Six years of CO2-based tax incentives for new passenger cars in The Netherlands: Impacts on purchasing behavior trends and CO2 effectiveness

There is growing evidence that consumers respond more effectively to upfront price signals, such as vehicle purchase taxes and feebate policies, and to tax incentives that are more salient than others, such as company car taxes graded by CO₂ emissions. This paper examines tax changes in The Netherlands, which are among the most stringent and most salient in Europe, and assesses the ex-post purchasing impacts and CO₂ effectiveness of six years of CO₂-based tax incentives for low-carbon cars in The Netherlands. Dutch tax incentives resulted in 13 g/km, or 11% lower average CO₂ emissions in 2013. The Netherlands has moved from the 12th position before the tax changes in 2007 to become Europe’s number one in terms of the lowest average new car CO₂ emissions and highest share of electric vehicles in 2013. Tax incentives for new cars sold between 2008 and 2013 have resulted in 4.6 million tons of potential lifetime CO₂ abatement at the cost of a drop in tax revenues of 30–50%. However, when corrected for the Dutch policy-induced increasing real-world fuel-economy shortfall and leakage of carbon reduction potential through vehicle export of low-carbon cars, only 3.5 million tons or 75% of the CO₂ reduction remains. CO₂-based tax incentives for company cars seem to have contributed the most to the observed turnaround in purchasing behavior towards lower CO₂-emitting passenger cars.     

New car preferences move away from greater size,weight and power: Impact of Dutch consumer choices on average CO2-emissions

This paper assesses the separate effects of consumer preferences and technological advances on sales-weighted average CO₂ emissions of new passenger cars in the Netherlands. Since 2008, consumer preferences have been moving away from large size, weight and power whereby car buyers were offsetting more than 50% of the potential CO₂ reduction from technological advances. From 2008 to 2011 consumer choices not only ceased to offset a large share of the technological advances, but contributed more than an additional 30% to CO₂ reductions. Had consumer preferences not decoupled from the historical upward trend, the Dutch sales-weighted average CO₂ emissions of new passenger cars would have been 139 g/km rather than the 126 grams CO₂ per km in 2011.     

A model system for the assessment of the effects of car and fuel green taxes on CO2 emission

This study aims at developing a model system to examine the changes in the car market configuration, the life cycle CO₂ emission from automobile transport and the tax revenues due to different taxation policies. The model system specifically determines the effect of varying the weights of the tax components in the stages of a) car purchasing, b) car owning, and c) car using to the changes in the car class and age mix and the car users' driving pattern and behavior towards car class choice and decommissioning. Five sub-models comprise the model system, formulated using car ownership related data in Japan from 1980 to 1994. Performance tests conducted against the sub-models generally yielded encouraging results. The sensitivity analysis identified car usage tax as the most significant parameters in reducing CO₂. An increase in, ownership tax, on the other hand, significantly results to a shift to smaller cars, while the propensity to decommission and repurchase can be reduced by increasing the purchase tax and can be decreased by increasing the ownership tax. The model system was utilized to determine the impact of the 1989 tax reform and to forecast future scenarios using different taxation schemes. The model system is being further developed for possible future application in other countries.     

Accelerating the transformation to a low carbon passenger transport system: The role of car purchase taxes,feebates, road taxes and scrappage incentives in the UK

The transition to a low carbon transport world requires a host of demand and supply policies to be developed and deployed. Pricing and taxation of vehicle ownership plays a major role, as it affects purchasing behavior, overall ownership and use of vehicles. There is a lack in robust assessments of the life cycle energy and environmental effects of a number of key car pricing and taxation instruments, including graded purchase taxes, vehicle excise duties and vehicle scrappage incentives. This paper aims to fill this gap by exploring which type of vehicle taxation accelerates fuel, technology and purchasing behavioral transitions the fastest with (i) most tailpipe and life cycle greenhouse gas emissions savings, (ii) potential revenue neutrality for the Treasury and (iii) no adverse effects on car ownership and use.The UK Transport Carbon Model was developed further and used to assess long term scenarios of low carbon fiscal policies and their effects on transport demand, vehicle stock evolution, life cycle greenhouse gas emissions in the UK. The modeling results suggest that policy choice, design and timing can play crucial roles in meeting multiple policy goals. Both CO₂ grading and tightening of CO₂ limits over time are crucial in achieving the transition to low carbon mobility. Of the policy scenarios investigated here the more ambitious and complex car purchase tax and feebate policies are most effective in accelerating low carbon technology uptake, reducing life cycle greenhouse gas emissions and, if designed carefully, can avoid overburdening consumers with ever more taxation whilst ensuring revenue neutrality. Highly graduated road taxes (or VED) can also be successful in reducing emissions; but while they can provide handy revenue streams to governments that could be recycled in accompanying low carbon measures they are likely to face opposition by the driving population and car lobby groups. Scrappage schemes are found to save little carbon and may even increase emissions on a life cycle basis.The main policy implication of this work is that in order to reduce both direct and indirect greenhouse gas emissions from transport governments should focus on designing incentive schemes with strong up-front price signals that reward ‘low carbon’ and penalize ‘high carbon’. Policy instruments should also be subject to early scrutiny of the longer term impacts on government revenue and pay attention to the need for flanking policies to boost these revenues and maintain the marginal cost of driving.     

Estimation of nitrogen oxides emissions from petrol and diesel passenger cars by means of on-board monitoring: Effect of vehicle speed,vehicle technology,engine type on emission rates

NO_X emission rates of 13 petrol and 3 diesel passenger cars as a function of average speed from 10 to 120 km/h, emission class (pre-Euro 1 – Euro 5), engine type were investigated by on-board monitoring on roads and highways of St. Petersburg using a portative Testo XXL 300 gas analyzer. The highest level of NO_X emission 0.5–2.5 g/km was inherent to old pre-Euro 1 petrol cars without a catalytic converter. NO_X emissions rates of Euro 1 and Euro 2 petrol cars changed within 0.15–0.9 g/km, Euro 3 – 0.015–0.27 g/km, Euro 4 – 0.013–0.1 g/km, Euro 5 – 0.002–0.043 g/km. Euro 3 – Euro 4 petrol cars generally satisfied corresponding NO_X Emission Standards (ES), except cold-start period, Euro 5 petrol cars did not exceed ES. Warmed, stabilized engines of Euro 3 – Euro 5 petrol cars showed 5–10 times lower NO_X emission rates than corresponding ES in the range of speed from 20 to 90 km/h. NO_X emission rates of diesel Euro 3 and Euro 4 cars varied from 0.45 to 1.1 g/km and from 0.31 to 1.1 g/km, respectively. Two examined diesel Euro 3 and one Euro 4 passenger vehicles did not satisfy NO_X ES at real use. Euro 3 diesel cars showed 28.9 times higher NO_X emissions than Euro 3 petrol cars and Euro 4 diesel car demonstrated 17.6 times higher NO_X emissions than Euro 4 petrol cars at warmed and stabilized engine at a cruise speed ranging from 30 to 60 km/h.     

The diffusion of cleaner vehicles in CO2 emission trading designs

The accelerated diffusion of cleaner vehicles to reduce CO₂ emissions in transport can be explicitly integrated in emission trading designs by making use of cross-sectoral energy efficiency investment opportunities that are found in data on CO₂ emissions during the production and the use of cars and trucks. We therefore elaborate the introduction of tradable certificates that are allocated or grandfathered to manufacturers that provide vehicles (and other durable goods) that enable their customers to reduce their own CO₂ emissions. This certificate is an allowance for each tonne CO₂ avoided. Manufacturers can then sell these certificates on the emission market and use the revenues to lower the price of their cleanest vehicles. This mechanism should partially overcome the price difference with less efficient cars. In a simulation, we found that the introduction of the certificate in tradable permit systems can lead to very significant reductions of CO₂ emissions. The simulations indicate that CO₂ emissions resulting from the car fleet can be reduced by 25 to 38% over a period of 15 years (starting in 1999). For the truck fleet, the reduction potential is more limited but still very interesting.     

Environmental impact of scrapping old cars

Many countries introduced scrapping programs in the 90s, partly legitimated by environmental impact reductions. However, reducing the age of the current car fleet may result in an increase of life-cycle CO₂ emissions. This will probably also be true for cars to be produced in future unless fuel efficiency of new cars improves much faster than the historical trend indicates. Reducing the age of petrol-fuelled cars without a catalytic converter will reduce both life-cycle NO_x and VOC emissions but is less cost-effective than fitting catalytic converters on these cars. In any case, the influence of a car’s lifetime on life-cycle NO_x and VOC emissions will be reduced in the near future.     

Influences of car type class and carbon dioxide emission levels on purchases of new cars: A retrospective analysis of car purchases in Norway

The impact of socio-demographic and psychological factors on purchases of new cars is examined. Data were gathered in an online retrospective survey using a sample of 198 Norwegian households who purchased a new car in December 2010. A latent class analysis was performed to identify car type classes followed by a path analysis to investigate the determinants of the purchased car type class and the influence on the purchased car’s level of carbon dioxide emissions. The results revealed that car type class is the strongest determinant of the car’s level of CO₂ emissions. Socio-demographic factors have little impact on choice of car type class when psychological factors are controlled for. Intention to purchase an environmentally friendly car has a direct effect on the car’s CO₂ emissions.     

A welfare cost assessment of various policy measures to reduce pollutant emissions from passenger road vehicles

Policy options to reduce passenger transport emissions in Europe are simulated with the EUCARS model. The EUCARS welfare analysis includes changes in consumer surplus, congestion and tax revenues. Simulations also address consumer myopia, i.e., the underestimation of fuel costs by car buyers. The best policy mix to reduce CO₂ consists of fuel taxes that are combined with differentiated purchase taxes to correct for the assumed myopia. This combination could reduce CO₂ emissions of over 25% without reducing contemporaneous well-being. For the reduction of conventional emissions, an equivalent best mix includes an emissions-based kilometre tax combined with a purchase feebate. This mix allows a 60% reduction in toxic emissions without any noticeable welfare reduction. The overall superiority of these two mixes compared to alternative choices is higher when the evaluation includes a broad group of externalities, a premium on public funds, and positive feedbacks across emissions categories. Local traffic management measures are important zero-cost complements for an overall emissions strategy.     

Improvement in the estimation and back-extrapolation of CO2 emissions from the Irish road transport sector using a bottom-up data modelling approach

Road transport is a major source of CO₂ emissions in Ireland and accounts for almost 96% of the total CO₂ emissions from the transport sector. Following the recent adopted UNFCCC reporting guidelines on annual inventories [24/CP.19], this study applied the 2006 IPCC Guidelines for National Greenhouse Gas Inventories (2006 IPCC GLs) tier 3 approach to estimate CO₂ emissions from road transport at the vehicle category level, for the first time in Ireland. For this, disaggregated datasets were prepared based on year of vehicle registration and mileage since registration of the vehicle. Such an approach provided a more realistic national scenario in comparison to the use of average mileage degradation in emission calculations. This investigation comprised a recalculation of previous emissions estimates (1990–2012) and an estimation of CO₂ emissions in 2013 using a previously unavailable level of data disaggregation for vehicle mileage as well as using vehicle class specific data and an improved bottom-up estimation methodology in COPERT. Historic vehicle fleet data were restructured, annual mileage data were estimated in relation to the fleet data and back extrapolated using a regression approach.The results showed that the mileage degradation was not only subject to fuel technology, engine size, and age but also the emissions class and vehicle category. It was also observed that the disaggregated level of data provided a different CO₂ emissions split among the vehicle categories than that of previous estimations which were based on an aggregated level of data. Previous emissions inventories (1990–2012) were shown to have underestimated the share from diesel fuelled passenger cars by more than 56% in 2012. Diesel fuelled passenger cars were also found to account for the majority of CO₂ emissions from road transport activities in Ireland in 2013. The level and trend assessment showed that emissions from Euro-II and Euro-III classed vehicles especially for passenger cars, which have a significant contribution to the total emission in 2013 have caused an increase in fleet level emissions in Ireland. In addition, the results also showed that the emissions share from Light Duty Vehicles and Heavy Duty Vehicles were overestimated by previous investigations. This paper highlights the importance of the resolution of data used in emissions inventory preparation which may impact upon future projections and policy formulation. The findings of this investigation are also discussed in relation their implications for road transport policy, including carbon taxation and future policy options aimed at achieving EU emissions target in 2020.     

Should BEVs be subsidized or taxed? A European perspective based on the economic value of CO2 emissions

Battery Electric vehicles (BEVs) are generally considered as potentially contributing to the reduction of CO₂ emissions. Consequently, many countries have promoted (or are in the process of promoting) policies aimed at directly or indirectly subsidizing BEVs to accelerate their market uptake. The aim of this paper is to assess whether BEVs’ subsidies are justified (and by what amount) with reference to the carbon component, distinguishing by car segments and countries. To address these research questions, a simulation model is developed, based on the most recent and reliable data available. The model estimates and monetizes the Well-to-Wheel CO₂ emissions of six car segments in 28 European countries. The monetary value of the difference of the CO₂ emissions between the non-BEVs and the BEVs ranges from −€1133 (tax) to +€3192 (subsidy), depending on the car segment and on the nation considered. These results are then compared to the policies about alternative fuels adopted by the single EU countries, suggesting in some cases the necessity to rethink such incentives.     

Are multi-car households better suited for battery electric vehicles? – Driving patterns and economics in Sweden and Germany

Battery electric vehicles (BEVs) could reduce CO₂ emissions from the transport sector but their limited electric driving range diminishes their utility to users. The effect of the limited driving range can be reduced in multi-car households where users could choose between a BEV and a conventional car for long-distance travel. However, to what extent the driving patterns of different cars in a multi-car household’s suit the characteristics of a BEV needs further analysis. In this paper we analyse the probability of daily driving above a fixed threshold for conventional cars in current Swedish and German car driving data. We find second cars in multi-car households to require less adaptation and to be better suited for BEV adoption compared to first cars in multi-car households as well as to cars in single-car households. Specifically, the share of second cars that could fulfil all their driving is 20 percentage points higher compared to first cars and cars from single-car households. This result is stable against variation of driving range and of the tolerated number of days requiring adaptation. Furthermore, the range needed to cover all driving needs for about 70% of the vehicles is only 220 km for second cars compared to 390 km for the average car. We can further confirm that second cars have higher market viability from a total cost of ownership perspective. Here, the second cars achieve a 10 percentage points higher market share compared to first cars, and to cars in single-car households for Swedish economic conditions, while for Germany the corresponding figure is 2 percentage points. Our results are important for understanding the market viability of current and near-future BEVs.     

High-speed rail's potential for the reduction of carbon dioxide emissions from short haul aviation: a longitudinal study of modal substitution from an energy generation and renewable energy perspective

Abstract

This paper quantifies and evaluates, utilising a ‘bottom-up’ approach, the effect on CO₂ emissions of a modal shift from short-haul air travel to high-speed rail (HSR), based on projected passenger movements, between Sydney and Melbourne, Australia during the period 2010–2030. To date, peer-reviewed studies assessing the CO₂ emissions from these competing modes of high-speed transportation have been restricted principally to a cross-sectional assessment, with a Eurocentric bias. This present comparative study seeks to address a gap in the literature by assessing, longitudinally, the CO₂ emissions associated with the proposed operation of HSR against the ‘business-as-usual’ air scenario between Sydney and Melbourne. Under the assumed 50/50 modal shift, and the Australian government's current renewable electricity target, an annual reduction in CO₂ emissions of approximately 14% could be achieved when compared with a ‘business-as-usual’ air scenario. This percentage reduction represents a 62 kt reduction in base year, 2010, and a 114 kt reduction in the final year, 2030. In total, the overall reduction achieved by such a modal shift, under the assumed conditions, during the period 2010–2030, equates to approximately 1.87 Mt of CO₂. Importantly, if the electrical energy supply for HSR operations was further ‘decarbonised’, then it follows that a greater emission reduction would be achieved.     

A valuation of the environmental performance of vehicles: an analysis and comparison of two methodologies

The European Clean Vehicle Directive was introduced in 2009 to create an obligation on public authorities to take into account the impact of energy consumption, carbon dioxide (CO₂) emissions and pollutant emissions into their purchasing decisions for road transport vehicles. This should stimulate the market for clean and energy-efficient vehicles and improve transport's impact on environment, climate change and energy use. Therefore the so-called ‘Operational Lifetime Cost’ of a vehicle is calculated, divided into the cost for energy consumption, CO₂ and pollutant (nitrous oxide, particulate matter, non-methane hydrocarbons) emissions. In Belgium, a different methodology has been developed to calculate the environmental impact of a vehicle, called ‘Ecoscore’, based on a well-to-wheel approach. More pollutants are included compared to the Clean Vehicle methodology, but also indirect emissions are taken into account. In this paper, both methodologies are compared and used to analyze the environmental performance of passenger cars with different fuel types and from different vehicle segments. Similar rankings between both methodologies are obtained; however, the large impact of energy use (and CO₂ emissions) in the Clean Vehicle methodology disadvantages compressed natural gas cars, as well as diesel cars equipped with particulate filters, compared to the Ecoscore methodology.     

Potential of low viscosity oils to reduce CO2 emissions and fuel consumption of urban buses fleets

This paper shows the results of a comparative fleet test the main objective of which was to measure the influence of Low Viscosity Oils (LVO) over the fuel consumption and CO₂ emissions of urban buses. To perform this test, 39 urban buses, classified into candidate and reference groups depending on the engine oil viscosity, covered a 60,000 km mileage corresponding to two rounds of standard Oil Drain Interval (ODI). In the same way, for 9 buses of the 39 buses, the effect of differential LVO over fuel consumption and their interaction with engine LVO was assessed during the second ODI.Test results confirm that the use of LVO could reduce fuel consumption, hence CO₂ emissions. However, special attention should be taken prior to its implementation in a fleet, particularly if the vehicles are powered by engines with high mechanical and thermal stresses during vehicle operation because this could lead to friction loss increase, loss of the potential fuel consumption reduction of LVO and, in the worst scenario, higher rates of engine wear.     

Application of the support vector machine and heuristic k-shortest path algorithm to determine the most eco-friendly path with a travel time constraint

This study aims to determine an eco-friendly path that results in minimum CO₂ emissions while satisfying a specified budget for travel time. First, an aggregated CO₂ emission model for light-duty cars is developed in a link-based level using a support vector machine. Second, a heuristic k-shortest path algorithm is proposed to solve the constrained shortest path problem. Finally, the CO₂ emission model and the proposed eco-routing model are validated in a real-world network. Specifically, the benefit of the trade-off between CO₂ emission reduction and the travel time budget is discussed by carrying out sensitivity analysis on a network-wide scale. A greater spare time budget may enable the eco-routing to search for the most eco-friendly path with higher probability. Compared to the original routes selected by travelers, the eco-friendly routes can save an average of 11% of CO₂ emissions for the trip OD pairs with a straight distance between 6 km and 9 km when the travel time budget is set to 10% above the least travel time. The CO₂ emission can also be reduced to some degree for other OD pairs by using eco-routing. Furthermore, the impact of market penetration of eco-routing users is quantified on the potential benefit for the environment and travel-time saving.     

Reducing CO<Subscript>2</Subscript> from cars in the European Union

The European Union (EU) recently adopted CO₂ emissions mandates for new passenger cars, requiring steady reductions to 95 gCO₂/km in 2021. We use a multi-sector computable general equilibrium (CGE) model, which includes a private transportation sector with an empirically-based parameterization of the relationship between income growth and demand for vehicle miles traveled. The model also includes representation of fleet turnover, and opportunities for fuel use and emissions abatement, including representation of electric vehicles. We analyze the impact of the mandates on oil demand, CO₂ emissions, and economic welfare, and compare the results to an emission trading scenario that achieves identical emissions reductions. We find that vehicle emission standards reduce CO₂ emissions from transportation by about 50 MtCO₂ and lower the oil expenditures by about €6 billion, but at a net added cost of €12 billion in 2020. Tightening CO₂ standards further after 2021 would cost the EU economy an additional €24–63 billion in 2025, compared with an emission trading system that achieves the same economy-wide CO₂ reduction. We offer a discussion of the design features for incorporating transport into the emission trading system.     

The effectiveness and costs of speed reductions on emissions from international shipping

Greenhouse gas emissions from international shipping are an increasing concern. The paper evaluates whether vessel speed reduction can be a potentially cost-effective CO₂ mitigation option for ships calling on US ports. By applying a profit-maximizing equation to estimate route-specific, economically-efficient speeds, we explore policy impacts of a fuel tax and a speed reduction mandate on CO₂ emissions. The profit-maximizing function incorporates opportunity costs associated with speed reduction that go unobserved in more traditional marginal abatement cost analyses. We find that a fuel tax of about $150/ton fuel will lead to average speed-related CO₂ reductions of about 20–30%. Moreover, a speed reduction mandate targeted to achieve 20% CO₂ reduction in the container fleet costs between $30 and $200 per ton CO₂ abated, depending on how the fleet responds to a speed reduction mandate.     

Carbon emission from urban passenger transportation in Beijing

Urban passenger transport significantly contributes to global greenhouse gas emissions, especially in developing countries owing to the rapid motorization, thus making it an important target for carbon reduction. This article established a method to estimate and analyze carbon emission from urban passenger transport including cars, rail transit, taxis and buses. The scope of research was defined based on car registration area, transport types and modes, the stages of rail transit energy consumption. The data availability and gathering were fully illustrated. A city level emission model for the aforementioned four modes of passenger transport was formulated, and parameters including emission factor of electricity and fuel efficiency were tailored according to local situations such as energy structure and field survey. The results reveal that the emission from Beijing’s urban passenger transport in 2012 stood at 15 million tonnes of CO₂, of which 75.5% was from cars, whereas car trip sharing constitutes only 42.5% of the total residential trips. Bus travel, yielding 28.6 g CO₂, is the most efficient mode of transport under the current situations in terms of per passenger kilometer (PKM) emission, whereas car or taxi trips emit more than 5 times that of bus trips. Although a decrease trend appears, Beijing still has potential for further carbon reduction in passenger transport field in contrast to other cities in developed countries. Development of rail transit and further limitation on cars could assist in reducing 4.39 million tonnes CO₂ emission.     

Can we reduce car use and, if so, how? A review of available evidence

Transport accounts for nearly a quarter of current energy-related carbon dioxide emissions with car travel constituting more than three quarters of all vehicle kilometres travelled. Interventions to change transport behaviour, and especially to reduce car use, could reduce CO₂ emissions from road transport more quickly than technological measures. It is unclear, however, which interventions are effective in reducing car use and what the likely impact of these interventions would be on CO₂ emissions. A two-stage systematic search was conducted focusing on reviews published since 2000 and primary intervention evaluations referenced therein. Sixty-nine reviews were considered and 47 primary evaluations found. These reported 77 intervention evaluations, including measures of car-use reduction. Evaluations of interventions varied widely in the methods they employed and the outcomes measures they reported. It was not possible to synthesise the findings using meta-analysis. Overall, the evidence base was found to be weak. Only 12 of the 77 evaluations were judged to be methodologically strong, and only half of these found that the intervention being evaluated reduced car use. A number of intervention approaches were identified as potentially effective but, given the small number of methodologically strong studies, it is difficult to draw robust conclusions from current evidence. More methodologically sound research is needed in this area.