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Optimal intervention for incentivizing the adoption of commercial electric vehicles

While electric vehicles (EVs) have great potential in reducing greenhouse gas emissions, successful EV adoption depends largely on the availability of public charging stations. The lack of charging stations poses an even more serious problem for the adoption of commercial EVs (e.g., trucks used for freight transportation), because the (commercial EV) fleet planner needs to build their own specialized charging stations, requiring additional investment in commercial EV purchase. This paper presents a first mathematical model and rigorous analysis for incentivizing the adoption of commercial EVs. We propose an intervention policy for the social planner (e.g., the government) to promote commercial EV adoption. The intervention policy includes a subsidy for EV purchase (i.e., expenditure) and a carbon tax for gas emissions (i.e., income). We propose provably fast algorithms for the social planner to find the optimal budget-balanced intervention policy. We analyze in detail the effect of the intervention policy on commercial EV adoption, and prove that the proposed intervention policy achieves higher commercial EV adoption rates.