Electric Vehicle Incentives Research Articles

Effectiveness of electric vehicle incentives in the United States

Transportation accounts for 28% of total energy use and 26% of carbon emissions in the US, and battery electric and plug-in hybrid electric vehicles are promising options to decarbonize transportation. Federal and state governments, electric utility operators, and a number of other entities have provided support to accelerate electric vehicle purchases via monetary and non-monetary incentives. In this paper, we evaluate the effect of these incentives on the adoption of electric vehicles. We find that every $1000 offered as a rebate or tax credit increases average sales of electric vehicles by 2.6%. We also find that HOV lane access is a significant contributor to adoption, the effect is a 4.7% increase corresponding to density of HOV lanes (every 100 vehicles per hour). In addition, we introduce a novel variable to capture consumer knowledge of EVs and associated incentives in our model to help explain the state level heterogeneity in response to incentives and find that raising consumer awareness is critical to the success of EV incentive programs.

Politics in the U.S. energy transition: Case studies of solar, wind, biofuels and electric vehicles policy

We examine the politics of US state and federal policy supporting wind and solar in the electricity sector and biofuels and electric vehicles in the transportation sector. For each technology, we provide two policy case studies: the federal Production Tax Credit (PTC) and state Renewable Portfolio Standards (RPS) for wind; state Net Energy Metering (NEM) and the federal investment tax credit (ITC) for solar; federal excise tax incentives and the Renewable Fuel Standard (RFS) for biofuels; and California's Zero Emission Vehicle (ZEV) mandate and federal tax incentives for electric vehicles. Each case study traces the enactment and later revision of the policy, typically over a period of twenty-five years. We use these eight longitudinal case studies to identify common patterns in the politics of US renewable energy policy. Although electricity and transportation involve different actors and technologies, we find similar patterns across these sectors: immature technology is underestimated or misunderstood; large energy bills provide windows of opportunity for enactment; once enacted, policies are extended incrementally; there is increasing politicization as mature technology threatens incumbents.

Analysis of Manufacturer Plug-In Electric Vehicle Incentives

Vehicle manufacturers offer incentives in an attempt to encourage consumers to purchase or lease new vehicles. Similarly federal and local governments offer incentives to help build and maintain a market for plug-in electric vehicles (1). This paper analyzes manufacturer cash rebates and special lease offers and presents a comparison of plug-in electric vehicle incentives by manufacturer, technology, geographic area, and time period. How these manufacturer plug-in electric vehicle incentives relate to vehicle sales as well as state and federal government incentives is also investigated.

Establishing the Transferability of Best Practice in EV Policy across EU Borders

In supporting the growth of the electric vehicle market within Europe, incentives will play a significant role. The paper presents the case that the success of incentives is contextualised. On the basis of 110 expert responses from Austria, Germany, Spain and the UK, the paper evaluates the effectiveness of different incentives, financial and non-financial, under different market and policy environments. Although incentives are invariably perceived as effective by our expert respondents, it is observed that the distribution in acceptance levels were dependent on the region in which they have been deployed. Interrogation of the supporting commentary provided the basis for the interpretation of these differences. The research therefore makes a positive contribution to the understanding of the linkage between the success in electric vehicle incentives and regional market framework and policy environments. This opens the door for best practice transferability of incentives and optimally combining different incentives dependent on the social and institutional environments into which they are deployed.

The increase of electric vehicle usage in Norway—incentives and adverse effects

Norway has been named the “capital” of Electric Vehicles (EVs) because the purchase and use of EVs in Norway has increased tremendously over the last few years. Currently, the fleet of EVs in Norway is the largest per capita in the world. From a transportation research perspective, the questions immediately asked are (i) what economic incentives make the purchase and use of EVs in Norway so attractive to road users; (ii) do these incentives have any adverse effects and, if so, how large are they; and (iii) how does the marginal external cost of EVs compare to that of conventional vehicles. We explore the above questions using available data, the literature and personal observations while relating to the city of Oslo as a case study. We find that the tremendous increase in the use of EVs is the result of multiple economic incentives, such as exemption from toll charges, exemption from purchase duties and permission to use transit lanes that induce road users to purchase and use EVs. The increase in EVs has led to a reduction in CO2 emissions. However, some of the EV incentives have adverse effects, the most serious of which is the exemption from toll charges, which has led to a sizable loss of toll revenue. We find that the marginal external cost of EVs’ road use is approximately the same as that for a conventional vehicle. The incentives for EVs should consider the adverse effects and how electricity is produced; the Norwegian approach should not be followed by other countries without due consideration of these factors.

Should policy-makers allocate funding to vehicle electrification or end-use energy efficiency as a strategy for climate change mitigation and energy reductions? Rethinking electric utilities efficiency programs

In order to reduce greenhouse gas emissions in the United States by an order of magnitude, a portfolio of mitigation strategies is needed. Currently, many utilities pursue energy efficiency programs. We study a case where utilities could choose whether to allocate their energy efficiency budget to either end-use efficiency or vehicle electrification as a means to reduce CO2 emissions. We build a decision space that displays the conditions under which utilities should pursue either strategy. To build such decision space, assumptions are needed on how consumers respond to electric vehicle incentives, and what would be the baseline vehicle selected by consumers if no incentives were in place. Since these two aspects are highly uncertain, we treat them parametrically: if consumers are replacing a conventional vehicle with a PHEV, utility incentive programs to induce PHEV adoption appear to be cost-effective for a wide range of efficiency program costs and grid emissions factors.

Evaluating the Financial Future of Electric Utilities Using Scenarios Analysis: The Case of Tamil Nadu

This paper analyzes the impact of multiple scenarios on the utility’s financials using Revenue and Tariff Analysis for Electric Utilities (RATE) model. The RATE modeling tool can provide actionable insights into the impact of various decisions on overall demand–supply scenarios, the energy balance, and revenue gaps. The model was customized for application to Tamil Nadu (TN) by World Resources Institute (WRI) in collaboration with Prayas (Energy Group) as a knowledge partner.