Abstract
The effectiveness of fiscal policy to influence vehicle purchases for emissions reductions in private passenger road transport depends on its ability to incentivise consumers to make choices oriented towards lower emissions vehicles. However, car purchase choices are known to be strongly socially determined, and this sector is highly diverse due to significant socio-economic differences between consumer groups. Here, we present a comprehensive dataset and analysis of the structure of the 2012 private passenger vehicle fleet-years in six major economies across the World (UK, USA, China, India, Japan and Brazil) in terms of price, engine size and emissions distributions. We argue that choices and aggregate elasticities of substitution can be predicted using this data, enabling us to evaluate the effectiveness of potential fiscal and technological change policies on fleet-year emissions reductions. We provide tools to do so based on the distributive structure of prices and emissions in segments of a diverse market, both for conventional as well as unconventional engine technologies. We find that markets differ significantly between nations, and that correlations between engine sizes, emissions and prices exist strongly in some markets and not strongly in others. We furthermore find that markets for unconventional engine technologies have patchy coverages of varying levels. These findings are interpreted in terms of policy strategy.
Highlights
Road transport generates 5.3 Gt out of 31.7 Gt of CO2 of global fuel combustion greenhouse gas emissions contributing to climate change, and over 30% of total emissions annual growth (IEA 2013)
We have provided qualitative and quantitative tools that can help understand and determine the likely outcome of chosen policies targeting consumer vehicle choice for emissions reductions
The effectiveness of fiscal policies for incentivising consumer choices towards lower emissions vehicles of any type, according to this work, is of around 0.3–0.4 gCO2 km−1 per percent of a proportional emissions tax applied to vehicle sale prices, in all countries except in the USA where it is of 0.6–0.9 gCO km−1 per percent of tax, 2 to 3 times higher, with higher uncertainty
Summary
Road transport generates 5.3 Gt out of 31.7 Gt of CO2 of global fuel combustion greenhouse gas emissions contributing to climate change, and over 30% of total emissions annual growth (IEA 2013). Transport is not currently highly regulated for emissions, and consumer preferences with increasing income drives choices towards increasingly carbon intense engines (e.g. Gallachoir et al 2009, Zachariadis 2013). The fuel efficiency of the car fleet depends directly on its composition of engine types and sizes. In other emissions intensive sectors such as industry, technologies of the same type (e.g. boilers, blast furnaces, power plants) differ modestly predominantly due to vintage. The transport sector, features a very wide continuous array of possible fuel efficiencies (spanning a factor of 3–4, see data below), that do not depend as strongly on the state of technology and age of cars as it does on socio-economic characteristics of owners. As demonstrated by McShane et al 2012, vehicle choices strongly relate to social groups, and existing socio-economic differences are reflected in
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