The economics of electric vehicles for passenger transportation: understanding and mitigating the fiscal risks of infrastructure

Sustainable infrastructure series

Format:

Corporate Author:

World Bank

Author:

Cecilia Briceno-Garmendia, Wenxin Qiao, Vivien Foster

Publisher:

World Bank

'The Economics of Electric Vehicles for Passenger Transportation' provides answers to three critical questions: Why should developing countries pursue e-mobility? When does an accelerated transition to electric vehicles (EVs) make sense for developing countries? How can governments make this transition happen? A key finding from the research is that there is a strong economic case for EVs in many developing countries. This is news because, despite growing momentum and interest in the sector, 90 percent of EV sales are still concentrated in major markets such as China, Europe, and the United States. According to original models developed by the report's authors, developing countries can look to electric buses as well as to two- and three-wheeled vehicles as entry points to this critical transition. Readers will find many examples of countries already benefiting from e-mobility solutions. For example, Brazil, Chile, and India are leaders in electric bus fleets. Their progress, made possible by innovative financing and procurement practices, is improving mobility in cities, reducing local air pollution, and reducing congestion in fast-growing downtowns. Readers will also see examples from Asian and East African countries, which are embarking on battery-swapping schemes to lower upfront costs of ownership for two- and three-wheeled vehicles. Based on the unique modeling, analysis, and benchmarking of results across 20 developing countries, complemented by a compilation of actual organic and diverse experiences of developing countries with electric mobility adoption, this report provides policy guidance on how governments can accelerate EV adoption, and when and where it makes economic sense to adopt electric mobility more quickly. This report is a critical read for anyone interested in the future of transport and its links with development progress