Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:

 

Hybrid vehicle rebates produce scant environmental benefits, high cost

06.08.2009
Despite major costs to taxpayers in the U.S. and Canada, government programs that offer rebates to hybrid vehicle buyers are failing to produce environmental benefits, a new UBC study says.

The study finds that hybrid sales have come largely at the expense of small, relatively fuel-efficient, conventional cars, rather than large SUVs, trucks and vans, which produce substantially greater carbon emissions.

"If the intention of rebate programs is to replace gas guzzlers with hybrids, they are failing," says Ambarish Chandra, a professor at UBC's Sauder School of Business and study co-author. He says large vehicle sales have risen steadily since the introduction of hybrid rebates.

"People are choosing hybrids over similarly priced small- and medium-sized conventional cars, which are not far behind hybrids for fuel efficiency and emissions," says Chandra. "The reductions in carbon emissions are therefore not great."

The study also finds that the majority of consumers who purchase hybrids were not motivated to do so by government rebates, says Chandra, whose co-authors include Sumeet Gulati, assistant professor in UBC's Dept. of Food and Resource Economics, and Milind Kandlikar of UBC's Liu Institute for Global Issues and Institute of Asian Research.

"Our estimates indicate that two-thirds of people who buy hybrids were going to buy them anyway," says Chandra. "So for the majority, rebates are not changing behaviour – they are subsidizing planned purchases."

According to the study, the inefficiency of rebate programs rises disproportionately when governments increase rebate levels. "When B.C.'s rebate jumped from $1,000 to $2,000 in 2005, the actual cost of reducing carbon emissions more than doubled," he says, noting that Ontario recently increased its rebate to a maximum of $10,000 per hybrid vehicle.

The study finds that Canadian provinces that offer rebates have spent an average of $195 per tonne of carbon saved or, equivalently, $0.43 for every litre of gasoline that a vehicle consumes over its 15 year average life expectancy.

Chandra says that governments could garner greater environmental benefits by purchasing carbon offsets (currently priced between $3 and $40 per tonne on carbon markets) or investing in green jobs and technologies.

While hybrid rebates help governments to appear environmentally progressive, Chandra suggests that some programs may serve as de facto "bailouts" for the North American auto industry.

"The criteria for Ontario's recent rebate increase seem designed to benefit domestic manufacturers, especially General Motors," Chandra says. "The biggest rebates will be given to purchasers of the Chevy Volt, rather than other hybrids like the Toyota Prius."

Hybrid rebate programs are currently offered by the governments of the U.S. and 13 states, including Washington, Oregon, Illinois and Colorado, and five Canadian provinces, including B.C., Ontario, Quebec, PEI and Manitoba. The Canadian government offered hybrid rebates during 2007-2008.

Researchers used Canadian vehicle sales data over a 17-year period from 1989 to 2006. Results are believed to extend to the U.S. market, given the similarities between auto industries, in terms of vehicle buying patterns, pricing structures and car models.

Basil Waugh | EurekAlert!
Further information:
http://www.ubc.ca
http://www.publicaffairs.ubc.ca/download

More articles from Studies and Analyses:

nachricht New study: How does Europe become a leading player for software and IT services?
03.04.2017 | Fraunhofer-Institut für System- und Innovationsforschung (ISI)

nachricht Reusable carbon nanotubes could be the water filter of the future, says RIT study
30.03.2017 | Rochester Institute of Technology

All articles from Studies and Analyses >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: Deep inside Galaxy M87

The nearby, giant radio galaxy M87 hosts a supermassive black hole (BH) and is well-known for its bright jet dominating the spectrum over ten orders of magnitude in frequency. Due to its proximity, jet prominence, and the large black hole mass, M87 is the best laboratory for investigating the formation, acceleration, and collimation of relativistic jets. A research team led by Silke Britzen from the Max Planck Institute for Radio Astronomy in Bonn, Germany, has found strong indication for turbulent processes connecting the accretion disk and the jet of that galaxy providing insights into the longstanding problem of the origin of astrophysical jets.

Supermassive black holes form some of the most enigmatic phenomena in astrophysics. Their enormous energy output is supposed to be generated by the...

Im Focus: A Quantum Low Pass for Photons

Physicists in Garching observe novel quantum effect that limits the number of emitted photons.

The probability to find a certain number of photons inside a laser pulse usually corresponds to a classical distribution of independent events, the so-called...

Im Focus: Microprocessors based on a layer of just three atoms

Microprocessors based on atomically thin materials hold the promise of the evolution of traditional processors as well as new applications in the field of flexible electronics. Now, a TU Wien research team led by Thomas Müller has made a breakthrough in this field as part of an ongoing research project.

Two-dimensional materials, or 2D materials for short, are extremely versatile, although – or often more precisely because – they are made up of just one or a...

Im Focus: Quantum-physical Model System

Computer-assisted methods aid Heidelberg physicists in reproducing experiment with ultracold atoms

Two researchers at Heidelberg University have developed a model system that enables a better understanding of the processes in a quantum-physical experiment...

Im Focus: Glacier bacteria’s contribution to carbon cycling

Glaciers might seem rather inhospitable environments. However, they are home to a diverse and vibrant microbial community. It’s becoming increasingly clear that they play a bigger role in the carbon cycle than previously thought.

A new study, now published in the journal Nature Geoscience, shows how microbial communities in melting glaciers contribute to the Earth’s carbon cycle, a...

All Focus news of the innovation-report >>>

Anzeige

Anzeige

Event News

Expert meeting “Health Business Connect” will connect international medical technology companies

20.04.2017 | Event News

Wenn der Computer das Gehirn austrickst

18.04.2017 | Event News

7th International Conference on Crystalline Silicon Photovoltaics in Freiburg on April 3-5, 2017

03.04.2017 | Event News

 
Latest News

New quantum liquid crystals may play role in future of computers

21.04.2017 | Physics and Astronomy

A promising target for kidney fibrosis

21.04.2017 | Health and Medicine

Light rays from a supernova bent by the curvature of space-time around a galaxy

21.04.2017 | Physics and Astronomy

VideoLinks
B2B-VideoLinks
More VideoLinks >>>