Study on the optimal subsidy policy for the development of methanol vehicle in China

Date

2017

Authors

Li, C.
Yue, W.L.
Zou, X.

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Conference paper

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Proceedings of the Eastern Asia Society for transportation studies, 2017, vol.11, iss.44, pp.1-13

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Eastern Asia Society for Transportation Studies (18 Sep 2017 - 22 Sep 2017 : Ho Chi Minh City, Vietnam)

Abstract

Methanol as a fuel for vehicle is economy and environmental friendly, compared with gasoline. The development of methanol vehicle conforms to China's goal of achieving sustainable development as it would accelerate energy restructure by reducing the dependence on fossil fuels. However, the promotion of methanol vehicle in China is slow. While the governments in China have offered subsidy to electric vehicles, there is lack of financial incentive for other alternative fuels. Without an integrated subsidy system, manufacturers would be hardly involved. This paper introduces methanol as a fuel for vehicle and proposes an optimal subsidy model based on microeconomic theories. As subsidy policy may also be influenced by other criteria, the development of a logit model which includes the designed subsidy model would be a future research direction.

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Copyright 2017 the authors

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