Many oil rich nations like Saudi Arabia and Iraq continue to rely on heavily subsidized fossil fuels, mostly gasoline and diesel. But international pariah Iran has bucked that trend with its efforts to put CNG cars and electric vehicles on its road, and its efforts have taken a big step forward.
The effort is being spearheaded by the Iran Fuel Conservation Commission, which is currently working to replace gas and diesel vehicles with CNG vehicles to great success. Now the FCC wants to bring some 400,000 electric motorcycles and 120,000 hybrid taxis to the streets of Tehran, Iran’s capital, and eventually only EVs will be allowed on its ancient streets.
But Iran plans to go a lot further to support electric vehicles, including paying manufacturers $300 for every electric motorcycle they build. Manufacturers can choose to either keep that money, or pass the savings onto consumers. While the IFCC admits that some hybrid cars may have to be imported, a $6,000 manufacturer credit for every domestically-built hybrid could saw Iranian automakers (of which there are many) to commit to hybrid development. Iran’s auto industry is actually the 18th largest in the world, with annual production of about 1.6 million units. Few of those cars are hybrids, though a growing number resorted to using CNG as a fuel over oil as international sanctions limited production.
It’s ironic that a nation that appears at times to be culturally conservative can be more liberal when it comes to its energy policies. Outside of the UAE, few Middle Eastern nations are doing anything to combat climate change, content to sit back and collect their oil money. If approved, the Iranian plan to bring EVs and hybrids to the streets could change the balance of power in the region.
It won’t happen overnight, but with oil prices and demand basically flatlining, fossil fuels seem to be falling out of favor at a time when both were supposed to be rising, and Iran’s support for electrified vehicles could make all the difference.