Electric car grants

Terms and conditions for grants for the purchase of clean energy vehicles

Purpose, objectives and scope.

The Minister for the Environment, Energy and Climate Change shall award grants for the purchase of vehicles that have no emissions, are clean-energy or emission-free vehicles, and the awarding of such grants shall be in accordance with these rules. Grants are awarded through the Energy Fund, which is intended to encourage the purchase of clean, renewable energy vehicles in order to accelerate energy exchange in transport with the primary goal of reducing greenhouse gas emissions.

The grants are awarded to individuals and legal entities registered as owners of eligible vehicles in Iceland with the Icelandic Transportation Authority. The eligibility of a vehicle covers the following categories:

• M1 passenger cars, including taxi and rental cars.

• Category N1 vans, small N2 buses and trucks of category N3.

• M2 and M3 buses.

Eligible vehicles include both new and imported used vehicles. Certain criteria apply to the maximum value of purchases of vehicles of categories M1 and N1, i.e. if the purchase price exceeds a certain maximum, no subsidy is obtained.

New vehicles are considered to be those that receive their first registration in Iceland as of January 1st, 2024. If a vehicle is imported after January 1st, 2024, the amount of the subsidy will depend on the category to which the vehicle belongs and, as appropriate, how long it has passed since its first registration abroad.

These rules provide exceptions for vehicles of categories M1 and N1 where a vehicle is specially equipped for the needs of persons with disabilities. In other respects, grant amounts shall take into account the advertised maximum purchase price and grant amounts for each category of automobile.

Vehicles of categories M2, M3, N2, N3 are only eligible for grant in the case of new vehicles.

Advertisements.

The Energy Fund shall advertise each year when and how applications for grants will be open. The advertisement shall contain information on the conditions which vehicles must meet in order to meet their eligibility for a grant, and on the rules and conditions for the granting of the grant. If the Minister decides to place more emphasis on the allocation of grants than is stated in Article 1, this shall be stated in the advertisement.

Applications and disbursement of grants.

Applications for the purchase of M1 passenger cars and N1 commercial vehicles are generally made digitally through the applicant's electronic access to Iceland.is. For cars in the same categories that are specially equipped for the purchaser's disability, a confirmation from the State Insurance Institute (TR) must be submitted before applying to Iceland.is.

As regards grants to vehicles in categories M2, M3, N2 and N3, their implementation will be through the Energy Fund application process, following a notice.

Grants are only awarded once for each eligible vehicle. If co-owners are registered on the eligible vehicle, a grant shall be paid to the registered primary owner, who may apply for a grant only.

If both the vehicle and the applicant fulfil all the conditions and the applicant has accepted the conditions underlying the grant award and are stated in the application process, the grant is paid out within two days as a rule after the application is received.

Misuse of data, incorrect or misleading information, collection of data.

If an applicant is found to provide incorrect or misleading information to the Energy Fund with respect to his/her application, or uses a grant for purposes other than purchasing a clean-energy vehicle, the Fund reserves the right to cancel the grant and require the grant recipient to reimburse the grant as well as the cost. All such cases will be subject to an exceptional appeal to the police. In this connection, the Energy Fund reserves the right to call for information on the purchase, registration and ownership history of the vehicles that have been supported. Furthermore, it is disclosed that the National Audit Office has extensive inspection powers, which include the authority to call for documents and information in this connection.

Prohibition of export.

For the purpose of meeting the governmental greenhouse gas reduction target, the grant recipient undertakes that the vehicle is only registered in Iceland while it is in his ownership.

Effect

The rules and conditions take effect immediately