Evaluation of a Necessity for Subsidies for Electric Vehicle Purchases in Latvia: 2013–2017

This article is evaluating if as of the 2017 there is an objectively justifiable necessity for governmental subsidies for purchasing electric vehicles (hereinafter—EV) in Latvia. The analysis was carried out using Total Cost of Ownership (TCO) approach and comparing all costs for electric and internal combustion engine vehicles using pair analysis. The time period was chosen to assess how the technological and market developments had affected the requirement for government subsidies for EV purchase since the development of Latvia National Electromobility plan in 2013. The study demonstrated that there was a significant difference in TCO and subsequently in the justification for purchase subsidies between various classes of vehicles as well as even within a single class of cars, depending on the vehicle manufacturer, hence, several possible approaches for subsidies were examined to recommend the most effective form for subsidizing EV purchases.