Market Sales
|
11 June 2020
Germany is getting serious about boosting EV adoption in the country. As defined in the 2030 Climate Action Programme passed in October last year, the Government aims to have up to 10 million EVs and 1 million charging stations on German roads by 2030. To achieve this ambitious objective, several EV incentives have been extended or added. Additionally, the recently announced post-COVID-19 stimulus package of €130 billion is set to allocate significant funding into infrastructure development, tax cuts, and further subsidies to invigorate Germany’s EV market.
All this means that current and prospective drivers can enjoy a wide range of grants, tax incentives, and other benefits when purchasing an EV or charger in Germany. In fact, by taking advantage of the full scope of incentives, a Seat Mii Electric can soon be purchased for less than €11,000. Here is a quick overview of the main incentives available:
EV Incentives in Germany
National EV Incentives
Subsidies
Umweltbonus - save up to €9,000 on the purchase of your EV:
Germany’s ‘Umweltbonus’ (environmental bonus) program (German text) offers grants for the purchase or lease of EVs.
The following incentives apply until 30.6.2020:
- For vehicles priced up to €40,000:
- Fully-electric: €6,000
- Plug-in hybrid: €4,500
- Fully-electric: €6,000
- For vehicles priced up to €65,000:
- Fully-electric: €5,000
- Plug-in hybrid: €3,750
- Fully-electric: €5,000
The following incentives are expected to apply from 1.07.2020 until 31.12.2021 as part of the new economic stimulus package (German text):
- For vehicles priced up to €40,000:
- Fully-electric: €9,000
- Plug-in hybrid: €6,750
- Fully-electric: €9,000
- For vehicles priced up to €65,000:
- Fully-electric: €7,500
- Plug-in hybrid: €5,625
- Fully-electric: €7,500
To find out whether your EV is eligible for a grant and what official price applies for your car model, download the official list of eligible electric vehicles from the Federal Office for Economic Affairs and Export Control here (German text).
In general, car dealers will fill out the grant application form for you. However, if you want to find more information on the grant and complete the application yourself, click here (German text).
Used-cars can also benefit from a subsidy of €5,000 for EVs and €3,750 for plug-in cars, as long as they haven’t already received the Umweltbonus subsidy before.
AVAS Bonus - save €100 on purchases of your EV if it comes with an AVAS
If you’re buying an EV equipped with an Acoustic Vehicle Alert System (AVAS), you can receive an additional bonus of €100.
Tax Benefits
Kfz-Steuer (motor vehicle tax):
- Fully-electric vehicles registered between 2011 and 2030 have a 10-year exemption from this tax. On average, the ownership tax in Germany is around €194 per car and year, but based on the type of car, this figure can even be much higher. You can use this calculator to estimate how much car tax you’d pay if you opt for an ICE car.
- Plug-in hybrid EVs pay the tax, but it’s lower for them than diesel/gasoline vehicles, in proportion with their lower CO2 emissions.
Company car tax:
- private usage of a fully-electric company car with a list price below €60,000, is taxed at only 0.25% of the list price per month. In comparison, Internal Combustion Engine (ICE) cars are taxed at 1%.
- private usage of a hybrid company car or a fully-electric company car with a list price above €60,000, is taxed at only 0.5% of the list price per month. In comparison, ICE cars are taxed at 1%.
VAT:
Will temporarily fall from 19 to 16% between 1 July - 30 December 2020. This tax incentive benefits BEVs as well as PHEVs.
Local and Regional EV Incentives
Subsidies
Depending on your place of residence, you might also benefit from local incentives of up to €1,500 for the purchase of your EV. These are added on top of the national EV incentives explained above, enabling you to save even more money on your purchase. They are offered by some cities and municipalities and can be accessed if you meet certain criteria. Additional local incentives are also often offered by energy providers to new or existing customers, who sign up for their services. You can find a list of several local incentives available at the bottom of this article from the General German Automobile Club (in German). However, due to the high volume of new and expiring incentives at local levels from municipalities and local providers, you might also want to do a quick search on Google for “Elektroauto Förderung [name of your city]” to make sure you don’t miss out on any recent changes in policies.
Additional EV benefits
In 2015 the electromobility law (Elektromobilitätsgesetz) came into effect with the aim of promoting electric mobility in Germany. Depending on the specific implementation of the law in each federal states and cities, EV drivers can enjoy the following benefits until 2030:
- Free parking
- Reserved parking spots
- Bus lane use
This article from the General German Automobile Club (in German) shows some of the specific benefits available in certain regions.
EV Charging Incentives in Germany
National Private EV Charging Incentives
While EV incentives are regulated and harmonized on a national level, benefits for private EV charger purchases and installation vary between cities, municipalities, and federal states. The only nationwide incentive, according to our knowledge, is the following subsidy offered by the German state-owned development bank KfW-Bank:
- KfW-Bank: 10-30% incentive for the purchase and installation of a wallbox charger
To check the different local EV charging incentives in this article, click here.
National Public EV Charging Incentives
In terms of public charging benefits, the German government aims to have 1 million charging stations in the country by 2030. To achieve this goal, The Federal Ministry of Transport and Digital Infrastructure has introduced an incentive program to encourage the roll-out of public charging stations.
Subsidies
- Up to €3,000 for purchasing charging stations of up to 22 kW.
- Up to €12,000 for purchasing DC chargers up to 100 kW.
- Up to €30,000 for purchasing DC chargers above 100 kW.
- Up to €5,000 for low voltage and up to €50,000 for medium voltage grid connections
Tax Benefits
- Private and company car owners of plug-in electric vehicles that charge their cars in their employer premises are exempt from declaring this as a cash benefit in their income tax return (in German).
- Company car owners that charge their EVs at home can even benefit from a tax reduction (in German).
- Employers offering free charging of electric vehicles or bicycles will not be taxed for this service until 2030.
Local & Regional EV Charging Incentives
Incentives from cities and states (examples)
- Nordrhein-Westfalen: 50% (max. €1,000) of purchasing and installation costs of your private EV charger via the Sofortprogramm Elektromobilität
- Munich: 40% of total net costs (max. €3.000 per charging point of up to 22kW capacity; max. €10.000 per fast charging point with capacity over 22kW): includes purchase price, installation, and planning
- Hannover: €500 incentive for purchasing and installing a smart charging station and
- Limburg: €300 incentive per changing point
Incentives from energy companies and other organizations (examples)
- N‑ERGIE: €250 incentive for purchasing and installing a wallbox charger in Nürnberg and switching to the firms eco-energy tariff
- Stadtwerke Marburg: €400 incentive for purchasing and installing a wallbox charger; additional 100€ incentive if you produce your own renewable energy
- Mainzer Stadtwerke: €400 incentive for purchasing and installing a wallbox charger in Mainz and switching to the firms eco-energy tariff
- Stadtwerke Schwedt: €200 incentive for purchasing and installing a wallbox charger in Schwedt and switching to the firms eco-energy tariff
- Wuppertaler Stadtwerke: €150 incentive for purchasing and installing a fast charger in Wuppertal and switching to the firms eco-energy tariff
- Stadtwerke Rastatt: €100 incentive for purchasing and installing a wallbox charger in Rastatt and switching to the firms eco-energy tariff
This list is by no means exhaustive. For instance, several other incentives are provided by energy companies for the purchase of their own EV chargers. Apart from that, new incentives may be introduced by specific cities, states or organizations in the future. As a result, you might also want to do a quick search on Google for “Ladestation Förderung [name of your city]” to make sure you don’t miss out on any recent changes in policies.
Overview of Government Electrification Initiatives & Policies in Germany
As part of both the new 2030 Climate Plan and the recent post-corona economic stimulus package, the German government has pledged funds and development rights to different areas of its transport system to reach the updated electrification goals.
Ongoing and new initiatives include:
- Batteries and infrastructure: As part of the new €130 billion package, €2.5 billion will be spent on battery cell production and the expansion of the charging infrastructure, with Germany aiming to have 1 million charging stations by 2030.
- Electrify petrol stations: The German government has announced plans that will require all gas stations to also offer EV charging in the future. This will mean that fuel stations will now function simultaneously as EV charging stations, helping to increase electric mobility.
- Subsidies for manufacturers: as part of a bonus program for 2020 and 2021, to invest in “new technologies, processes, and plants”.
- Fleet exchange programs: as part of the post-COVID-19 economic stimulus package, these are designed to ensure that small and medium-sized enterprises (SMEs) and social services don’t cut back on the renewal of their fleets during the financial uncertainty of the corona and post-corona economy. The first program is Sozial & Mobil, which will promote electric mobility in urban traffic and support non-profit organizations with an allocated fund of €200 million in 2020 and 2021. The second program is designed for tradespeople and SMEs that use EVs of up to 7.5 tonnes.
- Bus and truck funds: for a limited period until the end of 2021, funding for electric buses, trucks and their charging infrastructure will be increased. Private and municipal operators will receive €1.2 billion to switch to alternative drive systems, as an incentive to make urban transport switch to electric.
Can Germany’s EV Market reach 2030 with a “ka-boom”?
As the world continues to battle the COVID-19 pandemic, industries are beginning to prepare for a recession. In March, auto sales in Germany fell by 37.7% however the plug-in market grew by 33.3%. This expansion in the EV market during the pandemic is a global trend, and according to this Wall Street Journal article, after seeing the benefits to air quality following worldwide stay-at-home measures consumers are more likely to buy sustainable vehicles. When the new Climate Plan was released at the end of last year, Ferdinand Dudenhoeffer, director of Center for Automotive Research, estimated that 5 million pure electric and hybrid EV registrations by 2030 would be a feasible goal. With the positive growth in EV markets and the new budgets, Germany’s sights to double that goal look promising. Olaf Scholtz, finance minister, said the aim was to bring Germany out of the crisis with a “ka-boom”, hopefully exploding their EV market too.
To find out more about incentives in other countries and how they compare to German EV benefits, make sure to check our comprehensive guide on EV and EV charger incentives in Europe.
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