Sustainable Governance for the Opened Electric Vehicle Charging and Upgraded Facilities Market

Tian Wu, Bohan Zeng, Yali He, Xin Tian and Xunmin Ou
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Tian Wu: Academy of Mathematics and Systems Sciences, Chinese Academy of Sciences, Beijing 100190, China
Bohan Zeng: School of Economics, Renmin University of China, Beijing 100872, China
Yali He: School of Finance, Renmin University of China, Beijing 100872, China
Xin Tian: School of Economics and Management, University of Chinese Academy of Sciences, Beijing 100190, China
Xunmin Ou: Institute of Energy, Environment and Economy, Tsinghua University, Beijing 100084, China

Sustainability, 2017, vol. 9, issue 11, 1-22

Abstract: Since the China State Grid opened the market for infrastructure construction of electric charging stations and allowed Tesla, Potevio, BAIC BJEV and other enterprises to provide their own charging stations and other infrastructure construction, the development of electric vehicles has been greatly affected. How to maintain a sustainable governance in the opened electric vehicle charging and upgraded facilities market is an important policy issues. This paper presents a monopolistic competition model for the differentiated products market and addresses several issues related to Cournot equilibrium to illustrate why the expected free market actually operates in a monopolistic competition market structure. The analytic solution of the model shows that whether the extent of firm entry is insufficient, excessive or optimum is determined by consumers’ time preference, level of production differentiation and features of cost structure, including fixed cost and marginal cost. The sensitivity analysis has been performed among the above factors and tracked some other factors which would determine the effect of the new policy issues. The main policy suggestion is that the government should optimize entry regulations and lay down the criterion of charging interface standards for charging stations to avoid the electric vehicle charging and upgraded facilities marketization process of a one-size-fits-all solution and form a monopolistic competition market.

Keywords: electric vehicle; charging station; monopolistic competition; production differentiation; sustainable governance (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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