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The Government Subsidizes Electric Cars to Make Them More Affordable for Citizens.

13 August, 2024

Green Transition is the Core Mission

Following the meeting on the development policy of green means of transport and the development policy of charging stations for green means of transport, the Government Office has recently issued a notice of the conclusion of Deputy Prime Minister Tran Hong Ha.

Accordingly, Notice No. 372/TB-VPCP clearly states that the core and most important task to achieve the green growth goals that Vietnam has committed to at international conferences is the green energy transition.

Electrifying transport is one of the focuses to achieve Vietnam’s Net Zero 2050 goal.

At COP26, Vietnam made strong commitments to green transition, declaring to achieve net zero emissions by 2050.

Towards this goal, the Prime Minister has issued Decision No. 876/QD-TTg dated July 22, 2022, with the Ministry of Transport, approving the Action Program on Green Energy Transition, reducing carbon and methane emissions of the transport sector (Program). From here, ministries, branches, and localities can take action towards the Net Zero target as mentioned.

At the same time, the Ministry of Transport, Construction, Planning and Investment, Finance, Industry and Trade, and the People’s Committees of the localities have performed the assigned tasks, but according to the assessment, they are still lacking in focus and emphasis, so the results are not clear.

Promoting the Use of Electric Vehicles

One of the tasks in the request of Deputy Prime Minister Tran Hong Ha to the ministries, agencies, and localities to develop green transport is to encourage people to use green vehicles.

Specifically, the Ministry of Transport will need to coordinate with the ministries and relevant localities to promote the transition, including reviewing the mechanisms and policies to encourage and support the production, import, and use of road motor vehicles using green energy.

The mentioned encouragement method includes supporting investment in charging stations for electric vehicles and supporting the transition from fossil fuel vehicles to green energy vehicles.

In parallel, the Ministry of Transport and the relevant ministries and localities will need to research and propose policies to encourage the use of electric buses for inter-provincial travel. This proposal will need to be reported to the Prime Minister before July 2025.

Inter-provincial electric buses are the subject of research support.

Thus, it can be seen that the mechanisms and policies to encourage and support the production, import, and use of green vehicles will be the focus of the Ministry of Transport and the relevant ministries and localities.

This is a matter of great concern because, according to the current policy, the preferential registration fee for the first time of 0% will soon end. Specifically, the Government’s Decree No. 10/2022/ND-CP stipulates that electric cars enjoy a preferential registration fee of 0% for the first time within 3 years from March 1, 2022. In the following period, from March 1, 2025, to February 28, 2027, electric cars will be subject to a registration fee for the first time, equal to 50% of the collection rate for gasoline and oil cars with the same number of seats.

This support policy will help people own electric cars at a lower total cost, promoting the electrification of transport.

Urban Areas Must Have Public Charging Stations

Along with promoting the transition to the use of electric vehicles, promoting the development of public charging stations must also be carried out in parallel.

For the Ministry of Industry and Trade, the Deputy Prime Minister requested to quickly report to the Prime Minister the amendments and supplements on the structure of retail electricity prices and, at the same time, to research, propose, and evaluate the impact on electric vehicle charging stations of the mechanism to support electricity prices.

For the Ministry of Construction, the Deputy Prime Minister requested to promulgate and amend the standards and norms for apartment buildings and commercial centers, stipulating the standards for electric vehicle charging systems. The ministry needs to complete this before the end of 2024.

Charging stations need to be developed in parallel with electric vehicles.

In addition, building a system of public charging stations in urban areas to serve green vehicles is also noted. In this regard, the Ministry of Construction needs to coordinate with the ministries, the Public Security Agency, the Ministry of Industry and Trade, the Ministry of Transport, the People’s Committees of Hanoi and Ho Chi Minh City, and related agencies to supplement the planning, which needs to be completed in August.