A Life Cycle Cost Analysis of Different Shore Power Incentive Policies on Both Shore and Ship Sides based on System Dynamics and a Chinese Port Case

Abstract Shore power (SP) is widely recognized as an efficient strategy for reducing air pollution in port areas. Unfortunately, the adoption of SP has been relatively low, resulting in limited emission reductions and financial losses. To address these challenges, this paper focuses on enhancing the utilization rate of SP. We propose a system dynamics model that assesses the impact of various incentive policies on the economic and environmental benefits of SP. The model considers the life cycle cost and comprises four subsystems. By conducting a case study on Nansha Port, we find that price subsidies are more effective than construction subsidies in overcoming economic barriers. Furthermore, we observe that the overall economic benefits only increase when the electricity price decreases. This is because lowering the electricity price enhances the profitability of ships without negatively affecting port revenue. Additionally, it is the proportion of the electricity price and service price that determines the overall economic benefits, rather than the SP price itself. Hence, it is recommended to provide preferential subsidies for the electricity price.