What if EV credits could be exchanged between drivers? Beijing tries it

Tesla made about $354 million in Q1 2020 by selling regulatory credits. Fiat Chrysler and General Motors, among others, buy billions of dollars in CO2 credits a year to avoid paying fines. What if a similar credit system to get individuals to drive an electric car, or avoid driving altogether, were put in place? That’s what the Beijing Environmental Exchange launched today.

Carbon emissions allowances are usually traded by companies. But the Beijing exchange’s mobile app allows individual car owners to create an account and accumulate credits.

Wang Huijun, executive vice president of the exchange, explained that an individual driver can drastically cut emissions by driving an EV. As reported in China:

The average daily carbon dioxide emissions for an electric vehicle is 0.83 kg, while a fuel-powered vehicle with an engine of no more than 1.2 liters discharges 2.58 kg of carbon dioxide on average daily.

Beijing authorities want 1 million car owners to participate in a “1-ton” campaign, which could tally a reduction of 1 million metric tons of carbon emissions within three years. Completely refraining from driving can reduce emissions by 1 metric ton per year.

Using the Beijing Environmental Exchange’s “Green Traveler Platform,” individual drivers would install a smart device to track a user’s emission-reduction behavior. Emissions would be tallied in an account, building up credits. Then, other individuals or companies (including banks and insurance companies) would buy credits for cash.

In short, you get paid to drive an EV or not to drive. (Several European cities, and US employers, have tried paying people to ride bicycles to work.)

In the Beijing travelers exchange, an individual might earn less than a dollar a day. But over a year, it could add up to a few hundred dollars or more.

Parts of the system have been in place for a couple of years. It integrates an auto insurance platform that tracks real-world driving behavior. Metro Mile and other insurance providers in the US offer similar programs that use connected devices to monitor driving.

However, what Beijing launched today not only reduces your insurance bill, it pays you not to drive at all or to get around in a zero-emissions vehicle.