1. Norwegian School of Economics
Instruments to achieve a long-term goal of almost zero emissions of greenhouse gases in city passenger transport
Shiyu Yan
Norwegian School of Economics

2. PhD thesis: The Automobile in Transition
PhD thesis: The Automobile in Transition? Economic and Environmental Evaluations of Vehicle Policies for Reducing CO2 from Transport.
Shiyu Yan, CenSES PhD candidate from Norwegian School of Economics,
PhD thesis focus on the policy instruments that can be used to achieve a long-term goal of (almost) zero emissions of greenhouse gases in the city's passenger transport

3. Zero Emissions ?
𝑻𝒐𝒕𝒂𝒍 𝑬𝒎𝒊𝒔𝒔𝒊𝒐𝒏 = 𝑭𝒖𝒆𝒍 𝑬𝒄𝒐𝒏𝒐𝒎𝒚 × 𝑪𝑶 𝟐 𝒊𝒏𝒕𝒆𝒏𝒔𝒊𝒕𝒚 × 𝑻𝒓𝒂𝒗𝒆𝒍 𝑫𝒆𝒎𝒂𝒏𝒅
(kg)
(litre/Vkm)
(kg/litre)
(Vkm)
1. CO2 based registration tax
(Yan and Eskeland, 2016)
4.Volumetric Ethanol Excise Tax Credit
(Zhu, Yan, Smeets and Siemen, 2016)
3.Low emission zone
(Seyed Mostafa and Yan, 2017)
Instruments
2. Financial incentives for Battery Electric Vehicles
Yan (2017)

4. 1. CO2 based vehicle registration tax
Norway
Continuous
Based on CO2 after 2007
Feebate after 2009.

5. 1. CO2 based vehicle registration tax
Econometric analysis of data from 2006 to 2014 of how vehicle demands shift towards low emission vehicles.

6. 1. CO2 based vehicle registration tax
The estimated tax effect explains most (79%) of the reduced CO2 emission rate and yields an elasticity of average CO2 emission rate to the CO2 price of
CO2 price
10%
CO2 emission rate 0.6%

7. 2. Financial incentives for Battery Electric Vehicles in Europe
Policy options:
Vehicle registration tax exemption (full or partial)
Annual circulation tax exemption (full or partial)
Direct subsidies

8. 2. Financial incentives for Electric Vehicles
10 pairs of Battery Electric Vehicles (BEVs) and Internal Combustion Engine Vehicles (ICEVs) which similar attributes
For example, Renault Zoe – Renault Clio (graph)
The tax incentives, especially registration tax exemptions, significantly reduce total ownership costs of BEVs. 10% increase of the total tax incentive is associated with a 3% - 4% increase in the sales share of BEVs.

9. 2. Financial incentives for Electric Vehicles
45 degree line.
Existing tax incentive for a EV = potential environmental benefit of switching from an ICEV to a EV
Many countries apply higher tax incentives than potential environmental benefits (air quality improvements, noise and CO2 reductions). Additional benefits are costly

10. 3. Low emission zone
Low emission zone with restricted entry for high-emission or heavy vehicles (e.g., a fee charge or other deterrent) in order to reduce emissions in the city. Low emission vehicles are exempted or get discounts.
The concept of low emission zone can be generalized as “a limited zone” which give free accesses to EV and add limitations to combustion engines (ICEV). For example, exemption from toll, free access to congestion zone, access to bus lane and free parking
Earlier research only considered the purchase upfront cost affecting consumers. The annual distance travelled is assumed to be fixed for vehicles, 15000km per year.
In our study, with simulation models, we analyze how the future travel planning could affect the optimal decisions of vehicle purchases and routing.

12. EV has lower external costs than ICEV, especially inside the zone
The urban area has a higher population density, pollutant concentrations and congestion, giving rise to a zone EV
ICEV
Local air pollutions
(NOx, SO2)
Inside the zone
EC1
Outside the zone
EC2
CO2 emission
EC3
EC4
Congestion
EC5
EC6
EC1>EC2
EC3 < EC4
EC5 > EC6
EV has lower external costs than ICEV, especially inside the zone

13. EV sales
External cost
Low emission zone is able to work as well as the vehicle taxes in the urban area in terms of promoting EV purchase. If designed appropriately, it works better in some cases.

14. 4. Biofuel - Volumetric Ethanol Excise Tax Credit (optional)
Land use and fertilizer application
Fertilizer Corn Ethanol Gasoline
Biofuel might not be a good option.
Corn ethanol emissions are higher than for gasoline, due to a tendency to use nitrogen fertilizer to raise corn yields

15. Thanks