Abstract:

This study responds to two Zero-emission vehicle (ZEV) regulation questions: How quickly are electric vehicle costs declining and what are the resulting consumer benefits compared to gasoline vehicles? This paper analyzes these two questions in the context of Colorado’s potential adoption of a zero-emission vehicle regulation for new light-duty vehicles from 2023 through 2030. The authors apply state-of-the-art battery projections to evaluate the implications of increased deployment of electric vehicles to comply with a ZEV regulation. The assessment of Plug-in hybrid electric vehicles (PHEVs), Battery electric vehicles (BEVs) technologies of varying electric range offers the ability to quantify the direct costs and benefits of a ZEV regulation that increasingly requires a growing electric vehicle market over time. The findings lead to several conclusions about cost parity timing, per-vehicle benefits, and overall effects from a ZEV regulation. Based on the analysis, by 2025 consumer benefits of electric vehicles greatly exceed the associated incremental vehicle costs for the technology. The authors find that, incorporating a mix of electric vehicle technologies across vehicle classes, a Colorado ZEV regulation can be met with a decidedly positive cost-to-benefit balance.