Institute for Transport Studies (ITS)

Combining agent-based and system dynamics approaches to better understand policies for the uptake of alternate fuel vehicles

Supervisors : Simon Shepherd and Thijs Dekker

Background:

With the recent interest around the world in the promotion of AFVs such as Battery Electric, Plug-in hybrids and Hydrogen Fuel Cell vehicles, there have been a number of key papers which model their uptake using a system dynamics approach. System dynamics is a good fit to this type of problem as previous studies have investigated technology or product diffusion in other sectors where the Bass diffusion model has been applied and adapted. Struben and Sterman (2008) developed a framework for modelling the uptake of AFVs which consists of three main elements: a fleet turnover or stock model, a discrete choice model of the purchase decision and a social/technology diffusion process. This process extends the Bass diffusion concept to include the impacts of word of mouth, marketing and social exposure to the new vehicles.  It allows for a development of the choice set or willingness to consider the option over time including the effect of forgetting about the new vehicle types which then permits a failing market solution. This is an example of where system dynamics models can bring something different to the process of policy assessment – the possibility of an initial uptake of new technology which then fails and which has been observed in practice when subsidies for CNG vehicles were removed in Canada and New Zealand (Flynn, 2002). 

Other studies incorporate similar diffusion structures but add other policy dimensions such as regulation, including manufacturer responses, add other indicators such as impact on fuel duty revenues (Shepherd et al, (2012)) and the co-evolution of infrastructure for re-fuelling and extending to the cases of Natural gas or Hydrogen Fuel Cell vehicles. Meanwhile others have investigated the role of strategic niche management, Kwon (2012), the implication of policies on distributional issues, Harrison and Shepherd, (2013). In terms of impact of policies, most studies find that the uptake is not affected greatly by subsidies but more by regulation and infrastructure. However, as both Struben and Sterman (2008) and Shepherd et al, (2012) point out, the results may be more sensitive to the assumed strength of the word of mouth or marketing effects rather than to changes in the technical attributes of the alternate vehicles. This ability to bring in soft issues such as impacts of social exposure and to quickly demonstrate the sensitivity of results to assumed parameters are another strength of the system dynamics approach. However the studies are weak in that they do not cover:  

  • consumer attitudes and heterogeneity of consumers as most models are used to predict aggregate shares
  • the contribution of vehicle in-service benefits (such as free parking at city centres, exemption from congestion or other road charges, reduction in taxi license fees, etc.)
  • the impacts of spatial differences (both inter-regional and urban/rural) in information/awareness and car/dealership availability
  • the changes in attitudes and social norms towards new technology
  • the contribution of car buying behaviour in the second-hand market and its impact on residual values (of particular interest where access to charge points could be an issue as well as uncertainty about battery life) 

To incorporate such detail spatially and behaviourally, the aggregate choice structure of such models should be adapted.  Using an agent-based approach is one way to introduce such elements and this has been done previously by Huetink et al (2010), but using an agent-based approach alone then loses the higher level policy or large actor responses.  This project would aim to investigate a combined agent-based and system dynamics approach to better represent the issues surrounding the uptake of alternative fuel vehicles within the city/regional level context. 

Objectives and tasks: Given the background above, the project aims to: 

  • understand the key factors involved in the diffusion of new vehicle technologies
  • expand the modelling of the diffusion of new vehicle technologies under a system dynamics framework in order to capture the effects described above by combining an agent-based approach with a system dynamics approach.
  • understand and quantify how city specific policy tools (e.g. fiscal exemptions) can be applied to enhance the uptake of AFVs 

Impact

The research will help cities such as Leeds develop an understanding of how they can influence the take up of low emission vehicles and get best value for money via more targeted schemes. It will help them meet the EU White paper target of removing conventional powered vehicles from city centres by 2050.  It will also impact on the academic community by extending modelling approaches and understanding of the pros and cons of an integrated agent-based –system-dynamics approach. 

References

Flynn, P. (2002). "Commercializing an alternate vehicle fuel: lessons learned from natural gas for vehicles." Energy Policy 30(7): 613-619.

Harrison, G. and Shepherd, S.P. (2013) An interdisciplinary study to explore impacts from policies for the introduction of low carbon vehicles, Transportation Planning and Technology

Huétink, F.J., van der Vooren, A., and Alkemade, F. (2010) Initial infrastructure development strategies for the transition to sustainable mobility. Technological Forecasting & Social Change 77 (2010) 1270–1281

Kwon, T. (2012) Strategic niche management of alternative fuel vehicles: A system dynamics model of the policy effect.  Technological Forecasting & Social Change 79 (2012) 1672–1680

Shepherd, S.P., Bonsall, P.W., and Harrison G. (2012) Factors affecting future demand for electric vehicles:  a model based study.  Transport Policy, (20) March 2012, pp 62-74.

Struben, J. and Sterman, J.D. (2008). "Transition challenges for alternative fuel vehicle and transportation systems." Environment and Planning B-Planning & Design 35(6): 1070-1097.

Walther, G., Wansart, J., Kieckhafer, K., Schnieder, E. & Spengler, T. S. 2010. Impact assessment in the automotive industry - mandatory market introduction of alternative powertrain technologies. System Dynamics Review, 26, 239-261.

Entry Requirements:

Applicants for a research degree should have or expect to obtain a first or upper second class honours degree or equivalent, preferably in a quantitative discipline. A Master's degree (not necessarily in transport) may be advantageous but is not essential. Candidates should have a clearly specified and achievable research goal.

Search site