IDEAS home Printed from https://ideas.repec.org/a/eee/retrec/v80y2020ics0739885919303208.html
   My bibliography  Save this article

Dissecting the total cost of ownership of fully electric cars in Italy: The impact of annual distance travelled, home charging and urban driving

Author

Listed:
  • Scorrano, Mariangela
  • Danielis, Romeo
  • Giansoldati, Marco

Abstract

The paper quantifies the importance for cost competitiveness of fully electric cars (BEVs) of three determinants of the total cost of ownership (TCO): the annual distance travelled (ADT), the percentage of urban trips, and the availability of a private parking space. The estimates are performed with reference to the Italian car market. We find that charging at home increases the break-even BEV manufacturer's suggested retail price (MSRP) relative to other propulsion systems by €2866-11,466, depending on the ADT. Driving in urban areas increases the break-even BEV MSRP by €910-10,314, depending on the ADT and on the referenced propulsion system. Taking into account the share of Italian drivers who own a garage and drive in urban areas, we find the cheapest BEVs are cost competitive without a subsidy with respect to the HEVs for 11.8% of the Italian drivers, but not with respect to the diesel and petrol cars, unless extremely high annual distances are driven. With the purchase subsidy recently introduced by the Italian government, the cheapest BEVs become competitive also with respect to the diesel cars, but not relative to the petrol cars, unless more than 12,500 km are annually driven.

Suggested Citation

  • Scorrano, Mariangela & Danielis, Romeo & Giansoldati, Marco, 2020. "Dissecting the total cost of ownership of fully electric cars in Italy: The impact of annual distance travelled, home charging and urban driving," Research in Transportation Economics, Elsevier, vol. 80(C).
    • Handle: RePEc:eee:retrec:v:80:y:2020:i:c:s0739885919303208
    DOI: 10.1016/j.retrec.2019.100799
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0739885919303208
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.retrec.2019.100799?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. van Velzen, Arjan & Annema, Jan Anne & van de Kaa, Geerten & van Wee, Bert, 2019. "Proposing a more comprehensive future total cost of ownership estimation framework for electric vehicles," Energy Policy, Elsevier, vol. 129(C), pages 1034-1046.
    2. Vazifeh, Mohammad M. & Zhang, Hongmou & Santi, Paolo & Ratti, Carlo, 2019. "Optimizing the deployment of electric vehicle charging stations using pervasive mobility data," Transportation Research Part A: Policy and Practice, Elsevier, vol. 121(C), pages 75-91.
    3. Krause, Rachel M. & Carley, Sanya R. & Lane, Bradley W. & Graham, John D., 2013. "Perception and reality: Public knowledge of plug-in electric vehicles in 21 U.S. cities," Energy Policy, Elsevier, vol. 63(C), pages 433-440.
    4. Wang, Shanyong & Wang, Jing & Li, Jun & Wang, Jinpeng & Liang, Liang, 2018. "Policy implications for promoting the adoption of electric vehicles: Do consumer’s knowledge, perceived risk and financial incentive policy matter?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 117(C), pages 58-69.
    5. Wu, Geng & Inderbitzin, Alessandro & Bening, Catharina, 2015. "Total cost of ownership of electric vehicles compared to conventional vehicles: A probabilistic analysis and projection across market segments," Energy Policy, Elsevier, vol. 80(C), pages 196-214.
    6. Breetz, Hanna L. & Salon, Deborah, 2018. "Do electric vehicles need subsidies? Ownership costs for conventional, hybrid, and electric vehicles in 14 U.S. cities," Energy Policy, Elsevier, vol. 120(C), pages 238-249.
    7. Palmer, Kate & Tate, James E. & Wadud, Zia & Nellthorp, John, 2018. "Total cost of ownership and market share for hybrid and electric vehicles in the UK, US and Japan," Applied Energy, Elsevier, vol. 209(C), pages 108-119.
    8. Patt, Anthony & Aplyn, David & Weyrich, Philippe & van Vliet, Oscar, 2019. "Availability of private charging infrastructure influences readiness to buy electric cars," Transportation Research Part A: Policy and Practice, Elsevier, vol. 125(C), pages 1-7.
    9. Hunt Allcott & Nathan Wozny, 2014. "Gasoline Prices, Fuel Economy, and the Energy Paradox," The Review of Economics and Statistics, MIT Press, vol. 96(5), pages 779-795, December.
    10. Giansoldati, Marco & Danielis, Romeo & Rotaris, Lucia & Scorrano, Mariangela, 2018. "The role of driving range in consumers' purchasing decision for electric cars in Italy," Energy, Elsevier, vol. 165(PA), pages 267-274.
    11. Lévay, Petra Zsuzsa & Drossinos, Yannis & Thiel, Christian, 2017. "The effect of fiscal incentives on market penetration of electric vehicles: A pairwise comparison of total cost of ownership," Energy Policy, Elsevier, vol. 105(C), pages 524-533.
    12. Chunlin Guo & Jingjing Yang & Lin Yang, 2018. "Planning of Electric Vehicle Charging Infrastructure for Urban Areas with Tight Land Supply," Energies, MDPI, vol. 11(9), pages 1-17, September.
    13. Hao, Han & Ou, Xunmin & Du, Jiuyu & Wang, Hewu & Ouyang, Minggao, 2014. "China’s electric vehicle subsidy scheme: Rationale and impacts," Energy Policy, Elsevier, vol. 73(C), pages 722-732.
    14. Diao, Qinghua & Sun, Wei & Yuan, Xinmei & Li, Lili & Zheng, Zhi, 2016. "Life-cycle private-cost-based competitiveness analysis of electric vehicles in China considering the intangible cost of traffic policies," Applied Energy, Elsevier, vol. 178(C), pages 567-578.
    15. Dumortier, Jerome & Siddiki, Saba & Carley, Sanya & Cisney, Joshua & Krause, Rachel M. & Lane, Bradley W. & Rupp, John A. & Graham, John D., 2015. "Effects of providing total cost of ownership information on consumers’ intent to purchase a hybrid or plug-in electric vehicle," Transportation Research Part A: Policy and Practice, Elsevier, vol. 72(C), pages 71-86.
    16. Danielis, Romeo & Giansoldati, Marco & Rotaris, Lucia, 2018. "A probabilistic total cost of ownership model to evaluate the current and future prospects of electric cars uptake in Italy," Energy Policy, Elsevier, vol. 119(C), pages 268-281.
    17. Zhao, Xin & Doering, Otto C. & Tyner, Wallace E., 2015. "The economic competitiveness and emissions of battery electric vehicles in China," Applied Energy, Elsevier, vol. 156(C), pages 666-675.
    18. Delucchi, Mark & Lipman, Timothy, 2001. "An Analysis of the Retail and Lifecycle Cost of Battery-Powered Electric Vehicles," Institute of Transportation Studies, Working Paper Series qt50q9060k, Institute of Transportation Studies, UC Davis.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Maxwell Woody & Shawn A. Adderly & Rushabh Bohra & Gregory A. Keoleian, 2024. "Electric and gasoline vehicle total cost of ownership across US cities," Journal of Industrial Ecology, Yale University, vol. 28(2), pages 194-215, April.
    2. Danielis, Romeo & Rotaris, Lucia & Giansoldati, Marco & Scorrano, Mariangela, 2020. "Drivers’ preferences for electric cars in Italy. Evidence from a country with limited but growing electric car uptake," Transportation Research Part A: Policy and Practice, Elsevier, vol. 137(C), pages 79-94.
    3. Santos, Georgina & Rembalski, Sebastian, 2021. "Do electric vehicles need subsidies in the UK?," Energy Policy, Elsevier, vol. 149(C).
    4. Kristián Čulík & Vladimíra Štefancová & Karol Hrudkay & Ján Morgoš, 2021. "Interior Heating and Its Influence on Electric Bus Consumption," Energies, MDPI, vol. 14(24), pages 1-19, December.
    5. Desreveaux, A. & Bouscayrol, A. & Trigui, R. & Hittinger, E. & Castex, E. & Sirbu, G.M., 2023. "Accurate energy consumption for comparison of climate change impact of thermal and electric vehicles," Energy, Elsevier, vol. 268(C).
    6. Rotaris, Lucia & Giansoldati, Marco & Scorrano, Mariangela, 2021. "The slow uptake of electric cars in Italy and Slovenia. Evidence from a stated-preference survey and the role of knowledge and environmental awareness," Transportation Research Part A: Policy and Practice, Elsevier, vol. 144(C), pages 1-18.
    7. Paolo Lazzeroni & Brunella Caroleo & Maurizio Arnone & Cristiana Botta, 2021. "A Simplified Approach to Estimate EV Charging Demand in Urban Area: An Italian Case Study," Energies, MDPI, vol. 14(20), pages 1-18, October.
    8. Mariangela Scorrano & Terje Andreas Mathisen & Marco Giansoldati, 2019. "Is electric car uptake driven by monetary factors? A total cost of ownership comparison between Norway and Italy," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 0(2), pages 99-132.
    9. Miao, Rui & Guo, Peng & Huang, Wenjie & Li, Qi & Zhang, Bo, 2022. "Profit model for electric vehicle rental service: Sensitive analysis and differential pricing strategy," Energy, Elsevier, vol. 249(C).
    10. Roberta Riverso & Carmela Altamura & Francesco La Barbera, 2023. "Consumer Intention to Buy Electric Cars: Integrating Uncertainty in the Theory of Planned Behavior," Sustainability, MDPI, vol. 15(11), pages 1-13, May.
    11. Kondev, Bozhil & Dixon, James & Zhou, Zhaoqi & Sabyrbekov, Rahat & Sultanaliev, Kanat & Hirmer, Stephanie A., 2023. "Putting the foot down: Accelerating EV uptake in Kyrgyzstan," Transport Policy, Elsevier, vol. 131(C), pages 87-96.
    12. Mariangela Scorrano & Romeo Danielis & Stefano Pastore & Vanni Lughi & Alessandro Massi Pavan, 2020. "Modeling the Total Cost of Ownership of an Electric Car Using a Residential Photovoltaic Generator and a Battery Storage Unit—An Italian Case Study," Energies, MDPI, vol. 13(10), pages 1-21, May.
    13. Yanhua Liang & Hongjuan Lu, 2022. "Dynamic Evaluation and Regional Differences Analysis of the NEV Industry Development in China," Sustainability, MDPI, vol. 14(21), pages 1-23, October.
    14. Agovino, Massimiliano & Ferraro, Aniello & Garofalo, Antonio, 2023. "Are green cars an optimal and efficient choice for motorists? Evidence from Italy," Transport Policy, Elsevier, vol. 141(C), pages 140-151.
    15. Hao, Xu & Lin, Zhenhong & Wang, Hewu & Ou, Shiqi & Ouyang, Minggao, 2020. "Range cost-effectiveness of plug-in electric vehicle for heterogeneous consumers: An expanded total ownership cost approach," Applied Energy, Elsevier, vol. 275(C).
    16. Gulnaz Ivanova & António Carrizo Moreira, 2023. "Antecedents of Electric Vehicle Purchase Intention from the Consumer’s Perspective: A Systematic Literature Review," Sustainability, MDPI, vol. 15(4), pages 1-27, February.
    17. Giansoldati, Marco & Monte, Adriana & Scorrano, Mariangela, 2020. "Barriers to the adoption of electric cars: Evidence from an Italian survey," Energy Policy, Elsevier, vol. 146(C).
    18. Simolin, Toni & Rauma, Kalle & Viri, Riku & Mäkinen, Johanna & Rautiainen, Antti & Järventausta, Pertti, 2021. "Charging powers of the electric vehicle fleet: Evolution and implications at commercial charging sites," Applied Energy, Elsevier, vol. 303(C).
    19. Ouyang, Danhua & Zhou, Shen & Ou, Xunmin, 2021. "The total cost of electric vehicle ownership: A consumer-oriented study of China's post-subsidy era," Energy Policy, Elsevier, vol. 149(C).
    20. Liu, Zhe & Song, Juhyun & Kubal, Joseph & Susarla, Naresh & Knehr, Kevin W. & Islam, Ehsan & Nelson, Paul & Ahmed, Shabbir, 2021. "Comparing total cost of ownership of battery electric vehicles and internal combustion engine vehicles," Energy Policy, Elsevier, vol. 158(C).
    21. Malima, Gabriel Clement & Moyo, Francis, 2023. "Are electric vehicles economically viable in sub-Saharan Africa? The total cost of ownership of internal combustion engine and electric vehicles in Tanzania," Transport Policy, Elsevier, vol. 141(C), pages 14-26.
    22. Schwab, Julia & Sölch, Christian & Zöttl, Gregor, 2022. "Electric Vehicle Cost in 2035: The impact of market penetration and charging strategies," Energy Economics, Elsevier, vol. 114(C).
    23. Say, Kelvin & Csereklyei, Zsuzsanna & Brown, Felix Gabriel & Wang, Changlong, 2023. "The economics of public transport electrification: A case study from Victoria, Australia," Energy Economics, Elsevier, vol. 120(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mariangela Scorrano & Terje Andreas Mathisen & Marco Giansoldati, 2019. "Is electric car uptake driven by monetary factors? A total cost of ownership comparison between Norway and Italy," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 0(2), pages 99-132.
    2. Santos, Georgina & Rembalski, Sebastian, 2021. "Do electric vehicles need subsidies in the UK?," Energy Policy, Elsevier, vol. 149(C).
    3. Hao, Xu & Lin, Zhenhong & Wang, Hewu & Ou, Shiqi & Ouyang, Minggao, 2020. "Range cost-effectiveness of plug-in electric vehicle for heterogeneous consumers: An expanded total ownership cost approach," Applied Energy, Elsevier, vol. 275(C).
    4. Danielis, Romeo & Giansoldati, Marco & Scorrano, Mariangela, 2019. "Consumer- and society-oriented cost of ownership of electric and conventional cars in Italy," Working Papers 19_3, SIET Società Italiana di Economia dei Trasporti e della Logistica.
    5. Breetz, Hanna L. & Salon, Deborah, 2018. "Do electric vehicles need subsidies? Ownership costs for conventional, hybrid, and electric vehicles in 14 U.S. cities," Energy Policy, Elsevier, vol. 120(C), pages 238-249.
    6. Liu, Zhe & Song, Juhyun & Kubal, Joseph & Susarla, Naresh & Knehr, Kevin W. & Islam, Ehsan & Nelson, Paul & Ahmed, Shabbir, 2021. "Comparing total cost of ownership of battery electric vehicles and internal combustion engine vehicles," Energy Policy, Elsevier, vol. 158(C).
    7. Schwab, Julia & Sölch, Christian & Zöttl, Gregor, 2022. "Electric Vehicle Cost in 2035: The impact of market penetration and charging strategies," Energy Economics, Elsevier, vol. 114(C).
    8. Malima, Gabriel Clement & Moyo, Francis, 2023. "Are electric vehicles economically viable in sub-Saharan Africa? The total cost of ownership of internal combustion engine and electric vehicles in Tanzania," Transport Policy, Elsevier, vol. 141(C), pages 14-26.
    9. Moon, Saedaseul & Lee, Deok-Joo, 2019. "An optimal electric vehicle investment model for consumers using total cost of ownership: A real option approach," Applied Energy, Elsevier, vol. 253(C), pages 1-1.
    10. Schloter, Lukas, 2022. "Empirical analysis of the depreciation of electric vehicles compared to gasoline vehicles," Transport Policy, Elsevier, vol. 126(C), pages 268-279.
    11. Nenming Wang & Guwen Tang, 2022. "A Review on Environmental Efficiency Evaluation of New Energy Vehicles Using Life Cycle Analysis," Sustainability, MDPI, vol. 14(6), pages 1-35, March.
    12. Yanhua Liang & Hongjuan Lu, 2022. "Dynamic Evaluation and Regional Differences Analysis of the NEV Industry Development in China," Sustainability, MDPI, vol. 14(21), pages 1-23, October.
    13. Ouyang, Danhua & Zhou, Shen & Ou, Xunmin, 2021. "The total cost of electric vehicle ownership: A consumer-oriented study of China's post-subsidy era," Energy Policy, Elsevier, vol. 149(C).
    14. Nie, Qingyun & Zhang, Lihui & Tong, Zihao & Hubacek, Klaus, 2022. "Strategies for applying carbon trading to the new energy vehicle market in China: An improved evolutionary game analysis for the bus industry," Energy, Elsevier, vol. 259(C).
    15. Babar, Abdul Haseeb Khan & Ali, Yousaf, 2021. "Enhancement of electric vehicles’ market competitiveness using fuzzy quality function deployment," Technological Forecasting and Social Change, Elsevier, vol. 167(C).
    16. Martins, H. & Henriques, C.O. & Figueira, J.R. & Silva, C.S. & Costa, A.S., 2023. "Assessing policy interventions to stimulate the transition of electric vehicle technology in the European Union," Socio-Economic Planning Sciences, Elsevier, vol. 87(PB).
    17. Gábor Horváth & Attila Bai & Sándor Szegedi & István Lázár & Csongor Máthé & László Huzsvai & Máté Zakar & Zoltán Gabnai & Tamás Tóth, 2023. "A Comprehensive Review of the Distinctive Tendencies of the Diffusion of E-Mobility in Central Europe," Energies, MDPI, vol. 16(14), pages 1-29, July.
    18. Zhou, Kaile & Cheng, Lexin & Lu, Xinhui & Wen, Lulu, 2020. "Scheduling model of electric vehicles charging considering inconvenience and dynamic electricity prices," Applied Energy, Elsevier, vol. 276(C).
    19. Mohammadzadeh, Narges & Zegordi, Seyed Hessameddin & Nikbakhsh, Ehsan, 2021. "Pricing and free periodic maintenance service decisions for an electric-and-fuel automotive supply chain using the total cost of ownership," Applied Energy, Elsevier, vol. 288(C).
    20. Lawrence Fulton, 2020. "A Publicly Available Simulation of Battery Electric, Hybrid Electric, and Gas-Powered Vehicles," Energies, MDPI, vol. 13(10), pages 1-15, May.

    More about this item

    Keywords

    Total cost of ownership; Electric car; Home charging; Urban travelling; Purchase subsidy;
    All these keywords.

    JEL classification:

    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:retrec:v:80:y:2020:i:c:s0739885919303208. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/620614/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.