Supporting the electric vehicle market in U.S. cities

This briefing encapsulates a recent ICCT report, Assessment of leading electric vehicle promotion activities in United States cities, which surveys actions being taken by state and local governments and public utilities to facilitate electric vehicle deployment in the 25 largest U.S. metropolitan areas. Many government actions aim to increase awareness, understanding, and confidence, while others directly and indirectly reduce the cost of purchasing or operating electric vehicles. The briefing quantifies how electric vehicle incentives impact the effective cost of ownership of a typical battery electric vehicle versus its non-electric counterpart.

Several key findings contribute to advancing understanding of how policy is influencing electric vehicle markets and effective ownership costs. Across the 25 cities studied, four—Atlanta, Denver, Los Angeles, and San Francisco—have effective electric vehicle ownership costs below the non-electric counterpart. The consumer proposition for battery electric vehicles is especially improving in cities with proactive electric vehicle support policies; these four metropolitan markets tended to be characterized by a combination of relatively progressive promotional activities, more extensive charging infrastructure per capita, and greater consumer incentives. 

The briefing offers four main conclusions:

  1. Battery electric vehicles are increasingly becoming competitive for average vehicle consumers. Fuel savings, along with policy support, are reducing the total cost of owning and operating a battery electric vehicle below that of a comparable hybrid in all 25 cities analyzed, and below the cost for a comparable conventional vehicle in four of the 25 cities.
  2. Policies that reduce effective electric vehicle ownership costs are priming the early market. The leading metropolitan electric vehicle markets tend to have consumer subsidies, public charging infrastructure, and other incentives that make electric vehicles more attractive to prospective buyers.
  3. Gaps in awareness, education, information, and model availability are inhibiting growth in the electric vehicle market. There are several cities—especially Denver—with substantial policy incentives but without the proportionate vehicle sales, indicating that widely recognized barriers are preventing greater uptake.
  4. Extending electric vehicle policy incentives through 2020 is likely to be critical to sustaining market growth. How, and how quickly, battery electric vehicles will make sense from a household financial perspective is a key question for the success of this still-maturing technology. As this analysis shows, that time is already here in some places where pioneering electric vehicle policies have been implemented.