Dynamic pricing strategies for electric vehicle charging: Enhancing cost-reflectivity and revenue stability

Abstract

Public charging infrastructure is essential for accelerating electric vehicle (EV) adoption. Currently, in Europe, customers are often offered fixed charging prices, while the costs incurred by charging site owners (CSOs) vary significantly due to factors such as electricity prices and power grid tariffs. This paper proposes alternative pricing solutions to improve cost-reflectivity based on an analysis of the current pricing landscape and related scientific literature. Simulations are carried out, using Danish and Finnish charging session data of multiple locations and electricity price databases, to assess the impact of the proposed pricing solutions on CSO revenues and their potential implications for the charging service business model. The findings indicate that dynamic cost-reflective pricing enhances the stability of CSO revenues and allows users to optimise their charging decisions by providing transparency through precise hourly charging costs. Furthermore, the results show that the proposed dynamic pricing schemes provide a competitive economic advantage for the CSO over the competitors using the present pricing schemes. Additionally, the proposed pricing schemes lead to lower charging costs for 53–64 % of the users even if they do not alter their charging behaviour.