Will the German electric-mobility package deliver? An assessment of the policy objective to reach 1 million electric cars in 2020
Infraday Berlin, October 8th, 2011 Giselmar Hemmert Michael Holtermann Dr. Jerome Massiani Jörg Radeke Dr. Jens Weinmann
Disclaimer
The opinions and findings of this research solely reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of the German environmental ministry (BMU)
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Agenda
Introduction Methodology Policy Example Findings and Conclusions
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Agenda
Introduction Methodology Policy Example Findings and Conclusions
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How can electric mobility be part of a transition to a more sustainable transport in Germany? ESMT project financed by the German environmental ministry within the framework of the stimulus package „Konjunkturpaket II" Research questions • What are the long-term economic and environmental costs and benefits of different policy instruments to foster and promote electric mobility? • What are the long-term infrastructure needs to achieve sustainable transport with the integration of electric vehicles? • Which overall growth and employment effects will occur in different scenarios?
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Model overview
Government
Car Industry
Energy Sector
Car Market
Cost Benefit Analysis 5
Agenda
Introduction Methodology Policy Example Findings and Conclusions
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Car industry – manufacturers try to find an optimal response to regulatory changes
Government
Car Industry
Energy Sector
Car Market
Implementation in MMEM • Price setting − Dynamic price setting − Smaller segments less profitable than larger ones
Cost Benefit Analysis
Propulsion technologies • • • •
Gasoline • BEV Diesel • PHEV Hybrid • REV LPG/CNG
Assumptions • Perfect competition • Prototypical supplier • 9 technologies and 11 size segments
• Biofuels • Hydrogen
• Strategic cost minimisation − Manufacturer considers optimal response to CAFE standards (EU regulation 443) by improving ICE technologies − Or, alternatively, paying fines
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Car industry constantly re-considers its options
Optimisation costs
Regulation (EC) 443/2009: Fines
Willingness to Pay for Fuel Efficiency
The optimal solution depends on the number of xEV
Car market – Discrete choice model determines purchase probability
General setting
Government
• Discrete Choice (Random Utility Maximisation) paradigm. Car industry
Energy
Car market
Cost-Benefit Analysis
• Elements of TCO and Bass diffusion • Strong disaggregation: − Markets (household, non household with further decomposition) − Consumer heterogeneity − 9 technologies − 11 segments (KBA) Implementation in MMEM • Discrete Choice Model − Based on car attributes (fuel costs, range, etc.). − Behavioural parameters based on metaanalysis of SP (Conjoint Analysis). − Nested Logit Structure. • Bass Diffusion 9
Existing models – methodologies Endogenesisation
Simplified DCM
Aecom (au) A.E.A (at) Spreadsheet models
Bass diffusion Stroben MIT
MMEM
Micro-economic Models Agent Based TAFV AVID
Vision CA
MIT TU delft
DLR RMI Disaggregation
PHEV and RE to dominate electric mobility 2.0 1.8 1.6 1.4
Diesel Benzin
1.2
Hybrid LPG/CNG
1.0
Biofuel Wasserstoff
0.8
BEV 0.6
PHEV RE
0.4 0.2 0.0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049
Million units
Annual new registrations, million units
Quelle: ESMT MMEM (2011)
EV propulsion becomes mass market by 2030 Vehicle stock, million units
Source: ESMT MMEM (2011)
Findings 1.
Car buyers are myopic as they overvalue the purchase price and underestimate future operating costs – that hinders the adoption of fuel efficient technologies
2.
Electric mobility (via hybrid propulsion concepts) to become competitive by 2020 – even without policy support.
3.
A low range, a lack of quick charging infrastructure, high purchase costs mean only a low uptake of pure BEV in the foreseeable future.
4. 5. 6. 7.
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Agenda
Introduction Methodology Policy Example Findings and Conclusions
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Policy support can speed up EV market penetration…
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…but the costs to society may outweigh the benefits NPV 2012-2025 in € Million Rest der Welt (kein B estandteil der inländischen Ko sten-Nutzen B ilanz)
S t a k e ho lde rgruppe
B e re ic h Fahrzeugkauf
Treibsto ffausgaben
Nettgegenwartswert in M io . €
Ko nsumenten Ko nsumentenwo hlfahrt Fahrzeugkauf Ko nsumentenwo hlfahrt Treibsto ffko sten
1,988 €
-
Nettgegenwartswert in M io . €
P ro duzenten P ro duzentenrente Fahrzeugkauf
P ro duzentenrente Treibsto ffher997 € stellung und Vertrieb P ro duzentenrente Elektrizitätsherstellung und Vertrieb
Nettgegenwartswert in M io . €
Staat
Umwelt
Nettgegenwartswert in M io . €
P ro duzentenwo hlfahrt Fahrzeugkauf (A usland)
-
68 €
Direkte Ko sten der P o litikmaßnahme
349 €
-
62 €
Steuereinko mmen M ineralö lsteuer
484 €
CO2 Umweltschaden
P ro duzenten157 € wo hlfahrt Treibsto ff (A usland)
59 €
Steuereinko mmen Energiesteuer
54 €
A ndere Umweltschäden
56 €
65 €
Regulierung 443 Strafzahlungen
CO2 Vermeidungsko sten Elektrizitätssekto r
-
Nettgegenwartswert in M io . €
Rest der Welt
781€
-
450 €
-
1,2 3 1 €
3€
KfZ-Steuer
Infrastruktur
P o litikko sten
Gesamt Netto gegenwartswert Stakeho lder Gesamt Netto gegenwartswert der P o litikmaßnahme
KfZSteuerzahlungen
-
417 €
A usgaben für Ladestatio nen
-
181€
Netzausbauinvestitio nen
-
382 €
Schattenko sten durch Staatsausgaben Gesamt Netto gegenwartswert Ko nsumenten
-
353 €
KfZSteuereinko mmen
B ereitstellung Ladestatio nen
15 €
Netzausbauinvestitio nen
36 €
Schattenko sten 79 € durch Staatsausgaben Gesamt Netto 9 0 € gegenwartswert P ro duzenten
133 €
Einnahmen Umsatzsteuer
Gesamt Netto 4 8 € gegenwartswert Staat
417 €
-
-
339 €
Gesamt Netto 7 0 5 € gegenwartswert Umwelt
Gesamt Netto 2 14 € gegenwartswert Rest der Welt
Source: ESMT MMEM (2011) 16
Consumers benefit from lower purchase expenditure NPV in € Million B e re ic h Fahrzeugkauf
Treibsto ffausgaben
Rest der Welt (kein B estandteil der inländischen Ko sten-Nutzen B ilanz)
S t a k e ho lde rgruppe Nettgegenwartswert in M io . €
Ko nsumenten Ko nsumentenwo hlfahrt Fahrzeugkauf Ko nsumentenwo hlfahrt Treibsto ffko sten
1,988 €
-
997 €
Nettgegenwartswert in M io . €
P ro duzenten P ro duzentenrente Fahrzeugkauf P ro duzentenrente Treibsto ffherstellung und Vertrieb P ro duzentenrente Elektrizitätsherstellung und Vertrieb
-
-
CO2 Vermeidungsko sten Elektrizitätssekto r
Nettgegenwartswert in M io . €
Staat
Umwelt
Nettgegenwartswert in M io . €
1. Purchase incentive and declining cost of optimisation Direkte Ko sten der 68 €
62 €
-
349 €
Steuereinko mmen M ineralö lsteuer
484 €
P o litikmaßnahme
59 €
Steuereinko mmen Energiesteuer
65 €
Regulierung 443 Strafzahlungen
54 €
-
P ro duzentenwo hlfahrt Fahrzeugkauf (A usland)
CO2 Umweltschaden
P ro duzenten157 € wo hlfahrt Treibsto ff (A usland)
A ndere Umweltschäden
56 €
2. Fuel cost increase – despite higher EV share
Nettgegenwartswert in M io . €
Rest der Welt
781€
-
450 €
-
1,2 3 1 €
3€
3. Less efficient cars pay more road tax
KfZ-Steuer
Infrastruktur
P o litikko sten
Gesamt Netto gegenwartswert Stakeho lder Gesamt Netto gegenwartswert der P o litikmaßnahme
KfZSteuerzahlungen
-
417 €
A usgaben für Ladestatio nen
-
181€
Netzausbauinvestitio nen
-
382 €
Schattenko sten durch Staatsausgaben Gesamt Netto gegenwartswert Ko nsumenten
-
353 €
KfZSteuereinko mmen
B ereitstellung Ladestatio nen
Netzausbauinvestitio nen
Schattenko sten 79 € durch Staatsausgaben Gesamt Netto 9 0 € gegenwartswert P ro duzenten
417 €
15 € 4. Additional infrastructure is required
36 €
133 €
Einnahmen Umsatzsteuer
-
339 €
5. On balance positive for consumers yet- for the wrong Gesamt reasons Gesamt Netto Gesamt – Netto Netto 4 8 € gegenwartswert Staat
-
7 0 5 € gegenwartswert Umwelt
2 14 € gegenwartswert Rest der Welt
Source: ESMT MMEM (2011) Source: ESMT MMEM (2011) 17
Subsidising EVs reduces manufacturers‘ incentive to optimise conventional vehicles
ICE vehicle efficiency declines
Source: ESMT MMEM (2011)
Impact on producers is moderate NPV in € Million B e re ic h Fahrzeugkauf
Treibsto ffausgaben
Rest der Welt (kein B estandteil der inländischen Ko sten-Nutzen B ilanz)
S t a k e ho lde rgruppe Nettgegenwartswert in M io . €
P ro duzenten P ro duzentenrente Fahrzeugkauf P ro duzentenrente Treibsto ffherstellung und Vertrieb P ro duzentenrente Elektrizitätsherstellung und Vertrieb
Nettgegenwartswert in M io . €
Staat
-
68 €
Direkte Ko sten der P o litikmaßnahme
-
62 €
Steuereinko mmen M ineralö lsteuer
59 €
Steuereinko mmen Energiesteuer
65 €
Regulierung 443 Strafzahlungen
CO2 Vermeidungsko sten Elektrizitätssekto r
-
Umwelt
Nettgegenwartswert in M io . €
Nettgegenwartswert in M io . €
Rest der Welt
1. Less optimisation means less value added P ro duzentenwo hl349 €
fahrt Fahrzeugkauf (A usland)
484 €
CO2 Umweltschaden
P ro duzenten157 € wo hlfahrt Treibsto ff (A usland)
54 €
A ndere Umweltschäden
56 €
2. Demand for fossil fuel declines…
-
781€
450 €
3. …while electricity demand and abatement costs increase 3€
KfZ-Steuer KfZSteuereinko mmen Infrastruktur
P o litikko sten
Gesamt Netto gegenwartswert Stakeho lder
B ereitstellung Ladestatio nen
15 €
Netzausbauinvestitio nen
36 €
Schattenko sten durch Staatsausgaben
133 €
Gesamt Netto gegenwartswert P ro duzenten
417 €
4. Industry provides infrastructure
Einnahmen Umsatzsteuer
Gesamt Netto 4 8 € gegenwartswert Staat
-
339 €
5. On balance also- positive for producers Gesamt Netto Gesamt Netto -
7 0 5 € gegenwartswert Umwelt
2 14 € gegenwartswert Rest der Welt
-
1,2 3 1 €
Source: ESMT MMEM (2011) Source: ESMT MMEM (2011) 19
Government: Subsidy costs and tax loss outweigh the benefits NPV in € Million B e re ic h Fahrzeugkauf
Treibsto ffausgaben
1. Direct policy costs (discounted)
S t a k e ho lde rgruppe Nettgegenwartswert in M io . €
Staat Direkte Ko sten der P o litikmaßnahme
349 €
Steuereinko mmen M ineralö lsteuer
484 €
Steuereinko mmen Energiesteuer
Regulierung 443 Strafzahlungen
2. More EVs mean less fuel tax – despite rebound effect from ICE technologies
54 €
3. Energy tax on electricity can not compensate the loss -
3€
KfZ-Steuer KfZSteuereinko mmen
417 €
4. Road tax increase mitigates some of the effects
Infrastruktur
5. VAT revenue loss P o litikko sten
Gesamt Netto gegenwartswert Stakeho lder
Einnahmen Umsatzsteuer
-
339 €
Gesamt Netto gegenwartswert Staat
-
705 €
5. On balance a net costs for the government Source: ESMT MMEM (2011) 20
Policy measure fails to produce net benefits in the long run NPV in € Million
Source: ESMT MMEM (2011)
Findings 1.
Car buyers are myopic as they overvalue the purchase price and underestimate future operating costs – that hinders the adoption of fuel efficient technologies
2.
Electric mobility (via hybrid propulsion concepts) to become competitive by 2020 – even without policy support.
3.
A low range, a lack of quick charging infrastructure, high purchase costs mean only a low uptake of pure BEV in the foreseeable future.
4.
Effects of EV policies will be generally driven by regulatory context and will often produce negative net benefits.
5. 6. 7.
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CO2 Balance improves – Savings would be higher without the impact from De-optimisation CO2 Emissions, million tonnes
Cumulative savings equal 0.2% of total emissions from passenger cars
Source: ESMT MMEM (2011)
Findings 1.
Car buyers are myopic as they overvalue the purchase price and underestimate future operating costs – that hinders the adoption of fuel efficient technologies
2.
Electric mobility (via hybrid propulsion concepts) to become competitive by 2020 – even without policy support.
3.
A low range, a lack of quick charging infrastructure, high purchase costs mean only a low uptake of pure BEV in the foreseeable future.
4.
Effects of EV policies will be generally driven by regulatory context and will often produce negative net benefits.
5.
Effects of EVs on emissions will be ambiguous and counter intuitive.
6. 7.
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Fossil fuel consumption declines by 50% until 2030… Fuel consumption in billion litres
-50%
Source: ESMT MMEM (2011)
…generating annual reductions of 55 million tonnes CO2
CO2 g/km
Passenger cars CO2 emission factors (LHS), Annual emissions (RHS)
Source: ESMT MMEM (2011)
…eroding the basis of fuel taxation Annual fuel tax revenues, passenger cars, € billions
Energy tax on electricity can‘t compensate tax loss
Source: ESMT MMEM (2011) 27
Findings 1.
Car buyers are myopic as they overvalue the purchase price and underestimate future operating costs – that hinders the adoption of fuel efficient technologies
2.
Electric mobility (via hybrid propulsion concepts) to become competitive by 2020 – even without policy support.
3.
A low range, a lack of quick charging infrastructure, high purchase costs mean only a low uptake of pure BEV in the foreseeable future.
4.
Effects of EV policies will be generally driven by regulatory context and will often produce negative net benefits.
5.
Effects of EVs on emissions will be ambiguous and counter intuitive.
6.
A fuel-based taxation of mobility will see its tax base erode.
7.
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Agenda
Introduction Methodology Policy Example Findings and Conclusions
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Findings 1.
Car buyers are myopic as they overvalue the purchase price and underestimate future operating costs – that hinders the adoption of fuel efficient technologies
2.
Electric mobility (via hybrid propulsion concepts) to become competitive by 2020 – even without policy support.
3.
A low range, a lack of quick charging infrastructure, high purchase costs mean only a low uptake of pure BEV in the foreseeable future.
4.
Effects of EV policies will be generally driven by regulatory context and will often produce negative net benefits.
5.
Effects of EVs on emissions will be ambiguous and counter intuitive.
6.
A fuel-based taxation of mobility will see its tax base erode.
7.
Subsidising private charging infrastructure is not an efficient policy option.
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Disclaimer
The opinions and findings of this research solely reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of the German environmental ministry (BMU)
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Backup
