Examining the cost-effectiveness of electric vehicle policy in India
Suraj Ghosh, Biplab Sarkar
Abstract
Deployment of electric vehicles (EVs) is being widely used by governments across the world as a policy tool to mitigate the catastrophic effects of global warming and climate change. However, the demand for EVs has been slow in many large automotive markets, including India. To increase the uptake of EVs in India, the central government has introduced a new consumer incentive program and a special tax rate for EVs. In this paper, we estimate the cost-effectiveness of these EV promotion programs in achieving CO2 emission reduction for each State in India. We use emission data of the chosen vehicle and CO2 emission intensity data of each State’s power grid for computation. The results are then compared to other benchmark investments in climate change mitigation. The findings indicate that subsidizing EVs may not be the most cost-efficient method to achieve CO2 reduction.