Can charging infrastructure used only by electric taxis be profitable? A case study from Karlsruhe, Germany

Abstract

Electric vehicles are a promising instrument for reducing greenhouse gas emissions and other local pollutants, such as nitrogen oxides. Especially the taxi sector is a promising field of application. First, their high driving distances are necessary for electric vehicles to economize against conventional vehicles. Second, taxis are operated predominantly in city centers, where the pressure to reduce local emissions is greatest. However, while the electrification potential of taxi fleets has gained great attention in literature, the question of whether charging infrastructure can be profitable if only used by taxis has not been answered yet. To answer this question, we analyze 161 taxis in Karlsruhe, Germany. We find that a high share of electric taxis would come at lower cost than their diesel counterparts. Thus, a 25-45% share of taxi driving could be electrified, if only the taxi user perspective would be taken into account. However, while ten charging sites would be necessary to do so, only one charging site could be refinanced through exclusive taxi use. Consequently, the electrification potential would fall to about 3%, if only this one profitable charging site was built. Yet, in the future, electric driving will become cheaper. In 2025, already 55% electrification potential would be possible, given that both electric driving and charging infrastructure operation would be profitable. Altogether, while currently taxi charging infrastructure would require public funding or other business models, in the medium to long term, an exclusive use by taxis would be sufficient.