Republic of Latvia
Cabinet
Order No. 129
Adopted 26 March 2014
On Electromobility Development Plan 2014-2016
1. To support the Electromobility Development Plan 2014-2016 (hereinafter – the Plan).
2. To determine the Ministry of Transport as the responsible authority in implementation of the Plan.
3. To review the issue on assigning additional resources from the State budget so that in 2015 and subsequent years to ensure implementation of measures according to the action directions for introducing the electromobility support policy, at the Cabinet during the process of preparing and reviewing the framework of the draft law on State budget for 2015 and the draft law on medium-term budget for 2015, 2016 and 2017 together with proposals of all ministries and central State authorities for new policy initiatives according to the financial possibilities of the State budget of the respective year.
4. For the Ministry of Transport in co-operation with the Interdepartmental Co-ordination Centre to prepare and for the Minister for Transport to submit the following informative reports to the Cabinet according to specific procedures:
4.1. until 1 July 2015 – the interim assessment of implementation of the Plan;
4.2. until 1 July 2017 – the final impact report on implementation of the Plan, including proposals for the development of electromobility in subsequent years.
Prime MinisterLaimdota Straujuma
Minister for TransportAnrijs Matīss
(Cabinet
Order No. 129 of
26 March 2014)
Electromobility Development Plan 2014-2016
(summary)
The Electromobility Development Plan of Latvia 2014-2016 (hereinafter – the Plan) has been drawn up according to Paragraph 2 of the protocol decision of the Cabinet meeting of 11 December 2012 (protocol No. 70, Section 42, Paragraph 2) “Informative Report On the Need to Establish an Electromobility Co-ordination Centre”, in which it is provided for that the Ministry of Transport together with experts of the Interdepartmental Co-ordination Centre must submit to the Cabinet a draft Plan for examination according to the directions laid down in the National Development Plan 2014-2020.
1. Description of the Situation
Electromobility is one of the components of the field of transport, and it will be incorporated fully in the policy of the field of transport in long-term. It includes the segment of electric vehicles (environment-friendly vehicles which are basically operated by an electric motor) (hereinafter – the EV) and the infrastructure for charging thereof, as a result of which the greenhouse effect is reduced, also CO2 and other harmful emissions and environmental noise level is reduced and fossil fuel reserves are saved at the same time.
1.1. Need for Support to Electromobility
The main three reasons why Latvia needs support for the development of electromobility are as follows:
• to increase the competitiveness of enterprises of Latvia for the creation of a new field of transport;
• to increase the energy independence of Latvia;
• to reduce gases causing pollution and greenhouse gas effect.
The industry of vehicles with internal combustion engines has solidified its positions during the last 100 years, and it is almost impossible for new enterprises to enter it. In turn, currently there is no pronounced competition in manufacturing of electric vehicles and there are vehicle units having only one or few suppliers in the world – it creates new opportunities for entering an industry worth billions of euros, which will replace the industry of vehicles with internal combustion engines in the nearest 30 years. Being aware of that, the countries around the world take active measures for supporting entrepreneurship in order to become the leading countries in this emerging field of electromobility. Hitherto the USA have invested or are planning to invest in the nearest future five billion dollars in development of electromobility, China – more than one billion euros, Germany – one billion euros, Great Britain – 800 million euros, France – 400 million euros.
It is particularly important to promote the competitiveness of enterprises of Latvia, taking into account that Latvia holds the 25th position in the field of innovations in Europe1 and innovations are the cornerstone of future competitiveness.
Energy independence is strategic priority of any country. Although within the last 20 years Latvia has become more independent in terms of energy (the total amount of imported energy has decreased from 88.9% in 1990 to 59.1% in 20112), it is provided for in the NDP2020 to increase energy independence of Latvia from 41.6% in 2010 up to 44.1% in 20203. Energy independence of Latvia in the field of transport is higher than in national economy at large. 97% of energy used in transport of Latvia is fossil energy, and it is being imported in the amount of 100%. Every year Latvia imports fossil fuel for ensuring transport in the amount of more than half billion of lats, thus creating an external trade deficit in the amount of 6.5%4. In terms of quantity the consumption of fossil fuel in Latvia exceeds 1.1 million of tonnes per year. Taking into account the current retail prices it amounts up to more than one billion lats (1.42 billion euros), which inhabitants of Latvia have paid for imported fossil fuel, moreover, Latvia cannot influence the prices of imported fuel, therefore, economy of Latvia is completely dependent on oil exporting countries in the field of strategic resources.
At large progress has been achieved in Latvia in relation to CO2 emissions during the last years. The most significant amount of CO2 emissions is in Riga. The total amount of CO2 emissions has decreased in Riga by 50% in comparison to 1990 – from 4.2 to 2.3 million of tonnes of CO2, however, it is apparent that emissions from transport have increased and reached 37% from the total amount of CO2 emissions, becoming the largest source of emissions with 860000 tonnes of CO2. One of the ways of reducing the amount of CO2 emissions in transport is the development of electromobility, using renewable energy resources. The NDP2020 provides for the creation of support programmes for transition to renewable energy resources in the transport sector and for the provision of the necessary infrastructure, as well as supporting innovations as a result of which use of economically advantageous alternative energy resources is being promoted.
1.2. EU Electromobility Policy and Requirements for the Support of Electromobility in EU Member States
The White Paper “Roadmap to a Single European Transport Area – Towards a competitive and resource efficient transport system” invited to break the dependence of the transport sector on oil and determined a target to reduce the amount of transport greenhouse gas emissions by 60% up to 2050. Therefore, the European Commission undertook to draw up a sustainable alternative fuels strategy, as well as to develop a proper infrastructure.
On 25 January 2013 the European Commission proposed a new proposal for a Directive of the European Parliament and of the Council on deployment of alternative fuels infrastructure. The proposal for this Directive lays down the requirements for drawing up State political regulation in relation to the development of alternative fuels market and the development of the minimum of an alternative fuels infrastructure, also introduction of joint technical specifications.
The purpose of the Directive is to ensure the development of an alternative fuels infrastructure and the introduction of the joint technical specifications of such infrastructure in the European Union. Concurrently the proposal identifies the possible activities in order to stimulate the use of alternative fuels and to ensure the industry, public sector and consumers with a clear and co-ordinated vision regarding the development of the alternative fuels market.
It is provided for in the proposal that each Member State should ensure the minimum number of charging points for electric vehicles, 10% of which would be accessible to the public. Also joint technical specifications for interfaces between charging points and vehicles, as well as for the provision of shore-side electricity for water vehicles should be introduced.
2. Solution Offered
2.1. Results to be Achieved by the Plan
Electromobility concerns several fields concurrently: provision of environmental protection and sustainability, energy, entrepreneurship, transport. Therefore, electromobility has a considerable potential in future development of economy of Latvia. In order to promote the development of electromobility, the Plan provides for specific directions of support policy in relation to the most important elements thereof: distribution of EV, building of the network of charging points, support to the development of innovative products, also educating of the society and provision of access to information regarding electromobility.
On the basis of the common transport policy of the European Union, in which it is provided for that transport should consume less and purer energy, use of modern infrastructure should be preferred and negative environmental impact should be reduced, the objective of the Plan is to reduce the dependence of the transport system of Latvia on oil, improving its efficiency, ensuring mobility and promoting creation and use of innovative technologies in the transport field of Latvia.
According to the NDP priorities three main results should be achieved:
• increase of competitiveness of Latvian enterprises for the creation of a new field of transport;
• increase of energy independence of Latvia;
• reduction of pollution and gases causing greenhouse effect.
2.2. Main Principles for Introducing Electromobility
In drawing up the electromobility support policy, it is based on the following basic principles:
• financial validity;
• the “user pays” principle and the “polluter pays” principle;
• priority for educating and non-financial support activities;
• use of the European Union financing;
• progressiveness:
• priority is support to the development of local technologies and products;
• the system to be established will be based on the world’s best examples and latest technologies;
• co-operation:
• involvement of the society (informative and educating measures);
• co-operation with enterprises (in development of the electromobility infrastructure, in development of technologies);
• openness and equality:
• the EV charging infrastructure in Latvia will be established on the basis of an open charge point protocol (OCPP) in order to prevent dependence on one manufacturer and supplier of equipment;
• according to the requirements of the draft directive on alternative fuels infrastructure the electromobility system of Latvia must ensure equal treatment of all employees of the industry, ensuring that any user of EV may use any charging point regardless of which operator’s client he or she is.
2.3. Implementation of the Electromobility Policy
Four main action directions and 38 activities are provided for in introducing the electromobility policy of Latvia.
The main action directions are:
• support to science and development of innovative products;
• creation of EV charging infrastructure;
• stimulation of purchasing EV;
• strengthening of administrative capacity and informative measures.
Establishment of the infrastructure for charging electric vehicles is one of the most important tasks to be performed in order for the development of electromobility to be possible.
It is planned to introduce a two-level charging infrastructure in Latvia:
1) the national level infrastructure, which would be joint, open-type fast charge infrastructure throughout the territory of Latvia, and it is intended to implement it from the resources attracted from the ERDF. It is planned to build the national infrastructure on TEN-T roads and in populated areas of Latvia where the number of inhabitants exceeds 5000 inhabitants;
2) local level infrastructure, for the establishment of which co-operation programmes with local governments are intended for the placing of charging points on the side of the street, in parking lots belonging to local governments and near public buildings, as well as co-operation programmes with entrepreneurs for the establishment of infrastructure near shops, restaurants, etc.
The basic tasks in establishment of the EV charging infrastructure in Latvia are as follows:
• to perform research of the national network of charging points and determination of location of charging points;
• to perform construction of the national network of charging points;
• to establish a clearing centre for the EV charging infrastructure network and to carry out the functions of the clearing centre among charging network operators of Latvia and other countries;
• to ensure compatibility of the control systems of operators with the charging points to be installed in Latvia.
It is intended to organise support to science and development of innovative products in the field of electromobility, ensuring co-operation with scientific and educational institutions and manufacturing enterprises of Latvia.
It is intended to take measures for stimulation of EV purchase, taking into account the limited possibilities of the budget of Latvia, therefore, a special emphasis is put on activities which do not require direct financial investments:
• tax allowances upon purchasing and using EV;
• tax policy change, increasing taxes for polluting vehicles;
• use of EV in public transport lanes;
• free-of-charge parking of EV in public parking lots;
• right to use EV free of charge in chargeable areas or “clean areas” (in future).
Direct financial support is intended as the chronologically last activity because it has a short-term effect and, as demonstrated by experience of Estonia, it is not very efficient, if other measures are not implemented – particularly if there is no generally accessible infrastructure for charging EV.
2.4. Organising Electric Mobility
The Ministry of Transport is responsible for the field of electromobility in Latvia. Its functions include:
• to draw up electromobility policy;
• to organise and co-ordinate the implementation of electromobility policy;
• to draw up draft legal acts and policy planning documents that govern the respective sector.
It is planned to establish an Electromobility Control and Co-ordination Centre (EMCCC) for introduction of the electromobility policy of Latvia drawn up. The EMCCC has the following duties:
• to prepare and, in accordance with the procedures laid down in laws and regulations, to provide proposals for drawing up of legal acts and policy planning documents governing the field, also on the basis of experience acquired, to submit proposals to the Ministry of Transport for the necessary support programmes;
• to ensure implementation of the measures provided for in the laws and regulations and the respective policy planning documents, including:
• to ensure the establishment of the national charging infrastructure of Latvia;
• to co-operate with local governments and commercial companies in introduction of the infrastructure, ensuring technical support software basis;
• to draw up technical standards of Latvia for electromobility according to the norms of standards and to ensure their introduction in order to achieve efficient compatibility of the charging systems installed in Latvia in a joint network;
• to perform the maintenance of the register for use of green energy certificates of EV.
The Plan contains an evaluation of the three EMCCC models of operation observed in global practice and it is recommended to implement the divided function model in Latvia as the most appropriate model for the situation of Latvia and corresponding to the State Administration Structure Law.
The divided function model provides for separation of the function of introducing electromobility from support (awarding and control of grants) functions. In this model electromobility support functions, including grant administration, could be performed by the Ministry of Transport, but the functions of introducing electromobility – by the State stock company “Road Traffic Safety Directorate” (hereinafter – the RTSD).
This model is the most appropriate for Latvia because State authorities have experience and resources for the provision of support functions (grant administration and sectoral control), however, do not have specialists in the field of electromobility. Such specialists with experience in issues of electromobility are in public organisations (for example, Latvian Energy Efficiency Association, Green-tech Cluster of Latvia, Zero Emission Mobility Support Society), in turn, the RTSD maintains and ensures the State register of vehicles and their drivers (hereinafter – the register) that contains information regarding all vehicles registered in traffic of Latvia, which would allow rapid and easy accounting of EV, reducing administrative costs. Similarly, the RTSD is already ensuring data exchange with the respective registers of other countries. By delegating the functions of the EMCCC to the RTSD State administrative functions could be reduced and the existing register could be used for ensuring accounting of EV.
3. Financing of the Plan
The anticipated summary of the financing of the Plan is presented in the Table according to the directions of the purpose.
Division of the Financing of the Electromobility Development Plan 2014-2016
(mill. of EUR)
Electromobility support direction / Financing in total / Public financing / Private and local government financing2EU funds / State budget5 / CCFI1
1. Innovation, research, development / 10,7* / 7,04* / 1,7* / 0,0* / 2,0*
2. Strengthening of administrative capacity and informative measures / 0,7 / 0,0 / 0,7 / 0,0 / 0,0
3. Creation of EV charging infrastructure / 13,09 / 7,093 / 3,2 / 1,7 / 1,1
4. Stimulation of purchasing EV / 5,4 / 0,0 / 0,1 / 3,3 / 2,0
In total / 29,99 / 14,09 / 5,7 / 5,0 / 5,2
Notes.
1 Open competition of projects financed by the Climate Change Financial Instrument administered by the MoEPRD “Reduction of Greenhouse Gas Emissions in Transport Sector – Support to Introduction of Electric Vehicles and Their Charging Infrastructure”.
2 Co-financing of local governments on the basis of principles of voluntary participation, if local governments wish, upon receipt of State co-financing, to install EV charging points or to purchase EV.
3 In the planning period 2014-2020 of EU funds the indicative support planned within the scope of the European Regional Development Fund is 7.09 million euros, supporting the establishment of the infrastructure for charging electric vehicles and the centre of operators controlling them.
4 Financing from the ERDF for continuation of the Competence Centre Programme according to the provisions drawn up in the subsequent planning period of EU Structural Funds (2014-2020). Enterprises will be able to apply for receipt of support according to the procedures of general competition in activity programmes of the MoE according to the provisions drawn up in the subsequent planning period of EU Structural Funds (2014-2020).
5 Additional expenses from the State budget are not necessary in 2014. The issue regarding assigning of additional resources from the State budget for the provision of measures according to the action directions for introducing the electromobility support policy in 2015 and subsequent years shall be reviewed by the Cabinet during the process of preparing and reviewing the draft law on State budget for 2015 and the draft law on medium-term budget for 2015, 2016 and 2017 together with proposals of all ministries and central State authorities for new policy initiatives according to the financial possibilities of the State budget of the respective year.
* The indicator is indicative.
1 Innovation Union Scoreboard 2013
2 Eurostat: Energy transport and Environment Indicators 2012.edition ISSN 1725-4566
3 NDP 2020 [198]
4 Central Statistical Bureau of the Republic of Latvia
Minister for TransportAnrijs Matīss
Translation © 2015 Valsts valodas centrs (State Language Centre)1