Volkswagen plans to transition a Greek island entirely to electric vehicles powered by renewable energy.

The automaker is working with the Greek government to turn Astypalea, in the southern Aegean Sea, into a "model island" for zero-emission transportation.

The plan calls for a sharing service encompassing electric cars, e-scooters, and e-bikes. In total, 1,000 electric vehicles will replace about 1,500 internal-combustion vehicles on the island, according to VW.

Commercial vehicles and municipal vehicles will be electrified as well, VW said, without offering further details.

A network of Elli charging stations will be installed around the island, totaling 230 private and publicly-accessible charging points, the automaker said.

Astypalea makes for a relatively easy test case. It's total area is only about 40 square miles, and it has a permanent population of just 1,300 people. Public transit is also limited, leaving more demand for sharing services.

Volkswagen demonstration project on Greek island of Astypalea

Volkswagen demonstration project on Greek island of Astypalea

Islands in general make good testbeds for renewable energy, as they are isolated from mainland power grids, and infrastructure needs are more manageable.

The demonstration of electric vehicles with renewable energy for charging is another indication that VW is taking a holistic approach to emissions reduction. VW is scrutinizing the entire supply chain for its ID vehicles for potential cuts to carbon emissions, and has also been aiming for close control of the battery supply chain.

The automaker didn't say explicitly that the Greek project is related to its diesel-emissions scandal or the accompanying settlement, but it closely resembles some projects that are.

Electrify America is a VW subsidiary set up to spend $2 billion of diesel-emissions penalties on charging infrastructure and promotion of electric cars—including sharing services for disadvantaged communities.

The island project also resembles projects undertaken by Renault, which has set up two "smart islands" that also feature fleets of electric cars and charging infrastructure powered by renewable energy. The islands are located off the coasts of France and Portugal.