Electric mobility

and other alternatives to combustion engines

Electric mobility

The advancement of mobility is an extremely exciting aspect of the current technological revolution. Electric mobility is one of the trends, alongside digitization, self-driving cars, and shared mobility – also in the Slovak Republic. 

What is electric mobility? It comprises all street vehicles that are powered by an electric motor and primarily get their energy from the power grid. So, in other words: they can be recharged externally. This includes purely electric vehicles and vehicles with a combination of an electric motor and a small combustion engine. 

The benefits are obvious: electric mobility can help the EU to achieve its goals of reducing greenhouse gas emissions, air pollution, noise, and the dependence on oil. Petrol and diesel vehicles are still dominant within the EU market, although the share of electric vehicles is growing fast. 

In 2020, despite the COVID-19 pandemic, which caused a strong decline in car sales, plug-in electric car sales grew rapidly: according to the European Automobile Manufacturers Association (ACEA), in 2020 more than one in ten cars registered in the EU was electrically chargeable (5.4% electric vehicles, 5.1% plug-in hybrid vehicles). However, one of the biggest shortcomings due to which the market share in the EU is not growing faster is and remains the lack of charging infrastructure. 

Legal framework in the EU and the Slovak Republic 

The declared aim of the EU is to ensure an effective and continuous transition towards a mobility system that is safe, clean, connected, and automated. It also means the focus is on production and that EU companies should manufacture the best, cleanest and most competitive products. 

The European strategy for low-emission mobility highlighted the importance of publicly available electric recharging points, the use of renewable electricity for transport, and customer awareness of the improvements made with regard to electric vehicles, such as increased driving range and lower maintenance costs. The strategy also called on member states to review their tax systems to introduce incentives for low-emissions vehicles and energy. In May 2017, the Commission submitted “Europe on the Move” which is a package of legislative and other mobility-related measures aimed at making Europe a leader in clean, competitive, and connected mobility. 

For example, member states were encouraged to increase the number of recharging points, raise awareness of their existence and make them more standardized and interoperable. Many more charging points will be needed in the future due to the growing number of electric vehicles: The Commission estimates that around 440,000 publicly accessible recharging points were needed in 2020, and two million will be needed by 2025. 

Based on the EU Directive on the deployment of alternative fuels infrastructure a national political framework has been adopted in the Slovak Republic. Among other things, tax incentives for the purchase of electric vehicles or for the development of the charging infrastructure, the initiation of technical and administrative procedures and legislative changes regarding the authorisation of the supply of alternative fuels as well as changes in public procurement, etc. are envisaged. 

In this context the Slovak government adopted the Action plan for the development of electromobility in Slovakia in 2019. The program contains 15 specific measures such as the inclusion of the topic of electromobility in all relevant strategies and policies of the state, continuity of direct support for the use of low–emission vehicles or accelerated tax depreciation of electric vehicles and charging stations. 

Tax and subsidy incentives 

In the same year, the Ministry of Economy of the Slovak Republic published a call for the subsidisation of electric vehicles. Specifically, a grant of EUR 8,000 was available for the purchase of a new vehicle with a purely electric drive, or EUR 5,000 EUR in the case of a plug-in hybrid. The maximum purchase price of a vehicle for which a subsidy could be granted could not exceed EUR 50,000 (gross). 

Conclusion: The allocated subsidies were used up within 4 minutes, so that only the fastest claimants received them. The Ministry of Economy of the Slovak Republic therefore announced that subsidies for electric vehicles will be available to every applicant from 2022. The amount of subsidies is likely to be somewhat lower than in 2019, but in return every applicant would have a legal right to the subsidy for an electric vehicle. 

Focus on hydrogen technology 

In addition to electric mobility, there is another alternative to combustion engines which is also in line with environmental requirements: hydrogen. The aim of the Minister of the Economy of the Slovak Republic is to become one of the leaders in hydrogen technology. In this context, to increase the competitiveness of the Slovak economy and contribute to a carbon-neutral society in accordance with the Paris Climate Agreement, the Slovak government has adopted the National Hydrogen Strategy in 2021. In this strategy the main goals and areas in which hydrogen will be used in the future were defined. One of them is transportation. Hydrogen propulsion can be used in public transport, trucks and commercial vehicles for long-distance transport, also in trains, aircraft, ships and construction vehicles, agriculture, forestry and in the defence industry. As a first step the city of Bratislava plans to tender 20 hydrogen buses, which should be in use from 2022/2023 onwards. 

Energy efficiency of buildings is tightened 

The EU has also taken measures to improve the charging infrastructure at home and at the workplace in the Directive on the energy performance of buildings. 

Based on this Directive, the amendment on the energy performance of buildings and on the amendment of certain laws entered into force in Slovakia. It regulates obligations during the construction or significant reconstruction of residential and non-residential projects. Planning permission for such projects will only be granted if the project documentation takes into account the charging infrastructure or the construction of a charging station. The amendment precisely stipulates in which cases these obligations shall apply. At the same time, the amendment on the energy performance of buildings also imposes an obligation for each non-residential building. From 1st January 2025, each non-residential building with more than 20 parking spaces must have at least one electric vehicle charging station. 

One of the essential measures to support and increase the market share of electric vehicles are incentives in the tax area. Already since 2020, there is a possibility to apply for the tax depreciation on 2 years instead of 4 years in case of electric vehicles. Accelerated tax depreciation of electric vehicles may have a positive effect on the generation of the secondary market for electric vehicles, where their price will no longer be affected by the price of production but by the purchasing power of the market. 

Promotion of green trucks 

Based on the Directive on the promotion of clean and energy-efficient road transport vehicles, the Slovak Republic has adopted the Act on the promotion of clean road transport vehicles, which came into force at the beginning of August 2021. The purpose of this Act is to ensure that the procurement of vehicles complies with the minimum procurement targets for clean light-duty vehicles and for clean heavy-duty vehicles. 

The act will bring important changes, when for instance, from the year 2026 onwards, a contracting authority in Slovakia, within the public procurement of clean light-duty vehicles of category M1, M2 or N1, will be obliged to keep the limit of 22% of clean vehicles on a total number of procured vehicles. 

Without a doubt, we are on the threshold of a new era. We are moving towards a future with new technologies disrupting the way we produce cars and drive them. It is also clear that the EU will not be left behind with its long-established vehicle manufacturers. Plenty of vehicle manufacturers have already reversed their course and start to focus mainly on the production of electric and plug-in hybrid vehicles. Some of the manufacturers started already with innovative ideas and concepts of alternative propulsion such as hydrogen. The numerous measures already taken by the EU and its member states demonstrate that the main goals now are to improve the charging infrastructure and the development of an innovative, sustainable, and competitive battery production system in Europe, as well as to promote electric mobility with many national-level tax and subsidy incentives. 


AUTHORS:

JUDr. Martin Jacko, Attorney-at-Law and Managing Partner at LANSKY, GANZGER + partner Bratislava
Mgr. Jakub Hanesch, Associate at LANSKY, GANZGER + partner Bratislava

Conditions for issuance a building permit for new properties or the extensive renovation of objects:

At least 10 parking spaces on the premises, the costs for building the infrastructure must not exceed 7 percent of the total costs for the construction or renovation

Non-residential buildings

Residential buildings

At least 1 charging station and infrastructure for the future installation of a charging station on at least every 5th parking space

Preparing infrastructure for each parking space for the future installation of a charging station

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