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Biofuels, Climate Policy, and the European Vehicle Fleet


  • Xavier Gitiaux
  • Sebastian Rausch
  • Sergey Paltsev
  • John M. Reilly


We examine the effect of biofuels mandates and climate policy on the European vehicle fleet, in particular the prospects for diesel and gasoline vehicles. Our analysis is based on a dynamic computable general equilibrium model of the world economy which explicitly incorporates current generation biofuels, accounts for stock turnover of the vehicle fleets, disaggregates gasoline and diesel cars, and represents an advanced E85 vehicle. We find that the European vehicle fleet is robust to proposed biofuels mandates owing to an existing fuel tax and tariffs structure that favours diesel vehicles. Harmonising excise duties on diesel and gasoline or lowering tariffs on biofuel imports, however, is shown to reverse the trend toward more diesel vehicles and significantly alters the efficiency costs and environmental effectiveness of renewable fuel policies. © 2012 LSE and the University of Bath

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  • Xavier Gitiaux & Sebastian Rausch & Sergey Paltsev & John M. Reilly, 2012. "Biofuels, Climate Policy, and the European Vehicle Fleet," Journal of Transport Economics and Policy, University of Bath, vol. 46(1), pages 1-23, January.
  • Handle: RePEc:tpe:jtecpo:v:46:y:2012:i:1:p:1-23

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    References listed on IDEAS

    1. de Palma, André & Kilani, Moez & Lindsey, Robin, 2005. "Congestion pricing on a road network: A study using the dynamic equilibrium simulator METROPOLIS," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(7-9), pages 588-611.
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    Cited by:

    1. Schafer, Andreas, 2012. "Introducing behavioral change in transportation into energy/economy/environment models," Policy Research Working Paper Series 6234, The World Bank.
    2. Hoefnagels, Ric & Banse, Martin & Dornburg, Veronika & Faaij, André, 2013. "Macro-economic impact of large-scale deployment of biomass resources for energy and materials on a national level—A combined approach for the Netherlands," Energy Policy, Elsevier, vol. 59(C), pages 727-744.
    3. Chen, Y.-H. Henry & Paltsev, Sergey & Reilly, John M. & Morris, Jennifer F. & Babiker, Mustafa H., 2016. "Long-term economic modeling for climate change assessment," Economic Modelling, Elsevier, vol. 52(PB), pages 867-883.
    4. Aileen Lam, 2013. "Projections of future emissions and energy use from passenger cars as a result of policies in the EU with a dynamic model of technological change," 4CMR Working Paper Series 005, University of Cambridge, Department of Land Economy, Cambridge Centre for Climate Change Mitigation Research.
    5. Winchester, Niven & McConnachie, Dominic & Wollersheim, Christoph & Waitz, Ian A., 2013. "Economic and Emissions Impacts of Renewable Fuel Goals for Aviation in the US," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 155003, Agricultural and Applied Economics Association.
    6. Beach, Robert H. & Birur, Dileep K. & Davis, Lauren M. & Ross, Martin T., 2011. "A Dynamic General Equilibrium Analysis Of U.S. Biofuels Production," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103965, Agricultural and Applied Economics Association.
    7. Winchester, Niven & McConnachie, Dominic & Wollersheim, Christoph & Waitz, Ian A., 2013. "Economic and emissions impacts of renewable fuel goals for aviation in the US," Transportation Research Part A: Policy and Practice, Elsevier, vol. 58(C), pages 116-128.
    8. Paltsev, Sergey & Chen, Y.-H. Henry & Karplus, Valerie & Kishimoto, Paul & Reilly, John & Loeschel, Andreas & von Graevenitz, Kathrine & Koesler, Simon, 2015. "Reducing CO2 from cars in the European Union: Emission standards or emission trading?," CAWM Discussion Papers 84, University of Münster, Center of Applied Economic Research Münster (CAWM).
    9. Cai, Yongxia & Beach, Robert H. & Zhang, Yuquan, 2014. "Exploring the Implications of Oil Prices for Global Biofuels, Food Security, and GHG Mitigation," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170589, Agricultural and Applied Economics Association.
    10. Junko Mochizuki & John F. Yanagida & Makena Coffman, 2013. "Market, Welfare and Land-Use Implications of Lignocellulosic Bioethanol in HawaiÔi," Working Papers 2013-10, University of Hawaii Economic Research Organization, University of Hawaii at Manoa.

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