The push for greener transport in Denmark has gained momentum, with hauliers increasingly eager to transition from diesel to electric trucks. However, a funding shortfall has left many disappointed, as applications for subsidies have far exceeded the available budget.
In the fall of last year, a government fund dedicated to supporting the transition of heavy road transport to electric alternatives was quickly exhausted. The initial allocation of 75 million DKK was claimed almost immediately, leaving hauliers scrambling for funds. According to new data from the Danish Road Directorate, applications totaled a staggering 309 million DKK—four times the available amount.
High demand, limited support
Erik Østergaard, CEO of the Danish Transport and Logistics Association (DTL), noted the frustration among hauliers who were ready to invest in electric trucks but were unable to secure financial support. “One of our members had just stepped away to get a cup of coffee while preparing his application. By the time he submitted it—just 15 minutes after the fund opened—he was already too late,” Østergaard explained.
The 75 million DKK subsidy was part of a larger 700-million-DKK government plan to transition heavy transport to electric power by 2030. Each year, politicians decide how much of this total fund will be allocated and how it will be distributed.
Given the overwhelming demand this year, Østergaard is urging policymakers to accelerate the rollout of funding so that more companies can test electric trucks in real-world conditions.
Lasse Hansen, director of Leif Hansen transport company in Brabrand near Aarhus, was among those left empty-handed. He had applied for 625,000 DKK to purchase two electric trucks but was denied funding.
“I’m incredibly disappointed. We want to be ahead of the curve,” said Hansen. However, without the subsidy, he stated that switching to electric trucks would be financially unfeasible. “If I have to pay three times as much for a truck as I normally would, my business would go under immediately.”
This concern is widely shared within the industry. While battery technology has improved and electric trucks are becoming more affordable, the upfront costs remain significantly higher than their diesel counterparts.
A shift in strategy?
Jeppe Rich, a professor at DTU Management specializing in freight electrification, believes policymakers need to reconsider their approach. Instead of outright grants, he suggests offering state-backed loans.
“From an economic perspective, electric trucks will be more cost-effective in the long run. Their total operating costs will decrease, making them a viable investment. Instead of grants, a state-guaranteed loan program would allow more funds to be distributed effectively,” Rich argued.
Hansen, the transport company director, said he is open to the idea: “If I could get an interest-free, government-backed loan, that could be a good solution.”
Transport Minister Thomas Danielsen has acknowledged the need for faster action and has called for discussions with political parties to decide on the next steps for funding distribution.
“I want to get the money working as quickly as possible to benefit both the green transition and hauliers,” Danielsen stated. He considers the high demand for electric trucks a success story, pointing out that many are now being purchased without subsidies.
To ensure fairness, Danielsen is also exploring ways to prioritize smaller hauliers in the subsidy program. “My focus is to make it easier for smaller transport companies to receive the largest funding amounts while limiting subsidies for bigger companies, as they are already adapting on their own,” he said.
However, Danielsen is skeptical about replacing subsidies with loans. “I have no interest in turning the government into a bank for hauliers. A direct grant is the simplest and least bureaucratic solution,” he stated.
