Electric vehicles have faced a significant diffusion in the last years, however they still represent a minority share over passenger cars registrations worldwide. Economic factors play a crucial role ...in preventing a higher diffusion of electric vehicles, with particular reference to the higher purchase price compared to internal combustion engine vehicles. Indeed, potential electric vehicles buyers typically tend to underestimate long-term savings that can be achieved due to the lower operating costs characterizing electric vehicles compared to internal combustion engine vehicles (so-called “energy-efficiency paradox”). An emerging literature stream suggests that the availability of comprehensive economic comparisons between electric vehicles and internal combustion engine vehicles, based on the total cost of ownership, would increase the potential customers’ willingness to buy an electric vehicle. However, there is an ongoing debate on the cost competitiveness of electric vehicles considering the whole ownership period, and in particular on the most influencing factors affecting it. The paper aims to fill this literature gap by assessing the cost competitiveness of electric vehicles against a broad set of alternative powertrains, with reference to the Italian market. To this aim, an ad hoc assessment tool based on the total cost of ownership has been developed, leveraging the extant knowledge on the topic and addressing current gaps. Results show that battery electric vehicles are characterized by the lowest total cost of ownership among analysed powertrains in two out of four vehicle segments evaluated, i.e., segments A (mini cars) and C (medium cars). This is mainly due to the presence of purchasing incentives and the lower fuel-related and non fuel-related operating costs characterizing battery electric vehicles compared to other powertrains, which more than offset the higher purchase price. In other cases, the relatively high purchase price characterizing battery electric vehicles (as well as plug-in hybrid electric vehicles) negatively affects their cost competitiveness. The study provides suggestions for managers of companies within the e-mobility value chain and policymakers on the levers to promote the spread of electric vehicles to achieve the decarbonisation targets for the transportation sector.
The transport sector is a major source of greenhouse gas emissions worldwide as well as in Germany and is therefore able to contribute significantly to the achievement of climate protection goals. ...With this in mind and the steadily increasing electricity generation from renewable energy sources in Germany, electrically driven vehicles can be an attractive option to reach the climate targets of the EU and the German government. The target of the German government to have at least one million electric vehicles registered by 2020 seems currently far from realisation. For this reason, this article analyses the total cost of ownership (TCO) of electric passenger vehicles in Germany on a component-based approach and gives an estimation about the further development until 2050. To represent the German market, we investigate different vehicle sizes, user types and drive technologies. Furthermore, we show the CO2 abatement potential offered by different types of electric vehicles. Finally, we analyse buyer's premiums as an incentive to accelerate the uptake of electric vehicles on German roads.
In result, even without governmental subsidies, full and mild hybrid electric vehicles are already an economic option for a wide range of vehicle sizes and user types. To achieve nowadays cost competitiveness for full electric vehicle powertrains, considerable buyer's premiums are necessary. For plug-in hybrid electric vehicles and battery electric vehicles, the premiums range from about 8,600 to 32,400 EUR2010/vehicle depending on the vehicle size and user type. Eventually, following the future cost estimations, full electric vehicles can reach economic viability from 2030 onwards for many of the investigated vehicles and users.
•This study analyses the total cost of ownership of passenger vehicles.•Electric drive technologies are analysed for several vehicle and user types.•Hybrid electric vehicles are already cost competitive for many users.•To foster market penetration of full electric vehicles action is needed in the short term.
Environmental issue such as global warming caused serious natural disasters such as flood and drought due to CO2 emission. Global countries cooperate to address the global warming represented by ...Paris Agreement, which encouraged actions to restrict CO2 emission and global average temperature increase. H2 has been received more attention than before due to its eco-friendly property. Fuel cell and fuel cell electric vehicle (FCEV) are the widely used H2 application in terms of energy and transportation sector. However, most of the researches were carried out related to H2 supply chain. In hence, in this study, economic analysis considering total cost of ownership (TCO) of FCEV was conducted and correlation between TCO and market share of FCEV was figured out by drawing a regression curve. Finally, an optimization model was developed to obtain the optimal H2 fueling station arrangement model in case of 2022, 2030, and 2040 depending on learning rate (8, 13, and 18%).
The $ 46,444.2 of TCO was computed considering three years of ownership length. In addition, 4.3, 31.7, and 94.0% of maker share in 2040 were reached in case of 8, 13, and 18% of learning rate, respectively. Finally, it was unveiled that H2 fueling station is preferred to construct equally in nation and the construction region will be shifted to a higher population density region as time passed.
•Optimization arrangement model of FCEV fueling station was developed.•Economic analysis for FCEV depending on learning rate was carried out.•Correlation between TCO and market share was figured out via regression curve.•Economic prospects of FCEV and guidelines for H2 fueling station were provided.
•New multiobjective optimisation model to design a sustainable hydrogen supply chain.•Optimisation of LCOH, GWP and safety risk and social cost-benefit.•Methodology applied to the “Green H2 in ...Hungary” project.•H2 demand for industrial and mobility markets (trucks and buses).•Comparison of single- and multiobjective optimisation strategies.
This article presents a comprehensive approach to design hydrogen supply chains (HSCs) targeting industrial and mobility markets. Even if the inclusion of sustainability criteria is paramount, only a few studies simultaneously consider economic, environmental, and social aspects - the most difficult to measure. In this paper, the safety risk and the social cost-benefit (SCB) have been identified as quantifiable social criteria that would affect society and the end-users. The objectives of this research are (1) to design a sustainable HSC by using four objective functions, i.e., levelized cost of hydrogen, global warming potential, safety risk and social cost-benefit through a mixed-integer linear programming model; (2) to compare results from SCB and multiobjective optimisation. The integration of the SCB criterion at the optimisation stage is not a trivial task and is one of the main contributions of this work. It implies the minimisation of the total cost of ownership (TCO) for buses and trucks. The evolution of the HSC from 2030 to 2050 is studied through a multiobjective and multiperiod optimisation framework using the ε-constraint method. The methodology has been applied to a case study for Hungary with several scenarios to test the sensitivity of demand type and volume as well as the production technology. The results analysis highlights that (1) it is beneficial to have mixed demand (industry and mobility) and a gradual introduction/migration to electrolysis technology and fuel cell vehicles (FCVs) for a smooth transition. Liquid hydrogen produced via water electrolysis powered by nuclear and wind energy can result in an average levelized cost of $4.78 and 3.14 kg CO2-eq per kg H2; (2) the frameworks for multiobjective optimisation and SCB maximisation are complementary because they prioritise different aspects to design the HSC. Taxes and surcharges for H2 fuel will impact its final price at the refuelling station resulting in a higher TCO for FCVs compared to diesel buses and trucks in 2030 but the TCO becomes almost competitive for hydrogen trucks from 2035 when SCB is maximised. The SCB function can be refined and easily adapted to include additional externalities.
Battery electric vehicles (BEVs) are an important pathway for decarbonizing transportation and reducing petroleum dependence. Although one barrier to adoption is the higher purchase price, advocates ...suggest that fuel and maintenance savings can make BEVs economical over time. To assess this empirically, this paper analyzes the five-year Total Cost of Ownership (TCO) for conventional, hybrid, and electric vehicles in 14 U.S. cities from 2011 to 2015. Results show spatial variation due to differences in state and local policies, fuel prices, insurance and maintenance costs, depreciation rates, and vehicle miles traveled. Yet in nearly all cities, the BEV's higher purchase price and rapid depreciation outweighed its fuel savings. Extensive sensitivity analyses highlight the impact of key parameters and show that both federal and state incentives were necessary for BEVs to be cost competitive. Future BEV cost competitiveness may improve if innovation and scaling lead to significantly reduced BEV purchase prices, but our analysis suggests that it will be challenging for BEVs to achieve unsubsidized cost competitiveness except in the most optimistic scenarios.
•Analyzes 5-year Total Cost of Ownership (TCO) for 3 cars across 14 U.S. cities.•Battery electric vehicles (BEV) are rarely cost competitive, despite fuel savings.•Sales tax and rapid depreciation of BEVs contribute to higher net capital costs.•BEVs need large subsidies and reduced rate charging to be cost competitive.•Scenario analyses show impact of fuel prices, VMT, and ownership length.
Firms compete on value, not cost alone. However, sourcing decisions are often heavily weighted towards minimizing costs, even though these decisions also can affect revenue, risk, and other ...stakeholder values. To address this disconnect, we introduce a new approach to strategic sourcing, “total value contribution” (TVC). The TVC name by itself promotes attention to value. TVC's structured approach begins with the question: “what do our customers, current and future, value about our products?” The TVC approach builds on insights from the literature on individual and group decision‐making to offset human biases and organizational incentives that emphasize cost reduction. TVC builds on gains already achieved by “total cost of ownership” (TCO) sourcing methods, which broadened the list of factors considered in sourcing. We provide examples of TVC‐like thinking in real organizations and argue that such thinking would be more common with the dissemination of TVC. We also provide access to a version of this JOM Forum piece suitable to assign to students, and discuss a new teaching note which describes how to implement TVC in a popular strategic sourcing teaching case. We believe widespread implementation of TVC would improve both organizational and social outcomes.
Electric buses are growing in numbers in Sweden, which contributes to the development of a fossil fuel free society and a reduction of emissions. Earlier studies of bus systems have identified a need ...to further investigate societal costs, total cost of ownership, energy use on a yearly basis to account for seasonal variations, and noise during acceleration. Addressing those needs was the purpose of this study. Investigations were made in five cities in Sweden that have recently implemented different electric buses in their respective public transport system. Based on results from these investigations and earlier studies, new and developed models where designed and applied on electric buses on route 1 in Karlskrona, as a representative example. It was found that there were significant savings in societal costs and total cost of ownership when compared to diesel and biogas powered buses, mainly due to decreased noise, no emissions in the use phase, and decreased energy use.
•Optimization of electric vehicle investment and operations cost under uncertainty.•Two-stage stochastic program is solved by sample average approximation.•Stochastic mobility demand patterns are ...predicted based on a hidden Markov model.•Case study shows that new scenario reduction heuristic can improve approximation.•Consideration of variable battery and charging capacities can reduce total costs.
The possibility of electric vehicles to technically replace internal combustion engine vehicles and to deliver economic benefits still mainly depends on the battery size and the charging infrastructure costs as well as on annual mileage (utilizing the lower variable costs of electric vehicles). Current studies on electric vehicles’ total cost of ownership often neglect two important factors that influence the investment decision and operational costs: firstly, the trade-off between battery and charging capacity; secondly the uncertainty in energy consumption. This paper proposes a two-stage stochastic program that minimizes the total cost of ownership of a commercial electric vehicle under uncertain energy consumption and available charging times induced by mobility patterns and outside temperature. The optimization program is solved by sample average approximation based on mobility and temperature scenarios. A hidden Markov model is introduced to predict mobility demand scenarios. Three scenario reduction heuristics are applied to reduce computational effort while keeping a high-quality approximation. The proposed framework is tested in a case study of the home nursing service. The results show the large influence of the uncertain mobility patterns on the optimal solution. In the case study, the total cost of ownership can be reduced by up to 3.9% by including the trade-off between battery and charging capacity. The introduction of variable energy prices can lower energy costs by 31.6% but does not influence the investment decision in this case study. Overall, this study provides valuable insights for real applications to determine the techno-economic optimal electric vehicle and charging infrastructure configuration.
•A technoeconomic model is created to predict whether BEVs or FCEVs have a lower TCO.•By 2030, the TCO of FCEVs is lower than that of BEVs for the majority of the market.•The TCO is most affected by ...the costs of hydrogen fuel, batteries, and fuel cells.
This paper estimates battery electric (BEV) and hydrogen fuel cell electric vehicle (FCEV) costs from today through 2040 to explore the potential market size of each vehicle type. Two main tasks are performed. First, the total cost of ownership (TCO) – including vehicle purchase, fuel, maintenance, resale, and refueling inconvenience – is estimated for 77 light-duty vehicle (LDV) segments, defined by driving range and size class. Second, data on individual travel behavior is used to estimate the fraction of vehicle owners within each of the 77 segments. In 2020, BEVs are estimated to be the cheaper vehicle option in 79–97 percent of the LDV fleet and have a weighted average cost advantage of $0.41 per mile below FCEVs across all vehicle segments and drivers. However, costs of the two powertrains quickly converge between 2025 and 2030. By 2040, FCEVs are estimated to be less expensive than BEVs per mile in approximately 71–88 percent of the LDV fleet and have notable cost advantages within larger vehicle size classes and for drivers with longer daily driving ranges. This analysis demonstrates a competitive market space for both FCEVs and BEVs to meet the different needs of LDV consumers.
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