IDEAS home Printed from https://ideas.repec.org/a/eee/energy/v244y2022ipas0360544221028772.html
   My bibliography  Save this article

A game-theory analysis of electric vehicle adoption in Beijing under license plate control policy

Author

Listed:
  • Zhu, Lijing
  • Wang, Jingzhou
  • Farnoosh, Arash
  • Pan, Xunzhang

Abstract

To reduce traffic congestion and protect the environment, license plate control (LPC) policy has been implemented in Beijing since 2011. In 2019, 100,000 vehicle license plates were distributed, including 60,000 for electric vehicles (EVs) and 40,000 for gasoline vehicle (GVs). However, whether the current license plate allocation is optimal from a social welfare maximization perspective remains unclear. This paper proposes a two-level Stackelberg game, which portrays the interaction between vehicle applicants and the government to quantify the optimal number of EV license plates under the LPC policy in Beijing. The equilibrium number of EV license plates derived from the Stackelberg model is 58,800, which could increase the social welfare by 0.38%. Sensitivity analysis is conducted to illustrate the impact of important influential factors — total license plate quota, vehicle rental fee, and energy price — on EV adoption. The LPC policy under COVID-19 is also studied through a scenario analysis. If the government additionally increases the total quota by 20,000, 24% could be allocated to GV and 76% to EV. One third reduction of the current vehicle rental fee could increase EV license plates by 10.5%. In terms of energy prices, when gasoline price is low, reducing electricity prices could contribute to EV adoption significantly, while that effect tapers off as gasoline prices increase.

Suggested Citation

  • Zhu, Lijing & Wang, Jingzhou & Farnoosh, Arash & Pan, Xunzhang, 2022. "A game-theory analysis of electric vehicle adoption in Beijing under license plate control policy," Energy, Elsevier, vol. 244(PA).
  • Handle: RePEc:eee:energy:v:244:y:2022:i:pa:s0360544221028772
    DOI: 10.1016/j.energy.2021.122628
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0360544221028772
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.energy.2021.122628?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yu, Yi & Zhou, Dequn & Zha, Donglan & Wang, Qunwei & Zhu, Qingyuan, 2021. "Optimal production and pricing strategies in auto supply chain when dual credit policy is substituted for subsidy policy," Energy, Elsevier, vol. 226(C).
    2. Uri Gneezy & Stephan Meier & Pedro Rey-Biel, 2011. "When and Why Incentives (Don't) Work to Modify Behavior," Journal of Economic Perspectives, American Economic Association, vol. 25(4), pages 191-210, Fall.
    3. Ma, Shao-Chao & Fan, Ying & Feng, Lianyong, 2017. "An evaluation of government incentives for new energy vehicles in China focusing on vehicle purchasing restrictions," Energy Policy, Elsevier, vol. 110(C), pages 609-618.
    4. Sheldon, Tamara L. & Dua, Rubal, 2020. "Effectiveness of China's plug-in electric vehicle subsidy," Energy Economics, Elsevier, vol. 88(C).
    5. Kong, Deyang & Xia, Quhong & Xue, Yixi & Zhao, Xin, 2020. "Effects of multi policies on electric vehicle diffusion under subsidy policy abolishment in China: A multi-actor perspective," Applied Energy, Elsevier, vol. 266(C).
    6. Berkovec, James & Rust, John, 1985. "A nested logit model of automobile holdings for one vehicle households," Transportation Research Part B: Methodological, Elsevier, vol. 19(4), pages 275-285, August.
    7. Diamond, David, 2009. "The impact of government incentives for hybrid-electric vehicles: Evidence from US states," Energy Policy, Elsevier, vol. 37(3), pages 972-983, March.
    8. Zhuge, Chengxiang & Wei, Binru & Shao, Chunfu & Shan, Yuli & Dong, Chunjiao, 2020. "The role of the license plate lottery policy in the adoption of Electric Vehicles: A case study of Beijing," Energy Policy, Elsevier, vol. 139(C).
    9. Yuan, Xueliang & Liu, Xin & Zuo, Jian, 2015. "The development of new energy vehicles for a sustainable future: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 42(C), pages 298-305.
    10. Yang, Jun & Liu, Antung A. & Qin, Ping & Linn, Joshua, 2020. "The effect of vehicle ownership restrictions on travel behavior: Evidence from the Beijing license plate lottery," Journal of Environmental Economics and Management, Elsevier, vol. 99(C).
    11. Zhu, Lijing & Zhang, Qi & Lu, Huihui & Li, Hailong & Li, Yan & McLellan, Benjamin & Pan, Xunzhang, 2017. "Study on crowdfunding’s promoting effect on the expansion of electric vehicle charging piles based on game theory analysis," Applied Energy, Elsevier, vol. 196(C), pages 238-248.
    12. Leenders, Ludger & Bahl, Björn & Hennen, Maike & Bardow, André, 2019. "Coordinating scheduling of production and utility system using a Stackelberg game," Energy, Elsevier, vol. 175(C), pages 1283-1295.
    13. Zhang, Qi & Tang, Yanyan & Bunn, Derek & Li, Hailong & Li, Yaoming, 2021. "Comparative evaluation and policy analysis for recycling retired EV batteries with different collection modes," Applied Energy, Elsevier, vol. 303(C).
    14. Gu, Huaying & Liu, Zhixue & Qing, Qiankai, 2017. "Optimal electric vehicle production strategy under subsidy and battery recycling," Energy Policy, Elsevier, vol. 109(C), pages 579-589.
    15. Noori, Mehdi & Tatari, Omer, 2016. "Development of an agent-based model for regional market penetration projections of electric vehicles in the United States," Energy, Elsevier, vol. 96(C), pages 215-230.
    16. Chen, Xiaojie & Zhao, Jinhua, 2013. "Bidding to drive: Car license auction policy in Shanghai and its public acceptance," Transport Policy, Elsevier, vol. 27(C), pages 39-52.
    17. Li, Zhe & Ouyang, Minggao, 2011. "The pricing of charging for electric vehicles in China—Dilemma and solution," Energy, Elsevier, vol. 36(9), pages 5765-5778.
    18. Pan, Xunzhang & Wang, Hailin & Wang, Lining & Chen, Wenying, 2018. "Decarbonization of China's transportation sector: In light of national mitigation toward the Paris Agreement goals," Energy, Elsevier, vol. 155(C), pages 853-864.
    19. Zhu, Lijing & Wang, Peize & Zhang, Qi, 2019. "Indirect network effects in China’s electric vehicle diffusion under phasing out subsidies," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    20. Xiao, Xu & Chen, Zi-Rui & Nie, Pu-Yan, 2020. "Analysis of two subsidies for EVs: Based on an expanded theoretical discrete-choice model," Energy, Elsevier, vol. 208(C).
    21. Yang, Jun & Liu, Ying & Qin, Ping & Liu, Antung A., 2014. "A review of Beijing׳s vehicle registration lottery: Short-term effects on vehicle growth and fuel consumption," Energy Policy, Elsevier, vol. 75(C), pages 157-166.
    22. Jenn, Alan & Springel, Katalin & Gopal, Anand R., 2018. "Effectiveness of electric vehicle incentives in the United States," Energy Policy, Elsevier, vol. 119(C), pages 349-356.
    23. Egnér, Filippa & Trosvik, Lina, 2018. "Electric vehicle adoption in Sweden and the impact of local policy instruments," Energy Policy, Elsevier, vol. 121(C), pages 584-596.
    24. Han, Sun Sheng, 2010. "Managing motorization in sustainable transport planning: the Singapore experience," Journal of Transport Geography, Elsevier, vol. 18(2), pages 314-321.
    25. Liu, Dunnan & Xiao, Bowen, 2018. "Exploring the development of electric vehicles under policy incentives: A scenario-based system dynamics model," Energy Policy, Elsevier, vol. 120(C), pages 8-23.
    26. Wang, Shenhao & Zhao, Jinhua, 2017. "The distributional effects of lotteries and auctions—License plate regulations in Guangzhou," Transportation Research Part A: Policy and Practice, Elsevier, vol. 106(C), pages 473-483.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xiong, Siqin & Yuan, Yi & Yao, Jia & Bai, Bo & Ma, Xiaoming, 2023. "Exploring consumer preferences for electric vehicles based on the random coefficient logit model," Energy, Elsevier, vol. 263(PA).
    2. Yang, Zaoli & Li, Qin & Yan, Yamin & Shang, Wen-Long & Ochieng, Washington, 2022. "Examining influence factors of Chinese electric vehicle market demand based on online reviews under moderating effect of subsidy policy," Applied Energy, Elsevier, vol. 326(C).
    3. Xue, Yixi & Zhang, Yi & Wang, Zhuoli & Tian, Shuo & Xiong, Qian & Li, Lydia Qianqian, 2023. "Effects of incentive policies on the purchase intention of electric vehicles in China: Psychosocial value and family ownership," Energy Policy, Elsevier, vol. 181(C).
    4. Tao Li & Lei Ma & Zheng Liu & Chaonan Yi & Kaitong Liang, 2023. "Dual Carbon Goal-Based Quadrilateral Evolutionary Game: Study on the New Energy Vehicle Industry in China," IJERPH, MDPI, vol. 20(4), pages 1-16, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lijing Zhu & Jingzhou Wang & Arash Farnoosh & Xunzhang Pan, 2021. "A Game-Theory Analysis of Electric Vehicle Adoption in Beijing under License Plate Control Policy," Working Papers hal-03500766, HAL.
    2. Yao, Xusheng & Ma, Shoufeng & Bai, Yin & Jia, Ning, 2022. "When are new energy vehicle incentives effective? Empirical evidence from 88 pilot cities in China," Transportation Research Part A: Policy and Practice, Elsevier, vol. 165(C), pages 207-224.
    3. Zhuge, Chengxiang & Wei, Binru & Shao, Chunfu & Shan, Yuli & Dong, Chunjiao, 2020. "The role of the license plate lottery policy in the adoption of Electric Vehicles: A case study of Beijing," Energy Policy, Elsevier, vol. 139(C).
    4. Martin Kalthaus & Jiatang Sun, 2021. "Determinants of Electric Vehicle Diffusion in China," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 80(3), pages 473-510, November.
    5. Nie, Qingyun & Zhang, Lihui & Tong, Zihao & Hubacek, Klaus, 2022. "Strategies for applying carbon trading to the new energy vehicle market in China: An improved evolutionary game analysis for the bus industry," Energy, Elsevier, vol. 259(C).
    6. Ma, Shao-Chao & Fan, Ying, 2020. "A deployment model of EV charging piles and its impact on EV promotion," Energy Policy, Elsevier, vol. 146(C).
    7. Li, Jingjing & Nian, Victor & Jiao, Jianling, 2022. "Diffusion and benefits evaluation of electric vehicles under policy interventions based on a multiagent system dynamics model," Applied Energy, Elsevier, vol. 309(C).
    8. Zhao, Dan & Ji, Shou-feng & Wang, He-ping & Jiang, Li-wen, 2021. "How do government subsidies promote new energy vehicle diffusion in the complex network context? A three-stage evolutionary game model," Energy, Elsevier, vol. 230(C).
    9. Luo, Qi & Yin, Yunlei & Chen, Pengyu & Zhan, Zhenfei & Saigal, Romesh, 2022. "Dynamic subsidies for synergistic development of charging infrastructure and electric vehicle adoption," Transport Policy, Elsevier, vol. 129(C), pages 117-136.
    10. Jinru Wang & Zhenwu Shi & Jie Liu & Hongrui Zhang, 2023. "Promoting “NEVs Pilot Policy” as an Effective Way for Reducing Urban Transport Carbon Emissions: Empirical Evidence from China," Sustainability, MDPI, vol. 15(14), pages 1-24, July.
    11. Rui Mu & Martin De Jong, 2018. "A Tale of Two Chinese Transit Metropolises and the Implementation of Their Policies: Shenyang and Dalian (Liaoning Province, China)," Energies, MDPI, vol. 11(3), pages 1-18, February.
    12. Junze Zhu & Hongzhi Guan & Mingyang Hao & Zhengtao Qin & Ange Wang, 2021. "“License Plate Lottery”: Why Are People So Keen to Participate in It?," Sustainability, MDPI, vol. 13(23), pages 1-16, December.
    13. Qiu, Y.Q. & Zhou, P. & Sun, H.C., 2019. "Assessing the effectiveness of city-level electric vehicle policies in China," Energy Policy, Elsevier, vol. 130(C), pages 22-31.
    14. Ruyu Xie & Liren An & Nosheena Yasir, 2022. "How Innovative Characteristics Influence Consumers’ Intention to Purchase Electric Vehicle: A Moderating Role of Lifestyle," Sustainability, MDPI, vol. 14(8), pages 1-24, April.
    15. Guohao Li & Tao Wang, 2022. "Long-Term Leases vs. One-Off Purchases: Game Analysis on Battery Swapping Mode Considering Cascade Utilization and Power Structure," Sustainability, MDPI, vol. 14(24), pages 1-28, December.
    16. Shi, Lei & Wu, Rongxin & Lin, Boqiang, 2023. "Where will go for electric vehicles in China after the government subsidy incentives are abolished? A controversial consumer perspective," Energy, Elsevier, vol. 262(PA).
    17. Debnath, Ramit & Bardhan, Ronita & Reiner, David M. & Miller, J.R., 2021. "Political, economic, social, technological, legal and environmental dimensions of electric vehicle adoption in the United States: A social-media interaction analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 152(C).
    18. Hsiao, Cody Yu-Ling & Yang, Rui & Zheng, Xin & Chiu, Yi-Bin, 2023. "Evaluations of policy contagion for new energy vehicle industry in China," Energy Policy, Elsevier, vol. 173(C).
    19. Alali, Layla & Niesten, Eva & Gagliardi, Dimitri, 2022. "The impact of UK financial incentives on the adoption of electric fleets: The moderation effect of GDP change," Transportation Research Part A: Policy and Practice, Elsevier, vol. 161(C), pages 200-220.
    20. Mo Chen & Rudy X. J. Liu & Chaochao Liu, 2021. "How to Improve the Market Penetration of New Energy Vehicles in China: An Agent-Based Model with a Three-Level Variables Structure," Sustainability, MDPI, vol. 13(21), pages 1-17, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:energy:v:244:y:2022:i:pa:s0360544221028772. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.