When thinking about buying an electric vehicle (EV), a big worry for a lot of people is whether there are enough charging stations nearby. This can be a dealbreaker, especially if they do not have other options for charging at home. A recent working paper called “A Tale of Two Investments: Charging Stations and Purchase Subsidies for EV Adoption” from Washington-based Resources for the Future delves into this issue.
By analyzing survey data from California’s Clean Vehicle Rebate Project (CVRP) and spatial data on charging stations, the authors — Yanjun (Penny) Liao, Bei Luo, and Beia Spiller — show how financial subsidies and charging infrastructure work together to drive EV adoption, particularly among lower-income individuals.
They found that when there are more charging stations around, subsidies play a bigger role in whether consumers decide to buy an EV. This is especially true for those earning less income, as they may not have access to their own charging setup at home. Higher-income earners, who might be more likely to have private charging options at home, aren’t as influenced by subsidies or the availability of public options.
(After reading this report, you should check out this one by the Pembina Institute about how to ensure condos and apartment buildings in Alberta are equipped with charging infrastructure.)
Based on these findings, the paper from Resources for the Future suggests a hybrid policy approach that integrates the expansion of charging infrastructure with ongoing financial incentives.
In the paper’s concluding paragraphs, the authors note:
Our results provide important implications for policy formulation in promoting EV adoption. First, they demonstrate the advantages of employing hybrid interventions — combining financial subsidies with the development of charging networks — to leverage their complementarity and improve the overall efficiency of clean vehicle incentives. Second, the heterogeneous effects across lower- and higher-income individuals highlight the potential of targeting the former in incentive programs to enhance both equity and cost-effectiveness.
“A Tale of Two Investments: Charging Stations and Purchase Subsidies for EV Adoption,” by Yanjun (Penny) Liao, Bei Luo, & Beia Spiller, Resources for the Future, July 22, 2024.
Download the full report originally published by Resources for the Future on July 22, 2024.
