The effect of battery-electric vehicle ownership on transport demand and substitution between modes

Abstract

Transport decarbonization is a key part of moves to reduce global greenhouse gas emissions. A major component of this involves shifting private car use from internal combustion internal engine vehicles (ICEVs) to battery-electric engine vehicles (BEVs). This has led to the introduction of a range of incentives that influence the relative desirability of car types, but also have the potential to influence wider transportation decisions through their effects on vehicle use in general. We examine this in the context of Norway which has pursued BEV ownership through a range of incentives, most notably purchase tax exemptions, and has experienced dramatic increases in BEV ownership. Based on highly detailed individual level travel survey data collected between 2016 and 2019 we estimate the effect of BEV ownership on transport demand patterns. We do so using a selection on observables approaches that seeks to reduce selection bias. We demonstrate that BEV ownership leads to an overall increase in car trip demand in the order of 10–20%. This reflects shifts from ICEV to BEV use, but also sizeable shifts away from public transport use, cycling and walking. These effects are increased by additional policies that incentivize BEV usage such as toll road exemptions. Together this suggests that while BEV usage reduces emission-based externalities, it may exacerbate others such as congestion externalities. Our results suggest a need for caution when using transportation incentives that make BEVs cheaper, but additionally make private motor vehicle use in general less expensive.