Climate ChangeS provides researchers with a timely and accurate update of new research papers on the Economics of Climate Change. On a weekly basis, links to the most recent and interesting working papers are aggregated from a variety of sources for easy and convenient reference. The focus is on research at the frontier, with most contributions appearing just a few days after having been released. For this reason, journal articles are not tracked.

December 1, 2008

Cost-Effectiveness of Greenhouse Gas Emission Reductions from Plug-in Hybrid.

by Daniel M. Kammen, Samuel M. Arons, Derek Lemoine and Holmes Hummel

- Plug-in hybrid electric vehicles (PHEVs) could significantly reduce automotive greenhouse gas (GHG) emissions and petroleum consumption, while improving energy security and urban air quality. Widespread PHEV adoption will depend upon technological and economic advances in batteries because the initial fuel savings do not rapidly compensate consumers for the capital costs of batteries today. For PHEV purchases to become economical to consumers, battery prices must decline from $1,300 per kilowatt-hour (kWh) to about or below $500/kWh, or U.S. gasoline prices must remain at about $5 per gallon-or the federal government must institute policy innovations with equivalent effects. Any carbon price would have to exceed $100/t-CO2-eq in order to render PHEVs' reductions cost-effective, and hence a carbon price alone represents an impractical short-term means of achieving this goal.

Kammen, D.M., S.M. Arons, D. Lemoine and H. Hummel (2008). "Cost-Effectiveness of Greenhouse Gas Emission Reductions from Plug-in Hybrid Electric Vehicles." Goldman School of Public Policy Working Paper No. GSPP08-014, Nov 2008.

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