Fuel price highly important
Incentives must be relevant to the state of market development in a specifi c location. In a premarket phase incentives should promote vehicle supply and fuel distribution as well as remove legal barriers and tax disincentives. In a market development
phase monetary incentives for end users and reliable information become effective tools. A wide range of incentives were introduced during the project, including motor tax rebate, local purchase grants, free parking and access to restricted areas. In Stockholm/Sweden, suffi cient data was available to make a statistical analysis of the effect of various incentives. This showed that in a market development phase, the single most important incentive is to ensure that the price of bioethanol is equal to or lower than petrol. As long as bioethanol is subject to higher customs duties and energy taxes than fossil fuels, other incentives must be used to compensate for this. Exemption from congestion charging was the second most important instrument to stimulate the use of clean vehicles and bioethanol in Stockholm. The Swedish market was also boosted by a new “pump law”, compelling petrol stations above a certain size to introduce pumps for alternative fuels.