IDEAS home Printed from https://ideas.repec.org/a/eee/enepol/v121y2018icp597-610.html
   My bibliography  Save this article

The dual-credit policy: Quantifying the policy impact on plug-in electric vehicle sales and industry profits in China

Author

Listed:
  • Ou, Shiqi
  • Lin, Zhenhong
  • Qi, Liang
  • Li, Jie
  • He, Xin
  • Przesmitzki, Steven

Abstract

The Passenger Cars Corporate Average Fuel Consumption and New Energy Vehicle Credit Regulation (dual-credit policy) was enacted by the Chinese government in 2017 to stimulate the fuel-efficient and electrification technologies in the China's passenger vehicle market. This study summarizes the dual-credit policy and develops the New Energy and Oil Consumption Credits Model to quantify the impacts of this policy on consumer choices and industry profits, where internal subsidies as decision variables are used to represent industry responses to the policy. Scenarios in 2016–2020 are simulated and discussed. Key findings from the model results include: (1) the Corporate Average Fuel Consumption rules alone may stimulate more plug-in electric vehicle (PEV) sales than the dual-credit policy; however, (2) the dual-credit policy could stimulate more battery electric vehicles (BEVs) in market, compared to other policy scenarios; (3) the industry could “lose” approximately $2122/vehicle by 2020 under the dual-credit policy; (4) battery electric sedans with a range greater than 250 km and plug-in hybrid SUVs could be popular under the dual-credit policy; (5) credit allocations for BEVs in the dual-credit policy can influence the PEV production; and (6) reduction of the fuel-efficient technology costs helps to minimize profit losses impacted by the policy.

Suggested Citation

  • Ou, Shiqi & Lin, Zhenhong & Qi, Liang & Li, Jie & He, Xin & Przesmitzki, Steven, 2018. "The dual-credit policy: Quantifying the policy impact on plug-in electric vehicle sales and industry profits in China," Energy Policy, Elsevier, vol. 121(C), pages 597-610.
    • Handle: RePEc:eee:enepol:v:121:y:2018:i:c:p:597-610
    DOI: 10.1016/j.enpol.2018.06.017
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301421518304051
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.enpol.2018.06.017?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. Han, Rong & Yu, Bi-Ying & Tang, Bao-Jun & Liao, Hua & Wei, Yi-Ming, 2017. "Carbon emissions quotas in the Chinese road transport sector: A carbon trading perspective," Energy Policy, Elsevier, vol. 106(C), pages 298-309.
    2. van Moerkerk, Mike & Crijns-Graus, Wina, 2016. "A comparison of oil supply risks in EU, US, Japan, China and India under different climate scenarios," Energy Policy, Elsevier, vol. 88(C), pages 148-158.
    3. Wang, Yunshi & Sperling, Daniel & Tal, Gil & Fang, Haifeng, 2017. "China's electric car surge," Energy Policy, Elsevier, vol. 102(C), pages 486-490.
    4. Yan Zhou & Michael Wang & Han Hao & Larry Johnson & Hewu Wang & Han Hao, 2015. "Plug-in electric vehicle market penetration and incentives: a global review," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 20(5), pages 777-795, June.
    5. González Palencia, Juan C. & Otsuka, Yuki & Araki, Mikiya & Shiga, Seiichi, 2017. "Scenario analysis of lightweight and electric-drive vehicle market penetration in the long-term and impact on the light-duty vehicle fleet," Applied Energy, Elsevier, vol. 204(C), pages 1444-1462.
    6. Xu, Lei & Su, Jun, 2016. "From government to market and from producer to consumer: Transition of policy mix towards clean mobility in China," Energy Policy, Elsevier, vol. 96(C), pages 328-340.
    7. Ou, Shiqi & Lin, Zhenhong & He, Xin & Przesmitzki, Steven, 2018. "Estimation of vehicle home parking availability in China and quantification of its potential impacts on plug-in electric vehicle ownership cost," Transport Policy, Elsevier, vol. 68(C), pages 107-117.
    8. Zhenhong Lin, 2014. "Optimizing and Diversifying Electric Vehicle Driving Range for U.S. Drivers," Transportation Science, INFORMS, vol. 48(4), pages 635-650, November.
    Full references (including those not matched with items on IDEAS)

    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. Ou, Shiqi & Hao, Xu & Lin, Zhenhong & Wang, Hewu & Bouchard, Jessey & He, Xin & Przesmitzki, Steven & Wu, Zhixin & Zheng, Jihu & Lv, Renzhi & Qi, Liang & LaClair, Tim J., 2019. "Light-duty plug-in electric vehicles in China: An overview on the market and its comparisons to the United States," Renewable and Sustainable Energy Reviews, Elsevier, vol. 112(C), pages 747-761.
    2. Ou, Shiqi & Lin, Zhenhong & Xu, Guoquan & Hao, Xu & Li, Hongwei & Gao, Zhiming & He, Xin & Przesmitzki, Steven & Bouchard, Jessey, 2020. "The retailed gasoline price in China: Time-series analysis and future trend projection," Energy, Elsevier, vol. 191(C).
    3. Na Zhou & Qiaosheng Wu & Xiangping Hu, 2020. "Research on the Policy Evolution of China’s New Energy Vehicles Industry," Sustainability, MDPI, vol. 12(9), pages 1-17, May.
    4. Li, Wenbo & Long, Ruyin & Chen, Hong & Yang, Tong & Geng, Jichao & Yang, Muyi, 2018. "Effects of personal carbon trading on the decision to adopt battery electric vehicles: Analysis based on a choice experiment in Jiangsu, China," Applied Energy, Elsevier, vol. 209(C), pages 478-488.
    5. Zhang, Lei & Qin, Quande, 2018. "China’s new energy vehicle policies: Evolution, comparison and recommendation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 110(C), pages 57-72.
    6. Ma, Haicheng & Lou, Gaoxiang & Fan, Tijun & Chan, Hing Kai & Chung, Sai Ho, 2021. "Conventional automotive supply chains under China's dual-credit policy: fuel economy, production and coordination," Energy Policy, Elsevier, vol. 151(C).
    7. 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.
    8. Wang, Sinan & Zhao, Fuquan & Liu, Zongwei & Hao, Han, 2018. "Impacts of a super credit policy on electric vehicle penetration and compliance with China's Corporate Average Fuel Consumption regulation," Energy, Elsevier, vol. 155(C), pages 746-762.
    9. Wanke, Peter Fernandes & Chiappetta Jabbour, Charbel José & Moreira Antunes, Jorge Junio & Lopes de Sousa Jabbour, Ana Beatriz & Roubaud, David & Sobreiro, Vinicius Amorim & Santibanez Gonzalez‬, Erne, 2021. "An original information entropy-based quantitative evaluation model for low-carbon operations in an emerging market," International Journal of Production Economics, Elsevier, vol. 234(C).
    10. Guoqiang Zhang & Yanmei Xu & Juan Zhang, 2016. "Consumer-Oriented Policy towards Diffusion of Electric Vehicles: City-Level Evidence from China," Sustainability, MDPI, vol. 8(12), pages 1-16, December.
    11. Liu, Hu-Chen & You, Xiao-Yue & Xue, Yi-Xi & Luan, Xue, 2017. "Exploring critical factors influencing the diffusion of electric vehicles in China: A multi-stakeholder perspective," Research in Transportation Economics, Elsevier, vol. 66(C), pages 46-58.
    12. Shengyuan Wang, 2022. "Exploring the Sustainability of China’s New Energy Vehicle Development: Fresh Evidence from Population Symbiosis," Sustainability, MDPI, vol. 14(17), pages 1-21, August.
    13. Tao Wang & Kai Zhang & Keliang Liu & Keke Ding & Wenwen Qin, 2023. "Spatial Heterogeneity and Scale Effects of Transportation Carbon Emission-Influencing Factors—An Empirical Analysis Based on 286 Cities in China," IJERPH, MDPI, vol. 20(3), pages 1-17, January.
    14. Ye, Rui-Ke & Gao, Zhuang-Fei & Fang, Kai & Liu, Kang-Li & Chen, Jia-Wei, 2021. "Moving from subsidy stimulation to endogenous development: A system dynamics analysis of China's NEVs in the post-subsidy era," Technological Forecasting and Social Change, Elsevier, vol. 168(C).
    15. Vivoda, Vlado, 2022. "LNG export diversification and demand security: A comparative study of major exporters," Energy Policy, Elsevier, vol. 170(C).
    16. Wei, Xinxing & Shi, Xilin & Li, Yinping & Li, Peng & Ban, Shengnan & Zhao, Kai & Ma, Hongling & Liu, Hejuan & Yang, Chunhe, 2023. "A comprehensive feasibility evaluation of salt cavern oil energy storage system in China," Applied Energy, Elsevier, vol. 351(C).
    17. García-Villalobos, J. & Zamora, I. & Knezović, K. & Marinelli, M., 2016. "Multi-objective optimization control of plug-in electric vehicles in low voltage distribution networks," Applied Energy, Elsevier, vol. 180(C), pages 155-168.
    18. LIAN, Ying & LUCAS, Flavien & SÖRENSEN, Kenneth, 2022. "The electric on-demand bus routing problem with partial charging and nonlinear functions," Working Papers 2022005, University of Antwerp, Faculty of Business and Economics.
    19. Shuai Zhang & Xiaoman Zhao & Changwei Yuan & Xiu Wang, 2020. "Technological Bias and Its Influencing Factors in Sustainable Development of China’s Transportation," Sustainability, MDPI, vol. 12(14), pages 1-26, July.
    20. Ruguo Fan & Rongkai Chen, 2022. "Promotion Policies for Electric Vehicle Diffusion in China Considering Dynamic Consumer Preferences: A Network-Based Evolutionary Analysis," IJERPH, MDPI, vol. 19(9), pages 1-21, April.

    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:enepol:v:121:y:2018:i:c:p:597-610. 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.elsevier.com/locate/enpol .

    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.