Even French families can’t afford “Green” cars and homes

Is the transition accessible to all French families? It is this question that the Institute for Climate Economics (I4CE), a research institute and association founded by the Caisse des Dépôts et Consignations and the French Agency for Climate Change, has tried to answer, reported by the newspaper Valeurs Actuelles. The conclusion is not surprising: “ Today there are not the economic conditions for all families to be able to afford it . »

Here are the details of the study which also considers the contributions allocated to the need by the French state.

For just over fifteen years, the aid given by the Paris government – ​​often indexed to family income – has multiplied both in number and amount, both for the renovation of homes and for the purchase of an electric car and a charging station. “For the renovation of a single-family home and the purchase of a new electric car and charging station, the maximum amount of aid a household can get increased by approximately 160% between 2008 and 2023 , going from around 20,000 euros to 50,000 euros, explain the authors of the study. For comparison, in the same period, inflation was 17%. »

This aid was more specifically aimed at the lower-middle classes; they are – for an equivalent project – twice as important for low-income families than for wealthy ones. It's a shame that they are far from being sufficient, because they represent between 26 and 55% of the investment.

But can families easily convert to the energy transition, both for the renovation of a home and for the purchase of an electric vehicle?

This is where the study's findings are fascinating and full of lessons. It turns out that, as regards the investment to renovate one's home, the residual cost (difference between the amount of work and the total aid received) amounts to more than a year's income for the middle classes and can reach up to ten years and more of income for low-income classes . Furthermore, everything depends on the type of dwelling (oil-fired rural house, reconstruction pavilion, collective pavilion 1975-1985, bourgeois building, bar building 1948-1994, small collective 1974-1985). Some solutions such as the Eco PTZ (the ceiling has been raised to 50,000 euros) could be a solution to finance the rest, but it clashes "with the complexity of the administrative procedures and with the debt rate induced for low-income families and the middle classes. »

We then move on to focus on electric vehicles, the residual cost of which varies, on average, between 10,000 and 40,000 euros in France net of contributions. For a normal city car and for middle class families the figure amounts to around 27,000 euros, or 65 to 130% of the annual income . Strangely, the remaining cost is lower – around 7,000 euros – for low-income groups, who however can only purchase used vehicles. With a big problem: "in France the market is still underdeveloped", notes the institute.

At the beginning of 2022, electric cars represented only 1% of the fleet (around 400,000 vehicles). »The question of the profitability of said vehicle then arises: “thanks to the savings generated on the cost of fuel, the purchase of an electric vehicle will be profitable in a few years for the middle classes”, add the authors of the report. They calculated that switching to electric allowed motorists to save 150 euros per month based on an annual distance traveled of 13,000 km, but in France the cost of electricity is lower than in many European countries.

So even French families cannot afford to make the ecological transition, unless they sacrifice many years of income and take on debt. Will it be worth it? Will it be right to enrich the banks with forced interest? The answer to the French citizens.

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The article Not even French families can afford “Green” cars and houses comes from Economic Scenarios .

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This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/neanche-le-famiglie-francesi-possono-permettersi-auto-e-casa-green/ on Fri, 20 Oct 2023 14:00:01 +0000.