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.     

An interdisciplinary study to explore impacts from policies for the introduction of low carbon vehicles

Driven by concerns of climate change, governments across the world are introducing a number of policies to accelerate the uptake of low carbon vehicles (LCVs), with a specific focus on electric motors. However, there is uncertainty in the effectiveness of such policies and technology pathways, which are inherently interlinked. This article considers the short-term situation to 2020 and focuses on the concern that these policies may bring about some disproportionate impacts in society due to changes in mobility. An ethical framework is established that seeks to balance obligations to reduce greenhouse gas (GHG) emissions and rights to car ownership, then selected policies are modelled within this framework to assess acceptability of implementation. Although these policies are successful in introducing LCVs and reducing GHG emissions, findings also indicate uneven cost burdens and reduced affordability of car ownership. Following this, recommendations for policy amendments and model improvements are made.     

Conventional,hybrid and electric vehicles for Australian driving conditions. Part 2: Life cycle CO2-e emissions

This paper is the second of a two part study which quantifies the economic and greenhouse performance of conventional, hybrid and fully electric passenger vehicles operating in Australian driving conditions. This second study focuses on the life cycle greenhouse gas emissions. Two vehicle sizes are considered, Class-B and Class-E, which bracket the large majority of passenger vehicles on Australian roads.Using vehicle simulation models developed in the first study, the trade-offs between the ability of increasingly electric powertrains in curtailing the tailpipe emissions and the corresponding rise in the embedded vehicle emissions have been evaluated. The sensitivity of the life cycle emissions to fuel, electricity and the change in the energy mix are all considered. In conjunction with the total cost of ownership calculated in the companion paper, this allows the cost of mitigating life cycle greenhouse gas emissions through electrification of passenger transport to be estimated under different scenarios. For Class-B vehicles, fully electric vehicles were found to have a higher total cost of ownership and higher life cycle emissions than an equivalent vehicle with an internal combustion engine. For Class-E vehicles, hybrids are found to be the most cost effective whilst also having lowest life cycle emissions under current conditions. Further, hybrid vehicles also exhibit little sensitivity in terms of greenhouse emissions and cost with large changes in system inputs.     

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.     

Identifying the early adopters of alternative fuel vehicles: A case study of Birmingham,United Kingdom

The transport sector has been identified as a significant contributor to greenhouse gas emissions. As part of its emissions reduction strategy, the United Kingdom Government is demonstrating support for new vehicle technologies, paying attention, in particular, to electric vehicles.Cluster analysis was applied to Census data in order to identify potential alternative fuel vehicle drivers in the city of Birmingham, United Kingdom. The clustering was undertaken based on characteristics of age, income, car ownership, home ownership, socio-economic status and education. Almost 60% of areas that most closely fitted the profile of an alternative fuel vehicle driver were found to be located across four wards furthest from Birmingham city centre, while the areas with the poorest fit were located towards the centre of Birmingham. The paper demonstrates how Census data can be used in the initial stages of identifying potential early adopters of alternative vehicle drivers. It also shows how such research can provide scope for infrastructure planning and policy development for local and national authorities, while also providing useful marketing information to car manufacturers.     

On a pathway to de-carbonization – A comparison of new passenger car CO2 emission standards and taxation measures in the G20 countries

Considering the role of transport for a 1.5 Degree stabilization pathway and the importance of light-duty vehicle fuel efficiency within that, it is important to understand the key elements of a policy package to shape the energy efficiency of the vehicle fleet. This paper presents an analysis focusing on three types of policy measures: (1) CO₂ emission standards for new vehicles, (2) vehicle taxation directly and indirectly based on CO₂ emission levels, and (3) fuel taxation. The paper compares the policies in the G20 economies and estimates the financial impact of those policies using the example of a Ford Focus vehicle model. This analysis is a contribution to the assessment of the role of the transport sector in global decarbonisation efforts. The findings of this paper show that only an integrated approach of regulatory and fiscal policy measures can yield substantial efficiency gains in the vehicle fleet and can curb vehicle kilometres travelled by individual motorised transport. Using the illustrative example of one vehicle model, the case study analysis shows that isolated measures, e.g. fuel efficiency regulation without corresponding fuel and vehicle taxes only have minor CO₂ emission reduction effects and that policy measures need to be combined in order to achieve substantial emission reduction gains over time. The analysis shows that the highest level of impact is achieved by a combination regulatory and fiscal policies rather than only one policy even if this policy is more aggressive. When estimating the quantitative effect of fuel efficiency standards, vehicle and fuel tax, the analysis shows that substantial gains with regard to CO₂ emission are only achieved at a financial impact level above 500 Euros over a four year period.     

Optimal fleet conversion policy from a life cycle perspective

Vehicles typically deteriorate with accumulating mileage and emit more tailpipe air pollutants per mile. Although incentive programs for scrapping old, high-emitting vehicles have been implemented to reduce urban air pollutants and greenhouse gases, these policies may create additional sales of new vehicles as well. From a life cycle perspective, the emissions from both the additional vehicle production and scrapping need to be addressed when evaluating the benefits of scrapping older vehicles. This study explores an optimal fleet conversion policy based on mid-sized internal combustion engine vehicles in the US, defined as one that minimizes total life cycle emissions from the entire fleet of new and used vehicles. To describe vehicles' lifetime emission profiles as functions of accumulated mileage, a series of life cycle inventories characterizing environmental performance for vehicle production, use, and retirement was developed for each model year between 1981 and 2020. A simulation program is developed to investigate ideal and practical fleet conversion policies separately for three regulated pollutants (CO, NMHC, and NO_x) and for CO₂. According to the simulation results, accelerated scrapping policies are generally recommended to reduce regulated emissions, but they may increase greenhouse gases. Multi-objective analysis based on economic valuation methods was used to investigate trade-offs among emissions of different pollutants for optimal fleet conversion policies.     

A system dynamics model of CO2 mitigation in China’s inter-city passenger transport

Mitigation of greenhouse gas emissions from transportation has become increasingly important and challenging especially for developing countries. This paper takes the inter-city passenger transport in China as a case, and develops a system dynamics model for policy assessment and CO₂ mitigation potential analysis. It is found that the future demand for China’s inter-city passenger transport is expected to be large, with the turnover volume growing at a rate of 9% per annum and amounting to 6600 billion p-km in 2020. Major emissions reduction potential exists in inter-city passenger transport. In 2020, comparing to the case without any specific policies stressing mitigation, the reduction of CO₂ emissions ranges from 26% to 32% under those scenarios with policy controls. Sensitivity analysis reveals that the CO₂ mitigation will be best achieved by accelerating the development of railway network, together with slowing down the extension of highway network and imposing fuel taxes.     

Life cycle emissions and cost model for urban light duty vehicles

The growth of vehicle sales and use internationally requires the consumption of significant quantities of energy and materials, and contributes to the deterioration of air-quality and climate conditions. Advanced propulsion systems and electric drive vehicles have substantially different characteristics and impacts. They require life cycle assessments and detailed comparisons with gasoline powered vehicles which, in turn, should lead to critical updates of traditional models and assumptions. For a comprehensive comparison of advanced and traditional light duty vehicles, a model is developed that integrates external costs, including emissions and time losses, with societal and consumer life cycle costs. Life cycle emissions and time losses are converted into costs for seven urban light duty vehicles. The results, which are based on vehicle technology characteristics and transportation impacts on environment, facilitate vehicle comparisons and support policy making in transportation. Substantially, more sustainable urban transportation can be achieved in the short-term by promoting policies that increase vehicle occupancy; in the intermediate-term by increasing the share of hybrid vehicles in the car market and in the long-term by the widespread use of electric vehicles. A sensitivity-analysis of life cost results revealed that vehicle costs change significantly for different geographical areas depending on vehicle taxation, pricing of gasoline, electric power and pollution. Current practices in carbon and air quality pricing favor oil and coal based technologies. However, increasing the cost of electricity from coal and other fossil fuels would increase the variable cost for electric vehicles, and tend to favor the variable cost of hybrid vehicles.     

Evaluating policies to reduce greenhouse gas emissions from private transportation

This paper proposes a model system to forecast household greenhouse gas emissions (GHGEs) from private transportation. The proposed model combines an integrated discrete-continuous car ownership model with MOVES 2014. Four modeling components are calibrated and applied to the calculation of GHGEs: vehicle quantity, vehicle type and vintage, miles traveled, and rates of GHGEs. The model is applied to the Washington D.C. Metropolitan Area. Three tax schemes are evaluated: vehicle ownership tax, purchase tax and fuel tax. We calculate that the average GHGEs per vehicle is 5.15 tons of carbon dioxide-equivalent (CO₂E) gases. Our results show that: (a) a fuel tax is the most effective way to reduce vehicle GHGEs, especially for households with fewer vehicles; (b) a purchase tax reduces vehicle GHGEs mainly by decreasing vehicle quantity for households with more vehicles; and (c) an ownership tax reduces vehicle GHGEs by decreasing both vehicle quantity and miles traveled.     

Powertrain technologies and their impact on greenhouse gas emissions in key car markets

The role alternative car technologies may play in effectively tackling the problem of climate change is still highly uncertain. This paper aims at investigating possible impacts of car powertrain technologies on future energy demand and its corresponding greenhouse gas emissions until 2030. A system dynamics model covering nine car technologies in China, France, Germany, India, Japan and the United States was applied, with a focus on electric cars. Four main scenarios are constructed and sensitivity analysis undertaken. Greenhouse gas emissions from cars in the six countries are simulated to reach up to 2.6 gigatonnes in 2030 (a 13–32% increase between 2020 and 2030, depending on the scenario). The main conclusion from model-based policy analysis is that electric cars may have a positive contribution to emissions mitigation in the passenger road transport system. However, greenhouse gas emissions from cars arising from the combined effect of car manufacturing and scrappage and electricity generation processes are expected to grow more dramatically. As a result, actions that support both low-emission (re-)manufacturing and clean electricity generation are needed. These results complement accurate but static life cycle assessments and open the discussion for dynamic model assumptions.     

Feebates, footprints and highway safety

This paper presents an analysis of a market-based policy aimed at encouraging manufacturers to develop more fuel efficient vehicles without affecting the car buyer’s choice of vehicle size. A vehicle’s size is measured by its “footprint”, the product of track width and wheelbase. Traditional market-based policies to promote higher fuel economy, such as higher gasoline taxes or gas guzzler taxes, also induce motorists to purchase smaller vehicles. Whether or not such policies affect overall road safety remains controversial, however. Feebates, a continuous schedule of new vehicle taxes and rebates as a function of vehicle fuel consumption, can also be made a function of vehicle size, thus removing the incentive to buy a smaller vehicle. A feebate system based on a vehicle’s footprint creates the same incentive to adopt technology to improve fuel economy as simple feebate systems while removing any incentive for manufacturers or consumers to downsize vehicles.     

Greenhouse gas emission benefits of vehicle lightweighting: Monte Carlo probabalistic analysis of the multi material lightweight vehicle glider

Vehicle lightweighting reduces fuel cycle greenhouse gas (GHG) emissions but may increase vehicle cycle (production) GHG emissions because of the GHG intensity of lightweight material production. Life cycle GHG emissions are estimated and sensitivity and Monte Carlo analyses conducted to systematically examine the variables that affect the impact of lightweighting on life cycle GHG emissions. The study uses two real world gliders (vehicles without powertrain or battery) to provide a realistic basis for the analysis. The conventional and lightweight gliders are based on the Ford Fusion and Multi Material Lightweight Vehicle, respectively. These gliders were modelled with internal combustion engine vehicle (ICEV), hybrid electric vehicle (HEV), and battery electric vehicle (BEV) powertrains. The probability that using the lightweight glider in place of the conventional (steel-intensive) glider reduces life cycle GHG emissions are: ICEV, 100%; HEV, 100%, and BEV, 74%.The extent to which life cycle GHG emissions are reduced depends on the powertrain, which affects fuel cycle GHG emissions. Lightweighting an ICEV results in greater base case GHG emissions mitigation (10 t CO₂eq.) than lightweighting a more efficient HEV (6 t CO₂eq.). BEV lightweighting can result in higher or lower GHG mitigation than gasoline vehicles, depending largely on the source of electricity.     

Modeling the relationships among urban passenger travel carbon dioxide emissions,transportation demand and supply,population density,and proxy policy variables

To support the development of policies that reduce greenhouse gas (GHG) emissions by encouraging reduced travel and increased use of efficient transportation modes, it is necessary to better understand the explanatory effects that transportation, population density, and policy variables have on passenger travel related CO₂ emissions. This study presents the development of a model of CO₂ emissions per capita as a function of various explanatory variables using data on 146 urbanized areas in the United States. The model takes into account selectivity bias resulting from the fact that adopting policies aimed at reducing emissions in an urbanized area may be partly driven by the presence of environmental concerns in that area. The results indicate that population density, transit share, freeway lane-miles per capita, private vehicle occupancy, and average travel time have a statistically significant explanatory effect on passenger travel related CO₂ emissions. In addition, the presence of automobile emissions inspection programs, which serves as a proxy indicator of other policies addressing environmental concerns and which could influence travelers in making environmentally favorable travel choices, markedly changes the manner in which transportation variables explain CO₂ emission levels.     

Low-carbon futures for Shenzhen’s urban passenger transport: A human-based approach

Shenzhen, one of China’s leading cities, has the potential to be a model for achieving China’s ambitious CO₂ emission reduction targets. Using data from a travel diary survey in Shenzhen in 2014, we develop a human-based agent model to conduct a scenario study of future urban passenger transport energy consumption and CO₂ emissions from 2014 to 2050. Responses to different policy interventions at the individual level are taken into account. We find that with current policies, the carbon emissions of the urban passenger transport sector in Shenzhen will continuously increase without a peak before 2050. Strengthening 21 transport policies will help Shenzhen to peak the carbon emissions by 2030 for passenger transport. Among these policies, the car quota policy and the fuel economy standard are essential for achieving a carbon peak by 2030. In addition, a package of seven policies, including fewer car quotas, a stricter fuel economy standard, raising parking fees, limiting parking supply, increasing EV charging facilities and subway lines, and improving public transport services, is sufficient to peak carbon emissions by 2030, although at an emissions level higher than for the 21 policies.     

Trends in life cycle greenhouse gas emissions of future light duty electric vehicles

The majority of previous studies examining life cycle greenhouse gas (LCGHG) emissions of battery electric vehicles (BEVs) have focused on efficiency-oriented vehicle designs with limited battery capacities. However, two dominant trends in the US BEV market make these studies increasingly obsolete: sales show significant increases in battery capacity and attendant range and are increasingly dominated by large luxury or high-performance vehicles. In addition, an era of new use and ownership models may mean significant changes to vehicle utilization, and the carbon intensity of electricity is expected to decrease. Thus, the question is whether these trends significantly alter our expectations of future BEV LCGHG emissions.To answer this question, three archetypal vehicle designs for the year 2025 along with scenarios for increased range and different use models are simulated in an LCGHG model: an efficiency-oriented compact vehicle; a high performance luxury sedan; and a luxury sport utility vehicle. While production emissions are less than 10% of LCGHG emissions for today’s gasoline vehicles, they account for about 40% for a BEV, and as much as two-thirds of a future BEV operated on a primarily renewable grid. Larger battery systems and low utilization do not outweigh expected reductions in emissions from electricity used for vehicle charging. These trends could be exacerbated by increasing BEV market shares for larger vehicles. However, larger battery systems could reduce per-mile emissions of BEVs in high mileage applications, like on-demand ride sharing or shared vehicle fleets, meaning that trends in use patterns may countervail those in BEV design.     

Behavioural responses to vehicle emissions charging

Road pricing as an economic construct is not a new phenomenon in transportation research. Whilst fuel taxation and tolling of roads are common ways of raising revenue in many countries, these initiatives are primarily aimed at road infrastructure financing. Worldwide there has been growing interest in pricing structures designed to also manage the growing levels of traffic congestion and, in recent times, an increasing focus on generating reductions in carbon emissions from vehicle ownership and use. This paper presents a stated choice experiment undertaken in response to the increasing interest in the environmental externalities of travel behaviour. The aim of this choice experiment is to identify the potential to switch to more fuel efficient cars that emit lower emissions, under differing pricing and technology scenarios. Results indicate that annual and variable emissions surcharges targeted very specifically to vehicle emission rates have a noticeable role in modifying vehicle purchasing decisions.     

Environmental assessment of electrification of road transport in Norway: Scenarios and impacts

The study develops scenarios regarding the introduction of electric vehicles to the passenger vehicle fleet of Norway to reach the 2020 Norwegian greenhouse gas reduction target and a more extreme target to limit global temperature increase to two degrees. A process-based life cycle assessment approach is integrated with a temporally variable inventory model to evaluate the environmental impacts of these scenarios. We find that greenhouse gases in the reference scenario increase by 10% in 2020 in comparison to 2012; while for the more intensive improvements in conventional vehicles, this increase is reduced to 2%. For electric vehicles deployment scenarios, although the fleet share will reduce the tailpipe greenhouse gas emissions by 8–26%, with the upper end representing the two-degree reduction target, emissions reductions over the entire life cycle are only 3–15%. Electric vehicles also reduce emissions of NO_x, SO₂ and particulates reducing acidification, smog formation and particulate formation impacts, however, with addition of large numbers of electric vehicles significant trade-offs in toxicity impacts are found.     

How much should gasoline be taxed when electric vehicles conquer the market? An analysis of the mismatch between efficient and existing gasoline taxes under emerging electric mobility

The taxation of gasoline is characterized by large variability across countries and recent research has analyzed existing gasoline tax levels from an economic efficiency point of view focusing on conventional internal combustion engine vehicles. Most studies find that existing fuel tax rates do not coincide with economically efficient levels. As long as policymakers do not take action to reduce the resulting efficiency gap, there will be an ongoing welfare loss to the economy. However, the composition of passenger car fleets will probably be subject to fundamental changes in the (near) future due to the emergence of electric mobility. This raises the question of whether the mismatch between current and efficient fuel taxation will persist, shrink, or even exacerbate under emerging electric mobility. This paper aims at answering this question by determining the structure and level of optimal gasoline taxes in the presence of electric vehicles (EVs). First, the optimal (nationwide) gasoline tax is analytically derived employing a general equilibrium approach. It is shown that differences in traffic related marginal external costs among fuel powered cars and EVs affect the corrective Pigouvian component of the optimal gasoline tax while a differential tax treatment influences the fiscal rational of the tax. Second, the model is applied to Germany using differentiated data on e.g. external costs and behavioral responses. Under a wide range of scenarios, the present analyses indicate a strong relationship between optimal gasoline taxes and electric mobility, calling for a downward adjustment of efficient gasoline taxes. The effect is mainly driven by financial incentives for purchasing and using EVs. Since fuel is likely to be undertaxed in many countries, the emergence of electric mobility will therefore close the gap between gasoline taxes in place and economically efficient taxes. On the other side, it will increase the efficiency gap in those countries where gasoline is overtaxed. This also has important implications for policy concerned with environmental objectives. Pushing electric mobility seriously and at the same time taxing gasoline efficiently could actually prevent sufficient CO₂ emission savings. However, at least in the case of Germany, even a downward adjusted optimal gasoline tax under electric mobility is likely to be higher than the current (non-optimal) tax.     

Institutional constraints on transport policymaking: the case of company cars in Israel

Transportation analysis emphasizes the necessity to internalize the transport externalities of car usage through taxation. Yet taxation decisions are often made with non-transport goals in mind. In such cases, transport policies are made ‘by the way.’ This paper examines such a case: Israel’s taxation policy on company cars. It shows that current taxation policies result in increasing numbers of company cars and growing numbers of transport users who are not sensitive to the marginal cost of car use and make excessive use of the car. As a result, a significant portion of Travel Demand Management (TDM) measures cannot affect this group. The Israeli case of company car tax reform demonstrates the problematic effect of a policy that does not take its overall consequences on other policy fields into account and thereby impairs efforts to reduce the negative impacts of the transport system. Also, it demonstrates the importance of institutional aspects of transport policymaking.