Analysis of the impact of electric vehicle policy on supply and demand of U.S. states bioethanol market

Abstract

This study aims to construct a quantitative model of the dynamic influence of electric vehicle sales in the United States on bioethanol consumption and bioethanol production. The final research results have shown that there is a long-term equilibrium relationship in our multivariate vector autoregression (VAR) model between bioethanol consumption and bioethanol production, gasoline price, corn price, and electric vehicle sales. It can be seen from the impulse response analysis that ethanol demand will strongly respond to one standard deviation of electric vehicle sales, and our new model fits the real data of ethanol supply and demand deviation well. Based on this newly long-term equilibrium relationship, we have constructed a policy simulation model to describe the quantitative relationship between the changes in the electric vehicle policy of each state and the temporal and spatial pattern of the national bioethanol resource allocation among US states. It can help and serve as a reference tool for policy makers to conduct quantitative policy evaluation.