Willingness to Change to Electric Cars: Is the Ghanaian Consumer Ready?

Over the years, Ghana has developed and implemented policies that are intended to achieve green outcomes. In order to strengthen its green credentials, the country ratified the Paris Agreement in August 2016. Among the twenty action items developed to be implemented to achieve the targets of the Paris Agreement, nine are directly related to the energy sector. This has led to a number of interventions, including the Drive Electric Initiative, which seeks to encourage ownership and use of electric vehicles. In order to examine the readiness of consumers to change to, or pay for EVs, the paper adopts the limited dependent variable regression—with both probit and logit estimators—to determine the factors that influence the demand for electric vehicles. Our measure of the respondents’ willingness to change to or pay for EVs is captured in two forms to ensure robustness of our results. First, we measure willingness to change to EVs (WTC) by asking the respondents about their willingness to change to EVs based on the limited information that the respondents may have on EVs. Secondly, after realizing their limitations of knowledge regarding EVs and giving them further advantages of EV ownership, we measure the respondent’s willingness to change to EVs after exposure. Therefore, we consider the provision of knowledge on EVs to the respondents as some form of a treatment. After these, we examine the respondent’s willingness to pay for EVs (WTP) using the same determinants we considered in their WTC after treatment. The findings indicate that regardless of the level of information provided on EV, travel distance, income, expenditure on fuel and the extent of Green House Gas emissions were key factors that influenced respondents’ willingness to change to or pay for EVs and the result was significant when more information was given.