If passed by Parliament, the 2024 state budget proposal put forward by the government of Prime Minister Petteri Orpo (NCP) will end subsidies for the construction of charging stations for electric vehicles (EVs) in Finland.
"It will have a negative effect. We have seen applications that have been withdrawn because the costs have gone up so much that the housing association has not been able to afford to put money into installing this kind of charging infrastructure," says Leif Andersson of Finland's Housing Financing and Development Centre (ARA), the organisation which currently channels state charging station subsidies.
"So, it will be even more expensive next year when subsidies are withdrawn, and we expect that significantly fewer will invest in charging stations for electric cars," he added.
600 housing associations queued
Thanks to current subsidies, housing associations that own residential properties – from semi-detached houses to multi-storey blocks of flats – have been able to recover 35 percent of the total costs of building EV charging stations.
The funds can be used for any part of these projects, including hardware for charging stations, excavation work, project management and on-site supervision.
"It has been an extremely popular support. We have a lot of applications in the queue," Andersson told Yle.
At the moment, there are 600 housing companies with applications on file. The processing period is several months.
Impact on climate goals
The decision to abolish these subsidies means that it will take longer for Finland to reach its climate targets, says Markku Ollikainen, who chairs Finland's climate panel and is professor emeritus of environmental economics at the University of Helsinki.
"Subsidies for charging systems, especially for housing associations, is really important, because otherwise it will be almost impossible for many residents to get an EV. It is important to be able to charge a car at home. Reducing funding like this is not a good thing," says Ollikainen.
He added that it is impossible to say how much this will affect projected reductions in emissions. But the transition to EVs will be slowed down, he points out.
Current funding will be exhausted within the next few months.
ARA has funnelled around 20 million euros annually to housing associations to build charging infrastructure for EVs.
The government proposed additional temporary funding in its autumn supplementary budget, increasing this year's initial total from nine million euros to 18.5 million, but that money is only enough to deal with the present application queue and new applications for a few more months.
It is difficult to say exactly when available funds will run out, because large, individual projects can gobble up a relatively large amount of money, according to Andersson.
Some other climate subsidies are also disappearing from the state budget. There has been a separate subsidy programme for EV charging infrastructure at workplaces. That support will also be abolished before the year 2024.
Also, starting from the beginning of next year, subsidies will no longer be available for homeowners switching from district heating systems to geothermal heating.
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