Societal cost-benefit analysis of electric vehicles in the Philippines with the inclusion of impacts to balance of payments

Countries globally have committed to deploy electric vehicles immensely within the decade. However, these deployments at an early stage come at a huge cost to governments. The high ownership costs of electric vehicles require them to be supported by subsidies, tax exemptions and other incentives - not to mention the costs of installing new charging infrastructure. Several cost-benefit studies have looked into various components, and this present work aims to contribute to the literature by estimating the impact to the country's trade deficit or surplus. While ownership cost parity between electric vehicles and internal combustion vehicles might be farfetched, the modeling results in this study show that electric vehicles can achieve societal cost-benefit parity with internal combustion vehicles within the decade. This finding can provide a strong justification for subsidies and incentives provided to electric vehicles. To conclude, the authors provide some policy implications supporting the local production of electric vehicles.