Electric Vehicles

Slides

Lecture 1

Intro + Subsidy targetting

Pre-class

• Read Rapson & Muehlegger (REEP 2023), “The Economics of Electric Vehicles” for an overview of the economics in this module.
• Then read the following two blog posts on the specific issue of subsidy targetting:
  • Max Auffhammer, “The EV revolution will be heavily subsidized”
  • Lucas Davis, “Are clean energy tax credits equitable?”

Post-class

Conceptual questions

1. Since the externalities from driving are tied to marginal use (ie driving), policies targeting upfront costs alone can never be efficient. Why?

Computing additionality and subsidy costs

Two EV’s are eligible for a $5000 EV subsidy.

• EV A costs $30,000 and has a demand elasticity of -2.5.
• EV B costs $50,000 and has a demand elasticity of -3.5.

Question: If the government was choosing which EV to subsidize, which one is more cost-effective? Steps:

1. Compute the additional sales from the subsidy for each car.
2. Compute the total cost of the subsidy for each car.
3. Compute the cost per additional EV sold for each car.

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Lecture 2

EV Charging + Environmental Benefits

Pre-class

• Read this recent NY Times article arguing that EV’s are cheaper than gas cars. Find your state’s price comparison.
• Read this summary of an important article on the benefits of EV’s. Optional: If you are interested, the full paper is available here.
• Then read these blog posts from Berkeley on charging (first two required. all recommended)
  • https://energyathaas.wordpress.com/2021/06/14/12201/
  • https://energyathaas.wordpress.com/2024/04/15/electric-vehicle-charging-we-can-count-on/
  • https://energyathaas.wordpress.com/2018/07/30/apartments-rarely-have-charging-stations-but-electric-vehicles-need-them/
  • https://energyathaas.wordpress.com/2025/08/25/raising-the-low-expectations-of-electric-vehicle-drivers/

Post-class

• TBD