13 August 2009

Hybrid vehicle rebates of dubious value

Despite major costs to taxpayers in the U.S. and Canada, government programs that offer rebates to hybrid vehicle buyers are failing to produce environmental benefits, a new University of British Columbia (UBC) study said.

The study finds hybrid sales have come largely at the expense of small, relatively fuel-efficient, conventional cars, rather than large SUVs, trucks, and vans that produce substantially greater carbon emissions.

“If the intention of rebate programs is to replace gas guzzlers with hybrids, they are failing,” said Ambarish Chandra, a professor at UBC’s Sauder School of Business and study co-author.

He said large vehicle sales have risen steadily since the introduction of hybrid rebates.

“People are choosing hybrids over similarly priced small- and medium-sized conventional cars, which are not far behind hybrids for fuel efficiency and emissions,” said Chandra. “The reductions in carbon emissions are therefore not great.”

The study also finds the majority of consumers who purchase hybrids were not motivated to do so by government rebates.

Chandra said governments could garner greater environmental benefits by purchasing carbon offsets (currently priced between $3 and $40 per ton on carbon markets) or investing in green jobs and technologies.

For related information, go to www.isa.org/environmental.