Electric Cars May Not Be Cost-Competitive Til 2030. Let's Think Beyond the Car.


Image credit: Low Carbon Vehicle Partnership

I've argued before that going solar is about way more than just money, but nevertheless news that solar price parity with coal is close in parts of Europe is extremely hopeful news for clean energy advocates. The moral and cultural case can only go so far—but when economics kick in, the mainstream is bound to listen. The same could be said for electric cars—while advocates rave about the driving experience and low running costs, it seems fair to assume that they will gain most widespread adoption once they make economic sense for your average driver. Unfortunately, the point when that happens could be a very long way off, if a new report from the UK's Low Carbon Vehicle Partnership is anything to go by. Public-Private Partnership for Low Carbon Vehicles
As the name suggests, the report entitled Influences on the Low Carbon Car Market from 2020 to 2030 (PDF) is not focused purely on battery electric vehicles. Rather, it was commissioned by the UK's public-private Low Carbon Vehicle Partnership (LCVP), a group made up of over 200 organizations from various backgrounds including automotive and fuel supply chains, vehicle users, academics and civil society, to establish which technologies have the best chance of contributing to the ambitious, world leading near-term carbon reduction goals set out by the UK government.

Battery Electric Vehicles Will Remain Expensive
Focusing largely on the Total Cost of Ownership (TCO), excluding any government incentives or other grants, the report finds that in the near-term the cost differential between plug-in hybrids and pure battery-electric vehicles, compared to their conventional, hybrid and biofueled counterparts is likely to remain significant for some time to come:

The ICE and hybrid vehicles have the lowest TCOs. The spread of their TCOs are much smaller than the alternative vehicles as there is much more certainty about the capital costs of these vehicles. All of the alternative vehicles have a wide distribution on possible TCOs, particularly the EV where battery costs are the biggest contributor to the total vehicle cost.

Insurance Is An Increasingly Significant Cost
By 2030, the gap is expected to narrow considerably, and the report suggests that Plug-in Hybrids (PHEVs) will actually be the most cost effective means of reducing tailpipe emissions. Interestingly, it also suggests that insurance costs will be an increasingly significant factor in all vehicles overall cost of ownership, and if unconventional power trains command significantly higher insurance payments, this could seriously impact their viability.

The Future Price of Oil?
Of course the future cost of fuel is a huge unknown in this whole scenario. The report does include a scenario in which fuel prices double, which would see the cost differences greatly reduced—but talking to Greg Archer, Managing Director of the LCVP, The Guardian reports that he sees the likelihood of nearer term price parity as pretty slim:

He added there was a very small chance that electric cars and other alternatively fueled vehicles would become competitive by 2020, but said that was around a one in 20 likelihood. "Major technology takes a couple of decades before it receives parity with current technology," said Archer.

One has to wonder, of course, given the IEA's warnings over Peak Oil and increasing recognition of the true cost of gasoline (and the related pressure for legislative means to correct it), whether a doubling of fuel prices is all that far fetched. But either way, this is a useful reminder that we can't focus the effort for carbon reduction on any one technology or strategy and, crucially, that we have to think beyond the car if we want to get immediate cuts in transportation emissions.

Think Outside the Car
While battery electric vehicles may be a key part of our future mobility, cheap bus travel, bike commuting, car sharing and working from home are all more than cost competitive right now. Why wait for technological innovation when cultural innovation is here already?

More on Electric Vehicles and PHEVs
Finally! Volvo's AWD Diesel Plug-In Hybrid. But Not for America. (Video)
4000+ Nissan Leaf's Sold in US
Toyota to Bring Electric Version of Scion IQ to US in 2012

Tags: Electric Cars | Oil | Peak Oil | Transportation | United Kingdom | United States

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