The Effect of New Energy Vehicle Policies on Traffic Congestion: Evidence from Beijing

Abstract

This paper systematically summarizes Beijing’s new energy vehicle (NEV) policies (including lottery policy and driving-restriction policy) and investigates their impacts on traffic congestion. We propose that although the current NEV policies might alleviate air pollution by reducing exhaust emission, they could worsen Beijing’s traffic condition by increasing congestion probability. We suggest that the lottery policy increases the proportion of NEVs in the total number of newly-added vehicles. Moreover, as the NEVs are not subjected to driving-restriction policy, the number of vehicles travelling on the road will increase and the average velocity will decrease. Hence, traffic congestion is more likely to happen. By adopting general traffic flow model and TTI congestion probability model, empirical findings based on Beijing’s traffic data show that the higher the proportion of newly added NEV is, the larger the congestion probability will be, which support our proposition. In addition, we also simulate NEV policies with different settings (% of NEVs and the degree of driving restrictions). Finally, policy implications and future research directions are also discussed.