Policy Assessment for Energy Transition to Zero- and Low-Emission Technologies in Pickup Trucks: Evidence from Mexico

Abstract

The transport sector is under scrutiny because of its significant greenhouse gas emissions. Essential strategies, particularly the adoption of zero- and low-emission vehicles powered by electricity, are crucial for mitigating emissions in road transport. Pickups, which are integral to Mexico’s fleet, contribute to such emissions. Thus, implementing effective policies targeting pickups is vital for reducing air pollution and aligning with Mexico’s decarbonization objectives. This paper presents a simulation model based on system dynamics to represent the adoption process of zero- and low-emission vehicles, with a focus on pickups and utilizing data from the Mexican case. Three policy evaluation scenarios are proposed based on the simulation model: business as usual; disincentives for zero- and low-emission vehicles; and incentives for unconventional vehicles. One of the most significant findings from this study is that even in a scenario with a greater number of vehicles in circulation, if the technology is fully electric, the environmental impact in terms of emissions is lower. Additionally, a comprehensive sensitivity analysis spanning a wide spectrum is undertaken through an extensive computational process, yielding multiple policy scenarios. The analysis indicates that to achieve a maximal reduction in the country’s emissions, promoting solely hybrid electric vehicles and plug-in hybrid electric vehicles is advisable, whereas internal combustion engines, vehicular natural gas, and battery electric vehicles should be discouraged.