Diffusion of Electric Vehicles and Public and Home Charging Stations in a Two-Sided Market

Abstract

The diffusion of electric vehicles (EV s) is affected by the spread of EV public charging stations (PCSs) and vice versa. Their interactions are often referred to as “indirect network effects” and analyzed with a two-sided market model. However, the consumer adoption of home charging stations (HCSs), which are considered key drivers of EV deployment, is often ignored. By modeling a two-sided market of EVs and PCSs (i.e., indirect network effects) under the adoption of HCSs, this study explores the EV diffusion process and considers effective strategies for its spread. We examine two cases: in the first, consumer adoption is determined exogenously; in the second, it is determined endoge-nously. In each case, we vary the strength of the indirect network effects, which correspond to the drivers' concern, referred to as “range anxiety.” Through numerical simulations, we evaluate the market shares of EVs, HCSs, and PCSs, as well as social welfare. Our findings have strategic implications for policymakers seeking to increase the market share of EV s in the presence of different types of charging stations without negative social impacts.