Electric vehicles such as those manufactured by Tesla, are great for consumers but for the Israeli economy, not so much.
That was the conclusion reached by economist David Bedell in a report submitted Thursday (Jan. 9) to the National Economic Council in the Prime Minister’s Office.
Bedell evaluated the entry of electric vehicles to the Israeli market, providing for the first time a comprehensive economic picture of the costs and benefits stemming from the transition from gasoline-powered vehicles to electric vehicles, with emphasis on the viewpoint of the economy.
The evaluation took into account the direct costs and benefits (while neutralizing the effects of taxation) of electric vehicles in the Israeli marketplace as well as the effects of external influences (pollution emissions, etc.).
The findings show that in 2024, the use of an electric family car as opposed to a gasoline-powered vehicle, created for the private consumer a savings of around NIS 3,700 per year thanks to the current taxation policy.
For the Israeli economy, however, electric vehicles imposed a higher cost of NIS 740 annually.
The trend is expected to change significantly over the next decade, given that according to the forecast, in 2034 an electric family car will save the economy NIS 1,600 per year, as compared to a gasoline-powered vehicle.
According to the current taxation framework and without travel tax, the private consumer is expected to benefit from a savings of around NIS 3,500 per year.
The study shows that the positive benefit to the economy from the transition to electric vehicles stems from the reduction in greenhouse gas emissions more than anything else.
Bedell found that the government targets for the entry of electric vehicles to the market will lead to an economic benefit of approximately NIS 2.1 billion as compared to the base scenario without targets.
The Council added that the results of the analysis are sensitive to future fluctuations in a number of main parameters, among them prices of electric vehicles, fuel costs and the pace of technological developments in the field.
