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Oslo’s framework agreement for procuring zero-emission vehicles (Norway)

By News Editor / Updated: 23 Jul 2015

In 2010 Oslo’s city council established a policy to transform all its municipal vehicles into a fleet of zero-emission electric cars within five years. A framework agreement to enable this change was signed in 2013. The agreement is key to procuring a zero-emission fleet and contributing to Oslo’s environmental goals.

In order to help convert the fleet into electric vehicles, the city council offered a financing plan of € 7m. Now, in 2015, approximately 450 of Oslo’s municipal cars are electric, and with the economic incentives in place and new car models on the market, this number looks set to increase. 

Context 

Norway has the world’s most EV’s per inhabitant. There are over 59 000 electric vehicles (EVs) in Norway, 22 000 in Oslo and its surroundings. At the time of writing, nearly a quarter of all new cars sold on the market are electric.

Oslo’s goal is to reduce greenhouse gas emissions by half, compared to 1991, between 2030 and become a zero-emission city by 2050. The electric vehicles framework agreement is an important contribution to achieving this goal.

The framework contract is not standalone; it fits in a broader policy program. There are a number of incentives in Norway for introducing EVs. At the national level this includes: exempting vehicles from VAT (25 per cent), no registration tax and a reduced road tax that is one-eighth of the ordinary price. Drivers of EVs also get free use of commuter lanes, toll-free passage and free parking in public lots.

In action 

The framework agreement covers the procurement of both EVs and charging points (including installation). The city of Oslo fleet has approximately 1 600 registered vehicles, but the there is still a lot of potential for increasing this number.

The ambition of the program was to replace 1 000 vehicles that each weighed 3.5 tons with electric alternatives within four years of the contract start (2010). This number is made up of 600 small- and medium-sized service cars and 400 medium-sized service vans. The rest of the fleet consists of 600 trucks, trailers, tractors and motorcycles that to today have no zero-emission alternatives. Over the same period, Oslo planned to install 800 charging points that can only be used by the municipality and its entities. In addition there will be 800 charging points available for public use. 

How does the framework agreement work?

The fleet is owned by Oslo municipality and administered by the supplier LeasePlan. LeasePlan offers all necessary services including management of invoices and technical maintenance services. Municipality entities (independent organisations that perform municipal services on behalf of a municipality) get access to a web-based tool where employees who are responsible for vehicles can monitor the status, such as monthly costs and types of cars in use,  and order new vehicles.

In addition there are subsidies for charging points and installing charging points, to which co-operatives, residential developments and commercial companies are eligible to apply. There are several requirements that have to be met before a subsidy can be granted for installing a charging point. These include that they must be reserved for EVs only, equipped with a system to measure consumption and have a lock (or situated in a secure, locked area).

The framework agreement ensures that Oslo has access to the most suitable electric cars, and enables to choose freely between different car models. The only supplier under the framework agreement, LeasePlan, is able to provide all car brands. This means there is a free choice between brands and models which is important in order to keep up with the technological progress in the market, as new and better car models are being developed rapidly.

Results 

Today, following two-and-a-half years of the four-year framework, Oslo’s municipal vehicle fleet has around 450 EVs and approx 1 800 public charging points (locations here).

Espen Skistad, Senior Procurement Manager at Oslo’s Corporate Procurement Unit says: ‘At the moment we have almost reached our goal for the segment of small service cars. In accordance with the “zero-emission technology” policy for municipality vehicles, Oslo’s municipal entities are opting for electric cars. When it comes to the segment of medium-sized service vans we still needed a boost, therefore it was great to add a new and stronger service van among the electric alternatives in the framework agreement.’

Skistad adds: ‘Most of the cars under 3.5 tons can be replaced by electric alternatives. For instance, home care is an important service area where EVs can be deployed at a large scale. It does not require large vehicles, nor driving over long distances, therefore EVs are a rather suitable alternative.’ 

Challenges, opportunities and transferability 

The main challenge to converting Oslo’s entire municipal into zero-emission vehicles, says Skistad, is that around 600 of the 1 600 vehicles have no zero-emission alternatives in the market.  Heavy machines and construction vehicles are especially challenging to replace with environmentally friendly alternatives.

He added: ‘We need more innovation to reach the goal of zero-emission municipal vehicles. Innovative public procurement may offer opportunities which have not yet been discovered.’

The Oslo municipality model of the green fleet is so far a unique initiative in Norway and the world. It is however transferable to other cities, organisations and countries. Above all, it requires good leadership, the right level of commitment and positive economic incentives. 

In Depth 
Topic: 
Clean and energy-efficient vehicles
Country: 
Norway
City: 
Oslo
Author: 
Daan Kuiper
19 Jul 2015
23 Jul 2015
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