Public-Private Partnerships in the Electric Vehicle Charging Infrastructure in China: An Illustrative Case Study
Public-Private Partnerships in the Electric Vehicle Charging Infrastructure in China: An Illustrative Case Study
Kun Wang1 and Yongjian Ke2
1Faculty of Architectural, Civil Engineering and Environment, Ningbo University, Ningbo, Zhejiang, China
2School of Built Environment, University of Technology Sydney, Ultimo, NSW, Australia
Correspondence should be addressed to Kun Wang; nc.ude.ubn@nukgnaw
Received 17 April 2018; Accepted 21 June 2018; Published 8 July 2018
Academic Editor: Dong Zhao
Copyright © 2018 Kun Wang and Yongjian Ke. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Abstract
Effective supply of charging infrastructure is a necessary support for the development of electric vehicle and also an important strategic measure to promote energy consumption revolution and green development. The construction and operation of charging infrastructure in China is unfortunately not smooth, lagging behind the actual demand. Public-Private Partnerships (PPPs) may offer a promising way forward and accelerate the development of charging infrastructure by tapping the private sectors’ financial resources and professional skills. However, PPP has not been commonly adopted in this sector yet. This paper hence studied an illustrative case of Anqing Project in China to demonstrate how governments structure a PPP deal in the electric vehicle charging infrastructures. A content analysis was conducted on the important project documents to investigate key elements including the planning, construction, risk sharing, profit distribution, and supervision during the execution stage. Based on the illustration, some key lessons and recommendations were provided to offer a reference for future charging infrastructure PPP projects in China.
1. Introduction
China’s newly developed urban electric vehicle charging infrastructure provides power through high-voltage centralized charging stations and low-voltage decentralized charging piles. This infrastructure is an important baseline for the popularization of electric vehicles, whose development and adoption can accelerate the replacement of fossil fuels and reduce automotive exhaust emissions, helping to ensure energy security, promote emissions reduction, and prevent air pollution. The promotion of charging infrastructure in China is therefore an urgent strategic measure underlying the energy consumption revolution and green development.
As of the end of 2016, China had nearly 150,000 public charging piles, more than twice the number in 2015, making China a global leader in developing charging infrastructure [1]. Although charging infrastructure in China is large in absolute terms, it lags well behind the rate of electric vehicle development (Figure 1). The electric vehicles in proportion to charging infrastructure in Figure 1 refer to the number of electric vehicles sharing a public charging pile. This ratio is important for decision-makers to determine the number of public charging piles to be built according to the existing and expected numbers of electric vehicles. It also influences the customers’ willingness to purchase and use electric vehicles. To the best knowledge of the authors, there is no universally accepted threshold value of the ratio. Given the strong strategic promotion of using electric vehicles, the Chinese government stated a goal of constructing 500,000 new public charging piles from 2015 to 2020, which however remains far from being achieved. The lack of charging infrastructure is considered a significant barrier for the wide acceptance of electric vehicles [2]. Being a quasipublic good, the initial investment from the government is large but insufficient, so a strong inflow of private capital is required [3].
Figure 1: Electric vehicles in proportion to charging infrastructure in 2010–2016.
Public-Private Partnership (PPP) is a long-term contract between a public party and a private party, for the development and management of a public asset or service, in which the private party bears significant risk and management responsibility through the life of the contract [4]. PPP may offer a promising way forward and accelerate the development of charging infrastructure by tapping the private sectors’ financial resources and professional skills. However, PPP has not been commonly adopted in this sector in China yet. In the project database with a size of 14,424 projects operated by the Ministry of Finance (MOF) as of December 31, 2017, there were only 14 electric vehicle charging infrastructure PPP projects, of which three were procured [5]. It is not clear how the government should structure a PPP deal in the electric vehicle charging infrastructure to achieve value for money due to its significant differences with other infrastructure sectors such as transport, water, waste, and gas wh (...truncated)