Incentives Difference - Stephen D. Wong

Do Incentives Make a Difference? Understanding Smart Charging Program Adoption for Electric Vehicles

Summary

Wong et al. (2023) discussed about the acceptance of EV smart charging among EV owners, potential EV buyers, and the general population. The research was conducted in 2018 among 785 participants using a survey and choice models. Like the study of 04 WTP for V2G, a survey is counted as “stated preference”. It is less convincing than “revealed preference”. To reiterate, stated preference means what people “claim” to do, and revealed preference means what they “actually” did.

Methodology

1. Literature Review - Ongoing Programs

There are 14 programs in North America from 2020 to 2022. Their incentives and regulations are listed in the “Description” column below.

Table 1: Smart Charging Pilot Programs in North America
No. Provider Location Description Incentive
1 Con Edison New York, USA Customers can earn $150 for signing up and additional money for charging at specific times or locations. Upfront + Cash Back
2 Dominion Energy Virginia, USA Customers can receive a rebate for charging equipment that enables smart charging technology and data collection. Cash Back
3 DTE Energy Michigan, USA In partnership with Ford and Chevrolet, DTE offered a $100 incentive for participating in a one-year pilot. Upfront
4 ENMAX Calgary, Canada EV owners may opt-in to a pilot that assesses their charging behavior. Nil
5 GA Power Georgia, USA Participants can earn up to $85 per year by allowing smart charging for their EV. Upfront per Year
6 NB Power New Brunswick, Canada Participants are rewarded $25 for signing up and are paid out various rewards each month. Upfront + Monthly Rewards
7 Nova Scotia Power Nova Scotia, Canada EV owners can apply to have an EV smart charger installed in their home. Free Smart Charger Installation
8 Pacific Gas & Electric and BMW California, USA BMW EV owners living in PG&E service areas in California can opt-in to a smart charging program that shifts vehicle charging in exchange for incentives to the customer. Unspecified Incentives
9 Portland General Electric Oregon, USA Participants can earn between $100 and $800 during the course of the smart charging program. Upfront (Varied)
10 Sacramento Municipal Utility California, USA Sacramento Municipal Utility EVs were managed on a smart charging system, identifying potential for EV fleet management. Unspecified
11 Shell California, USA Shell gas station owners may participate in a smart charging program that helps decrease overall electricity costs. Cash Back
12 Tennessee V alley Authority Tennessee, USA EV owners can receive cash bonuses and other incentives for participating in the program. Cash Back
13 Toronto Hydro Toronto, Canada EV owners can receive a free EV charger for their home for participating in a smart charging pilot. Free Charger
14 Xcel Energy Colorado, USA Customers can receive up to $300 for participating in a pilot, alongside BMW, Ford, General Motors, and Honda. Upfront

2. The Survey Attributes

In the survey conducted by the authors, the stated preference attributes are listed below:

Table 2: Stated Preference Attributes
No. Incentive Program Attribute Levels
1 Incentive Per Year $0, $50, $100, $150, $200, $250, $300
2 Potential to Receive a Penalty, Based on Lack of Program Participation or Excessive Opt-Outs Yes or No
3 Free level 1 (120V) and Level 2 (240V) Charging Equipment Yes or No
4 Guaranteed Battery Level; Uber/Lyft/Taxi Ride Reimbursement if Battery Level is Not Met Yes or No

3. Attributes of Participants

The attributes of participants are listed below:

  • Gender
  • Race and Ethnicity
  • Age
  • Education
  • Annual Household Income
  • Electricity Program at Home

Results

  1. Although some people support smart charging even without incentives, monetary rewards are still important for a larger amount of people. However, monetary rewards undergo a diminishing marginal utility (with a cap as well).

  2. Assured battery levels and alternative transportation solution will encourage people’s willingness to smart charging. On the contrary, penalties for taking back charging control will hurt the willingness, especially for EV owners.

Figure 1: Incentive Curves for EV Owners Programs
Figure 1: Incentive Curves for EV Owners

Figure 2: Incentive Curves for Potential EV Buyers Programs
Figure 2: Incentive Curves for Potential EV Buyers

Gaps

  1. The sample size of 785 is too small. The year of the survey is 2018, too old.
  2. There is no comparison between different incentive structures, such as upfront discount vs annual incentives.
  3. Environmental problems: a lot of places did not have infrastructure in 2018, and the COVID 19 has limited people’s willingness to travel.
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References

Wong, Stephen D., Susan A. Shaheen, Elliot Martin, and Robert Uyeki. 2023. “Do Incentives Make a Difference? Understanding Smart Charging Program Adoption for Electric Vehicles.” Transportation Research Part C: Emerging Technologies 151 (June): 104123. https://doi.org/10.1016/j.trc.2023.104123.