Heterogeneity in Economic and Carbon Benefits of Electric Technology Vehicles in the US

To broadly contribute to sustainable mobility, electric
technology
vehicles (hybrid, electric, and plug-in-hybrid) must become more price
competitive with internal combustion vehicles. This study assesses
the economic and carbon benefits of electric technology vehicles in
the U.S., accounting for household-by-household behavioral variability
and geographical differences in fuel and electricity prices. This
finer resolution provides insight into subsets of the population for
whom adoption is economically or environmentally favorable, allowing
us to construct marginal abatement cost curves for CO2 that
account for geographic, behavioral, and stock heterogeneities. Currently,
low gasoline prices and high initial expense means that, without subsidies,
few consumers benefit financially from electric technology vehicles
(1.7% of drivers). However, improved technology dramatically and nonlinearly
increases both the number of consumers that benefit and corresponding
carbon emissions that could be abated without government subsidy.
Our results clarify cost targets that electric vehicle technology
must achieve in order to deliver net financial and subsidy-free environmental
benefits.