Dua, Rubal

Estimating Regional Variation in Saudi Arabia’s Energy Usage and Carbon Emissions

Estimates of regional energy consumption and carbon emissions could be useful for agencies investigating the effects of regionally targeted investments and policy interventions. Using gasoline consumption in Saudi Arabia as a case study, we develop two approaches for estimating the regional variation in gasoline consumption in Saudi Arabia: a sector-specific approach and a generic econometrics-based approach. Our findings reveal that Riyadh and Makkah, which account for 60% of the nation’s population and economic activity, consume 58% of the country’s gasoline.

18th June 2023

The Dynamic Role of Subsidies in Promoting Global Electric Vehicle Sales

We offer the most comprehensive analysis to date of global plug-in electric vehicle (PEV) subsidies. We accomplish this by estimating vehicle choice models for 23 countries using 2010–2019 sales data and using counterfactual simulations to assess the cost-effectiveness of PEV incentives.

6th June 2023

Choosing to Diet: The Impact and Cost-effectiveness of China’s Vehicle Ownership Restrictions

Can voluntary carbon emission reduction pledges, such as the nationally determined contributions under the Paris Agreement, result in significant emission reductions? According to prominent experts such as Nordhaus (2015), Barrett (2005), and Weitzman (2019), free-riding is unavoidable in cooperative situations based on voluntary agreements. If their assessments are correct, each country’s nationally determined contribution is unreliable. Countries will strategically promise large cuts while making only minor emission reductions.

14th May 2023

How Responsive Are New Car Buyers in India and China to Factors Driving Fuel Consumption?

China and India, the world’s two most populous developing economies, are also among the largest automotive markets and carbon emitters. To reduce carbon emissions from the passenger car sector, both countries have considered various policy levers that affect fuel price, car prices and fuel economy. This study estimates the responsiveness of new car buyers in China and India to such policy levers and drivers, including income.

9th April 2023

How to Mitigate Transportation Emissions in Saudi Arabia? The Role of Energy Price Governance

In light of Saudi Arabia’s recent energy-pricing reform strategy, this paper investigates the main drivers of fuel carbon dioxide (CO2) emissions in the transport sector. We employed a battery of econometric techniques to analyze the long-run relationships between income, fuel prices, energy share, population, and total carbon emissions in the transportation sector.

29th May 2022

Barriers to and Opportunities for Light-Duty Vehicle Electrification in India: Insights From a Survey of Experts

According to the World Health Organization, India has the world’s worst air quality. Among other factors, vehicular pollution from the increasing stock of passenger vehicles has contributed to India’s deteriorating air quality. This increasing stock is also a factor in India becoming the third-highest oil-consuming and greenhouse gas (GHG)-emitting country worldwide.

5th October 2021

Are Consumers Myopic About Future Fuel Costs? Insights from the Indian two-wheeler market

India has the world’s third highest carbon dioxide (CO2) emissions, after China and the United States. The transportation sector is the third largest contributor to carbon dioxide emissions in India, accounting for roughly 11% of all carbon dioxide emissions in 2016. Road transport accounts for around 94% of the total carbon dioxide emissions of the transportation sector.

24th August 2021

How Cost-Effective Are Electric Vehicle Subsidies in Reducing Tailpipe-CO2 Emissions?

The transportation sector accounts for 24% of global greenhouse gas (GHG) emissions (IEA 2020). Road transport is the most utilized mode because of its convenience (Van Essen 2008). However, it is also the most emissions intensive mode, accounting for 75% of global transport GHG emissions, with roughly 44% coming from road passenger vehicles alone (IEA 2020).

8th June 2021

Are Electric Vehicle Subsidies Becoming More Impactful Over Time?

Various subsidies for plug-in electric vehicles (PEVs) have been implemented worldwide at the federal, state and regional levels. These subsidies aim to promote PEV adoption to help reduce both local air pollution and greenhouse gas emissions (Hardman 2019). In the United States (U.S.), the federal government began subsidizing PEVs in 2010.

22nd March 2021

Eliciting Preferences of Ride-Hailing Users and Drivers

The ‘ride-hailing’ services offered by transportation network companies (TNCs) such as Uber and Lyft have rapidly disrupted personal transportation, particularly in cities. Schaller (2018) reports that TNCs provided 2.6 billion rides in 2017 in the United States (U.S.), a 37% increase from 2016. The rapid increase in the adoption of TNC services can be attributed to the ease of access offered by smartphone applications and the higher availability of cars and drivers compared to regulated, traditional taxi services.

24th February 2020

The Effectiveness of China’s Plug-In Electric Vehicle Subsidy

Subsidies for promoting plug-in electric vehicle (PEV) adoption are a key component of China’s overall plan for reducing local air pollution and greenhouse gas (GHG) emissions from its light-duty vehicle sector. This paper explores the impact and cost-effectiveness of the Chinese PEV subsidy program. A vehicle choice model is estimated using a large random sample of individual-level data for new vehicle purchases in China for model year 2017.

29th December 2019

Drivers of New Light-Duty Vehicle Fleet Fuel Economy in Saudi Arabia

This paper investigates the drivers of recent improvements in Saudi Arabia’s new light-duty vehicle fleet fuel economy. A vehicle choice model is estimated using aggregate and disaggregate new vehicle purchase data. The estimates are used to simulate counterfactual policy scenarios. The simulation results suggest that: Price elasticity of fuel economy for new vehicles has been decreasing in Saudi Arabia over recent years, but it is still more elastic than the new vehicle market in the United States (U.S.). Pegging Saudi Arabia’s fuel economy standards to U.S. fuel economy standards might warrant further economic evaluation. The increase in domestic gasoline prices in Saudi Arabia between 2014 and 2016 accounted for 42% of the increase in estimated new vehicle fleet fuel economy over that period. The remainder of the increase could be attributable to changes in product offerings and consumer preferences. The estimated elasticities, and thus policy sensitivities, vary by income and household size. Thus, a revenue-neutral ‘feebate’ policy – involving taxes on fuel-inefficient vehicles and rebates for fuel-efficient vehicles – could be more progressive than another gasoline price increase.

1st May 2019

Vehicle Retirement and Replacement Policy: Assessing Impact and Cost-Effectiveness

Governments across the world, motivated by air quality improvement or by climate change mitigation goals, are trying to accelerate the turnover of older, higher-emitting vehicles and replace these with lower emission vehicles. One approach is to encourage consumers to scrap their old, inefficient and more polluting vehicles and buy new ones, typically plug-in electric vehicles (PEVs) and hybrid electric vehicles (HEVs). This can be expensive on a per-additional-vehicle basis if fixed subsidy programs allow those owners who would have replaced their vehicles with a low emission vehicle anyway to obtain these subsidies. It is important that all parties — whether invested in conventional internal combustion engine (ICE), hybrid electric or newer, fully electric powertrains — understand the scope for more economically efficient policy to avoid incorrectly estimating the barriers to entry for new vehicle technologies. Previous KAPSARC research used counterfactual simulations to highlight the fact that policymakers might increasingly switch to targeted subsidy designs to improve the cost-effectiveness of low emission vehicle subsidies. This study, however, explores the effectiveness of a real-world targeted subsidy policy, California’s ‘Replace Your Ride’ (RYR) program. RYR gives targeted subsidies to lower-income households living in districts with poor local air quality to retire older vehicles and replace them with newer, cleaner vehicles. The effectiveness of the RYR policy is measured using new vehicle registration and sociodemographic data in a difference-in-difference analysis framework.

24th May 2018

Measuring the Cost-Effectiveness of Clean Vehicle Subsidies

Demand-side policies, including rebates, sales tax exemptions, and tax credits promote clean vehicle adoption, with the goal of reducing local air pollution and greenhouse gas (GHG) emissions. Limited research to date on their cost-effectiveness and efficiency suggests such subsidies are unsustainably expensive, but this may not tell the whole story. KAPSARC used a nationally representative sample of new car purchases in the United States and developed a vehicle choice model-based simulation to assess the scope for reducing the costs of subsidy policies.

10th May 2018

Gasoline Savings From Clean Vehicle Adoption

Without the option to purchase plug-in electric and/or hybrid vehicles, conventional counterfactuals used in literature may underestimate the fuel savings from clean vehicle adoption, thus overestimating the costs of securing associated environmental benefits. Using a nationally representative sample of new car purchases in the U.S., a vehicle choice model-based counterfactual approach is proposed that allows for the prediction of what consumers would purchase if these clean vehicles were unavailable. The cost of demand-side policies in the form of financial incentives to encourage plug-in electric vehicle adoption is estimated.

16th January 2018

Understanding Long Term Consumer Demand For Fuel Efficient Vehicles

Consumer adoption of fuel-efficient vehicles is a crucial step in improving energy use and reducing emissions from the transportation sector. The range of options includes hybridization of powertrains all the way through to fully electric vehicles. To promote adoption, policymakers have employed supply side policies such as the Greenhouse Gas (GHG) Emissions/Corporate Average Fuel Economy (CAFE) standards and the Zero Emission Vehicle (ZEV) mandate, which require automakers to produce and sell fuel-efficient and alternative fuel vehicles. In addition, demand side measures in the form of financial and non financial incentives promoting ZEV adoption have also been employed. We measure the changes in consumers’ purchase motivations and potential demand in the wake of such programs by analyzing the past 11 years of new vehicle buyer survey data in the United States as a case study.

16th April 2017

Understanding Adoption of Energy-Efficient Technologies: A Case Study of Battery Electric Vehicle Adoption in the U.S.

The adoption of energy-efficient technologies is a key factor in improving energy utilization. The ways in which consumers make their decisions – incorporating non-economic factors – is critical to understanding the pace and depth of adoption. We present a way of characterizing current and potential adopters of new technology and the factors that influence their decisions using battery electric vehicle (BEV) adoption in the U.S. as a case study.

16th May 2016

Expert Survey Assessment of Emerging Maritime Decarbonization Challenges and Priorities

The decarbonization of the maritime sector has emerged as a global concern due to the shipping sector’s 3% contribution to world’s total greenhouse gas (GHG) emissions. Notably, the latest developments involving the adoption of more ambitious GHG reduction targets by the International Maritime Organization (IMO) highlight the increasing urgency to address maritime decarbonization. The revised IMO strategy includes indicative checkpoints and intermediary targets, aiming at emission reductions of at least 20% by 2030 and at least 70% by 2040 and reaching net-zero emissions “by or around 2050 (Carbon Pulse 2023). As nations strive to meet such commitments, it becomes crucial to comprehend the latest challenges associated with decarbonizing the maritime sector. Using an expert survey, we seek to identify the key priorities for achieving effective and equitable decarbonization by engaging a diverse group of maritime fuel, policy, technology, and infrastructure experts to gain valuable insights into the industry’s most pressing challenges.

14th September 2023

Current and Future Trends in Saudi Arabia’s Container Throughput

The maritime sector is a key pillar for the diversification of the Kingdom of Saudi Arabia’s economy, and it has been prioritised by the Saudi government due to its strategic importance. Saudi Vision 2030 has set a target for making KSA a global logistics hub. Correspondingly, the Kingdom has been investing heavily in its seaports to modernize their infrastructure and increase their capacity. For instance, several projects are now underway to boost the maritime transport sector, costing around 6 billion Saudi Arabian riyals (SAR) (USD $1.6 billion).

25th May 2022

Post-Covid Recovery of Air Traffic in Saudi Arabia

The dramatic drop in air traffic caused by the COVID-19 pandemic and the related travel restrictions has significantly impacted the aviation industry in Saudi Arabia and around the world. The sector has suffered considerable losses due to the reduction in passenger traffic.

25th May 2022

Understanding demand for hybrid and electric vehicles using large-scale consumer profile data

Consumer adoption of hybrid and electric vehicles is a crucial step in improving energy utilization and reducing emissions from the transportation sector. To promote adoption, U.S. policymakers have employed supply-side policies such as Greenhouse Gas (GHG) Emissions/Corporate Average Fuel Economy (CAFE) standards and Zero Emission Vehicle (ZEV) mandate, which require automakers to produce fuel-efficient vehicles. In addition, demand-side measures in the form of financial and non-financial incentives promoting ZEV adoption have also been utilized. We measure the changes in consumers’ purchase motivations and potential demand in the wake of such programs by analyzing the past 11 years of new vehicle buyer survey data with more than one million respondents in the U.S. We found that hybrid-electric vehicles (HEVs), plug-in hybrid-electric vehicles (PHEVs) and battery-electric vehicles (BEVs), collectively termed as “xEVs,” had the potential to secure as much as 11 percent of the U.S. automotive market in model year 2015, but the actual market share was only one-third of this. Potential buyers desire features and factors such as exterior styling, safety, warranty coverage and better resale value. Achieving market share beyond the estimated potential share of 11 percent, would require offering features that mainstream gasoline vehicle buyers value, such as reliability, handling and value for money. Currently, both actual and potential xEV buyers are willing to trade them for fuel economy, environmental friendliness and technical innovation. Future mainstream xEV buyers, however, may not be willing to make that trade-off. A narrowing of the consumer’s valuation gap between non-xEV and xEV buyers for purchase motivations including fuel economy, environmental friendliness, technical innovation and price is increasing the potential consumer demand for xEVs. The term valuation gap, refers to the difference between the average rating given by non-xEV and xEV buyers for a particular purchase motivation question in the survey. The closer the ratings, the smaller will be the valuation gap. Policy instruments such as sales-weighted fuel economy target show strong correlation with the consumer valuation gap. In combination with demand-side policies that make xEVs more accessible to mainstream consumers, they could be considered as viable tools to nudge consumers toward xEVs. © 2017 MOBI -Mobility, Logistics and Automotive Technology Research Centre. Link: https://www.scopus.com/inward/record.uri?eid=2-s2.0-85050097941&partnerID=40&md5=fd6ac204cd44dcd69b41d1eca57ead78

9th October 2017

Is the Recent Price Spike in Electric Vehicle Lithium-Ion Battery Packs Temporary or the Start of a New Trend?

Most nations are evaluating vehicle electrification as a way to decarbonize their passenger car sectors. To make electric vehicles competitive with conventional vehicles for cost-conscious consumers, the upfront purchase price of electric vehicles needs to fall. The battery pack is the most expensive part of an electric vehicle, accounting for about 30% of the total cost to consumers.

5th March 2023

Bans on the Sale of Gasoline- And Diesel-Powered Vehicles: Why Are Policymakers Favoring Commandand- Control to the Point of Banning, and Does It Send Unintended Policy Signals?

In recent years, the adoption of command-and-control policies, from mandating sales of zero-tailpipe-emission vehicles all the way to prohibiting future sales of gasoline- and diesel-powered vehicles via tailpipe carbon dioxide (CO2) emissions standards or otherwise, has gained momentum globally in the new light-duty vehicle sector. This includes the zero-emissions vehicle (ZEV) mandate in California (CARB 2017), which was later adopted by other ZEV states in the United States, the new energy vehicle mandate in China (ICCT 2018), and the recently enacted laws in the European Union (Council of the European Union 2022) and California (CARB 2022) that effectively ban the sale of new gasoline- and diesel-powered vehicles after 2035.

15th February 2023

How Long Will the Semiconductor Crisis Affect the Traditional Automotive Sector? Implications for car fuel demand

The 2020 semiconductor crisis has hit the automotive sector, as well as many other sectors. As a consequence of the COVID-19-induced shock, a worldwide semiconductor supply-demand imbalance arose between 2020 and 2022. Demand grew by around 17% annually while manufacturing capacity grew by only 6% annually (Figure 1). However, this supply-demand gap was not uniform across all semiconductor applications. For instance, during the early months of the COVID-19 pandemic (i.e., the first half of 2020), car demand plummeted by as much as 80% in Europe, 70% in China, and over 50% in the United States (U.S.).

13th October 2022

Once Consumers Adopt an Electric Vehicle, Do They Go Back?

The lack of repeat adoption of low carbon technologies has implications for climate change mitigation. In this insight, we explore how many electric vehicle owners dispose of their electric vehicles and do not buy another when purchasing their next car. We also investigate their reasons for discontinuing their electric vehicle ownership. We highlight the policy implications of these findings, comparing policies aimed at promoting adoption vis-à-vis sustaining adoption.

29th June 2021

The Impact of Recent Changes to China’s Plug-In Electric Vehicle Subsidy Design

Subsidies that promote plug-in electric vehicle (PEV) adoption have been a key component of China’s overall plan for reducing local air pollution and the greenhouse gas emissions from its light-duty vehicle sector. Since 2009, PEVs qualify for substantial rebates (up to US$9,000) from both the central and local Chinese governments. However, PEV subsidies were cut by almost 50% from June 2019 onward, and China had plans to eliminate the subsidies in 2020.

19th July 2020

Impact of India’s Recent Electric Vehicle Subsidy Announcement

The Indian government is urgently promoting electric vehicles (EVs) to help curb the country’s urban air pollution — the world’s worst, according to the World Health Organization. The steep increase in vehicle sales in recent years has brought deteriorating air quality and made India the third-highest oil consuming and greenhouse gas (GHG) emitting country in the world.

3rd December 2019

Impact of China’s Plug-In Electric Vehicle Subsidy Reduction

China, the world’s largest emitter of carbon dioxide, has set ambitious climate goals. These include reducing the carbon intensity of its 2005 gross domestic product (GDP) by 40-45% by 2020 and by 60-65% by 2030 (Xu, Chen, and Chen 2017). A key component of the country’s overall plan to reduce its carbon emissions is its New Energy Vehicle (NEV) policy. Battery electric vehicles (BEVs), which run solely on electricity, and plug-in hybrid electric vehicles (PHEVs), which run on electricity and gasoline or diesel, are a major component of China’s NEV policy and market. The policy is aimed at increasing the market shares of BEVs and PHEVs. It is as much a tool to help reduce carbon emissions and local air pollution as it is an industrial policy to help China leapfrog other countries in the plug-in electric vehicle (PEV, which includes both BEVs and PHEVs) manufacturing space. Japan, Germany and the United States (U.S.) continue to be leaders in internal combustion engine vehicle (ICEV) manufacturing, and China sees PEV manufacturing as a way to propel itself forward in the automotive manufacturing sector. PEV subsidies are one of the most commonly used policy levers for encouraging PEV purchases globally, including in China. They reduce the high up-front purchase price of PEVs relative to comparable ICEVs, one of the major barriers to PEV adoption. Since 2009, PEVs qualify for substantial rebates (up to US$9,000) from both the central and local Chinese governments (ICCT 2017a; Hancock 2019). Furthermore, in several big cities such as Shanghai and Shenzhen, PEVs are exempt from new vehicle registration fees (ICCT 2017b). These PEV support policies have led to significant PEV market share growth in recent years, with PEVs accounting for more than 4% of new vehicle sales in 2018 (IEA 2019). However, PEV subsidies are scheduled to be cut from June 26, 2019 (Kharpal 2019) by roughly 45% to 60% (Hancock 2019; Kharpal 2019).

17th July 2019

Future Fuel Demand From the Saudi Shipping Sector: A Business-as-Usual Estimation

The purpose of this commentary is to suggest a rough estimation of future exports and corresponding fuel consumption of the Saudi shipping sector up to 2040. For estimation purposes, we use two assumptions: A global average energy intensity of 0.078 megajoules per tonne-kilometers (MJ/tonne-km). An average export distance of 5,441 nautical miles (nm) between Saudi Arabia and export trading partner countries.

21st August 2023

Challenges Facing the Circular Economy That Aims to Improve Electric Vehicle Sector Sustainability

Governments around the world are increasingly focusing on the future of transportation, particularly road transportation, to reduce global greenhouse gas emissions and local air pollution. As the shift to low-carbon transportation continues, the sales of electric vehicles (EVs) are expected to rise, with several associated challenges. The growing demand for EVs will also increase the demand for the critical mineral resources required to manufacture them. Many EV motor technologies require rare-earth magnets, whereas batteries require raw elements such as lithium, cobalt and nickel. Mining such minerals raises several environmental, social and governance (ESG) issues, including environmental degradation, exploitation of child labor and human health risks. Furthermore, these critical raw materials are hampered by supply chain problems and price volatility.

13th June 2023

Can Circularity-Based Approaches Prevent a Cobalt Supply Shortfall?

Electric vehicle batteries rely heavily on a small number of critical minerals, including cobalt. Cobalt metal prices have doubled over the past year as a result of a mismatch between supply and demand, particularly for electric car batteries (Hume 2022).

4th April 2023

India’s Political Ambition of Implementing Plug-In Electric Vehicle Sales Targets

The Indian transportation sector is going through a massive transition, especially the light-duty vehicle (LDV) sector. Policymakers consider the electrification of road transport to be one of the ways of solving India’s triple problem of increasing greenhouse gas (GHG) emissions, rising oil imports, and increasing urban air pollution. Several government ministries and departments have been involved in supporting the transition of the transport sector.

26th April 2021

Responsiveness of Saudi New Vehicle Fleet Fuel Economy to Fuel and Vehicle Price Policy Levers

The Saudi government has implemented several policies to slow the growth of, or even reduce, its on-road motor gasoline consumption. These include demand-side policies such as raising fuel prices and supply-side policies such as the fuel economy standards (SASO and SEEC 2014). However, the extent to which these policies have been effective in improving the Saudi new vehicle fleet fuel economy is not well understood. This commentary highlights the findings from a recent KAPSARC paper published in the Energy Economics journal that explored the impact of fuel- and vehicle price-related policies on Saudi Arabia’s new vehicle fleet fuel economy (Sheldon and Dua 2020).

21st April 2021

What Policy Levers Could Address Indiaʼs Automobile-Related Externalities?

The Indian government has shown a growing recognition of the need for policy instruments aimed at addressing increasing air pollution, oil imports, and greenhouse gas (GHG) emissions associated with India’s light-duty vehicle (LDV) sector. Based on the findings of a survey of Indian passenger vehicle ecosystem experts, this commentary aims to understand the potential central and state policy levers that could be used to address these three issues.

12th April 2021

Understanding Latent Consumer Demand For Fuel-Efficient Vehicles

Consumer adoption of electric vehicles (EVs) – including hybrids, plug-in hybrids and pure battery electric – is a crucial step in improving energy use and reducing emissions in the transportation sector. To promote adoption, policymakers have employed various demand- and supply-side policies, including incentives, corporate average fuel economy (CAFE) standards, zero-emission vehicle mandates, among others.

3rd February 2021

Understanding the Evolution of the Impact and Cost-Effectiveness of Electric Vehicle Subsidies

Our previous research found that promoting plug-in electric vehicle (PEV) adoption through financial subsidies is expensive. In this commentary, we explore how the cost-effectiveness of the PEV subsidy program has evolved over time. To understand this evolution, we developed vehicle choice model-based counterfactual simulations using annual United States (U.S.) new vehicle market share and vehicle characteristics data for each of the model years (MYs) from 2011 to 2017.

30th August 2020

Estimating the Size and Efficiency of the Saudi Vehicle Fleet

Estimates of the size of Saudi Arabia’s vehicle fleet in 2015 vary from as high as 18 million (Arab News 2014) to as low as 6.6 million (OICA 2019). This significant variation stems from the fact that the Kingdom does not operate a vehicle registration program that deletes vehicle registrations from the records after a vehicle is exported, destroyed in an accident, or depreciated by wear and tear (Algadhi, Mufti, and Malick 2002).

24th June 2020

Understanding the Impact of Ride-Hailing Services on Travel Behavior

Major transformations are taking place in the road transportation sector, particularly in passenger auto travel. The arrival of transportation network companies (TNCs), including Uber, Didi Chuxing, Ola, Lyft and others, has the potential to critically alter key aspects of passenger auto travel behavior such as vehicle ownership, miles traveled, the uptake of alternative fuel vehicles and the use of mass transit.

26th December 2019