GCC: Study finds behavior-influencing policies remain critical for mass market success of low-carbon vehicles

Policies to entice consumers away from fossil-fuel powered vehicles and normalize low carbon, alternative-fuel alternatives, such as electric vehicles, are vital if the world is to significantly reduce transport sector carbon pure-emissions, according to a new study. . . .

. . . the study is the first to take a global look at the non-financial reasons why consumers choose certain vehicles, and the long-term energy and carbon emissions implications those choices may have.

• urgeoning demands for mobility and private vehicle ownership undermine global efforts to reduce energy-related greenhouse gas emissions. Advanced vehicles powered by low-carbon sources of electricity or hydrogen offer an alternative to conventional fossil-fuelled technologies. Yet, despite ambitious pledges and investments by governments and automakers, it is by no means clear that these vehicles will ultimately reach mass-market consumers. Here, we develop state-of-the-art representations of consumer preferences in multiple global energy-economy models, specifically focusing on the non-financial preferences of individuals. We employ these enhanced model formulations to analyse the potential for a low-carbon vehicle revolution up to 2050.
  
  Our analysis shows that a diverse set of measures targeting vehicle buyers is necessary to drive widespread adoption of clean technologies. Carbon pricing alone is insufficient to bring low-carbon vehicles to the mass market, though it may have a supporting role in ensuring a decarbonized energy supply.

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  —McCollum et al.

Consumers will look not just at the upfront costs and running costs, but will also consider attributes such as the available models and brands, comfort, acceleration, and interior space, and the availability of infrastructure such as refueling stations, which are still lacking for most types of alternative-fuel vehicles, particularly electric and hydrogen vehicles. Additionally, most consumers lack first-hand experience with these novel technologies. . . .

The researchers found that focusing on the behavioral aspects of consumers in vehicle purchase decisions is key to encouraging the rapid uptake of plug-in hybrid vehicles, battery-electric vehicles, and hydrogen fuel cell vehicles.

Making conventional gasoline and diesel vehicles more expensive to run—through increased fuel or carbon taxes—is not enough to incentivize the majority of consumers to change. However, carbon taxes can be critical in pushing electricity providers to decarbonize their operations.

• Alternative-fuel vehicles will play a critical role in the effort to avoid dangerous climate change, but only if measures to stimulate their adoption in cities – with positive climate, air quality, and health outcomes – are combined with policies to drive fossil fuels out of the electricity mix in favor of renewables and other low-carbon resources.
  
  —David McCollum

The researchers employed six global energy-economy models in the study, upgrading the tools so that they could more adequately represent consumers and their behavior and preferences. They modeled two different future scenarios for alternative-fuel vehicle policy worldwide to 2050.

• ‘AFV Push’ imagines a future where policy and social nudges lead consumers to be less risk averse, allowing low carbon vehicles and their requisite refueling and recharging infrastructure become the norm.
  
  ‘No AFV’ imagines current views of these vehicles persisting, due to minimal policy support, low levels of consumer awareness, and limited infrastructure.

The models show that a mix of robust transport policies and strategies could increase the market share of alternative-fuel vehicles to more than 25% of all passenger cars and trucks by 2050, perhaps even higher. This would amount to some 500 million of these vehicles worldwide by mid-century.

Without any such policies, the market for alternative-fuel vehicles will remain very niche, with a market share hovering around 1% for the foreseeable future—in other words, hardly greater than today.

Behavior-influencing policies to encourage the use of alternative-fuel vehicles include a suite of options: fuel taxes; vehicle subsidies; technology mandates and efficiency standards; investment in refueling infrastructure and dedicated parking spaces; as well as social media campaigns and car-sharing networks to demonstrate the technology.

The difference these policies can make, if applied in a multi-pronged strategy, can already be seen in countries that strongly support the use of alternative-fuel vehicles, such as China, Iceland, Norway, and Sweden. In Norway, for example, 40% of passenger cars sold in 2017 were either battery-electrics or plug-in hybrids.

• Our research indicates that, when considering the wide range of non-financial attributes over which vehicle purchasers express preferences, alternative-fuel vehicles will be a hard sell to many for some time to come. The good news is that this is where dedicated transport policies and measures can help – and in fact are already helping.
  
  —Charlie Wilson. . . .

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