Page 70 - CARILEC CE Industry Journal_Oct_2019

TAX EXEMPTIONS AND reviewing tariff structures to prevent unnecessary loss of
TARIFF CONSIDERATIONS capital. Inflexible EV charging can substantially increase
peak electricity demand which would require costly
network reinforcements. Whereas flexible EV charging
The introduction of EVs has convinced countries to can contribute to cost-effective decarbonization of
introduce tax exemptions for purchasing these vehicles. transportation [7]. In this scenario, tariffs are a strategy
These tax exemptions are necessary to reduce the up-front to curb inflexible EV charging.
costs of purchasing EVs. One such example is Trinidad
and Tobago’s tax exemption policy [13]. This finance Act
details tax exemptions on CNG, hybrid and EVs for both
commercial and residential categories. Tax exemption is
allowed on all CNG vehicles and EVs not exceeding an
equivalent engine size of 159 kW. This economic
mechanism can be adopted by other SIDS for promoting
EV penetration. In perspective, Trinidad and Tobago has
been nourished with a fuel subsidy that is gradually being
removed. With this fuel subsidy being removed and tax
exemptions, EVs are becoming more favorable than the
conventional ICE. At the time of writing, there are
approximately 20,000 Hybrid Electric Vehicles (HEVs) in
Trinidad and Tobago [7]. Figure 4 shows the prices of
both gasoline and diesel fuel in Trinidad and Tobago
compared to market value [14] [15].

Fig. 3 - Standardization Process
According to the NRDC Environmental Assessment of a
Full Electric Transportation Portfolio, the Base GHG
Scenario without any transportation electrification to
show the effects of a grid that is already changing
toward cleaner generation and a transportation fleet with
improving fuel economy. Figure 4 shows that when the
transportation sector is electrified in the Base GHG
Scenario, 2050 emissions are reduced by 48 percent
from 2015 levels. In the Lower GHG Scenario, total
emissions are reduced by 70% from 2015 levels. [8]
Fig. 4 - Petroleum Price for Trinidad and Tobago

It can be seen that the price of fuel is approaching the CHARGING LEVELS AND
market value as the subsidy is being removed. Based on BATTERY CHARGE TIMES
the electricity price and the price for fuel, EVs will be
more economical. Table VI shows the current electricity
residential rates for Trinidad and Tobago. To date, Caribbean islands may not necessarily be
equipped economically and practically to install the
latest and advanced EV infrastructure with emerging
TABLE VI -
TRINIDAD AND TOBAGO RESIDENTIAL ELECTRICITY TARIFF [16] technologies, therefore considerations need to be made
with respect to the capital cost of electricity and
infrastructure. In the absence of ToU tariffs, charging
Tariff Range Rate/USD/kWh levels are standard and there are no financial incentives
1-400 kWh $0.039 for charging at non-peak hours.
401-1000 kWh $0.048
Regardless of ToU tariffs, considerations need to be taken
>1000 kWh $0.055 with respect to infrastructure. Level 1 and 2 charging
should not require any additional infrastructure for modern
With tax exemptions being employed on EVs and buildings as these outlets are standard. Level 3 may
petroleum prices approaching market value, electricity require the use of a three (3) phase supply which requires
rates should be restructured by carefully considering and additional infrastructure.

68 CE INDUSTRY Journal