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Economic appraisal of implementing electric vehicle taxis in Seoul

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  • Kang, Seong-Cheol
  • Lee, Hoyoung

Abstract

Global commitments for climate change mitigation and sustainable development have given the electric vehicle renewed attention as a critical building block of sustainable transport. However, the diffusion of electric vehicles has been limited so far. In an effort to facilitate scaled-up deployment of electric vehicles, this paper examines the economic feasibility of replacing the current fleet of fossil fuel taxis in Seoul with electric vehicle (EV) taxis by gradually phasing out the former based on their operational lifetime. In the cost-benefit analysis for such a transition, costs of purchasing vehicles and constructing and maintaining charging infrastructure are estimated based on the market prices and characteristics of taxi transport in Seoul. On the benefit side, the avoided environmental costs due to reduced air pollutants and greenhouse gas emissions are calculated. Traffic assignment is incorporated in the calculation process for a better estimation of the avoided costs through more accurate link flows and speeds on the road network. Savings in fuel and maintenance costs are also estimated. The resultant benefit-cost ratio signifies economic viability of the deployment of EV taxis. The results of the study are encouraging and could strengthen the argument for pushing the transition to electric vehicles forward.

Suggested Citation

  • Kang, Seong-Cheol & Lee, Hoyoung, 2019. "Economic appraisal of implementing electric vehicle taxis in Seoul," Research in Transportation Economics, Elsevier, vol. 73(C), pages 45-52.
    • Handle: RePEc:eee:retrec:v:73:y:2019:i:c:p:45-52
    DOI: 10.1016/j.retrec.2018.11.007
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    References listed on IDEAS

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    1. Tommy Carpenter & Andrew Curtis & S. Keshav, 2014. "The return on investment for taxi companies transitioning to electric vehicles," Transportation, Springer, vol. 41(4), pages 785-818, July.
    2. Joonho Ko & Daejin Kim & Daisik Nam & Taekyung Lee, 2017. "Determining locations of charging stations for electric taxis using taxi operation data," Transportation Planning and Technology, Taylor & Francis Journals, vol. 40(4), pages 420-433, May.
    3. Marguerite Frank & Philip Wolfe, 1956. "An algorithm for quadratic programming," Naval Research Logistics Quarterly, John Wiley & Sons, vol. 3(1‐2), pages 95-110, March.
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    Citations

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    Cited by:

    1. Kinsella, L. & Stefaniec, A. & Foley, A. & Caulfield, B., 2023. "Pathways to decarbonising the transport sector: The impacts of electrifying taxi fleets," Renewable and Sustainable Energy Reviews, Elsevier, vol. 174(C).
    2. Manik Chandra Das & Abanish Pandey & Arun Kumar Mahato & Rajnish Kumar Singh, 2019. "Comparative performance of electric vehicles using evaluation of mixed data," OPSEARCH, Springer;Operational Research Society of India, vol. 56(3), pages 1067-1090, September.
    3. Wilfredo F. Yushimito & Sebastian Moreno & Daniela Miranda, 2023. "The Potential of Battery Electric Taxis in Santiago de Chile," Sustainability, MDPI, vol. 15(11), pages 1-15, May.

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    More about this item

    Keywords

    Electric vehicle taxi; Air pollutant; Greenhouse gas; Economic appraisal; Sustainable transport;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

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