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ICCT White Paper on Transition to All Zero-Emission Vehicles

Auto News - Published on Thu, 17 Oct 2019

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This white paper quantifies the costs, benefits, and appropriate government funding associated with the transition to all passenger zero-emission vehicles. It assesses the key government support programs needed, for how long the need continues, and how public expenditures compare to societal benefits as the ZEV market develops. The work also identifies opportunities to phase down government expenditures, including shifting to polluter-pay programs, adopting long-term policies with minimal outlays, and transitioning costs to the private sector.The analysis supports the following conclusions:

Sustained funding is critical to growing the early ZEV market. The near-term costs required to address ZEV market barriers are substantial. Incentives to defray upfront vehicle costs, infrastructure to ensure convenient charging, and outreach campaigns to educate consumers on ZEV options and their benefits are all necessary. As ZEVs reach cost parity with conventional vehicles and are more widely adopted, incentives and consumer awareness programs can evolve while infrastructure costs continue through the transition. Polluter-pay policies that tax higher-polluting vehicles could produce steady revenue, incorporate vehicle externalities, and help to avoid annual budget debates while incentivizing ZEVs.

The societal benefits of ZEVs far outweigh the costs. The costs of the ZEV transition are substantial but are greatly outweighed by the benefits. Benefits are estimated to outweigh costs before 2030, and 2020–2050 cumulative benefits will outweigh the costs by a factor of about 5 to 11. The figure below shows the annual ZEV transition costs and benefits over 2020–2050 for Germany. Costs include purchase incentives required before cost parity is reached, consumer education campaigns, and infrastructure. Benefits include fuel savings, maintenance savings, reduced vehicle prices after cost parity is achieved, and greenhouse gas emission reductions. Excluding the benefits from reduced greenhouse gas externalities, the 2020–2050 cumulative benefits outweigh the costs by a factor of about 7 in the United States, and by a factor of about 4 in Germany.

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Posted By : Mohan Sharma on Thu, 17 Oct 2019
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