32 Centre for Economics and Business Research Three shocks are considered: • A doubling of petrol, diesel, and electricity costs. • A doubling of petrol and diesel costs. • A doubling of electricity costs. In all cases this shock is assumed to persist over the full horizon period. Petrol, diesel, and electricity prices Doubling in resource costs for fuels leads to a smaller impact on prices paid by consumers for petrol and diesel than for electricity, as liquid fuels are more highly taxed (and Fuel Duty does not change in response to prices). Therefore, the relative increase in operating costs for electric vehicles are larger, and overall, the savings to consumers from operating them rather than petrol or diesel vehicles are smaller. Table 10: Headline results – Petrol, diesel, and electricity price shock sensitivity test (£Bn) Environmental impacts Total Car Motorbike LGV HGV CO2e, driving emissions 65.4 38.3 0.7 19.9 6.5 Air quality emissions 11.3 4.6 0.1 5.7 0.9 CO2e, vehicle manufacture -32.6 -21.6 -1.1 -8.9 -1.1 Value of time impacts Total Car Motorbike LGV HGV Time spent refuelling/recharging -47.0 -26.0 -0.4 -13.0 -7.5 Tax revenue impacts Total Car Motorbike LGV HGV Fuel Duty -60.2 -36.5 -0.7 -17.7 -5.3 VAT on fuel -22.9 -14.3 -0.3 -6.5 -1.9 Household/business spending Total Car Motorbike LGV HGV Fuel 12.5 16.1 0.4 -2.6 -1.3 Fuel (resource cost only) -70.6 -34.7 -0.6 -26.8 -8.5 New vehicles -186.4 -96.7 -7.2 -67.1 -15.4 Infrastructure impacts Total Car Motorbike LGV HGV Investment Costs -94.3 n/a n/a n/a n/a
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