This study analyzes climate change mitigation policies focused on light-duty electric vehicles (LDEVs) in the transportation sector in Rio de Janeiro state, Brazil, in the 2016–2050 period. We use the Open Source Energy Modeling System (OSeMOSYS) to analyze scenarios that consider greater uptake of LDEVs in different time frames, implementation of a CO₂ emission restriction policy, exclusion of fossil fuels from the power mix, and a combination of these policies. We find that carbon pricing, along with higher rates of LDEVs adoption, causes the highest emission reductions (up to 47%), albeit at higher costs. LDEVs become the preferred vehicle technology as soon as they reach cost parity with internal combustion engine vehicles in different scenarios. Greater LDEVs uptake, however, leads to increased electricity consumption (up to 3%), which is provided by fossil fuels when there is no emission restriction policy. If restrictions are placed on the expansion of fossil fuel power plants, fewer LDEVs are adopted (up to less than 26%) because there is not enough electricity to supply the demand. Given the state’s power mix in 2016 (58% provided by fossil fuels), investment in zero-carbon energy is necessary for mitigation policies in the transportation sector to be effective.

We develop an innovative methodology that links a general equilibrium economic model and an energy systems model (ESM) of Rio de Janeiro state, Brazil, to evaluate climate change mitigation policies (higher availability of shared mobility, electric vehicles, and carbon pricing) in passenger transport in the 2050 timeframe. This hybrid model captures effects that could not be measured in a standalone ESM. When more shared mobility becomes available, transport demand increases by 35% due to a rebound effect – which can get to 76% if electric vehicles become cheaper sooner, leading to vehicle capacity and CO2 emissions increases of 146%-203% and 8%-16%, respectively. The rebound effect can be countered with transport taxation at a loss of welfare, which may be eased when tax revenue is returned to consumers. CO2 price is the most cost-effective policy to cut emissions (70-73%), but increases electricity’s costs, reducing demand and welfare. CO2 prices’ impact on transport demand, however, is not significant because of ethanol flex-fuel vehicles, which are zero-carbon technologies and ubiquitous in Rio de Janeiro, thus being used to fulfil transport demand when other fuels become more expensive. These findings provide useful information for policymakers about the trade-offs of different climate change mitigation policies.