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Germany is extending its vehicle tax exemption for electric cars until 2035, a federal move aimed at boosting EV sales, supporting the auto industry, and advancing the country’s transition to cleaner, more sustainable transportation.

Why is Germany Exempting EVs from Vehicle Tax Until 2035?

Germany is exempting electric vehicles from vehicle tax until 2035 to boost EV adoption, support its auto industry, and meet national climate targets.

✅ Encourages consumers to buy zero-emission cars

✅ Protects jobs in the automotive sector

✅ Advances Germany’s clean energy transition

Germany’s federal government has confirmed plans to extend the country’s vehicle tax exemption for electric cars until 2035, as part of a renewed push to accelerate the nation’s e-mobility transition and support its struggling automotive industry. The move, announced by Finance Minister Lars Klingbeil, comes just weeks before the existing exemption was set to expire.

“In order to get many more electric cars on the road in the coming years, we need to provide the right incentives now,” Klingbeil told the German Press Agency (DPA). “That is why we will continue to exempt electric cars from vehicle tax.”

Under the proposed law, the exemption will apply to new fully electric vehicles registered until December 31, 2030, with benefits lasting until the end of 2035. According to the Finance Ministry, the measure aims to “provide an incentive for the early purchase of a purely electric vehicle.” While popular among consumers and automakers, the plan is expected to cost the federal budget several hundred million euros in lost revenue.

Without the extension, the tax relief for new battery-electric vehicles (BEVs) would have ended on January 1, 2026, creating uncertainty for automakers and potential buyers. The urgency to pass the new legislation reflects the government’s goal to maintain Germany’s momentum toward electrification, even as the age of electric cars accelerates amid economic headwinds and fierce international competition.

The exemption’s renewal was originally included in the coalition agreement between the Christian Democratic Union (CDU), the Christian Social Union (CSU), and the Social Democratic Party (SPD). It follows two other measures from the government’s “investment booster” package—raising the maximum gross price for EV tax incentives to €100,000 and allowing special depreciation for electric vehicles. However, the vehicle tax measure was previously in jeopardy due to Germany’s tight fiscal situation. The Finance Ministry had cautioned that every proposal in the coalition deal was “subject to financing,” and a plan to end EV subsidies led to speculation that the EV tax break could be dropped altogether.

Klingbeil’s announcement coincides with an upcoming “automotive dialogue” summit at the Chancellery, hosted by Chancellor Friedrich Merz. The meeting will bring together representatives from federal ministries, regional governments, automakers advancing initiatives such as Daimler’s electrification plan across their portfolios, and trade unions to address both domestic and international challenges facing Germany’s car industry. Topics will include slowing EV sales growth in China, the ongoing tariff dispute with the United States, where EPA emissions rules are expected to boost EV sales, and strategies for strengthening Germany’s global competitiveness.

“We must now put together a strong package to lead the German automotive industry into the future and secure jobs,” Klingbeil said. “We want the best cars to continue to be built in Germany. Everyone knows that the future is electric.”

The government is also expected to revisit a proposed program to help low- and middle-income households access electric cars, addressing affordability concerns that persist across markets, modelled on France’s “social leasing” initiative. Though included in the coalition agreement, progress on that program has stalled, and few details have emerged since its announcement.

Germany’s latest tax policy move signals renewed confidence in its electric vehicle transition, despite budget constraints and a turbulent global market, as the 10-year EV outlook points to most cars being electric worldwide. Extending the exemption until 2035 sends a clear message to consumers and manufacturers alike: the country remains committed to building its clean transport future—one electric car at a time.

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Tesla Battery Day Innovations detail larger cylindrical EV cells with higher energy density, greater power, longer range, cobalt-free chemistry, automated manufacturing, battery recycling, and lower cost per kWh to enable an affordable electric car.

Key Points

Tesla Battery Day innovations are new EV cells and methods to cut costs, extend range, and scale production.

✅ Larger cylindrical cells: 5x energy, 6x power, 16% more range

✅ Automation and recycling to cut battery cost per kWh

✅ Near-zero cobalt chemistry, in-house cell factories worldwide

Elon Musk described a new generation of electric vehicle batteries that will be more powerful, longer lasting, and half as expensive as the company’s current cells at Tesla’s “Battery Day”.

Tesla’s new larger cylindrical cells will provide five times more energy, six times more power and 16% greater driving range, Musk said, adding that full production is about three years away.

“We do not have an affordable car. That’s something we will have in the future. But we’ve got to get the cost of batteries down,” Musk said.

To help reduce cost, Musk said Tesla planned to recycle battery cells at its Nevada “gigafactory,” while reducing cobalt – one of the most expensive battery materials – to virtually zero. It also plans to manufacture its own battery cells at several highly automated factories around the world.

The automaker plans to produce the new cells via a highly automated, continuous-motion assembly process, according to Drew Baglino, Tesla senior vice-president of powertrain and energy engineering, a contrast with GM and Ford battery strategies in the broader market today.

Speaking at the event, during which Musk outlined plans to cut costs and reiterated a huge future for Tesla's energy business during the presentation, the CEO acknowledged that Tesla does not have its new battery design and manufacturing process fully complete.

The automaker’s shares slipped as Musk forecast the change could take three years. Tesla has frequently missed production targets.

Tesla expects to eventually be able to build as many as 20m electric vehicles a year, aligning with within-a-decade EV adoption outlooks cited by analysts. This year, the entire auto industry expects to deliver 80m cars globally.

At the opening of the event, which drew over 270,000 online viewers, Musk walked on stage as about 240 shareholders – each sitting in a Tesla Model 3 in the company parking lot – honked their car horns in approval.

As automakers shift from horsepower to kilowatts to comply with stricter environmental regulations amid an age of electric cars that appears ahead of schedule, investors are looking for evidence that Tesla can increase its lead in electrification technology over legacy automakers who generate most of their sales and profits from combustion-engine vehicles.

While average electric vehicle prices have decreased in recent years thanks to changes in battery composition and evidence that they are better for the planet and household budgets, they are still more expensive than conventional cars, with the battery estimated to make up a quarter to a third of an electric vehicle’s cost.

Some researchers estimate that price parity, or the point at which electric vehicles are equal in value to internal combustion cars, is reached when battery packs cost $100 per kilowatt hour (kWh), a potential inflection point for mass adoption.

Tesla’s battery packs cost $156 per kWh in 2019, according to electric vehicle consulting firm Cairn Energy Research Advisors, with some studies noting that EVs save money over time for consumers, which would put the cost of a 90-kWh pack at around $14,000.

Tesla is also building its own cell manufacturing facility at its new factory in Germany in addition to the new plant in Fremont.

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Bimbo Canada VPPAs secure renewable electricity from RES wind and solar projects in Alberta, totaling 170MW, via 15-year contracts to offset consumption, advance RE100 goals, and drive decarbonization across bakeries, depots, and distribution centers.

Key Points

Virtual power purchase agreements sourcing wind and solar to offset Bimbo Canadas electricity and support RE100.

✅ 15-year RES contracts for Alberta wind and solar capacity

✅ Offsets electricity for bakeries, depots, and distribution centers

✅ Advances Grupo Bimbo RE100 target for 100% renewable power

Canada's oldest and largest bakery, Bimbo Canada, has signed two virtual power purchase agreements (VPPAs) with Renewable Energy Systems  (RES) to procure renewable electricity, similar to federal green electricity contracts advancing in Alberta, that will offset 100 per cent of the company's electricity consumption in Canada. The projects are expected to be fully operational by December, 2022.

Canada is the second market, alongside the United States, to enter into VPPAs, where companies like Amazon clean energy projects are expanding rapidly. These agreements, together with additional sustainability initiatives conducted around the world by the parent company Grupo Bimbo, will help the company offset 90 per cent of its global electricity consumption.

"Bimbo Canada is committed to nourishing a better world through productive sustainability practices," said Joe McCarthy, president of Bimbo Canada. "These agreements are the next big step in reducing our environmental footprint, as peers such as Arvato's first solar plant signal industry momentum, and becoming leaders in responsible stewardship of the environment."

The 15-year agreements with RES will support the commercial development of two renewable energy projects in southern Alberta, consisting of wind and solar projects, similar to RBC's solar PPA announced in the region, totaling 170MW of installed capacity. Under these two agreements, Bimbo Canada will procure the benefit of approximately 50MW of renewable electricity to offset electricity consumption for its 16 bakeries, 14 distribution centres and 191 depots. Commercial development for the wind and solar farms will be finalized later this year by RES Canada and the projects are expected to be fully operational by the end of next year.  

"RES is proud that its Alberta wind and solar projects, amid growth such as a $200M Alberta wind farm led by a Buffett-linked firm, are helping Bimbo Canada meet its sustainability initiatives," said Peter Clibbon, RES Senior VP of Development. "It's a win-win situation with our projects delivering competitive wind and solar electricity to Bimbo Canada, and while providing our host communities with long-term tax and landowner income."

In 2018, Grupo Bimbo joined RE100, a global initiative led by The Climate Group and in partnership with Carbon Disclosure Project (CDP) and committed to operating with 100 per cent renewable electricity by 2025. As a leading supplier of fresh-baked goods and snacks for Canadian families, these agreements support the company's targets and builds upon many successful past sustainability initiatives, as market activity by Canadian Solar project sales continues nationwide.

"The renewable electricity initiatives in our operations respond to Grupo Bimbo's deep commitment that we have had for many decades globally with the planet and with present and future generations," said Daniel Servitje, global CEO of Grupo Bimbo. "With this announcement, we have achieved another important milestone for the company on our journey towards becoming 100 per cent renewable electricity by 2025."

Last year, Bimbo Canada reduced product waste and exceeded its product waste reduction target by 18 per cent, which saved four million units of products from landfills. The company also eliminated 174 metric tonnes of plastic per year (equal to 43 adult elephants) through several packaging optimization initiatives.

Earlier this year, Bimbo Canada signed the Canada Plastics Pact (CPP) and, amid a broader push for clean energy exemplified by Edmonton rooftop solar installations, earned its first ENERGY STAR certification for its Hamilton, Ontario bakery. The company will continue to work towards other initiatives that fulfill its commitment to be a sustainable, highly productive and deeply humane company.

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Clean Coal Technologies Pristine Funding secures investment from a New York asset manager via Black Diamond, advancing commercialization, Tulsa testing, Wyoming relocation, PRB coal enhancement, and cleaner energy innovation to support global coal exports.

Key Points

Capital from a New York asset manager backs Pristine commercialization, testing, and Wyoming relocation to boost PRB coal.

✅ Investment via Black Diamond funds Tulsa test operations.

✅ Permanent relocation planned near a Wyoming mine site.

✅ First Pristine M module to enhance PRB coal quality.

Clean Coal Technologies, Inc., an emerging cleaner-energy company utilizing patented and proven technology to convert untreated coal into a cleaner burning and more efficient fuel, announced today that the company has secured funding for their Pristine technology through commercialization, a move reminiscent of Bruce C project funding activity, from a major New York-based Asset Management company. This investment will be made through Black Diamond with all funds earmarked for test procedures at the plant near Tulsa, OK, at a time when rare new coal plants are appearing, and the plant's move to a permanent location in Wyoming. The first tranche is being paid immediately.

"Securing this investment will confidently carry us through to the construction of our first commercial module enabling management to focus on the additional tests that have been requested from multiple parties, even as US coal demand faces headwinds across the market," stated CEO of Clean Coal Technologies, Inc., Robin Eves. "At this time we have begun scheduling plant visits with both US government agency and coal industry officials along with key international energy consortiums that are monitoring transitions such as Alberta's coal phaseout policies."

"We're now able to finalize our negotiations in Wyoming where the permitting process has begun and where we will permanently relocate the test facility later this year following completion of the aforementioned tests," added CCTI COO/CFO, Aiden Neary. "This event also paves the way forward to commence the process of constructing the first commercial Pristine M facility. That plant is planned to be in Wyoming near an operating mine where our process can be used to enhance the quality of PRB coal to make it more competitive globally, even as regions like western Europe see coal-to-renewables conversions at legacy plants, and help restore the US coal export market."

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Canada Coal Phase-Out Costs highlight Fraser Institute findings on renewable energy, wind and solar integration, grid reliability, natural gas backup, GDP impacts, greenhouse gas emissions reductions, nuclear alternatives, and transmission upgrades across provincial electricity systems.

Key Points

Costs to replace coal with renewables, impacting taxpayers and ratepayers while ensuring grid reliability.

✅ Fraser Institute estimates $16.8B-$33.7B annually for renewables.

✅ Emissions cut from coal phase-out estimated at only 7.4% nationally.

✅ Natural gas backup and grid upgrades drive major cost increases.

Replacing coal-fired electricity with renewable energy will cost Canadian taxpayers and hydro ratepayers up to $33.7 billion annually, with only minor reductions in global greenhouse gas emissions linked to climate change, according to a new study by the Fraser Institute.

The report, Canadian Climate Policy and its Implications for Electricity Grids by University of Victoria economics professor G. Cornelis van Kooten, said replacing coal-fired electricity with wind and solar power would only cut Canada’s annual emissions by 7.4%,

Prime Minister Justin Trudeau’s has promised a reduction of 40%-45% compared to Canada’s 2005 emissions by 2030, and progress toward the 2035 clean electricity goals remains uncertain.

The study says emission cuts would be relatively small because coal accounted for only 9.2% of Canada’s electricity generation in 2017. (According to Natural Resources Canada, that number is lower today at 7.4%).

In 2019, the last year for which federal data are available, Canada’s electricity sector generated 8.4% of emissions nationally — 61.1 million tonnes out of 730 million tonnes.

“Despite what advocates, claim, renewable power — including wind and solar — isn’t free and, as Europe's power crisis lessons suggest, comes with only modest benefits to the environment,” van Kooten said.

“Policy makers should be realistic about the costs of reducing greenhouse gas emissions in Canada, which accounts for less than 2% of emissions worldwide.”

The report says the increased costs of operating the electricity grid across Canada — between $16.8 billion and $33.7 billion annually or 1% to 2% of Canada’s annual GDP — would result from having to retain natural gas, consistent with net-zero regulations allowing some natural gas in limited cases, as a backup to intermittent wind and solar power, which cannot provide baseload power to the electricity grid on demand.

Van Kooten said his cost estimates are conservative because his study “could not account for scenarios where the scale of intermittency turned out worse than indicated in our dataset … the costs associated with the value of land in other alternative uses, the need for added transmission lines, as analyses of greening Ontario's grid costs indicate, environmental and human health costs and the life-cycle costs of using intermittent renewable sources of energy, including costs related to the disposal of hazardous wastes from solar panels and wind turbines.”

If nuclear power was used to replace coal-fired electricity, the study says, costs would drop by half — $8.3 billion to $16.7 billion annually — but that’s unrealistic because of the time it takes to build nuclear plants and public opposition to them.

The study says to achieve the federal government’s target of reducing emissions to 40% to 45% below 2005 levels by 2030 and net-zero emissions by 2050, would require building 30 nuclear power plants before 2030, highlighting Canada’s looming power problem as described by analysts — meaning one plant of 1,000-megawatt capacity coming online every four months between now and 2030.

Alternatively, it would take 28,340 wind turbines, each with 2.5-megawatts capacity, or 1,050 turbines being built every four months, plus the costs of upgrading transmission infrastructure.

Van Kooten said he based his calculations on Alberta, which generates 39.8% of its electricity from coal and the cost of Ontario eliminating coal-fired electricity, even as Ontario electricity getting dirtier in coming years, which generated 25% of its electricity, between 2003 and 2014, replacing it with a combination of natural gas, nuclear and wind and solar power.

According to Natural Resources Canada, Nova Scotia generates 49.9% of its electricity from coal, Saskatchewan 42.9%, and New Brunswick 17.2%.

In 2018, the Trudeau government announced plans to phase-out traditional coal-fired electricity by 2030, though the Stop the Shock campaign seeks to bring back coal power in some regions. 

Canada and the U.K. created the “Powering Past Coal Alliance” in 2017, aimed at getting other countries to phase out the use of coal to generate electricity.

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Nova Scotia Biomass Electricity Policy increases dispatchable renewable generation from Port Hawkesbury and Brooklyn Energy, raising MWh output while critics cite clearcutting, carbon emissions, high costs to ratepayers, and delays replacing Muskrat Falls hydro.

Key Points

Policy directing utilities to maximize biomass power as dispatchable renewable supply during hydro delays.

✅ Port Hawkesbury biomass output up 35% year over year

✅ Brooklyn Energy used as dispatchable renewable supply

✅ Critics cite clearcutting, emissions, high ratepayer costs

A boiler owned by Nova Scotia Power on the grounds of the Port Hawkesbury paper plant, whose discount power rate request has drawn attention, is burning 35% more woody biomass this year than last. 

The year-to-date figures show 126,810 megawatt hours (MWh) of electricity was generated over the first nine months of 2021 compared to 93,934 MWh for the same period in 2020 and 65,891 MWh in 2019. 

The information is contained in monthly fuel cost reports Nova Scotia Power must make to the Utility and Review Board, which regulates how much consumers ultimately pay for electricity and has received a call for major grid changes in Nova Scotia.

Burning biomass  — which includes everything from low-grade pulpwood to bark, shavings, and wood chip waste from sawmills — for the purpose of generating electricity is only about 22% efficient, even as some coal stations have switched to biomass abroad. Nova Scotia Power’s boiler at Port Hawkesbury supplies about 3% of the total electricity used in the province. 

Citizens concerned about climate change have for years opposed the government classifying biomass as “renewable energy” and have echoed calls to reduce biomass use for electricity, because clearcutting, which releases carbon from the ground, remains the dominant form of harvesting on Crown and private land. That’s despite ongoing work to begin implementing 2018 recommendations from Professor Bill Lahey to move toward a more ecological approach. 

In May 2020, after it became obvious renewable hydroelectricity from Muskrat Falls was going to be delayed yet again, the McNeil government passed an Order-in-Council extending until December 2022 the deadline to generate 40% of electricity from renewable sources as it moved to increase wind and solar projects across Nova Scotia. 

To help with the shortfall, Nova Scotia Power was told to “maximize” its use of biomass at both the facility it owns in Port Hawkesbury and another one in Brooklyn owned by its parent company, Emera.

In a letter to Nova Scotia Power dated May 15, then-Energy Minister Derek Mombourquette, amid debate over independent energy planning, added: “Nova Scotia Power shall also maximize the use of dispatchable renewable electricity from its own facilities, as well as those of renewable electricity power producers in Nova Scotia (excluding COMFIT generation sources).” 

By definition, “dispatchable” excludes wind and hydro sources, which are not available 24/7, though a new attempt to harness the Bay of Fundy's tides is underway. Nova Scotia Power claims the only “dispatchable renewable electricity power producer” in the province is Brooklyn Energy, the 35 MW biomass plant near Liverpool. 

The government capped at $7 million a year how much electricity Nova Scotia Power could buy from its affiliate company. Critics of the deal — such as auditors hired by the regulator and the province’s consumer advocate — say electricity generated by Brooklyn is the most expensive power and question why the province would burden ratepayers with its purchase.

The answer became apparent in September 2020 when then-Intergovernmental Affairs Minister Kelliann Dean appeared before the legislature’s standing committee on Natural Resources and Economic Development to praise the Order-in-Council for helping rescue the forestry industry four months after the closure of the Northern Pulp mill. 

“The change to Renewable Energy Standards (May,2020) is enabling Nova Scotia Power to generate more electricity from wood chips and sawmill residuals by operating two biomass plants at capacity until electricity from Muskrat Falls comes onstream,” she said. “We are using all the policy levers at our disposal to support the sector.”

Nova Scotia Power is not required to report to the UARB how much electricity is being produced or how much biomass is being burned at Brooklyn Energy. The company pleads “commercial confidentiality” when asked by The Halifax Examiner. 

Nova Scotia Power does report how much it spends each month to buy power from independent producers — a small group which includes Brooklyn but excludes all wind farms. That dollar amount has also increased over the past year — from $15.9 million for 10 months ending October 2020 compared to $23.3 million for 10 months ending October 2021. Unfortunately, the lack of transparency makes it impossible to know exactly how much of that increase is attributable to purchasing more biomass.

Radio silence
The current Minister of Natural Resources and Renewable Energy ,Tory Rushton, has the authority to reduce the amount of biomass being burned to generate electricity and by extension, the rate of clearcutting.

With a stroke of the pen, the PC government of Tim Houston could issue another Order-in-Council capping the amount of metric tonnes that could be used in the boilers, or, direct Nova Scotia Power to use biomass only when it is the most economical fuel choice. 

But so far, Rushton has not responded to the Halifax Examiner’s question about whether he intends to make any change to stop “maximizing” the use of biomass to produce electricity.

 The Examiner isn’t the only one pushing the Minister for answers to difficult issues. At noon today, Citizens opposed to a controversial clearcut on Crown land near Rocky Point Lake in Digby County will stage a demonstration outside the Department of Natural Resources and Renewable Energy on Hollis Street. The protest led by members of Extinction Rebellion and the Healthy Forest Coalition is to pressure the government to take action to protect the habitat of the mainland moose, an endangered species that ranges overs the Crown land currently being cut by the Westfor consortium. 

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