Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/87297 
Year of Publication: 
2013
Series/Report no.: 
Tinbergen Institute Discussion Paper No. 13-100/VIII
Publisher: 
Tinbergen Institute, Amsterdam and Rotterdam
Abstract: 
In this paper, we apply a dynamic innovation diffusion framework to model adoption of full electric vehicles where we explicitly distinguish three major phases of adoption: introduction, growth and maturity. We combine this approach with an SP study to elicit individual preferences for conventional, hybrid and full electric vehicles. We apply a nested logit model to estimate the preferences for EVs based on the total costs of ownership approach that includes monetary and non-monetary costs of owing a vehicle. With negative estimates of WTP for hybrid vehicles (of about €900 on a yearly basis), our results suggest abolishment of subsidization of hybrid vehicles as they potentially crowd out EV adoption. Besides, EVs need to be subsidized on average at €2,000 per year, and this amount is decreasing in the process of vehicle adoption. Time costs associated with rapid charging are a substantial hindrance to EV adoption with average value of time of €63 per hour, increasing for each subsequent consumer segment from €48 to €122 per hour. Environmental costs of CO2 reductions are valued far above the market average at €160 per ton, but determine EV choices only at a later stage of adoption. Finally, towing potential is valued on average at €540 per year and it is about the same for all consumer segments throughout the adoption phases. Policy implications are discussed involving a mix of structural and monetary incentives.
Subjects: 
stated preferences
revealed preferences
non-monetary costs
innovation
JEL: 
C01
C33
D12
D49
D91
R41
Document Type: 
Working Paper

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