Green Routing Game: Pollution-Aware Mixed Fleet Logistics With Shared Charging Facilities

Abstract

Eco-friendly freight operations are crucial for decarbonizing the transportation sector. Systematic analysis of policy measures requires a principled modeling approach. While the commonly used model referred to as a routing game considers the congestible nature of transportation facilities, existing models fail to account for environmental factors. This article aims at providing a mathematical framework to study strategic interaction between owners of mixed fleets comprising both internal combustion engine vehicle (ICEV) and electric vehicle (EV) trucks. This study introduces a “green” routing game with incomplete information that models strategic interaction among multiple logistic operators. These players face a pollution tax imposed on ICEVs and a potential delayed delivery cost due to EV charging requirements with uncertainty. In contrast to existing models, this novel model captures the players' tradeoff between lengthier congestion delay at charging stations as the share of EV trucks increases and higher pollution costs with increased ICEV usage, with uncertainty determined by a latent state. We first provide equilibrium characterization and present a condition for essential uniqueness. We show that this equilibrium can be computed in a distributed manner using a gradient projection method. We then introduce a public information system that broadcasts real-time information about the latent state. Importantly, we analyze the value of information for providing a condition for the public information to be beneficial. Finally, we present numerical examples to illustrate settings where environmental taxation and information dissemination can improve social welfare.