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Setting up charging electric stations within residential communities in current China: Gaming of government agencies and property management companies

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  • Wu, Tian
  • Ma, Lin
  • Mao, Zhonggen
  • Ou, Xunmin

Abstract

The difficulty of charging electric vehicles (EVs) is now hindering their further development. Governments generally choose to build stations for home charging (including piles) within residential communities. Given the conflict of interest between various government agencies and property management companies, constructing a charging station within residential communities would result in welfare loss for the property management companies and therefore lead to the principal–agent problem. This paper constructs a two-period imperfect information game theory model to study the moral hazard involved in this issue and government agencies׳ optimal choice. In the analytic solution of the model, we find that the optimal choice for a farsighted government agency is to constantly improve the incentive mechanism and introduce charging stations only when the conflict of interest is eliminated. Any benefits derived from government regulations by force would prove short-lived. The government should focus on long-term returns in the development of EVs, and its optimal mechanism should be designed to mitigate the principal–agent problem of property management companies, thereby accelerate the progress of EV charging infrastructure and improve overall social welfare.

Suggested Citation

  • Wu, Tian & Ma, Lin & Mao, Zhonggen & Ou, Xunmin, 2015. "Setting up charging electric stations within residential communities in current China: Gaming of government agencies and property management companies," Energy Policy, Elsevier, vol. 77(C), pages 216-226.
    • Handle: RePEc:eee:enepol:v:77:y:2015:i:c:p:216-226
    DOI: 10.1016/j.enpol.2014.10.012
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    3. Bo Chen & Christophe Midler & Joël Ruet, 2019. "The development of electric vehicles in China: Market facts and regulatory trends," Post-Print hal-03085772, HAL.
    4. Ji, Zhenya & Huang, Xueliang, 2018. "Plug-in electric vehicle charging infrastructure deployment of China towards 2020: Policies, methodologies, and challenges," Renewable and Sustainable Energy Reviews, Elsevier, vol. 90(C), pages 710-727.
    5. Bo Chen & Christophe Midler & Joël Ruet, 2018. "Le développement du véhicule électrique en Chine : réalités du marché et dynamiques réglementaires," Post-Print hal-03085769, HAL.
    6. Fa-Ping Wang & Jia-Li Yu & Peng Yang & Li-Xin Miao & Bin Ye, 2017. "Analysis of the Barriers to Widespread Adoption of Electric Vehicles in Shenzhen China," Sustainability, MDPI, vol. 9(4), pages 1-20, March.
    7. Li, Junqiang & Ren, Hao & Wang, Mingyue, 2021. "How to escape the dilemma of charging infrastructure construction? A multi-sectorial stochastic evolutionary game model," Energy, Elsevier, vol. 231(C).
    8. Hongxia Sun & Yao Wan & Huirong Lv, 2020. "System Dynamics Model for the Evolutionary Behaviour of Government Enterprises and Consumers in China’s New Energy Vehicle Market," Sustainability, MDPI, vol. 12(4), pages 1-21, February.
    9. Diao, Qinghua & Sun, Wei & Yuan, Xinmei & Li, Lili & Zheng, Zhi, 2016. "Life-cycle private-cost-based competitiveness analysis of electric vehicles in China considering the intangible cost of traffic policies," Applied Energy, Elsevier, vol. 178(C), pages 567-578.
    10. Lin Ma & Yuefan Zhai & Tian Wu, 2019. "Operating Charging Infrastructure in China to Achieve Sustainable Transportation: The Choice between Company-Owned and Franchised Structures," Sustainability, MDPI, vol. 11(6), pages 1-22, March.
    11. Lin Ma & Qinchuan Du & Tian Wu, 2019. "Government Intervention and Automobile Industry Structure: Theory and Evidence from China," Sustainability, MDPI, vol. 11(17), pages 1-25, August.
    12. Tian Wu & Bohan Zeng & Yali He & Xin Tian & Xunmin Ou, 2017. "Sustainable Governance for the Opened Electric Vehicle Charging and Upgraded Facilities Market," Sustainability, MDPI, vol. 9(11), pages 1-22, November.
    13. Tyfield, David & Zuev, Dennis, 2018. "Stasis, dynamism and emergence of the e-mobility system in China: A power relational perspective," Technological Forecasting and Social Change, Elsevier, vol. 126(C), pages 259-270.
    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. Li, Yaoming & Zhang, Qi & Liu, Boyu & McLellan, Benjamin & Gao, Yuan & Tang, Yanyan, 2018. "Substitution effect of New-Energy Vehicle Credit Program and Corporate Average Fuel Consumption Regulation for Green-car Subsidy," Energy, Elsevier, vol. 152(C), pages 223-236.
    16. Chen, Xiao & Wu, Tian & Zheng, Rui & Guo, Xiaoxian, 2018. "How vehicle market is segmented and influenced by subsidy policy: A theoretical study," Transportation Research Part A: Policy and Practice, Elsevier, vol. 118(C), pages 776-782.
    17. Sanchari Deb & Kari Tammi & Karuna Kalita & Pinakeswar Mahanta, 2018. "Review of recent trends in charging infrastructure planning for electric vehicles," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 7(6), November.
    18. Andrea Stabile & Michela Longo & Wahiba Yaïci & Federica Foiadelli, 2020. "An Algorithm for Optimization of Recharging Stops: A Case Study of Electric Vehicle Charging Stations on Canadian’s Ontario Highway 401," Energies, MDPI, vol. 13(8), pages 1-19, April.

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