Assessing the cost-effectiveness of electric vehicles in European countries using integrated modeling

Electric vehicles (EVs) are considered alternatives to internal combustion engines due to their energy efficiency and contribution to CO₂ mitigation. The adoption of EVs depends on consumer preferences, including cost, social status and driving habits, although it is agreed that current and expected costs play a major role. We use a partial equilibrium model that minimizes total energy system costs to assess whether EVs can be a cost-effective option for the consumers of each EU27 member state up to 2050, focusing on the impact of different vehicle investment costs and CO₂ mitigation targets. We found that for an EU-wide greenhouse gas emission reduction cap of 40% and 70% by 2050 vis-à-vis 1990 emissions, battery electric vehicles (BEVs) are cost-effective in the EU only by 2030 and only if their costs are 30% lower than currently expected. At the EU level, vehicle costs and the capability to deliver both short- and long-distance mobility are the main drivers of BEV deployment. Other drivers include each state’s national mobility patterns and the cost-effectiveness of alternative mitigation options, both in the transport sector, such as plug-in hybrid electric vehicles (PHEVs) or biofuels, and in other sectors, such as renewable electricity.     

Network tariff design with prosumers and electromobility: Who wins,who loses?

Distributed Energy Resources (DERs), mostly in the form of solar photovoltaic (PV) or lithium-ion batteries, and electric vehicles (EVs) are emerging as three disruptive innovations in power grids. Recent studies have pointed out the potential synergies between these technologies, while others have studied the difficulty to design adequate network tariff when some consumers can adopt DERs (prosumers). In this paper, we investigate the combined effect of DERs and EVs on grid cost recovery. To study these effects, we formulate a non-cooperative game between a regulator that sets tariffs to recover grid costs and the four classes of network users depending on whether they are prosumer (resp. EV owners) or not. We study how tariff structures and the levels of EV penetration and prosuming affect tariffs. First, we find that grid cost recovery concerns caused by load-defecting prosumers installing DER can be balanced by the diffusion of EVs in the network. Second, we highlight that EVs and DERs adoptions are conflicting through the network tariff design. In particular, we find that the more a tariff structure gives incentives for DERs, the less beneficial it is for EVs.     

Willingness to pay for vehicle-to-grid (V2G) electric vehicles and their contract terms

Vehicle-to-grid (V2G) electric vehicles can return power stored in their batteries back to the power grid and be programmed to do so at times when the grid needs reserve power. Since providing this service can lead to payments to owners, it effectively reduces the life-cycle cost of owning an electric vehicle. Using data from a national stated preference survey, this paper presents a study of the potential consumer demand for V2G electric vehicles. In a choice experiment, 3029 respondents compared their preferred gasoline vehicle with two V2G electric vehicles. The V2G vehicles were described by a set of electric vehicle attributes and V2G contract requirements such as “required plug-in time” and “guaranteed minimum driving range”. The contract requirements specify a contract between drivers and a power aggregator for providing reserve power to the grid. Our findings suggest that the V2G concept is most likely to help EVs on the market if power aggregators operate either on pay-as-you-go basis (more pay for more service provided) or provide consumers with advanced cash payment (upfront discounts on the price of EVs), rather than imposing fixed requirements on participants.     

Going hybrid: An analysis of consumer purchase motivations

What makes consumers adopt energy-sustainable innovations? The uptake of such products and technologies is of importance, particularly at a time when climate change, diminishing energy resources and energy security are urgent issues. This paper reports on a case study of consumer adoption of hybrid vehicles, a green innovation that has been in the market since the late 1990s. The study is based on a questionnaire survey, conducted in 2009 in collaboration with Toyota GB, to investigate the dimensions that constitute motivations to purchase the Prius and to examine how policy can encourage hybrid adoption. The survey yielded 1484 responses, 1263 of which were used for the analysis; the results of the exploratory factor analyses provide information on consumer purchase motivations. The financial benefits related to transport policy are an important factor in consumer hybrid purchase motivations, and social norms and consumers’ willingness to comply with the norms of their groups influence the purchase decision. We also find that various meanings are attached to hybrid vehicle ownership, and practical, experiential and affective values need to be communicated to consumers in terms of value added.     

Calculating the price trajectory of adoption of fuel cell vehicles

How do you model consumer behaviour for disruptive technologies? Technologies that potentially have no antecedents and that, by their very definition, change consumer behaviour patterns?This paper outlines a methodology and results employed during a study to model the consumer willingness to pay for fuel cell vehicles, a potential disruptive innovation (DI).The first part of the study provides a short overview on DI highlighting why the fuel cell family of technologies may represent an upcoming DI.From the post ante study of successful historical disruptive innovations a number of initial `rules of adoption' can be sketched. Further narrowing of the focus on economic reasons for adoption provides a framework for which the willingness to pay for the new disruptive technology, such as, here, fuel cell vehicles, can be analysed during different phases of the market.This economic framework is then applied to the potential future market of fuel cell vehicles using information from a model that was built from vehicles during the build years 1994–2002 in the subcompact, compact and luxury class. The results presented in this paper concentrate on the subcompact and compact class of vehicle and supersede the initial results previously published. Finally, there is a short discussion on different pathways that this can be taken forward and used to help in policy decisions.     

Consumer engagement: An insight from smart grid projects in Europe

This paper provides an insight into consumer engagement in smart grid projects in Europe. Projects analysed are those included in the catalogue annexed in the JRC Report “Smart Grid projects in Europe: lessons learned and current developments”. The analysis suggests an increase in the interest in consumer engagement projects at European level and a strong focus on the residential sector, and emphasises the key importance of public funding to support these projects. The study also reveals that projects involving consumers are characterised by the pursuit of two main objectives: gaining deeper knowledge of consumer behaviour (observing and understanding the consumer) and motivating and empowering consumers to become active energy customers (engaging the consumer). The paper reviews the main activities undertaken to obtain these objectives and highlights trends and developments in the field. Finally, the paper discusses obstacles to consumer engagement and the strategies adopted by the projects surveyed to tackle them, highlighting the need to build consumer trust and to design targeted campaigns taking into consideration different consumer segments. The conclusions are in line with findings and analyses presented in the literature and underscore the need for further research and action at European level.     

Willingness to pay and preferences for alternative incentives to EV purchase subsidies: An empirical study in China

The transport sector's promotion of electric vehicles (EVs) is an important tool in reducing greenhouse gas emissions. The high monetary subsidies widely used to promote EV diffusion in many countries are not sustainable in the long term. Therefore, effective alternative incentives are needed as subsidies are gradually phased out. In this paper, consumers' willingness to pay (WTP) for alternative incentives is studied based on a questionnaire survey. Using a discrete choice experiment, 1719 Chinese consumer questionnaires were collected. Consumers' WTP for nine alternative policies was calculated by applying the multinomial logit model and mixed logit model, and the mixed logit model is used as the main model of this study because of its better statistical performance. Finally, the relationship between the respondent heterogeneity and policy preferences was studied. The results show that alternative incentives can fill the gap produced by subsidy reductions. EV privileges like no restrictions on driving and purchases, which have the lowest implementation cost, are suitable for first- and second- tier cities. For second-tier cities, construction of more charging stations is the most appropriate choice. The heterogeneous features of the respondents, including cities of residence, type of vehicle owned, recognition of the environmental benefits of EVs, gender, and whether the family has children, had a significant impact on policy preferences.     

The influence of consumers' environmental beliefs and attitudes on energy saving behaviours

With a heightened focus on the concept of sustainability in the past few decades, government, business and individuals have become increasingly aware of the need to reduce our environmental footprint. Consequently there has been much research on consumer environmental behaviour, and the beliefs, norms and attitudes that influence this behaviour. In this article we develop a conceptual framework of consumer environmental behaviour and its antecedents, and test hypotheses within the framework by means of a survey of green consumers. The results show that general environmental beliefs do influence norms on environmental actions and prices, but only norms on price are correlated with environmental attitudes; both intrinsic and extrinsic environmental drivers together with social norms and community influence are associated with environmental attitudes, but cost barriers may have a negative influence. It was also found that there was a strong association between environmental attitudes and energy saving behaviours but the latter was not in any way influenced by government policies or subsidies.     

Moving from assumption to observation: Implications for energy and emissions impacts of plug-in hybrid electric vehicles

Plug-in hybrid electric vehicles (PHEVs) are currently for sale in most parts of the United States, Canada, Europe and Japan. These vehicles are promoted as providing distinct consumer and public benefits at the expense of grid electricity. However, the specific benefits or impacts of PHEVs ultimately relies on consumers purchase and vehicle use patterns. While considerable effort has been dedicated to understanding PHEV impacts on a per mile basis few studies have assessed the impacts of PHEV given actual consumer use patterns or operating conditions. Instead, simplifying assumptions have been made about the types of cars individual consumers will choose to purchase and how they will drive and charge them. Here, we highlight some of these consumer purchase and use assumptions, studies which have employed these assumptions and compare these assumptions to actual consumer data recorded in a PHEV demonstration project. Using simulation and hypothetical scenarios we discuss the implication for PHEV impact analyses and policy if assumptions about key PHEV consumer use variables such as vehicle choice, home charging frequency, distribution of driving distances, and access to workplace charging were to change.     

Perceived importance of fuel characteristics and its match with consumer beliefs about biofuels in Belgium

Consumer consciousness concerning the environment has increased and become a major factor in purchasing behaviour. Consumer research to understand and influence the adoption of green technologies and products is therefore important. This paper investigates the beliefs of Belgian consumers concerning the use of biofuels and identifies four consumer segments based on the perceived importance of different fuel characteristics. To convince the performance-oriented consumers to use biofuels, information about these fuels has to stress their quality and performance standards. The society-oriented cluster attaches great importance to environmental friendliness, odour, production origin, the opportunity to decrease energy dependency and job creation. To persuade the environment-oriented consumers low odour, beneficial environmental influence and quality assurance of biofuels have to be emphasized. The convenience-oriented consumers will be the most difficult to persuade to use biofuels. They need to be convinced that every vehicle can drive with biofuel blends without the need for engine modifications. Concerns relating to the price and perceived low availability of biofuels at fuel stations are major obstacles for all consumers involved in this study.     

Consumers in the green electricity market in Finland

“Green” electricity, i.e. electricity produced from environmentally less harmful sources and marketed as such, has been available to Finnish households since 1998, but the demand for it has remained low. In this paper we discuss the barriers identified by consumers to purchasing green electricity and contrast these with the interpretation energy sector actors give to consumer passivity. The empirical material consists of thematic interviews. Energy policy actors often assume that consumers’ passivity signifies their lack of interest or low environmental consciousness. This results partly from the failure to differentiate between the roles of consumer and citizen. The interpretation the energy sector actors give to consumer passivity and the role they assign to consumers affect the direction of green electricity policy. We argue that consumers need more information on both the environmental impact of different electricity products and in particular about the electricity supply and electricity contracts in a liberalised electricity market if they are to become active in the market.     

State of charge and health estimation of batteries for electric vehicles applications: key issues and challenges

Using electric vehicles (EVs) for transportation is considered as a necessary component for managing sustainable development and environmental issues. The present concerns regarding the environment, such as rapid fossil fuel depletion, increases in air pollution, accelerating energy demands, global warming, and climate change, have paved the way for the electrification of the transport sector. EVs can address all of the aforementioned issues. Portable power supplies have become the lifeline of the EV world, especially lithium-ion (Li-ion) batteries. Li-ion batteries have attracted considerable attention in the EV industry, owing to their high energy density, power density, lifespan, nominal voltage, and cost. One major issue with such batteries concerns providing a quick and accurate estimation of a battery’s state and health; therefore, accurate determinations of the battery’s performance and health, as well as an accurate prediction of its life, are necessary to ensure reliability and efficiency. This study conducts a review of the technological briefs of EVs and their types, as well as the corresponding battery characteristics. Various aspects of recent research and developments in Li- ion battery prognostics and health monitoring are summarized, along with the techniques, algorithms, and models used for current/voltage estimations, state-of-charge (SoC) estimations, capacity estimations, and remaining-useful-life predictions.     

Q-complementarity in household adoption of photovoltaics and electricity-intensive goods: The case of electric vehicles

Photovoltaic (PV) units and electric vehicles (EVs) are two household goods that are the focus of much research, and many policy initiatives attempting to promote a more sustainable, low-carbon energy system. Despite both academic and practical interest in household adoption of PV units and EVs, potential linkages in these household decisions have only just begun to be explored. This paper presents q-complementarity between the goods as one possible form of a linkage between PV and EV purchases that is based on economic utility theory. We posit the goods could be q-complements due to a PV-owning household's ability to offset and shift their electricity load from EV charging to increase the self-consumption of ‘home-made’ electricity, thereby increasing the positive feelings of environmental efficacy and monetary returns from the PV unit. We use data from 2541 internet surveys of Austrian residential electricity customers collected in 2018 to explore these hypotheses. Probit models of household EV and PV adoption choice are estimated, including a recursive bivariate probit model of households who plan to purchase an EV in the future, with PV ownership endogenously determined. Controlling for household income, characteristics, environmental attitudes, and neighborhood characteristics, we find that EV and PV adoption are positively correlated, and that current PV unit owners are 21% more likely to plan an EV purchase in the next 5 years compared to non-PV owners. We interpret these results as evidence in support of our hypothesis of q-complementarity between PV units and EVs, and note the potential for added benefits from incentive policies promoting adoption of one good or the other that this linkage suggests.     

Petrol supplies and consumer expectations

A formal model of the consumer's behaviour given uncertain supplies of petrol is developed. The theory derived implies that consumers will attempt to purchase larger quantities than they would under certainty; although, they expect to purchase less. It is shown that a service surcharge will reduce the optimal amount that the consumer attempts to purchase under uncertainty and from this it is concluded that such a fee would save gasoline supplies. Special consideration is given to the role of the consumer's expectations and their revision in this model.     

Towards a contemporary approach for understanding consumer behaviour in the context of domestic energy use

Domestic sector energy use is increasing in the UK and currently accounts for 30% of total use. Policies of liberalised energy markets have allowed greater consumer choice but have not sought to reduce carbon emissions. Overall sales of energy efficiency products are rising, but UK housing stock standards are poor and do not facilitate improved efficiency and further, the sales of such products are influenced by their price, thus the higher capital costs of products such as boilers and solar systems make them initially unattractive to consumers. Previous market-based research into the adoption of energy efficiency products has often focused on single factors, for example demographics. This has limited the ability of policy makers to make informed decisions that address a broader range of factors, such as individuals’ cognitive abilities, values and attitudes, as well as external factors such as social networks, marketing, and products and services. This paper provides a wider critique of the theoretical base related to consumer behaviour, product attributes and socio-environmental theories that relate to energy use. The aim of the paper is to draw together theories relevant to energy use in order to aid policy making in the broader context and to develop the discussion around integrated theories of consumer behaviour.     

The optimization of demand response programs in smart grids

The potential to schedule portion of the electricity demand in smart energy systems is clear as a significant opportunity to enhance the efficiency of the grids. Demand response is one of the new developments in the field of electricity which is meant to engage consumers in improving the energy consumption pattern. We used Teaching & Learning based Optimization (TLBO) and Shuffled Frog Leaping (SFL) algorithms to propose an optimization model for consumption scheduling in smart grid when payment costs of different periods are reduced. This study conducted on four types residential consumers obtained in the summer for some residential houses located in the centre of Tehran city in Iran: first with time of use pricing, second with real-time pricing, third one with critical peak pricing, and the last consumer had no tariff for pricing. The results demonstrate that the adoption of demand response programs can reduce total payment costs and determine a more efficient use of optimization techniques.     

Recent advances in the US Department of Energy’s energy storage technology research and development programs for hybrid electric and electric vehicles

This paper provides an overview of recent advances in battery technology resulting from the Department of Energy’s (DOE’s) energy storage research and development (R&D) programs for hybrid electric vehicles (HEVs) and electrical vehicles (EVs). The DOE’s Office of Advanced Automotive Technologies (OAAT) is working with industry, national laboratories, universities, and other government agencies to develop technologies that will lead to a reduction in the petroleum used and the emissions generated by the transportation sector. The programs reviewed in this paper are focused on accelerating the development of energy storage technologies that are critical for the commercialization of HEVs and EV. These include the research conducted at DOE’s national laboratories to develop the high-power batteries needed for hybrid electric vehicles (HEVs) and the collaborative research with the US Advanced Battery Consortium (USABC) to develop the high-energy batteries needed for EVs.     

Environmental evaluation of introducing electric vehicles using a dynamic traffic-flow model

A dynamic traffic-flow model (DTFM) is used in this study to evaluate the effectiveness of introducing electric vehicles (EVs) into the total traffic system as one of the alternative fuel vehicles. This model simulates congested and non-congested traffic flow caused by changes in the traffic demand. An environmental evaluation is carried out on the basis that all vehicles are substituted for EVs. Calculated results indicate that by introducing EVs, the NO_x emissions and the CO₂ emissions can be reduced by approximately 25.7 and 14.4% respectively. If battery performance of EVs is improved further, emissions can be further reduced by 39.6% (NO_x) and 27.8% (CO₂). Since emissions from heavy-duty vehicles are greater than other vehicles, the following measures have to be taken for these vehicles to significantly improve their impact upon the overall environment: (1) improvement in fuel efficiency and reductions of NO_x in exhaust gas, (2) traffic demand management, such as modal shift.     

Potential impacts assessment of plug-in electric vehicles on the Portuguese energy market

Electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs), which obtain their fuel from the grid by charging a battery, are set to be introduced into the mass market and expected to contribute to oil consumption reduction. In this research, scenarios for 2020 EVs penetration and charging profiles are studied integrated with different hypotheses for electricity production mix. The impacts in load profiles, spot electricity prices and emissions are obtained for the Portuguese case study. Simulations for year 2020, in a scenario of low hydro production and high prices, resulted in energy costs for EVs recharge of 20 cents/kWh, with 2 million EVs charging mainly at evening peak hours. On the other hand, in an off-peak recharge, a high hydro production and low wholesale prices' scenario, recharge costs could be reduced to 5.6 cents/kWh. In these extreme cases, EV's energy prices were between 0.9€ to 3.2€ per 100 km. Reductions in primary energy consumption, fossil fuels use and CO₂ emissions of up to 3%, 14% and 10%, respectively, were verified (for a 2 million EVs' penetration and a dry year's off-peak recharge scenario) from the transportation and electricity sectors together when compared with a BAU scenario without EVs.     

Life cycle cost of conventional,battery electric,and fuel cell electric vehicles considering traffic and environmental policies in China

Electric vehicles (EVs) are considered a promising alternative to conventional vehicles (CVs) to alleviate the oil crisis and reduce urban air pollution and carbon emissions. Consumers usually focus on the tangible cost when choosing an EV or CV but overlook the time cost for restricting purchase or driving and the environmental cost from gas emissions, falling to have a comprehensive understanding of the economic competitiveness of CVs and EVs. In this study, a life cycle cost model for vehicles is conducted to express traffic and environmental policies in monetary terms, which are called intangible cost and external cost, respectively. Battery electric vehicles (BEVs), fuel cell electric vehicles (FCEVs), and CVs are compared in four first-tier, four new first-tier, and 4 s-tier and below cities in China. The comparison shows that BEVs and FCEVs in most cities are incomparable with CVs in terms of tangible cost. However, the prominent traffic and environmental policies in first-tier cities, especially in Beijing and Shanghai, greatly increase the intangible and external costs of CVs, making consumers more inclined to purchase BEVs and FCEVs. The main policy benefits of BEVs and FCEVs come from three aspects: government subsidies, purchase and driving restrictions, and environmental taxes. With the predictable reduction in government subsidies, traffic and environmental policies present important factors influencing the competitiveness of BEVs and FCEVs. In first-tier cities, BEVs and FCEVs already have a competitive foundation for large-scale promotion. In new first-tier and second-tier and below cities, stricter traffic and environmental policies need to be formulated to offset the negative impact of the reduction in government subsidies on the competitiveness of BEVs and FCEVs. Additionally, a sensitivity analysis reveals that increasing the mileage and reducing fuel prices can significantly improve the competitiveness of BEVs and FCEVs, respectively.