Over the next 30 years we will see automobiles fully electrify. Gas emissions produced by traditional cars are poisoning the air that we breathe: in big cities the situation is critical. We need to change, and electrified vehicles is the solution. But which one: Battery or Hydrogen?
Energy efficient, battery-powered cars will, by 2025, be cheaper to buy than conventional, gasoline-powered cars.
Bloomberg New Energy Finance recently reported that the price of the zero emission cars is largely due to falling battery costs. The report says that “batteries currently account for about half the cost of EVs, and their prices will fall by about 77 percent between 2016 and 2030.”
Automaker Renault predicts ownership costs of electric vehicles will, by the early 2020s, equal that of conventional gas-powered vehicles.
The report also noted that by 2025 14% of new car sales, or 100 million electric cars globally, will be electric vehicles.
For fleet operators, this is good news. In 2014, greencarreports.com reported that electric vehicle fleets could save operators an average of $16,000 each, compared to the traditional vehicles over a service life of seven years. Now, the cost savings is clearly larger.
One of the challenges, however, with electric vehicles is total energy demand. The energy demand created by fully charging an electric vehicle (EV) can be as high as total domestic electricity consumption for one household, albeit more concentrated over particular periods of the day as well as geographical areas.
The latest study by McKinsey* et al (Electrifying insights: How automakers can drive electrified vehicle sales and profitability) claim around 2030 or so, EVs will be price competitive with conventional cars, which was based on sound data.
The report states that consumer demand is starting to shift in favor of slightly. While more than 20 per cent of new car shoppers think about buying a new battery-powered electric car, less than 0.5 per cent actually does buy.
There is still a battery barrier.
The 2016 estimated pack cost of ~$227/kWh means that a 60 kWh battery becomes a $13,600 component of the car. We may have to wait between 2025 and 2030, when battery pack costs fall below $100/kWh, creating financial headwinds for Battery Electric Vehicles (BEV) automakers. That’s a cost saving of $5,000 per car.
Relying on increasingly large lithium ion batteries to assuage range anxiety is not a practical long-term solution to eliminating greenhouse gases. Electric-powered automobiles are not a bad idea; pure battery-powered BEVs are a bad idea.
It’s going to take more than just cheap lithium ion to bring about the end of the internal combustion engine. Building an infrastructure to service this type of technology when there are quicker and more efficient recharging models available is a monumental waste of money.