Levelized costs of conventional and battery electric vehicles in china: Beijing experiences

Electric vehicles offer the potential to reduce oil consumption, air pollutants, and greenhouse gas (GHG) emissions. To take advantage of electric vehicles and improve its urban environment, Beijing, as one of China's most polluted cities, launched an electric vehicle promotion program that provided a generous subsidy for consumers who purchased battery electric vehicles (BEVs). In this study, we compare the levelized costs of a conventional vehicle (CV) versus a BEV using real data from the Beijing BEV subsidy program. Levelized cost for this study considers consumer driving patterns and vehicle age. For consumers with average driving profiles-i.e., an average driving distance of around 20 km per trip-the levelized cost of CVs decreases from 1.40 yuan/km for an 8-year vehicle lifetime to 1.04 yuan/km for a 15-year lifetime, while the levelized cost for BEVs decreases from 1.44 yuan/km for an 8-year vehicle lifetime to 1.01 yuan/km for a 15-year lifetime. BEVs are more cost competitive than CVs for consumers with medium and high driving profiles and a 12-year and 15-year lifetime. Under current conditions, the subsidy and tax incentives are necessary to make BEVs cost competitive. However, we project that, even if the subsidy is phased out in 2020, BEVs may become cost competitive with CVs because of the decrease in battery cost. Our study results suggest that the BEV subsidy should reflect changes in battery cost and gasoline prices to help continuing deployment of BEVs.