Who are Ontario's green drivers and how can we incentivize more of them?

In 2010, the Province of Ontario launched an Electric Vehicle Incentive Plan designed to support the adoption of plug-in electric vehicles, reward early adopters and stimulate market demand.

Before the 10-year anniversary of this plan, Glendon Economics Professor Can Erutku wondered: Who are these drivers and what can we learn about them? Using data from the Ontario Ministry of Transportation and Statistics Canada, he gained some vital information about them.

Importantly, this is the first comprehensive analysis of this provincial plan and perhaps the most interesting thing about this research is that it profiles the province’s green drivers.

Through this research, Erutku discovered these environmentally minded drivers represent only one per cent of all new car drivers; they are educated; and they have longer than average commutes. He sought to know more.

“We need to know more about this consumer community. The ability to discriminate among these buyers could provide guidance on how to tailor incentive programs to more efficiently promote the dissemination of plug-in electric vehicles, and move beyond the one per cent,” he emphasizes.

The article, “A First Look at Ontario's Electric Vehicle Incentive Program: Who Are Ontario's Green Drivers?” was published in Canadian Public Policy (2020).

Government was hoping to incentivize consumers

There are two types of electric vehicles that qualified for provincial incentives in Ontario. (Note: hybrid vehicles did not qualify for incentives although they were being sold.)

• Battery electric vehicles, which plug into an external source of electricity to recharge; and
• Plug-in hybrid electric vehicles, which plug into an external source of electricity to recharge, and also use an internal combustion engine.

Just about as soon as they were developed, these electrical vehicles were identified by many researchers, environmentalists and eco consumers, as a smart way to reduce greenhouse gas emissions and harmful air pollutants.

The Ministry of Transportation cites many advantages: Electric vehicles use less (or no) fuel and benefit from lower maintenance and operating costs. Owners can also take advantage of lower electricity rates when charging at off-peak times. They could charge the vehicle at home, at work or at public charging stations. Furthermore, these vehicles are eligible for green vehicle licence plates, which allow drivers to drive in all provincial high-occupancy-vehicle lanes, even with only one person in the vehicle.

The Ontario government got behind this idea, roughly 10 years ago, and sought to incentivize consumers to buy electric cars. As noted, it instituted the Electric Vehicle Incentive Program in 2010 with key features such as rewarding early adopters and stimulating market demand.

The program officially ran from 2010 to 2018. The Ontario government, under Premier Doug Ford, cancelled it in 2018.

Ministry of Transportation data linked with StatsCan data to profile electric car buyers

The objective of Erutku’s research was to find who took advantage of this government plan – more specifically, he sought to identify the socio-economic characteristics of electric car buyers while the government plan was enacted. As noted, this information could assist policy-makers in developing targeted incentives to promote electric vehicles and, ultimately, reduce greenhouse gas emissions.

What is original and compelling about this research is that Erutku was able to use a unique database obtained from the Ministry of Transportation of Ontario that includes information about more than 26,000 buyers of electric cars. Matching these data to Statistics Canada 2016 Census data allowed Erutku to identify these buyers’ socio-economic characteristics.

The data from the Ministry of Transportation was obtained by Erutku via a Freedom of Information request. It contained information about the purchase of 23,632 electric vehicles between January 2012 and October 2018, including the date of purchase; the make, model, trim and type of vehicle; the applicant type; and the applicant’s postal code.

Statistics Canada census data includes characteristics for: age and sex, education, marital status, housing, income, labour, journey to work, type of dwelling, language, etc.

Erutku linked the data from Statistics Canada with the data from the Ministry of Transportation. Data linking is used to bring together information from different sources to create a new, richer dataset.

What we now know about electric car consumers

Erutku found that although the market share of plug-in electric vehicles in Ontario followed an upward trend, it remained below one per cent of the new car market for most of the program’s duration.

By linking the two databases, he determined electric car buyers were recipients of higher education and faced longer than average commute times.

He was not able to determine, however, if marital status and household income played a role in identifying electric car buyers.

Researcher suggests more information about buyers is needed

Erutku emphasizes the need to know more about these buyers. This information could provide guidance for the provincial government on how to tailor incentive programs to more efficiently promote the dissemination of electric vehicles.

It is unclear as to whether the Premier would reinstate any incentives to buy green.

To read the article, visit the journal’s website. To learn more about Erutku, visit his Faculty profile page.

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By Megan Mueller, senior manager, Research Communications, Office of the Vice-President Research & Innovation, York University, muellerm@yorku.ca