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A cost benefit analysis of fuel cell electric vehicles

Author

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  • Anna Creti

    (X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique, LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique, Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres)

  • Alena Kotelnikova

    (X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique)

  • Guy Meunier

    (X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique)

  • Jean-Pierre Ponssard

    (CNRS - Centre National de la Recherche Scientifique, X-DEP-ECO - Département d'Économie de l'École Polytechnique - X - École polytechnique)

Abstract

This study develops a consistent framework to compare FCEV with gasoline ICE (ignition combustion engine) and applies this framework to the German market over the period 2015-2050. As such it provides for: - The formulation of a proper cost benefit analysis, including the definition of the abatement cost for the hydrogen technology; - The simulation of the results under various technological and cost assumptions; - The identification of the major conceptual issues to facilitate analytical developments. The sources used in the analysis are based on an update of previous industry studies. The main conclusion is that FCEV could be a socially beneficial alternative for decarbonizing part of the projected German car park at the horizon 2050. The corresponding abatement cost would fall in the range of 50 €/t CO2 to 60 €/t CO2. This range is higher than the current estimate for the normative cost of carbon as expressed in Quinet (2009 and 2013), which is around 30€/t in 2015. Still the gap is not out of hand. We identify the market and cost conditions that would shorten the gap. The methodology used in this study could be expanded to integrate two pending issues noted in the literature for the successful deployment of FCEV: - Making the deployment for FCEV endogenous and depending on the public and private instruments that could induce the decreasing of costs and the acceptance of the FCEV technology by consumers. - Designing an appropriate institutional framework to promote cooperation for manufacturing FCEV, producing carbon free H2 and investing in the distribution of H2. The initial sunk costs necessary for investment cannot be recouped through pure market equilibrium behavior. This study already provides an order of magnitude to quantify these issues.

Suggested Citation

  • Anna Creti & Alena Kotelnikova & Guy Meunier & Jean-Pierre Ponssard, 2015. "A cost benefit analysis of fuel cell electric vehicles," Working Papers hal-01116997, HAL.
    • Handle: RePEc:hal:wpaper:hal-01116997
    Note: View the original document on HAL open archive server: https://hal.science/hal-01116997
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    References listed on IDEAS

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    1. Ellerman, Danny & Delarue, Erik & Weigt, Hannes, 2012. "CO2 Abatement from RES Injections in the German Electricity Sector: Does a CO2 Price Help?," Working papers 2012/14, Faculty of Business and Economics - University of Basel.
    2. Newell, Richard G. & Pizer, William A., 2003. "Discounting the distant future: how much do uncertain rates increase valuations?," Journal of Environmental Economics and Management, Elsevier, vol. 46(1), pages 52-71, July.
    3. Stern,Nicholas, 2007. "The Economics of Climate Change," Cambridge Books, Cambridge University Press, number 9780521700801.
    4. Ignacio J. Perez-Arriaga & Carlos Batlle, 2012. "Impacts of Intermittent Renewables on Electricity Generation System Operation," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 2).
    5. Partha Dasgupta, 2008. "Discounting climate change," Journal of Risk and Uncertainty, Springer, vol. 37(2), pages 141-169, December.
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    Cited by:

    1. Anna Creti & Alena Kotelnikova & Guy Meunier & Jean-Pierre Ponssard, 2018. "Defining the Abatement Cost in Presence of Learning-by-Doing: Application to the Fuel Cell Electric Vehicle," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 71(3), pages 777-800, November.
    2. Olfa Tlili & Christine Mansilla & David Frimat & Yannick Perez, 2019. "Hydrogen market penetration feasibility assessment: Mobility and natural gas markets in the US, Europe, China and Japan," Post-Print hal-02265824, HAL.
    3. Jesus Ochoa Robles & Catherine Azzaro-Pantel & Guillem Martinez Garcia & Alberto Aguilar Lasserre, 2020. "Social cost-benefit assessment as a post-optimal analysis for hydrogen supply chain design and deployment: Application to Occitania (France)," Post-Print hal-03118656, HAL.
    4. De-León Almaraz, Sofía & Rácz, Viktor & Azzaro-Pantel, Catherine & Szántó, Zoltán Oszkár, 2022. "Multiobjective and social cost-benefit optimisation for a sustainable hydrogen supply chain: Application to Hungary," Applied Energy, Elsevier, vol. 325(C).

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