Laos to Grow EV Market, Fueled by Renewable Energy Ambitions

Laos to grow EV Market, Fueled by Renewable Energy Ambitions
Concept of electric car charging. (Photo: Freepik)

The burgeoning popularity of electric vehicles (EVs) in Laos has marked significant growth in 2023, with a total of 4,631 EVs sold, comprising 2,592 cars and 2,039 motorbikes.

But while the world is striving toward a green transition, this surge in EV adoption in Laos is not seamlessly matched by the necessary infrastructure. Currently, the country boasts only 41 charging stations, with the majority being in Vientiane Capital.

This is in stark contrast to its neighboring countries. Thailand, for instance, has surged ahead with an extensive network of 2,222 charging locations and a total of 8,702 charging units as of September this year.

Nonetheless, the Ministry of Energy and Mines is collaborating with relevant sectors to establish regulations on taxation, technical standards of EVs, and the management of vehicle charging stations.

To support the growing EV market, the Lao government has also implemented strategic policies to push forward the EV agenda.

In 2022, former Prime Minister Phankham Viphavanh introduced a policy to facilitate the sales of electric vehicles by removing import limits, provided the vehicles met international quality, safety, after-sales service, maintenance, and waste management standards.

The policy also offers a 30 percent reduction in the annual road tax for electric vehicles compared to their petrol counterparts with equivalent engine power and allows EVs priority parking at charging stations and other public parking areas.

The government remains steadfast in its commitment to promoting EVs in the country to minimize the financial burden of importing petroleum. 

The Ministry of Industry and Commerce, in collaboration with the natural resources and environment sector, is actively developing strategies for managing expired batteries. EV batteries must be replaced every seven to 10 years for smaller vehicles, and three to four years for larger EVs such as buses or vans.

While Laos’ EV market is currently smaller than that of neighboring countries like Thailand and Vietnam, the government is proactively driving EV adoption. Leveraging the country’s considerable potential for electricity generation through renewable sources, Laos aims to increase its EV consumption to at least 1 percent of total vehicles by 2025, encompassing cars, buses, and motorcycles. 

The country’s commitment to sustainable transportation aligns with its vision for a greener and more energy-efficient future.