Sustainable Energy, Grids and Networks 24 (2020) 100391

Contents lists available at ScienceDirect

Sustainable Energy, Grids and Networks

journal homepage: www.elsevier.com/locate/segan

Long-term profit for electric vehicle charging stations: A stochastic

optimization approach
∗
Erfan Bagherzadeh, Ali Ghiasian , Abdorreza Rabiee
Department of Engineering, Shahrekord University, Iran

article info a b s t r a c t

Article history: Electric vehicles are gradually finding their position as an alternative to fossil fuel vehicles. To
Received 21 February 2020 accelerate the replacement process, a number of new infrastructural facilities such as charging stations
Received in revised form 27 July 2020 (CS) have to be widely deployed. In order to encourage the private sector to invest in this area,
Accepted 17 September 2020
it is necessary to introduce a combination of business and technical model for CS that comprises
Available online 22 September 2020
management tools for guaranteeing their long-term profit. Given that the price of electricity and the
Keywords: number of vehicles drive to the CS are random variables, the proposed model should consider all
Electric vehicle these uncertainties. In this paper, the desired model is introduced by utilizing stochastic optimization
Profit framework. Long-term Durable Profit for Charging Station (DPCS) algorithm is proposed to maximize the
Charging station long-term profit of CS owner. By means of the DPCS algorithm, CS owner can decide on the electricity
Stochastic optimization sales price, vehicle entrance and number of working pumps at each time interval. Simulation results
Delay show that the CS owner would have an increase of 107% in profit at a cost of incurring 80% more
Queue
delay to vehicles. If a parking barrier is used in the CS, the achievable profit would be increased by
12% and the waiting delay of vehicles would be decreased by 25%.
© 2020 Elsevier Ltd. All rights reserved.

1. Introduction retailer [3]. It is of much interest to the investors to intelligently

Rapid development of electric vehicle (EV) technology is going
to create a considerable revolution in transportation and electric-
ity industry. The universal EV market was valued at $118,864.5
million in 2017, and is predicted to reach $567,299.8 million
by 2025 [1]. The production of electric vehicles is recognized as
a promising solution to air pollution by reducing emissions of
greenhouse gases [2].
Development of EV technology incorporates a number of new
infrastructural facilities into business. One of the inevitable struc-
tural requirements of EVs is charging stations (CS). Similar to
conventional gas station, CS is a place where EV is plugged to get
charged. A public CS may have one or several charging pumps as
shown in Fig. 1. In fact, EVs might need to recharge their batteries
in daily trips and the assumption that vehicles can always be
charged at home or work place causes practical challenges for
long distance journeys. This has created a new business. Public
CSs similar to gas stations in different locations of city such as
shopping centers and alongside streets and highways is going to
emerge as a subject of personal investment. The CS owner buys
electrical energy from the grid and sells it to the EV owner as a
∗ Corresponding author.
E-mail addresses: erfan710bs@yahoo.com (E. Bagherzadeh),
ghiasian.ali@sku.ac.ir (A. Ghiasian), rabiee@sku.ac.ir (A. Rabiee).
determine the selling price of energy in such a way that their
customers satisfaction is kept at high level while their profit is
also guaranteed. One of the prohibiting factor for securing CS
owner profit is the uncertainty in electricity market price [3],
which is the price that CS owner has to pay to buy electricity from
the grid. A branch of research direction is devoted to predict the
electricity price, e.g. [3–6]. They use different statistical tools to
estimate the future price based on the history of previous market
price databases.
Another approach to deal with the uncertainty in electricity
price is to incorporate the electricity price as a random variable
into mathematical models upon which the results are not relied
on a specific probability distribution function. The complexity
of deciding on energy selling price increases when the energy
purchase price is assumed as a random variable from the owner
of CS viewpoint. But, this approach is much more robust to
environmental impacts on variation of electricity price.
The selling price should not only cover all the costs of CS, but
also guarantee the long-term profit of the CS owner while keeping
customers contentment as well. A business plan in which the
long-term investor profits are guaranteed is more likely to be of
interest.
Not only the price, but also the quality of service is impor-
tant to customers (EV owner is the customer in our proposed
CS model). The customers satisfaction is inversely proportional
to their waiting time in CS [7] which refers to the delay that

https://doi.org/10.1016/j.segan.2020.100391
2352-4677/© 2020 Elsevier Ltd. All rights reserved.
E. Bagherzadeh, A. Ghiasian and A. Rabiee Sustainable Energy, Grids and Networks 24 (2020) 100391

• An stochastic optimization framework has been proposed

to maximize the long-term profit of a CS owner where the
vehicle arrival, energy purchase price and vehicle SoC were
considered as random variables/parameters.
• Taking into account the above-mentioned randomness in
problem formulation, Durable Profit for Charging Station
(DPCS) algorithm has been devised to maximize the long-
term profit of the CS owner.
• It is proved that DPCS algorithm can get as much close to the
optimal solution as desired by adjusting a control parameter.
The trade-off would be longer delay.
Fig. 1. A Charging Station Model. • In the stochastic optimization problem, in addition to the
energy selling price, the owner of CS could control the
number of working charging pumps.
Table 1
Sample information of the EV charging time [8]. • The impact of installing a parking barrier on the attainable
Vehicle Empty to full charging time profit has also been studied.
Model Battery Range 3.7 kW 7 kW 22 kW 43–50
• Simulation results show how the DPCS algorithm works well
slow fast fast kW rapid in real world.
Nissan LEAF 40 kWh 143 11 h 6 h 6 h 1 h
(2018) miles
The paper will proceed with Section 2 presenting a brief literature
review. Section 3 introduces the system model and problem
Tesla Model S 100 kWh 255 27 h 15 h 6 h 2 h
(2019) miles formulation. The proposed DPCS algorithm is also presented in
Section 3. In Section 4 the performance evaluation of the pro-
Mitsubishi 13.8 kWh 24 4 h 4 h 4 h 40 min
Outlander miles posed algorithm is carried out. Finally, the conclusion of the paper
(2018) is presented in Section 5.

customers tolerate from when they arrive at the CS until the time
they leave the CS by a battery full of charge. After arriving at the
CS, the EV may encounter vehicles that have entered the station
earlier and have not yet left it. Thus, the waiting time of a specific
vehicle comprises of two parts:
(a) The queuing time
(b) The time to charge its battery
The former is associated to the charging time of queuing
vehicles in front, while the latter is dependent on the vehicle
model, battery SoC, battery capacity (size), charging rate of vehi-
cle, charging rate of CS pump and environmental factors. Table 1
shows a typical information of EV charging time. The time it takes
to charge an electric vehicle depends on the battery capacity and
the speed (rate) of the charging pumps. The charging time varies
between 40 min to more than 20 h. For example, Tesla Model S
vehicle which is equipped by a 100 kWh battery needs 15 h to get
fully charged with a 7 kW charger. However, if this vehicle plugs
into a rapid charger, the charging time would reduce to 2 h.
Given that the waiting time is not a deterministic parameter
and the attainable profit of the CS owner is closely related to the
customer waiting time, any proposed CS model should consider
these random phenomena into account. Not only is the number
of vehicles in the queue a random variable, but also their SoC and
battery capacity.
As stated above, a number of random variables affect the
business aspect of CS investment. In this paper, the stochastic op-
timization method is applied to maximize the long-term profit of
the CS owner while keeping all the mentioned random variables
into account. The overall mathematical framework for long-term
profit maximization in this paper is established at the presence
of uncertainty in the electricity market price without any prior
assumption on its probability mass function.
Its been shown that, when there are a number of random
events in the system such as the electricity price, the arrival of the
vehicles to the CS and the state of charge (SoC) of each vehicle,
the short time pricing and scheduling strategy for CS, does not
essentially guarantee the long-term profit of CS owner [9]. So, our
main focus in this article is on maximizing the long-term profit.
The contributions of this paper are as follows:
2. Related works
As the electric vehicle industry is growing, the scope of as-
sociated research fields are expanding as well. Some research
studies are dealing with the effect of home plug vehicles on peak
load shaping [10–12] while some others are working to model
the probabilistic movement of EVs and their impact on nodal
charging demand [13]. Vehicle to grid (V2G) terminology is used
in scenarios that EV can discharge its energy to the grid in order to
obtain revenue [14,15]. Smart charging and discharging of EVs in
V2G could have a great impact on vehicle owner profit maximiza-
tion [9,16,17] as well as load balancing [10,18]. However, those
studies does not consider the long-term profit of the CS owner.
Focusing on Quality of Service (QoS) offered to the customers,
[7] has investigated the pricing strategies of maximizing revenue
of CS owner in a charging service market without specifically
looking in to the long term characteristics of the solution. The
QoS is assumed to be inversely proportional to the waiting time
of the customers where M/M/c1 queuing model is used to analyze
the waiting time of the customers. It is remarkable that the
arrival and service time of customers have not been proven to
be respectively Poisson and Exponential processes in practice.
Therefore, this paper is not limited to M/M/c queuing model.
By using fuzzy queuing theory, the impact of EVs charging on
power grid has been studied in [19].
In addition to business and marketing aspects, the emergence
of CS was the motivation for scientist to conduct researches in
other areas related to the EV technology. A branch of studies is
devoted to model the random behavior of EVs and their energy
demands. In [20] an algorithm was proposed that predicts the
number of EVs in a region and the amount of required energy
from CSs. Then according to the forecasting, the location of CSs
has been determined. In this paper, the arrival time of vehicles
to the CS is modeled by a stochastic process that can have any
arbitrary distribution. Then, the proposed model is able to capture
all the random behavior of vehicles.
1 M/M/c refers to a classical queuing model in which the arrival process is
modeled by Poisson, the service time is Exponential random process and the
number of servers is c.

2
E. Bagherzadeh, A. Ghiasian and A. Rabiee
In [21], the optimal location and size of the CS were identified
with an analytical framework aimed at minimizing the total cost
of CS construction. Some more budget and grid constraints as
well as traffic characteristics have been considered in CS localiza-
tion and placement in [22,23]. While the placement of charging
station is of great significance, this paper addresses the problem
of long-term profit optimization, assuming that the localization
studies are performed and the station is built in the right place.
To predict driving behaviors of drivers in an urban area, a large
recorded database of driving cycles have been used in [24], where
charging locations are assumed to be at home or work place. Then
the impact of EV charging on power system has been studied.
The increasing number of EVs in the grid will lead to new peak
demand. In [25], a decentralized charging control system has been
proposed in which the charging process of the EVs are controlled
in a distributed manner with the aim of increasing the number
of simultaneously charging EVs without the need of more grid
capacity investment. Investigating the impact of EVs on power
grid capacity is beyond the scope of this paper.
The charging rate of each EV can be controlled by dynamically
allocating charging power to individual charging connector [26].
To minimize queuing time and to maximize network capacity
utilization, an algorithm has been developed in [26] based on fast
charging capability of the CS.
The business aspect of CS deployment is another emerging
branch of research. The profit maximization problem for CS in-
vestors has been investigated in [27] where stations are equipped
with an energy storage system (ESS). The time horizon of the
proposed bidding framework has considered the day-ahead elec-
tricity market and did not take a long time analysis in to account.
The profit maximization of CS owner has been considered by
dynamic pricing and scheduling of EVs in [17]. The queueing
dynamics was simplified in [17] by assuming that each EV re-
quires a constant charging power. It means that the SoC of the
vehicles are supposed to be a constant value. Another assumption
in [17] is that CS owner is eligible to exclude the head of queue
vehicles from charging after they were waiting a long time in the
queue. This assumption was taken to guarantee an upper bound
for average waiting delay. In this article, the aforementioned
limitations in the problem formulation are not considered.
Instead of CS, a battery swapping station (BSS) was proposed
in [28] for smart microgrid environment and a price-incentive
management policy has been devised to simultaneously maxi-
mize the profit of BSS and to minimize the cost of EVs.
In our previous work, a long-term profit maximization al-
gorithm for CS owner has been proposed in [9]. In that paper,
different charging prices are offered to the EVs in order to provide
an opportunity of ‘‘paying more, waiting less’’ strategy. Then,
customers participate in a bidding strategy providing them an
option to purchase according to their budget. However, in [9] the
amount of required energy for each vehicle is considered as a
constant value which is the same for all vehicles. In practice, not
only the SoC of EVs is a random parameter when they go into
the CS, but the capacity of the batteries are also different which
results in different amount of required energy per vehicle.
In this paper, a different trade-based CS model is proposed in
which the electricity price, the arrival of the EVs and the SoC are
considered as random variables (or parameters) with arbitrary
distribution. To maximize the long-time profit of the CS owner,
stochastic optimization framework is utilized in which the selling
price and the number of working charging pumps are the opti-
mization variables. Unlike the head of queue dropping strategy
in [17], our proposed model investigates the impact of rejecting
a vehicle at the time of its entrance to the CS, on delay and profit.
In other words, the impact of availing automatic parking barrier
on long-term profit and delay is studied. The salient feature of the
proposed method is that, knowledge of future behavior of drivers
and the required charging power does not need to be known a
priory in the proposed model.
3
Sustainable Energy, Grids and Networks 24 (2020) 100391
3. System model
In this section, the system model and formulation of the opti-
mization problem to maximize the long-term profit of CS owner
is introduced.
Consider a CS that has an owner or manager who wants to
buy electricity from the grid and to sell it to EVs. The price of
electricity in the market from the owner’s point of view is a
random process. Fig. 1 shows the proposed CS model.
The SoC of vehicles and their battery capacity are assumed to
be random variables. The amount of electricity power required
by the cars is termed demand. From the CS point of view, cars are
random demands, whose arrival times to the station are random
as well. Time is assumed to be discrete and slotted. In other
words, t ∈ {1, 2, . . . , T } and each time slot is called an interval.
An interval is the minimum amount of time a vehicle may need
to be full charged. The value of demands at interval t is indicated
by a(t). In other words, the sum of all vehicle demands entering
the CS at time interval t is denoted by a(t).
It is assumed that the purchase price, f (t), and selling price,
s(t), will not change within an interval. At the beginning of each
interval, the station declares the price of the sale of electricity to
the vehicles. In addition, the station must decide at the start of
each interval how many of its charging pumps, n (t ), will work.
It should be noted that as more charging pumps are working,
more energy should be purchased from the grid. Another decision
variable is whether the station accepts new vehicle arrival at the
beginning of each interval or not. This variable is represented by
m (t ). Then, the CS owner have three decision variables n (t ) , s(t)
and m(t) to decide on them at each interval.
As stated above, when a vehicle enters the CS, it has a charging
demand according to its SoC. The vehicle demands may not be
served over an interval, due to lack of sufficient resources. To
illustrate the proposed model, let us take an example.
Illustrative Example: Suppose that three vehicles arrived at the
CS with 50, 80 and 100 kWh demands respectively and lets
m (t ) = 1 to make the example simple. In other words, 230
kWh of demand has come to the station at this interval. An
interval duration is supposed to be 1 h. Different demands are
due to different battery capacity, the remaining energy of the
battery and vehicle model (e.g., truck, bus, motorcycle, car, etc.,
See Table 1 as an example). Let us assume that each charging
pump is capable of charging 10 kW, which is a typical moderate
charging rate. For simplicity, assume that demands are multiple
of 10 kWh. Suppose the station decides to use two of its charging
pumps (i.e., n (t ) = 2). Therefore, the charge capacity of the
station at this time interval will be 20 kWh, and two cars can
start their charging at the same time. At the end of the interval,
20 kWh of 230 kWh demand is served, and the remaining 210
kWh must be served at later intervals.
The example above shows that a queue of demands may
be formed due to instantaneous larger arrival rate than system
capacity of charge. The queue of demands is represented with
Q (t). The dynamics of Q (t) over time is as follows:
Q (t + 1) = [Q (t ) − C · n (t )]+ + a (t ) · m(t) (1)
where the constant parameter C is the charging capacity of each
charging pump. In Eq. (1) [X ]+ = max [0, X ]. To see the dynamic
of the system in curse of time, an illustrative sample path of
system processes is shown in Fig. 2 where Q (0) = 0.
In practice, the arrival of vehicles at the CS depends on the
selling price and the length of the queue of the CS. If a station is
too crowded or the selling price of electricity is expensive, vehicle
may refuse entry and may go to another station in the city (See
Fig. 1). To consider this behavior in the proposed model, it is
E. Bagherzadeh, A. Ghiasian and A. Rabiee Sustainable Energy, Grids and Networks 24 (2020) 100391

Table 2
Nomenclature.
Parameter Comment
a(t) Charging demand (kWh)
amax Maximum amount of demand
f (t) Purchase price to electricity market ($/kWh)
C Charging capacity of each charging pump (kWh)
λ Expected value of a(t) (kWh)
V Algorithm parameter
T Number of intervals
K Maximum number of available charging pumps
n(t) Number of active charging pumps
m(t) Binary variable to model parking barrier
s(t) Selling price to vehicles ($/kWh)
Q(t) Queue of demands (kWh)
θ (t) Profit ($)
θ Long term expected profit ($)
ρ The ratio of average arrival rate to the maximum
departure rate

price would be s(t). The architecture of the proposed model is

Fig. 2. An illustrative dynamic of system variables.
assumed that the random process a(t) can have any arbitrary dis-
tribution. The price-sensitive behavior of vehicle owner is studied
in more details in [29].
The selling price (s(t)) is upper bounded by marketing policy
such that customers do not leave the CS because of a very higher
price than other competitors. In addition, for the provided model
to cover a wide range of applications, it is assumed that the
electricity purchase price (f (t)) is also a random variable with any
arbitrary distribution.
3.1. Problem formulation
The profit of the CS owner and its long-term average is calcu-
lated by Eqs. (2) and (3) respectively.
shown in Fig. 1 and its associated optimization problem is to
jointly control the selling price and the number of active charging
pumps to maximize the long-term profit of the owner. The strong
stability [30] of the waiting queue is guaranteed by constraint (5)
where Q̄ is the long term average of demand queue (refer to the
definition of long term average in Eq. (3)). Constraint (6) imposes
that the decision variable m (t ) is a binary variable. Constraint
(7) indicates that the total number of available charging pump
is K . However, the CS owner may decide to use any number of
them. Constraint (8) puts an upper bound on the selling price. The
necessary condition for queue stability is that the upper limit of
the arrival process a(t) should be less than the CS capacity. This
constraint is shown in (9). The letter C refers to charging capacity
of each charging pump. Meanwhile, the maximum power drawn
by the CS from the power grid is C .K .
The list of parameters used throughout the manuscript and
their description is presented in Table 2.
Note that the emerging telecomm technologies provide the
required communication infrastructure such that EVs and CS can
exchange selling price and waiting time information remotely. An
EV can decide to go to a CS which best suits its budget and delay
constraint. Thus, the proposed model and algorithm is applicable
in real world.

θ (t ) = m (t) · a (t ) · s (t ) − C · n (t ) · f (t) (2)

t
3.2. Problem solution
1∑
θ̄ = lim E {θ (τ )} (3)
t →∞ t To solve the optimization problem P0 , the framework of Lya-
τ =1
punov drift plus penalty (d.p.p) technique [30] is used, in which
In Eq. (3), E refers to the expected value. In order to maximize
a parametric algorithm is introduced and is executed at each
long term profit of the CS owner, the subsequent optimization
interval while the stability of queue (Constraint (5)) is guaran-
problem is formulated,
teed. It is proved in Theorem 1 that the optimal solution of P0
Problem P0 : max θ̄ (4) is attainable by adjusting the parameter of the algorithm. The
m(t ),s(t ),n(t)
Lyapunov function and its drift is defined below,
The optimization is subject to constraint (1) and the following 1
ones, Lyapunov function: L [Q (t )] ≜ Q 2 (t) (10)
2
Q̄ < ∞ (5) Lyapunov Drift:
m (t ) ∈ {0, 1} (6) ∆[Q (t )] ≜ E[ {L [Q (t + 1)] − L [Q (t )]}| Q (t )] (11)
n (t ) ∈ {0, 1, . . . , K } (7) If optimization decisions are made every slot t to minimize
0 ≤ s(t) ≤ smax (8) ∆[Q (t )], then queue length is steadily pushed towards a lower
backlog state, which intuitively preserves queue stability.
a (t ) ≤ amax ≤ C · K (9)
So far, the objective function that should be minimized has
It is noticeable that when a vehicle arrives at time interval not yet been introduced. The objective function is incorporated
t, regardless of its departure interval, its electricity purchase by adding an appropriate penalty function to ∆[Q (t )].
4
E. Bagherzadeh, A. Ghiasian and A. Rabiee Sustainable Energy, Grids and Networks 24 (2020) 100391

The penalty function is defined as the negative of profit func-

tion. Then, instead of taking steps to minimize ∆[Q (t )], optimiza-
tion variables are taken every slot t to minimize the following
drift-plus-penalty (d.p.p) expression,
d · p · p = ∆ [Q (t )] − V · E[ θ (t)| Q (t )] (12)
The method of designing the algorithm is to first calculate
an upper bound for the d.p.p . Then an algorithm is designed to
minimize the obtained upper bound at each time interval.
By substituting (10) and (11) in (12) ,
Fig. 3. DPCS Algorithm.
d · p · p = E [ {L [Q (t + 1)] − L [Q (t )]}| Q (t )] (13)
− V · E {m (t ) · a (t ) · s (t ) − C · n (t ) · f (t )}| Q (t )
{ }⏐ bound in (19), two separate and independent terms have to
1 2 1
Q (t + 1) − Q 2 (t ) ⏐⏐ Q (t ) be minimized. That is, after observing Q (t ) , a(t) and f (t ), two
⏐
=E
2 2 separate optimization problems given below should be solved
− V · E {m (t ) · a (t ) · s (t ) − C · n (t ) · f (t )}| Q (t ) concurrently.
The term Q (t + 1) can be replaced by Eq. (1), Problem P1 : min{C .n(t)[V .f (t ) − Q (t )]} (20)
{ n(t)
1
d·p·p=E [max [Q (t ) − C · n (t ) , 0] (14) Problem P2 : min {m (t ) · a(t)[Q (t ) − V · s(t)]} (21)
2 m(t ),s(t)
}⏐
1 Both problems P1 and P2 have threshold-based solution as
+ m (t ) · a (t ) ]2 − Q 2 (t ) ⏐⏐ Q (t )
⏐
2 follows,
Problem P1 Solution:
− V · E{m (t ) · a (t ) · s (t ) − C · n (t ) · f (t )}| Q (t )
if Q (t ) > Vf (t )
{
K
Given the inequality [max [Q − x, 0] + a]2 ≤ Q2 + x2 + a2 + n (t ) = (22)
2Q(a − x) for all Q > 0, a > 0, x > 0 [30], Eq. (14) can be 0 other w ise
rewritten as Problem P2 Solution:
( ) {
1 {
m (t ) = 0
d·p·p≤ · E Q (t) + C · n (t) + m (t ) · a (t )
2 2 2 2 2
(15) if Q (t ) ≥ Vsmax ⇒ (23)
2 S (t ) = Any v alue
+ 2Q (t ) [m (t ) · a (t ) − C · n (t )]
m (t ) = 1
{
if Q (t ) < Vsmax ⇒
( ) }⏐
1
· Q 2 (t ) ⏐⏐ Q (t ) S (t ) = smax
⏐
−
2
To apply Problem P1 and P2 solutions, DPCS algorithm is de-
− V · E{m (t ) · a (t ) · s (t )
vised as follows (see Fig. 3),
− C · n (t ) · f (t )}| Q (t ) The performance of the proposed algorithm has been proved
Noting that n(t) ≤ K and a(t) ≤ amax , then in Theorem 1.
( ) ( )
1 2 2 1 Theorem 1. Given that a(t) and f (t ) are independent and identi-
d·p·p≤ ·C ·K + a2max (16)
2 2 cally distributed (i.i.d.) stochastic processes over time and assuming
+ E [Q (t ) [m (t ) · a (t ) − C · n (t )]]| Q (t ) that Q (0) = 0, the performance gap between the long-term profit
(θ̄ ) achieved by DPCS algorithm and its optimum value (θ ∗ ) comply
− V · E [m (t ) · a (t ) · s (t ) with the following formula:
− C · n (t ) · f (t )]| Q (t )
M
θ ∗ − θ̄ ≤ (24)
By defining M ≜ 12 .C2 .K2 + 12 .a2max Eq. (16) is replaced by
( ) ( )
V
(17).
where M = 2 .C2 .K2 + 2 .a2max is a constant value and V is an
(1) (1)

d · p · p ≤ M + Q (t ) · E [m (t ) · a (t ) − C · n (t )]| Q (t )
+ V · E [C · n (t ) · f (t )]| Q (t )
− V · E [m (t ) · a (t ) · s (t )]| Q (t )
The terms in relation (17) is reordered to form the following
equation,
d · p · p ≤ M + Q (t ) · E [m (t ) · a (t )]| Q (t )
− V · E [m (t ) · a (t ) · s (t )]| Q (t )
− Q (t ) · E [C · n (t )]| Q (t )
+ V · E [C · n (t ) · f (t)]| Q (t )
d · p · p ≤ M + E {m (t ) · a (t ) [Q (t ) − V · s (t )]}| Q (t )
+ E {C · n (t ) [V · f (t ) − Q (t )]}| Q (t )
Now, an algorithm is designed to observe Q (t ) at each in-
terval and minimize the above bound. The optimization vari-
ables are n (t ), m(t) and s (t ). Therefore, to minimize the derived
(17) input parameter to the algorithm which is chosen by the CS owner
in order to make a trade off between customers delay and attainable
profit.
Proof. In order to prove the theorem, it is noticeable that DPCS
algorithm minimizes the right hand side of the inequality (18) at
each time interval. That is, among all the existing algorithms, the
(18) proposed algorithm has the lowest value for the upper bound of
the relation (18). When DPCS algorithm is executed, the upper
bound termed UDPCS . Therefore, the relation (18) is rewritten as
follows,
d · p · p ≤ UDPCS (t) (25)
(19)
According to the stochastic optimization framework [30], the
optimum profit θ ∗ is achievable by (a, f )−only random algorithm,
where (a, f ) − only is a class of algorithms that randomly gener-
ates solution after observing input parameters, a(t) and f (t ). The
solution of this algorithm is called sR (t), mR (t) and nR (t). Then,
5
E. Bagherzadeh, A. Ghiasian and A. Rabiee
there exists an algorithm from the class of (a, f ) − only such that
its execution at each time interval results in the Eqs. (26) and
(27) It is remarkable that the optimum probability distribution
of the (a, f ) − only random algorithm is unknown to us, but its
availability is used here.
E [θR (t )] =
E [sR (t ) · mR (t ) · a (t ) − f (t ) · C · nR (t )] = θ ∗
E[C · nR (t ) − mR (t ) · a (t )] ≥ 0
As the (a, f ) − only algorithm does not depend on Q (t),
Eqs. (26) and (27) can be rephrased as follows,
E [sR (t ) · mR (t ) · a (t ) − f (t ) · C · nR (t )]| Q (t) = θ ∗
E [C · nR (t ) − mR (t ) · a (t )]| Q (t) ≥ 0
Given that our proposed algorithm is chosen among all the
algorithms (including (a, f )− only) in a way that the upper bound
in Eq. (18) is minimized, the following relation is obtained.
d · p · p(t) ≤ UDPCS (t) ≤ URND (t)
where URND is the upper bound achieved by running (a, f ) − only
random algorithm. After substituting Eq. (12) in (18),
∆ [Q (t )] − V · E[ θ (t )| Q (t )]
≤ M + Q (t ) · E [mR (t ) · a (t )]| Q (t )
− V · E [mR (t ) · a (t ) · sR (t )]| Q (t )
− Q (t ) · E [C · nR (t )]| Q (t )
+ V · E [C · nR (t ) · f (t)]| Q (t )
By using Eq. (28), the inequality (31) is rewritten,
∆ [Q (t )] − V · E [ θ (t )| Q (t )]
≤ M − V θ ∗ + Q (t ) · E [mR (t ) · a (t ) − C · nR (t )]| Q (t )
Then, relation (32) is reduced to relation (33) by considering
inequality (29) referring to the negative sign of the last term in
(32).
∆ [Q (t )] − V · E[ θ (t )| Q (t )] ≤ M − V θ ∗
Inserting definition (11) in (33) results in
E[ {L [Q (t + 1)] − L [Q (t )]}| Q (t )] − V · E[ θ (t )| Q (t )] ≤ M − V θ ∗
Now by utilizing the law of iterated expectation,
E{L [Q (t + 1)] − L [Q (t )]} − V · E[θ (t )] ≤ M − V θ ∗
The relation (35) is correct for all t, so that by incorporat-
ing telescoping sum technique as defined in [30], the following
inequality is obtained,
D−1
∑ Long Run: First, the impact of parameter V on average queue
E {L [Q (D)] − L [Q (0)]} − V · E [θ (τ )] ≤ D · (M − V θ ∗ ) (36)
τ =0
By dividing both sides of (36) by D.V and noting that L [Q (0)
= 0], it is given that
D−1
E {L [Q (D)]} 1 ∑ M can be justified by looking into Eq. (12). The parameter V has the
− · E [θ (τ )] ≤ − θ∗
D·V D V
τ =0
The inequality (37) can be rephrased in (38) because E {L [Q
(D)]}>0,
D−1
1 ∑ M more demand should be backlogged in the queue to turn on
· E [θ (τ )] ≥ θ ∗ −
D V
τ =0
Now, by taking the limit as D → ∞, the proof completes.
Sustainable Energy, Grids and Networks 24 (2020) 100391
4. Performance evaluation
In this section, the performance of DPCS via different simula-
tion setups is evaluated.
4.1. Simulation setup
(26)
All of the simulations have run for T = 10, 000 time intervals,
(27) unless otherwise stated. The duration of a time interval is set to 1
h. To model different battery types, three kinds of battery with 40,
60 and 85 kWh capacity are considered. Each incoming vehicle’s
battery is randomly chosen among the above-mentioned types.
(28) In practice, vehicles with lower remaining charge (SoC) are more
likely to go to the CS. To consider this behavior, it is assumed
(29) that assume that the SoC of 70% of arrival vehicles are randomly
chosen from interval (0,30) percent while the remaining 30% have
their SoC in the range (31,80) percent of full charge. Vehicles
with above 80% battery charged would not drive to the CS. The
value of C and K are set to 12.5 kWh and 10 respectively and
(30) thus CSmax would be 125 kWh. Demand arrival is assumed to be
a stochastic process with uniform distribution with average λ. The
necessary condition for keeping the queue stable is that the ratio
of average arrival rate to the maximum departure rate must be
(31) less than one. This value is termed ρ and obviously ρ = Kλ.C . The
horizontal axes in simulation figures is set to ρ which is changed
by altering the value of λ. The purchase price f (t) is randomly
chosen from the set {12, 14, 16, 18, 20} and smax = $20.
4.2. Simulation results
In order to see the logic of the proposed DPCS algorithm, a
(32) short trace simulation results for ten step-by-step intervals is
evaluated first. Then, the long-term performance of the algorithm
has been evaluated.
Short Trace: Initially, the simulation results for ten consecutive
time intervals have been recorded to see the behavior of the
algorithm in a short time random trace. For this setup, ρ =
(33) 0.5, C = 12.5 kWh, V = 10 and K = 10. The outputs are shown
in Table 3, where the results of running DPCS algorithm, i.e., n (t ) ,
m(t) and s(t) are distinguished by bold font in three columns at
the center. If Q (t ) − Vf (t ) > 0 then n(t) is set to its maximum
value and if Q (t ) − VSmax > 0 then m(t) is set to zero. These
(34)
two conditions intuitively means that when the demand queue
grows up, the system should work by its maximum capacity
and no more arrival is allowed to reduce the vehicle congestion.
(35) The attainable profit is negative at time intervals that no vehicle
arrival occurs because CS have to buy electricity for charging
previously entered vehicles in the queue, while it gains no money
as no vehicle is allowed to enter.
length and on average profit is presented. Average queue length
represents the average delay of vehicles by little law [30]. Fig. 4
shows the average queue with respect to the incoming load
ρ . As it is observed, increasing the amount of V causes more
congestion in demand queue for any amount of ρ . This behavior
(37) role of weighting factor in drift plus penalty (d.p.p) optimization,
where the optimization target is to minimize the sum of queue
drift and to maximize the profit (or equivalently minimize the
negative form of profit) at the same time. This action can be
seen in relation (22) as well. By increasing the amount of V ,
(38)
the charging pumps. This leads to more average queue length.
Instead, an increase in parameter V results in more profit as
■ demonstrated in Fig. 6.
6
E. Bagherzadeh, A. Ghiasian and A. Rabiee Sustainable Energy, Grids and Networks 24 (2020) 100391

Table 3
Short trace simulation results.
T a(t) f (t ) Q (t) θ (t ) n(t) m(t) S(t) Q (t ) − V .f (t) Q (t ) − V .Smax
1 119 16 0 2380 0 1 20 −160 −200
2 85 14 119 1700 0 1 20 −21 −81
3 98 18 204 −2250 10 0 0 24 4
4 25.28 16 79 505.6 0 1 20 −81 −121
5 89.76 14 104.28 1795.2 0 1 20 −35.72 −95.72
6 46.56 18 194.04 −1318.8 10 1 20 14.04 −5.96
7 39.84 14 115.6 796.8 0 1 20 −24.4 −84.4
8 46.56 20 155.44 931.2 0 1 20 −44.56 −44.56
9 15.36 16 202 −2000 10 0 0 42 2
10 170 14 77 3400 0 1 20 −63 −123

Fig. 4. The impact of parameter V on average queue length in DPCS algorithm.

Fig. 5. The impact of parameter V on average profit in DPCS algorithm.

As it was expected, growing of ρ results in more queue con-
gestion and more profit as well. This is because the vehicle arrival
rate is increased and the capacity of CS is constant. Therefore,
more vehicles have to wait in the queue before they get charged.
More vehicles entering to the CS leads to more profit.
Now, the performance of the DPCS algorithm is evaluated in
comparison with the two reference algorithms obtained from our
proposed solution. The reference algorithms are similar to DPCS
except in a decision variable. In one of them, m (t ) is set to one
all the time. In fact, it removes the entrance control variable
7
and allow all the vehicles to move in to the CS. In the other
baseline algorithm, it is assumed that the number of charging
pumps is fixed. The two reference algorithms are called FreeArv
(referring to Free Arrival) and AllPmpOn (referring to All Pump
On) respectively. The parameter V is set to 100 in the following
simulation setups. Fig. 6 shows the average queue length of
demands. Noting that ρ = Kλ.C , to increase ρ , the average of λ
should be increased. As the incoming load becomes larger, the
delay increases in all algorithms (by little law [30]). When there
is no control over the number of working pumps, it is assumed
E. Bagherzadeh, A. Ghiasian and A. Rabiee Sustainable Energy, Grids and Networks 24 (2020) 100391

Fig. 6. Average demand queue length versus charging demand. Fig. 7. Average Profit versus charging demand.

that all of them are working all the times (i.e., n (t ) = K , all
the time). Obviously, in such a scenario that is termed AllPmpOn,
less average queue is observed as shown in Fig. 6. The reason is
that the CS is working by its maximum service rate when all the
pumps are On. Therefore, the cars receive their charge in less time
and leave the station. However, Fig. 7 illustrates that AllPmpOn
strategy constitutes larger cost and less profit compared to DPCS
and FreeArv approaches. The reason is that regardless of the
purchase price, the station owner should buy electricity from the
grid at all time intervals.
In case there is no control over vehicle arrivals and the parking
barrier is always open (i.e., m (t ) = 1 all the time in problem
formulation), the queue length grows more often as shown in
Fig. 6 by FreeArv marker. Then the average queue length is more
than AllPmpOn scheme. The attainable profit of FreeArv is higher
than AllPmpOn. It is because despite of AllPmpOn, in FreeArv Fig. 8. The superiority of DPCS algorithm to the FreeArv algorithm.
policy the number of running pumps and thus the electricity
purchase decision is a controllable parameter. For this reason,
in solving the optimization problem, some charging pumps are
turned off when the price of electricity is high. This strategy leads
to more profit in cost of more vehicle delays. In DPCS algorithm, it
is possible to control both arrivals and number of working pumps.
Therefore, by suffering a moderate delay, more profit is attainable
as depicted in Fig. 7. As demonstrated in Figs. 4 and 5, the DPCS
approach is able to balance the delay and profit by adjusting the
value of V.
Simulation results show that DPCS algorithm outperforms
FreeArv in terms of profit and delay. In Fig. 8 it is observed
that DPCS achieves 12% more profit on average. Its average delay
is 25% less than FreeArv. It is inferred from simulations that
DPCS outperforms AllPmpOn in terms of profit, but AllPmpOn
is superior to DPCS in terms of delay. Fig. 9 demonstrates the
superiority of DPCS in percentage for all the demand loads. The
attainable profit of DPCS is 107% more than AllpumOn while it Fig. 9. Comparison of DPCS and AllPmpOn algorithms.
causes 80% more delay to vehicles on average.

5. Conclusion
In this paper, a combination of commercial and technical
model for electrical vehicle charging stations has been proposed
with the aim of maximizing the long-term profit of CS owner.
To consider the random parameters such as electricity price and
vehicle arrival, a stochastic optimization problem has been devel-
oped for the model. In the proposed model, vehicles have to wait
in a queue before they get charged. By utilizing Lyapunov Drift
analysis, an algorithm called DPCS was developed to solve the
optimization problem. It is proved that DPCS achieves close-to-
optimal performance. By applying DPCS algorithm, CS owner can
8
decide on the electricity sales price, vehicle entrance and number
of working pumps at each time interval. Simulation results show
that the CS owner can achieve any desired profit value (as long as
this value is less than the proven optimal one) by using a parking
barrier and by controlling the number of working pumps in cost
of imposing more average delay to customers. This trade-off is
finely adjustable by the algorithm parameter V. It is demonstrated
that the CS owner would have an increase of 107% in profit at a
cost of incurring 80% more delay to vehicles. If a parking barrier
is used in the CS, the achievable profit would be increased by 12%
and the waiting delay of vehicles would be decreased by 25%.
E. Bagherzadeh, A. Ghiasian and A. Rabiee Sustainable Energy, Grids and Networks 24 (2020) 100391

Declaration of competing interest [15] H. Zhang, Z. Hu, Z. Xu, Y. Song, Evaluation of achievable vehicle-to-grid
capacity using aggregate PEV model, IEEE Trans. Power Syst. 32 (1) (2017)
784–794.
The authors declare that they have no known competing finan-
[16] A. Alavi Eshkaftaki, A. Ghiasian, A. Rabiee, Smart charge and discharge
cial interests or personal relationships that could have appeared scheduling of electric vehicle (EV) to maximize the profit of EV owner,
to influence the work reported in this paper. Univ. Isfahan 8 (3) (2017) 75–82.
[17] Y. Kim, J. Kwak, S. Chong, Dynamic pricing, scheduling, and energy
References management for profit maximization in PHEV charging stations, IEEE Trans.
Veh. Technol. 66 (2) (2017) 1011–1026.
[18] Q. Wang, X. Liu, J. Du, F. Kong, Smart charging for electric vehicles: A
[1] R. Kumar, Electric vehicle market size, share; growth | industry fore-
survey from the algorithmic perspective, IEEE Commun. Surv. Tutorials 18
cast 2025, Allied Mark. Res. (2019) [Online]. Available: https://www.
(2) (2016) 1500–1517.
alliedmarketresearch.com/electric-vehicle-market (Accessed 18 May 2019).
[19] E. Munoz, E. Ruspini, Using fuzzy queuing theory to analyze the im-
[2] W.J. Requia, M. Mohamed, C.D. Higgins, A. Arain, M. Ferguson, How clean
pact of electric vehicles on power networks, in: 2012 IEEE International
are electric vehicles? Evidence-based review of the effects of electric
Conference on Fuzzy Systems, 2012, pp. 1–8.
mobility on air pollutants, greenhouse gas emissions and human health,
[20] A.Y.S. Lam, Yiu-Wing Leung, Xiaowen Chu, Electric vehicle charging station
Atmos. Environ. 185 (2018) 64–77.
placement: Formulation, complexity, and solutions, IEEE Trans. Smart Grid
[3] K. Zare, S. Nojavan, B. Mohammadi-Ivatloo, Optimal bidding strategy of
5 (6) (2014) 2846–2856.
electricity retailers using robust optimisation approach considering time-
[21] Z. Liu, F. Wen, G. Ledwich, Optimal planning of electric-vehicle charging
of-use rate demand response programs under market price uncertainties,
stations in distribution systems, IEEE Trans. Power Deliv. 28 (1) (2013)
IET Gener. Transm. Distrib. 9 (4) (2015) 328–338.
102–110.
[4] F. Ziel, R. Steinert, Electricity price forecasting using sale and purchase
[22] A. Rajabi-Ghahnavieh, P. Sadeghi-Barzani, Optimal zonal fast charging
curves: The X-model, Energy Econ. 59 (2016) 435–454.
station placement considering urban traffic circulation, IEEE Trans. Veh.
[5] R. Weron, Electricity price forecasting: A review of the state-of-the-art
Technol. (2016) 1.
with a look into the future, Int. J. Forecast. 30 (4) (2014) 1030–1081.
[23] Z. Sun, X. Zhou, J. Du, X. Liu, When traffic flow meets power flow: On
[6] F. Ziel, Forecasting electricity spot prices using lasso: On capturing the
charging station deployment with budget constraints, IEEE Trans. Veh.
autoregressive intraday structure, IEEE Trans. Power Syst. 31 (6) (2016)
Technol. 66 (4) (2017) 2915–2926.
4977–4987.
[24] S. Shahidinejad, S. Filizadeh, E. Bibeau, Profile of charging load on the grid
[7] Binyan Zhao, Yi Shi, Xiaodai Dong, Pricing and revenue maximization for
due to plug-in vehicles, IEEE Trans. Smart Grid 3 (1) (2012) 135–141.
battery charging services in PHEV markets, IEEE Trans. Veh. Technol. 63
[25] R. Torabi, C. Sabino, A. Gomes, Development of an algorithm to control and
(4) (2014) 1987–1993.
optimize the coordinated charging process of a group of electric vehicles,
[8] PodPoint, How long does it take to charge an electric car? | pod point, Pod-
in: Smart SysTech 2014; European Conference on Smart Objects, Systems
Point (2019) [Online]. Available: https://pod-point.com/guides/driver/how-
and Technologies, 2014, pp. 1–5.
long-to-charge-an-electric-car (Accessed 03 Jun 2019).
[26] F.H. Malik, M. Lehtonen, Minimization of queuing time of electric vehicles
[9] A. Rabiee, A. Ghiasian, M.A. Chermahini, Long term profit maximization
at a fast charging station, in: 2017 IEEE PES Innovative Smart Grid
strategy for charging scheduling of electric vehicle charging station, IET
Technologies Conference Europe (ISGT-Europe), 2017, pp. 1–6.
Gener. Transm. Distrib. 12 (18) (2018) 4134–4141.
[27] M.R. Sarker, H. Pandžić, K. Sun, M.A. Ortega-Vazquez, Optimal operation of
[10] G. Binetti, A. Davoudi, D. Naso, B. Turchiano, F.L. Lewis, Scalable real-time
aggregated electric vehicle charging stations coupled with energy storage,
electric vehicles charging with discrete charging rates, IEEE Trans. Smart
IET Gener. Transm. Distrib. 12 (5) (2018) 1127–1136.
Grid 6 (5) (2015) 2211–2220.
[28] M. Zhang, J. Chen, The energy management and optimized operation of
[11] S. Shao, M. Pipattanasomporn, S. Rahman, Demand response as a load
electric vehicles based on microgrid, IEEE Trans. Power Deliv. 29 (3) (2014)
shaping tool in an intelligent grid with electric vehicles, IEEE Trans. Smart
1427–1435.
Grid 2 (4) (2011) 624–631.
[29] Y. Zhang, P. You, L. Cai, Optimal charging scheduling by pricing for EV
[12] N.G. Paterakis, O. Erdinc, A.G. Bakirtzis, J.P.S. Catalao, Optimal household
charging station with dual charging modes, IEEE Trans. Intell. Transp. Syst.
appliances scheduling under day-ahead pricing and load-shaping demand
20 (9) (2018) 3386–3396.
response strategies, IEEE Trans. Ind. Informatics 11 (6) (2015) 1509–1519.
[30] M.J. Neely, Stochastic network optimization with application to communi-
[13] D. Tang, P. Wang, Probabilistic modeling of nodal charging demand based
cation and queueing systems, Synth. Lect. Commun. Networks 3 (1) (2010)
on spatial-temporal dynamics of moving electric vehicles, IEEE Trans.
1–211.
Smart Grid (2015) 1.
[14] T. Mao, W. Lau, C. Shum, H.S.-H. Chung, K.-F. Tsang, N.C.-F. Tse, A regulation
policy of EV discharging price for demand scheduling, IEEE Trans. Power
Syst. 33 (2) (2018) 1275–1288.