Portfolio analysis of alternative fuel vehicles considering technological advancement, energy security and policy

Abstract

In recent years, there has been an increasing interest in alternative fuel vehicles (AFVs), such as electric vehicles (EVs), fuel cell vehicles (FCVs) and compressed natural gas (CNG) vehicles, as a promising option for mitigating global warming and reducing energy consumption. Most studies in this area have been conducted on only a few types of powertrains, e.g. EVs and gasoline vehicles; to fill this gap, this study will cover FCVs, CNGs, hybrid electric vehicles, diesel hybrid electric vehicles and liquefied petroleum gas (LPG) vehicles. This research is novel because it includes energy security aspects, uses scenario analysis and investigates FCVs. This study aims to predict an optimal AFV portfolio based on different scenarios to sustain energy security in light of gas and petroleum restrictions until 2030. To do this, we will present four scenarios that consider improvements in technology, energy security requirements, decreasing petroleum prices and government subsidies. The Polish market is considered as a case for demonstrating the optimal model. The results indicate that it is crucial to introduce all types of powertrains to achieve both economic and energy security objectives. The projected diffusion of FCVs will be more pronounced than that in previous studies, owing to the expected rapid decline in the cost of both infrastructure and purchase price of cars. Furthermore, the projected deployment of AFVs in transportation systems in this study will mostly occur in the form of lorries (trucks) and passenger vehicles. Because CNG vehicles are expected to achieve a high degree of diffusion in the transportation system, the government should seek a reliable CNG supply. Overall, this research will help automakers and policymakers recognise investment possibilities.