Research ArticlePublic-Private Partnerships in the Electric Vehicle ChargingInfrastructure in China: An Illustrative Case Study

Kun Wang 1 and Yongjian Ke2

1Faculty of Architectural, Civil Engineering and Environment, Ningbo University, Ningbo, Zhejiang, China2School of Built Environment, University of Technology Sydney, Ultimo, NSW, Australia

Correspondence should be addressed to Kun Wang; wangkun@nbu.edu.cn

Received 17 April 2018; Accepted 21 June 2018; Published 8 July 2018

Academic Editor: Dong Zhao

Copyright © 2018 KunWang and Yongjian Ke.+is is an open access article distributed under the Creative Commons AttributionLicense, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work isproperly cited.

Effective supply of charging infrastructure is a necessary support for the development of electric vehicle and also an importantstrategic measure to promote energy consumption revolution and green development.+e construction and operation of charginginfrastructure in China is unfortunately not smooth, lagging behind the actual demand. Public-Private Partnerships (PPPs) mayoffer a promising way forward and accelerate the development of charging infrastructure by tapping the private sectors’ financialresources and professional skills. However, PPP has not been commonly adopted in this sector yet. +is paper hence studied anillustrative case of Anqing Project in China to demonstrate how governments structure a PPP deal in the electric vehicle charginginfrastructures. A content analysis was conducted on the important project documents to investigate key elements including theplanning, construction, risk sharing, profit distribution, and supervision during the execution stage. Based on the illustration,some key lessons and recommendations were provided to offer a reference for future charging infrastructure PPP projectsin China.

1. Introduction

China’s newly developed urban electric vehicle charginginfrastructure provides power through high-voltage cen-tralized charging stations and low-voltage decentralizedcharging piles. +is infrastructure is an important baselinefor the popularization of electric vehicles, whose develop-ment and adoption can accelerate the replacement of fossilfuels and reduce automotive exhaust emissions, helping toensure energy security, promote emissions reduction, andprevent air pollution. +e promotion of charging in-frastructure in China is therefore an urgent strategic mea-sure underlying the energy consumption revolution andgreen development.

As of the end of 2016, China had nearly 150,000 publiccharging piles, more than twice the number in 2015, makingChina a global leader in developing charging infrastructure[1]. Although charging infrastructure in China is large inabsolute terms, it lags well behind the rate of electric vehicle

development (Figure 1). +e electric vehicles in proportionto charging infrastructure in Figure 1 refer to the number ofelectric vehicles sharing a public charging pile. +is ratio isimportant for decision-makers to determine the number ofpublic charging piles to be built according to the existing andexpected numbers of electric vehicles. It also influences thecustomers’ willingness to purchase and use electric vehicles.To the best knowledge of the authors, there is no universallyaccepted threshold value of the ratio. Given the strongstrategic promotion of using electric vehicles, the Chinesegovernment stated a goal of constructing 500,000 new publiccharging piles from 2015 to 2020, which however remains farfrom being achieved. +e lack of charging infrastructure isconsidered a significant barrier for the wide acceptance ofelectric vehicles [2]. Being a quasipublic good, the initialinvestment from the government is large but insufficient, soa strong inflow of private capital is required [3].

Public-Private Partnership (PPP) is a long-term contractbetween a public party and a private party, for the development

HindawiAdvances in Civil EngineeringVolume 2018, Article ID 9061647, 10 pageshttps://doi.org/10.1155/2018/9061647

and management of a public asset or service, in which theprivate party bears signicant risk and management re-sponsibility through the life of the contract [4]. PPP may o�era promising way forward and accelerate the development ofcharging infrastructure by tapping the private sectors’ nancialresources and professional skills. However, PPP has not beencommonly adopted in this sector in China yet. In the projectdatabase with a size of 14,424 projects operated by theMinistryof Finance (MOF) as of December 31, 2017, there were only 14electric vehicle charging infrastructure PPP projects, of whichthree were procured [5]. It is not clear how the governmentshould structure a PPP deal in the electric vehicle charginginfrastructure to achieve value for money due to its signicantdi�erences with other infrastructure sectors such as transport,water, waste, and gas where it is common to see examples ofPPP implementations. �is paper hence aims to analyze thedeal structure of an electric vehicle charging infrastructure PPPproject, investigate key elements during the execution stage,and obtain key lessons and recommendations. By providingpractitioners and academics with a better understanding of thedi�erences between electric vehicle charging infrastructurePPPs and other PPPs, this paper expects to o�er a reference forfuture charging infrastructure PPP projects.

2. Literature Review

2.1. Electric Vehicle Charging Infrastructure in China.Public charging infrastructure is a key to growing the electricvehicle market. In recent years, the central government hasissued several relevant policies to support the construction ofthe electric vehicle charging infrastructure, such as GuidingOpinions on Accelerating the Electric Vehicle Charging

Infrastructure Construction issued by the General O�ce ofthe State Council in October 2015 and Guidelines on De-velopment of the Electric Vehicle Charging Infrastructure(2015–2020) issued by the National Development and Re-form Commission in November 2015. �ese governmentdocuments are constituted to demonstrate the administrativeprocesses for land acquisition, public funding, approvals,business operation, and so on.�e charging infrastructure beingdeveloped in China includes centralized charging stations anddecentralized charging piles at public charging stations, as wellas public charging piles and private charging piles in publictransportation, sanitation, rental, engineering, logistics, andother areas [3].

�e numbers of charging piles and stations have in-creased but their growth has not matched that of electricvehicles (as shown in Figure 1). Because the gap betweensupply and demand of charging infrastructure is broadeningincreasingly, the charging infrastructure industry mustundergo an explosive growth, which has been re�ected in thegovernment’s strategic plan. According to the requirementsin the Guidelines on Electric Vehicles Charging InfrastructureDevelopment (2015–2020), the number of charging piles andstations should exceed 4.8 million and 12,000 by 2020, re-spectively, which are 154 times and 15 times the existing levels.�e investment demandwindow in the charging infrastructurewill hence be opened.

Compared to other infrastructure sectors, electric vehiclecharging infrastructure has the following unique charac-teristics: it requires a large initial investment as well asa long-term operation and maintenance investment [3]; itrequires a strong coordination with the smart city planning,power grids, and an intelligent transportation layout, which

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Figure 1: Electric vehicles in proportion to charging infrastructure in 2010–2016.

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involves multiple stakeholders, high complexity, and diffi-culties with promotion [6]; it is exposed to various risksincluding changes in policies, business default, technicalrisks, security, market uncertainty, price adjustment risksand so on [7]; the technological advances such as batteryproduction and electricity storage technology, wirelesspayment, and management are updated constantly [8].

2.2. International Practices in Electric Vehicle ChargingInfrastructure. Along with the promotion of electric vehicles,many governments at both national and local levels haverecognized the importance of charging infrastructure andproposed different development programs. However, theseprograms vary widely in scope and focus. Hall and Lutseysummarized the international practices in developing electricvehicle charging infrastructure [9], which indicates the fact thatPPP is not commonly adopted in this specific sector in-ternationally. Because electric vehicle charging infrastructure isnot necessarily the responsivity of governments, governmentsand private companies have both been constructing publiccharging infrastructure for several years in many countries. Inaddition, all recommendations must naturally be tailored to fitlocal political, geographic, and demographic contexts for eachcountry. +erefore, international practices of charging in-frastructure PPP projects are not selected to study in this paperbecause of the research purpose.

2.3. PPP Implementations inChina. PPP has been extensivelyused to deliver an array of infrastructure projects in Chinasince 1980s. Cheng et al. divided the development history ofPPPs in China into four phases based on the nationalmacroeconomic environment, relevant milestone policies,and statistical analysis of their self-collected database, that is,phase one—exploration (1984–2002), phase two—stable ex-pansion (2003–2008), phase three—development with fluc-tuations (2009–2013), and phase four—new boom (end of2013 to current) [10]. In phase one, PPP wasmainly applied intransportation, energy, water, and waste treatment sectors; themain player was foreign investors with mature technologiesand management skills; Build-Operate-Transfer (BOT) wasthe most common contract type. In phase two, PPP wasapplied mainly in municipal utilities, such as water supply,sewage treatment, garbage disposal, and heat supply; state-owned companies and private investors took the leading rolewhile foreign investment declined its share significantly. Inphase three, state-owned companies absolutely dominated thePPP market given the fact that they possessed more gov-ernment resources, by being highly affinitive with localgovernments and more favored by state-owned commercialbanks. In phase four, China is catching a PPP fever due to thestrong promotion by the central government. +e PPP en-vironment has been improved significantly, including a PPPproject database established by theMOF, a PPP center formedunder the MOF, a series of rules and regulations issued toclarify issues like value for money, public affordability, in-formation disclosure, and hundreds of national PPP demon-stration projects to illustrate the best practices.

2.4. PPPs in Electric Vehicle Charging Infrastructure in China.+e revenue from end-users cannot cover the constructionand operation costs in a charging infrastructure project. Inorder to deliver such a project via PPP mode, a governmentfund is needed to close the investment gap [3, 11].+erefore,compared to other economic infrastructure sectors such aspower, toll road, and water, the charging infrastructure wasnot favored by both the public and private sectors. Alongwith the rapid development of PPPs since 2013, subnationalgovernments started to explore the opportunity of usingPPPs in many other sectors including the charging in-frastructure. Currently, PPP in charging infrastructure inChina is at its initial stage, in which the governments areenthusiastic, and the participation degree of private sector isincreasing [7, 12].+erefore, the planning, construction, risksharing, profit distribution, and supervision during theexecution stage need to be further studied. As of December31, 2017, among the total 14,424 projects accounting for 18.2trillion yuan in the project database operated by the MOF,there were only 14 electric vehicle charging infrastructurePPP projects, representing only 0.097% of the total projectnumber and 0.027% of the total investment amount. Amongthe 14 projects, three projects have been procured, threeprojects have been approved and are being prepared forprocurement, and the rest are still at the project identifi-cation stage. Table 1 summarizes the six approved electricvehicle charging infrastructure PPP projects. +e paymentmechanism of viability gap funding denotes that the gov-ernment will make PPP projects financially viable by ded-icating a portion of its budget to fund the gap between theexpected project revenues and costs.

3. Research Methodology

+e PPP model will be increasingly applied to the develop-ment of the electric vehicle charging infrastructure in China.But so far, only three PPP projects have been procured. To thebest of the authors’ knowledge, little effort has been seen in theresearch of PPP application in this sector. +erefore, it isurgent to know what the lessons are in the few existingprojects, and a qualitative case study approach will be ap-propriate for the research purpose. According to Eisenhardtand Graebner and Yin, a case study is appropriate whenexisting theories or the available data are insufficient to engagein quantitative hypothesis testing and when the researcherdesires to gain an in-depth understanding of a complexphenomenon within its specific context [13, 14].

As shown in Table 1, there are six approved electric vehiclecharging infrastructure PPP projects in China, of which threeare still being prepared for procurement and are hence ex-cluded first. +e Kaili project, the Anqing project, and theLiupanshui project were procured in March 2015, June 2016,and July 2017, respectively. Because most information of theLiupanshui project has not been disclosed yet (and will bedisclosed within sixmonths after its execution stage accordingto the MOF project database), and most information of theKaili project is not available (and may not disclosed as nodisclosure plan is given in the MOF project database), theAnqing project has the richest public-available information

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and was selected for a single case study in this paper.Moreover, the Anqing project is one of the national dem-onstration projects, which reinforces the rationality ofstudying this project to achieve the research purpose. Na-tional PPP demonstration projects are selected by the MOFto highlight key examples of best practice in PPP imple-mentations in order to further promote PPP to a larger scale.As of December 2017, there are 697 national PPP demon-stration projects.

Due to limited information, a single case study methodwas adopted in this paper. In particular, the purpose of thestudy is illustrative. It is expected to demonstrate how theChinese government structured the deal in the Anqingproject, with a closer look at some key elements includingthe planning, construction, risk sharing, profit distribution,and supervision during the execution stage. All informationand data of the Anqing project are mainly derived fromimportant project documents including value for moneyreport, fiscal affordability report, feasibility report, pro-curement documents, and PPP agreement in the PPP projectdatabase established and operated by the MOF.

4. Case Study: the Anqing ChargingInfrastructure PPP Project

4.1. Project Background. +e Anqing project, located inAnqing, Anhui province, the largest charging infrastructurePPP project executed in China, was formally signed in June2016, later becoming a national demonstration project. Itwould be carried out in two phases. +e first phase covers

103 square kilometers of the main city, and the second phasecovers one town (Tongcheng) and six rural suburbs (Susong,Huaining, Qianshan, Yuexi, Taihu, and Wangjiang) underthe jurisdiction of Anqing. By 2020, nearly 20,000 publiccharging piles will be built. +e goal of the project is toprovide public charging infrastructure and services usinga smart service platform. A consortium led by QingdaoTGOOD Electric Co., Ltd., a private enterprise, was awardedthe project through a competitive consultation. +e privateconsortium is responsible for the financing, design, con-struction, operation, and maintenance. +e paymentmechanism is the method of viability gap funding, meaningthat the project revenues are from user charges, and thegovernment will dedicate its budget to fund the gap betweenthe expected project revenues and costs. A Special PurposeVehicle (SPV, a project company created to develop andmanage the project, which is a key feature of most PPPs) wasconfigured, in which the government’s agency and privateconsortium hold 10% and 90% shares, respectively. +eproject’s transaction structure is shown in Figure 2.

4.2. Project Planning. +e network effect of the planning issignificant. Broadly available public charging infrastructurecan meet the mobility and diversity requirements of electricvehicles [11], thereby promoting the usage of electric ve-hicles that in turn will increase the usage of charging service[15]. In addition, the economy of scale in the electric vehiclecharging service industry is apparent. In order to reduceoverall operation and maintenance costs, a specific modality

Table 1: Overview of the existing charging infrastructure PPP projects.

Project name Currentstage

Launchtime

Investment amount(million yuan)/(million

US dollars)

Concessionperiod(years)

Modalities Scope of work Paymentmechanism

(1) Anqing electricvehicle charginginfrastructure project

Procured 01-2016 818/124.58 13 Regionalconcession

Public charging piles:1700 Viability gap

fundingBus charging stations: 4(100 dc charging piles)

(short-term)(2) Liupanshui electricvehicle charginginfrastructure project

Procured 03-2016 210.92/32.23 20 BOOT Public charging piles:396

Viability gapfunding

(3) Kaili electric vehiclecharging station project Procured 03-2015 104/16.64 20 Not clear

Big charging stations:12

Small charging stations:100

(4) Tianjin electricvehicle charginginfrastructure project

Prepared 10-2014 516/76.08 20 BOT

Public charging piles:2000 Viability gap

fundingBus charging stations:40

(5) Kuerle electricvehicle charging stationproject

Prepared 11-2015 227.73/51.80 30 BOT

Distributed chargingpiles: 492 User payIntegrated chargingstations: 16

(6) Quanzhou electricbus and chargingstation project

Prepared 09-2017 78.00/11.95 10 Regionalconcession

Electric bus: 120 GovernmentpayIntegrated charging

stations: 1Note: this table shows only projects that are at procured and prepared stage, and projects in the identification stage are not included because of too littleinformation.

4 Advances in Civil Engineering

of regional concession was adopted in the Anqing project.�e private consortium was o�ered the exclusive concessionright to build and operate the charging infrastructure withinthe dened area (i.e., 103 square kilometers of the main city,one town, and six rural suburbs). In a typical BOT project,the exclusive right is only applied to the BOT project itselfwith a promise of limiting competition. In this project, theexclusive right is applied to the whole dened region witha promise of not building any charging infrastructure.

Since the electric vehicles and the relevant charginginfrastructure service are still under development in Anqing,it is di�cult to accurately forecast the demand. �erefore,a short-term dynamic adjustment of work scope was in-troduced in the PPP contract of the Anqing project, whichinitially specied the goal of construction in 2016 being 1800charging piles (1000 public charging piles in the main city,100 charging piles for four bus charging stations, and 700charging piles in one town and six rural suburbs). �econstruction plan for the following years during the con-cession period will be separately formulated and submittedto the government for implementation.

As an integral part of the future urban infrastructuresystem, charging infrastructure planning must be e�ectivelycoordinated with other infrastructure planning (such aselectricity, transportation, informationization, etc.). At thepreliminary expert review meeting for the special plan ofnew energy electric vehicle charging infrastructure inAnqing, electrical engineers, urban planners, and sta� fromthe municipal planning bureau, tra�c police detachment,power supply company, and other government departmentswere invited to participate in the joint coordination ofplanning. Meanwhile, the SPV was required to build anindependent smart charging service platform for the projectto ensure that the platformwould be interconnected with thedigital urban management platform of Anqing and reservedata interfaces for other provincial and national manage-ment platforms.

4.3. Construction Arrangement. Due to the requirements ofabovementioned network e�ect and economy of scale, theconstruction was required to be systematically planned andoptimally placed. In particular, the SPV was required to usecharging equipment complying with “Connecting Device forElectric Vehicle Conduction Charging-Part 1: General re-quirements” (GB/T 20234.1-2015), “Connecting Device forElectric Vehicle Conduction Charging-Part 2: the ACCharging Interface” (GB/T 20234.2-2015), “ConnectingDevice for Electric Vehicle Conduction Charging-Part 3: theDC Charging Interface” (GB/T 20234.3-2015), and otherrelevant national standards. In addition, the construction ofa smart charging service platform and its connection withthe Anqing digital urban management platform, provincial,and national management platforms was emphasized.

One of the challenges in the construction phase lies onthe decentralized construction sites, which not only causeddi�culties in construction management but also resulted inthe di�culties in land acquisition. �ere are mainly threetypes of construction lands in the Anqing project: (1) tobuild charging piles in existing private car parks, the SPVshould negotiate with the land-use right holders in a market-cooperative manner with an endorsement from the gov-ernment; (2) to build charging piles in existing publictransport stations, the SPV should rent the land from itsland-use right holders; (3) to build centralized publiccharging infrastructure on an independent site, AnqingUrban Administrative Bureau will coordinate the relevantdepartments to supply the land through an open compe-tition process.

4.4. Risk Sharing. Major risks of the Anqing project weredivided into seven categories: design/construction, opera-tion, nancial, revenue, legal, government behavior, andothers. Table 2 summarizes the risk allocation between thepublic and private sectors. In the following paragraphs, some

Anqing People’sGovernment

Tong’an Co., Ltd.

SPV

Anqing UrbanAdministrative Bureau

AnqingFinanceBureau

Financialinstitution

Authorizedinvestment

representative

Authorizedenforcement

body

Accounting for 10% of the shares Accounting for 90% of the shares

PAN-CHINA GroupJUMBO Consulting

Qingdao TGOODElectric Co., Ltd.

(65%)

Hefei GuoxuanTELD New

Energy Co., Ltd.(12%)

Anhui XiongfengMining

Equipment Co., Ltd. (13%)

Private consortium

PPP project a

greem

ent

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lting

Planning and design

Financing

Financial subsidy

Figure 2: Project transaction structure.

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unique risks for electric vehicle charging infrastructureprojects are further explained.

4.4.1. Design/Construction Risks. +e placement of charg-ing infrastructure is an important consideration becausemany issues need to be addressed, including charging

time, distribution, demand policies, and design standardiza-tion [16]. At present, the development of vehicles and in-frastructure is not coordinated, leading to the contradictoryoccurrences of inconvenient charging and idle charging piles,resulting in wasted resources and low operational efficiency.Meanwhile, a large-scale unbalanced placement can havea detrimental impact on the electric grid, resulting in a sig-nificant operational risk.

Because the public charging demand is mainly located inmature central urban areas, the construction of charginginfrastructure will encounter problems of demolition,property ownership, and more, such that the redevelopmentcost of land is high. Meanwhile, the existing electric in-frastructure may not be adequately designed to satisfy thesurge in power demand necessary for increased electricservice infrastructure in these areas [17], resulting in in-creased distribution transformer losses, voltage deviations,harmonic distortion, and peak demand [18]. +e centralareas of large cities in China have limited resources and sothe potential for power tapping is limited. +e expansion ofpower facilities, such as wires, transformers, and electricmeters will pose a challenge to the regional power load.

4.4.2. Operational Risks. Table 2 shows all operational risksthat are borne by the SPV in the Anqing project, which arethe most important risks in this type of project. In theoperation of charging infrastructure, factors such as costcontrol, efficiency improvement, charging time, and ad-justments to usage demands would cause extra difficulties tooperation management. Equipment replacement throughtechnical upgrades, distribution equipment overloadscaused by power demand surges, increased distributiontransformer losses, voltage deviations, and harmonic dis-tortions are some common operational risks in charginginfrastructure projects [17–19].

4.4.3. Revenue Risks. According to the press, most charginginfrastructure investments in China have faced losses or lowreturns from 2006 to 2014 [20]. +e Anqing governmentencouraged the SPV in the PPP agreement to participate inspecial charging infrastructure investment, construction, andoperation at residential areas or workplaces within theplanning area to increase its revenue. At present, the chargingprice of electric vehicles in China includes two parts: thecharging service fee and the electricity fee. In the Anqingproject, the fees charged by the SPV are set by the gov-ernment, and the SPV has no control authority on thechanges of fees. +erefore, the risk of pricing changes is al-located to the government.

4.4.4. Technical Risks. Technical risks in charging in-frastructure project are high. Continuous changes in tech-nology may lead to the replacement of existing chargingequipment, or even alternative technical methods, whichwould cause a significant additional investment. +erefore,technical risks are shared by both parties in this project.

Table 2: Risk allocation in the Anqing project.

Risk category Government SPVDesign/construction riskPlanning and site selection risk √Land delivery and coordination risk √Design faults √Engineering technical faults √Labor and equipment acquisition √Expansion of power supply capacity √Construction preparation √General engineering variation √Cost overruns of construction andprocurement √

Completion risk √Site safety, environmental protection √Operation riskFacilities’ technical defects √Commissioning test √Facilities and equipment failure √Cost overruns of operation and maintenance √Quality of service do not reach the standard √Grid load regulation √Operator default and early termination √Overhaul and asset replacement √Safety management in operation period √Environmental protection in operationperiod √

Financial riskFinancing failure √High financing costs √Interest rate change √Foreign exchange risk √Debt risk/liquidity risk √SPV bankruptcy √ √Revenue riskChange of electric car ownership/charginginfrastructure utilization ratio √ √

Government pricing changes, such as servicefees √

Changes in other revenue √Inflation √ √Legal riskContract document conflict √ √+ird party default √Government behavior riskGovernment default and early termination √Expropriation and nationalization √Approval delay √Special engineering variation √Tax variation √ √Industry standard variation √ √Technology variation √ √Other riskForce majeure √ √

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4.5. Pro�t Distribution. In the Anqing project, the paymentmechanism is the viability gap funding, including usercharges and viability gap funding from the government. �eformer includes the electricity fee and charging service fee.During the operation period, the electricity fee is chargedaccording to the “notice on the price of charging service forelectric vehicles in Anqing” [21]. If electricity prices arechanged, new prices will be adopted.�e charging service feeis based on the government guidance price prior to 2020,after which it will be determined in accordance with relevantlaws and policies, and through discussions with the SPV.

�e viability gap funding consists of two parts: theavailability and operation/maintenance subsidies. �eavailability subsidy is subject to the amount of constructioninvestment and operation revenues, as well as the annualcomprehensive performance assessment score. If the score is≥85 points, the subsidy will be paid in full; if the score is <85and ≥70 points, the subsidy will be reduced to 85%; if thescore is <70 points, the subsidy will be reduced to 70%. �eoperation/maintenance subsidy aims to ll the gap betweenoperational costs and revenues from the electricity andcharging service fees. �e Anqing PPP contract denes thefollowing:

(1) When the charging pile utilization rate is high,meaning that the ratio of actual charging usage toexpected usage is >85% and <115% and the projectincome is not enough to cover costs, the governmentwill fully compensate for the gap; if the income isgreater than cost, the government will provide nosubsidy, nor will it share the excess prot.

(2) When the charging pile utilization rate is low,meaning that the ratio of actual charging usage to

expected usage is <85% and the project income is notenough to cover costs, the government will com-pensate 85% of the gap (thus embodying risksharing); if the income is greater than the cost,government will provide no subsidy, nor will it sharethe excess prot.

(3) When the charging pile utilization rate is extremelyhigh, meaning that the ratio of actual charging usageto expected usage is >115% and project income is notenough to cover its costs, the government will fullycompensate for the gap; if the income is greater thanthe cost, but the ratio of income to cost is not higherthan 110%, the government will not provide a sub-sidy, nor will it share the excess prot. However, ifthe ratio of income to cost is higher than 110%, thegovernment will obtain 10% of the net yield.

4.6. Supervision. Figure 3 presents the overall supervisionframework for the Anqing project. �e government agenciesinvolved and supervision methods will be further explainedbelow.

4.6.1. Government Agencies. Stakeholders involved in thesupervision of the Anqing project are comprised of relevantgovernment agencies, contracting parties, and the public(mainly the users). �e government agencies include thefollowing:

(i) Procuring authority: Anqing Urban AdministrativeBureau, which signed the PPP project agreementwith the SPV, will supervise and manage the

SPV

Qingdao TGOODElectric Co., Ltd.

Hefei GuoxuanTELD New Energy

Co., Ltd.

Anhui XiongfengMining

Equipment Co., Ltd.

Anqing UrbanAdministrative

Bureau

Functionalsupervisionauthorities

Othergovernment

sectors

Terminal users

Insurancecompany

Commercial bank

Engineeringconsultantcompany

Engineeringcontractor

Power supplycompany

Contract supervision

Functional supervision

General supervision

Shareholder supervision

User supervision

Consultant

Contractperformancesupervision

Contractperformancesupervision

Fund supervision

Figure 3: Supervision framework of the Anqing project.

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investment, construction, and operation of theproject.

(ii) Functional authorities: Anqing Development andReform Commission, Housing and Urban-RuralConstruction Committee, and Finance Bureau atall levels will supervise and manage within theirrespective institutional responsibilities.

(iii) Other government authorities: Electric Power Bu-reau, Administration of Industry and Commerce,and Public Security Bureau will supervise andmanage according to their respective institutionalfunctions and responsibilities. +ese agencies areless relevant to the deal structure of the Anqingproject.

4.6.2. Supervision Methods. +e contract management(including performance monitoring) from the procuringauthority and other contracting parties, administrative su-pervision (including approvals) from functional governmentagencies and other relevant agencies, and public supervisionfrom the general public, and more importantly end-users arethe main supervision methods. +ese methods jointlyprovide an efficient and effective framework to ensure thatthe project achieves the expectations. During the projectdesign and construction stages, administrative supervisiondominates. It ensures that the correct processes are followed,that analysis of the proposed PPP is complete, that all theagencies that need to comment or give their approvals do so,and that the approval authorities receive all the informationthey need to make a sound decision. During the operationphase, one of the key activities in managing the PPP contractis to monitor project delivery and performance againstoutput specifications. Performance monitoring and man-agement hence performs the leading role. At this stage,public supervision also plays an important role in receivingfeedback from end-users and general public for the SPV tocontinuously improve their charging service.

5. Discussions

Although the PPP model has not been widely used in therealm of charging infrastructure, the potential is great. First,compared to the traditional energy sector that is relativelymonopolistic, electric vehicle charging infrastructure isa new energy industry and has fewer regulatory restraints.Second, of the fourteen PPP projects that have been iden-tified in the PPP project database, most projects did not usegovernment-pay mechanism. PPP is hence favored by localgovernments suffering severe financial burden. Moreover,the demand of charging infrastructure has been well vali-dated along with the rapid development of electric vehiclemarket. On the other side, the limited implementation ofPPPs in the charging infrastructure to date results ina concern of how the government should structure anelectric vehicle charging infrastructure PPP project, whichhas been partly solved by the abovementioned illustrativecase study of the Anqing project. In this section, some keylessons and recommendations are further discussed to

provide a reference for future charging infrastructure PPPprojects in China.

5.1. Planning a Coordinated and Dynamic Development.+e planning of charging infrastructure PPP projects musttake into account the network effect and the impact ofeconomies of scale. With the continuous expansion ofelectric vehicle usage, the layout of charging stations andcharging piles need to be optimized using a system opti-mization perspective and integrated in accordance with theelectricity demand characteristics of mobility, diversity, andbootability. An integrated information management plat-form is often required to construct an efficient, intelligent,and standardized charging service network.

Electric vehicle utilization rates, user charging conve-nience, land supply, and other factors should be considered inthe planning of site selection and quantity arrangementprocesses for the charging infrastructure. A scientific andsystematic planning can no doubt improve the utilization ofcharging infrastructure, which should also be coordinatedwiththe overall city planning, road network, and power grids. +iswould reduce impacts of travels for the purpose of charging onthe city traffic, ensure that the power grids provide adequatepower for electric vehicles, and avoid voltage limits or over-loading power distribution lines/equipment.

In addition, charging infrastructure planning should ad-equately consider uncertainties in the initial period and adaptto the frequent updates of electric vehicle technology. +eplanning decision of work scope should be careful in order toavoid idleness and resource waste. +e interaction betweenpromoting electric vehicles and constructing charging facilitiesshould be also fully considered.

5.2. Constructing with Unified Standards and ReducingConstruction Costs. +e unified standards related to charginginfrastructure are requisite for ensuring the proper con-struction of charging facilities, charging safety, vehicle-pileinterconnection, and payment interoperability and in-formation exchange. In December 2015, five governmentdepartments including the National Energy Administration ofChina, jointly issued five newly revised national standards forelectric vehicle charging interfaces and communication pro-tocols. +e levels of standards include the national standards(GB/T), industry standards (NB/T), and professional associ-ation standards (T/CEC). +e content of standards coverscharging interface and communication protocol, chargingfacilities and key equipment, charging station construction,power exchange, charging facilities operation and mainte-nance, operation monitoring and operation platform com-munication, and symbol standards. +e construction ofcharging infrastructure must comply with these unifiedstandards to enhance the interoperability for both the electricvehicle drivers and the SPV.

As shown in the Anqing project, the construction sites ofa charging infrastructure PPP project are often scattered andlocated in existing buildings and stations. +e constructioncosts are likely to increase due to the difficult coordinationamong different construction sites and with different

8 Advances in Civil Engineering

stakeholders. However, existing urban infrastructures mayprovide an opportunity to reduce the construction cost ifpolicies to streamline the construction of charging in-frastructure in existing buildings are in place and the existingurban infrastructure can be transformed to provide chargingservice. For example, the transformation of street lights intocharging facilities in Germany could save about 90% of theconstruction cost [1]. +erefore, opportunities for cost re-duction should be carefully examined through innovativetechnical solutions.

5.3. Identifying Project Risks Comprehensively and Sharing6em Properly. PPP projects confront great risks due totheir multiple participants with different objectives andinterests. +erefore, the ultimate project success can only berealized when the risks have been comprehensively identi-fied and properly shared. +e Anqing project is not anexception. As presented in Table 2, the most significant risksare associated with the operation of the project. +is isbecause most risk factors are likely to result in issues oc-curring at the operation stage. Due to the unique charac-teristics of electric vehicle charging infrastructure, such asa rapid development in recent years and frequent updates oftechnical solutions, the government is committed to sharingtechnical risks and revenue risks in the Anqing projectthrough the contractual arrangements of a dynamic scope ofwork and payment mechanism, respectively.

5.4. Building a Smart Service Platform to Provide DiversifiedServices. In the Anqing project, the SPV attached greatimportance to the simultaneous construction of smartservice charging platform and its connections with othermunicipal and provincial/national platforms, so that theSPV will be able to provide customers with charging nav-igation, status inquiries, charging reservations, cost settle-ment, used car trading, car washes, and other services toincrease revenues.

One of the characteristics of the Anqing charging in-frastructure service platform is the strong Internet con-nectivity, which can significantly reduce the queuing timeand strengthen third party resource integration capabilitiesthrough providing live information of charging in-frastructure on the Internet. Commercial value-added spacewill be expanded while providing convenient services forusers. +e private sector needs to develop a smart serviceplatform to record the big data of customers and analyze thedata to solve the operation problems and seek for new value-added business opportunities.

5.5. Strengthening Project Supervision. +e governmentneeds to ensure the selection of right private partners that isa key to the project success. +e selection criteria shouldinclude but not be limited to rich experience, strong tech-nical, financial, and management capacity. In the Anqingproject, the government emphasized technological capacityin the charging equipment supply, construction, and op-eration. TGOOD, the leader of the private consortium, is

a Sino-German joint venture company, with a strong fi-nancial capability and a comprehensive technical capacityand rich experience in the whole industrial chain, includingcharging equipment supply, construction, and operation.

Furthermore, the supervision of the PPP life-cycleprocesses also needs to be strengthened. +e charging in-frastructure is not completed by a short-term centralizedconstruction effort but is gradually expanded and improvedaccording to the market development. Its scale is in ac-cordance with an appropriate proportion to the overallnumber of electric vehicles, while construction and opera-tion are often carried out simultaneously. +erefore, thesupervision of the life-cycle process is very important, whichis not only related to the quality and standard of the serviceprovided by the project, but also related to the calculation ofthe subsidy for the viability gap of SPV. +us, in the entireproject concession period, performance monitoring andmanagement (including construction performance assessmentand operation performance assessment) is often involved.

6. Conclusions and Future Research

Charging infrastructure is an important baseline for thepopularization of electric vehicles, while the introduction ofPPP to this sector is conducive to the government’s use ofprivate resources by increasing the supply of and optimizingthe use of charging services. However, PPP has not beencommonly adopted in charging infrastructure in China. It isnot clear how the government should structure a PPP deal inthe electric vehicle charging infrastructure to achieve valuefor money due to its significant differences with other in-frastructure sectors. In this paper, an illustrative case studyof the Anqing project was conducted to investigate keyelements including project planning, construction ar-rangement, risk sharing, profit distribution, and supervisionduring the execution stage. Based on the illustration, somekey lessons and recommendations were provided to offera reference for future charging infrastructure PPP projects,including planning a coordinated and dynamic develop-ment, constructing with unified standards and reducingconstruction costs, identifying project risks comprehensivelyand sharing them properly, building a smart service platformto provide diversified services, and strengthening projectsupervision. +e case study can provide industry practi-tioners with a clear guidance of structuring a PPP projectbecause this project has been carefully evaluated through theMOF process to be nominated as one of the nationaldemonstration projects and is hence a good practice for theindustry to learn and follow.

At present, PPP in charging infrastructure in China is atthe initial stage; government sectors are enthusiastic butprivate investors’ willingness still needs to be stimulated. Asone single case study was conducted in this paper, thefindings may be biased and need to be carefully examinedbefore being applied to future PPP implementations. Due tothe limited access and timeframe, interviews cannot beconducted to collect first-hand data. +erefore, more similarprojects can be studied in the future, especially on the topicsof how to make a coordinated and dynamic plan, methods to

Advances in Civil Engineering 9

reduce execution costs, and risk management. In addition,because the selected case has been procured only for lessthan two years, the operation performance still remainsunclear, which leads to another future research opportunityto review the project at a later stage.

Data Availability

Raw data were generated at the PPP Project Library operatedby Ministry of Finance, China (http://jrs.mof.gov.cn/ppp/).Derived data supporting the findings of this study areavailable from the corresponding author on request.

Conflicts of Interest

+e authors declare that they have no conflicts of interest.

Acknowledgments

+e authors are grateful for support from the Ministry ofEducation Youth Project of Humanities and Social Sciences(“+e correlation mechanism between relationship man-agement and project performance in infrastructure PPPproject”, Grant no. 16YJCZH096) and the Soft ScienceResearch Program of Ningbo City (“PPP model selection fornew energy vehicle charging infrastructure project”, Grantno. 2017A10058). +is study was also sponsored byK. C. Wong Magna Fund from Ningbo University and theChinese Scholarship Council (CSC no. 201708330424).

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