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Cost-Benefit Analysis of policies for the development of electric vehicles in Germany: Methods and results

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  • Massiani, Jérôme

Abstract

Policies toward the diffusion of electric vehicles received a lot of attention in the latest years in many developed countries. Yet the real costs and benefits for society as a whole of this technology have received limited attention from economists. In this context, the present paper proposes a thorough cost benefit analysis of policies for the development of electric vehicles in Germany. It also reviews the main existing models of EV diffusion to shed light on the modeling issues underlying the evaluation of EV policies. Elaborating on a comprehensive simulation model, it shows that the potential for EV is fairly limited while there is more room for intermediate technologies like Plug-in Hybrid Vehicles and Range Extenders. The paper concludes that most of the investigated policies have a negative benefit-cost balance. These results are strongly driven by the regulatory framework in which EV diffusion could take place and especially the Car Average Fleet Emission regulation EU 443.

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  • Massiani, Jérôme, 2015. "Cost-Benefit Analysis of policies for the development of electric vehicles in Germany: Methods and results," Transport Policy, Elsevier, vol. 38(C), pages 19-26.
    • Handle: RePEc:eee:trapol:v:38:y:2015:i:c:p:19-26
    DOI: 10.1016/j.tranpol.2014.10.005
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    2. Zhang, Xingping & Liang, Yanni & Yu, Enhai & Rao, Rao & Xie, Jian, 2017. "Review of electric vehicle policies in China: Content summary and effect analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 698-714.
    3. Wenbo Li & Ruyin Long & Hong Chen & Feiyu Chen & Xiao Zheng & Muyi Yang, 2019. "Effect of Policy Incentives on the Uptake of Electric Vehicles in China," Sustainability, MDPI, vol. 11(12), pages 1-20, June.
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    6. Nian, Victor & Hari, M.P. & Yuan, Jun, 2019. "A new business model for encouraging the adoption of electric vehicles in the absence of policy support," Applied Energy, Elsevier, vol. 235(C), pages 1106-1117.
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    9. Ma, Shao-Chao & Fan, Ying & Feng, Lianyong, 2017. "An evaluation of government incentives for new energy vehicles in China focusing on vehicle purchasing restrictions," Energy Policy, Elsevier, vol. 110(C), pages 609-618.
    10. Ito, Yutaka & Managi, Shunsuke, 2015. "The potential of alternative fuel vehicles: A cost-benefit analysis," Research in Transportation Economics, Elsevier, vol. 50(C), pages 39-50.
    11. Anna Kiziltan & Mustafa Kiziltan & Shihomi Ara Aksoy & Merih Aydınalp Köksal & Ş. Elçin Tekeli & Nilhan Duran & S. Yeşer Aslanoğlu & Fatma Öztürk & Nazan Özyürek & Pervin Doğan & Ağça Gül Yılmaz & Can, 2023. "Cost–benefit analysis of road-transport policy options to combat air pollution in Turkey," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(10), pages 10765-10798, October.
    12. Li, Wenbo & Long, Ruyin & Chen, Hong, 2016. "Consumers’ evaluation of national new energy vehicle policy in China: An analysis based on a four paradigm model," Energy Policy, Elsevier, vol. 99(C), pages 33-41.
    13. Yixi Xue & Yi Zhang & Yi Chen, 2019. "An Evaluation Framework for the Planning of Electric Car-Sharing Systems: A Combination Model of AHP-CBA-VD," Sustainability, MDPI, vol. 11(20), pages 1-22, October.
    14. Du, Jiuyu & Li, Feiqiang & Li, Jianqiu & Wu, Xiaogang & Song, Ziyou & Zou, Yunfei & Ouyang, Minggao, 2019. "Evaluating the technological evolution of battery electric buses: China as a case," Energy, Elsevier, vol. 176(C), pages 309-319.
    15. Zhongqi Deng & Peng Tian, 2020. "Are China's subsidies for electric vehicles effective?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(4), pages 475-489, June.
    16. Li, Chengjiang & Negnevitsky, Michael & Wang, Xiaolin & Yue, Wen Long & Zou, Xin, 2019. "Multi-criteria analysis of policies for implementing clean energy vehicles in China," Energy Policy, Elsevier, vol. 129(C), pages 826-840.
    17. Stefan Englberger & Holger Hesse & Daniel Kucevic & Andreas Jossen, 2019. "A Techno-Economic Analysis of Vehicle-to-Building: Battery Degradation and Efficiency Analysis in the Context of Coordinated Electric Vehicle Charging," Energies, MDPI, vol. 12(5), pages 1-17, March.
    18. Abotalebi, Elnaz & Scott, Darren M. & Ferguson, Mark R., 2019. "Why is electric vehicle uptake low in Atlantic Canada? A comparison to leading adoption provinces," Journal of Transport Geography, Elsevier, vol. 74(C), pages 289-298.
    19. Lopez, Neil Stephen & Tria, Lew Andrew & Tayo, Leo Allen & Cruzate, Rovinna Janel & Oppus, Carlos & Cabacungan, Paul & Isla, Igmedio & Ansay, Arjun & Garcia, Teodinis & Cabarrubias-Dela Cruz, Kevien &, 2021. "Societal cost-benefit analysis of electric vehicles in the Philippines with the inclusion of impacts to balance of payments," Renewable and Sustainable Energy Reviews, Elsevier, vol. 150(C).
    20. Massiani, Jérôme & Gohs, Andreas, 2015. "The choice of Bass model coefficients to forecast diffusion for innovative products: An empirical investigation for new automotive technologies," Research in Transportation Economics, Elsevier, vol. 50(C), pages 17-28.
    21. Wang, Ning & Tang, Linhao & Pan, Huizhong, 2017. "Effectiveness of policy incentives on electric vehicle acceptance in China: A discrete choice analysis," Transportation Research Part A: Policy and Practice, Elsevier, vol. 105(C), pages 210-218.
    22. Weixing Liu & Hongtao Yi, 2020. "What Affects the Diffusion of New Energy Vehicles Financial Subsidy Policy? Evidence from Chinese Cities," IJERPH, MDPI, vol. 17(3), pages 1-15, January.
    23. Hirte, Georg & Tscharaktschiew, Stefan, 2013. "The optimal subsidy on electric vehicles in German metropolitan areas: A spatial general equilibrium analysis," Energy Economics, Elsevier, vol. 40(C), pages 515-528.
    24. Xiaoli Sun & Zhengguo Li & Xiaolin Wang & Chengjiang Li, 2019. "Technology Development of Electric Vehicles: A Review," Energies, MDPI, vol. 13(1), pages 1-29, December.

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    More about this item

    Keywords

    Electric vehicles; evaluation; Cost Benefit Analysis;
    All these keywords.

    JEL classification:

    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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