Policy pathways to electric vehicle adoption in Chile, a scenario-based analysis of economic and environmental outcomes

Purpose This study evaluates the economic and environmental impacts of electric vehicle adoption in Chile, examining how different policy scenarios could influence battery electric vehicle market penetration, energy demand, emissions and consumer costs through 2050. The research addresses the critical need to understand the viability of electromobility in an emerging market with unique characteristics, including abundant lithium resources and a renewable-dominated energy matrix. Design/methodology/approach Three scenarios (sustainable, conservative and non-sustainable) for 2025–2050 were developed using machine learning models (Extreme Gradient Boosting regression and ExtraTrees) and international subsidy frameworks adapted to Chilean conditions, with Gross Domestic Product-adjusted factors. The methodology integrates vehicle demand projections, energy consumption calculations accounting for Chile's cold climate heating requirements, emissions analysis considering the national energy mix and lithium extraction impacts, and cost assessments for consumers. Findings Aggressive policy intervention (25% purchase subsidies and expanded charging infrastructure) could achieve 100% battery electric vehicle sales by 2035, reducing transportation carbon dioxide emissions by 28%. Chile's renewable-dominated grid can support full electrification with only 4% of national generation capacity. Despite a 25% energy penalty from heating in cold climates, conventional vehicles produce 184% higher emissions than battery electric vehicles and annual costs are 18% lower under supportive policies. Originality/value This represents the first systemic scenario-based electric vehicle adoption analysis specifically adapted to Chilean conditions, quantifying the impact of cold climate on electric vehicle efficiency and developing an integrated modelling approach for policy impact assessment in emerging markets with renewable energy advantages.