E-mobility: How electric dreams come true

Global trends in electric vehicle uptake and infrastructure

Over the past few months, I have worked on various projects about the future of road transportation and alternatives to the internal combustion engine. These include a series of reports on the development of public charging infrastructure for battery electric vehicles (EV) and the product launch for a specialist lubricant designed for hybrid electric vehicle (HEV) engines. These projects underline the changes sweeping through the automotive industry. What is driving these changes? And what can we expect to see between now and 2025?

For several years, some of the biggest names in the automotive industry have been pouring vast sums of money into research and development projects for electric car production. Over the next 12 to 18 months, the public will start to see the results of these investments with the unveiling of an impressive selection of new EVs in market segments ranging from city to sports cars and SUVs. Rapid growth in the sales of EVs and HEVs means that these will account for more than 30% of all vehicle sales by 2025.

Lessons from Norway and China

In 2018, Norway’s EV sales rose to a record 31.2% market share, far ahead of any other nation; producers are struggling to keep up with demand. Norway is well-positioned to reduce carbon dioxide emissions by a transition to EVs: the country generates nearly all its electricity from hydroelectric power plants. It helps that the standard of living in Norway is one of the highest in the world: many of the nation’s citizens can afford a new electric car.

The incentives help too. For years, Norwegians who opted for zero-emissions cars enjoyed a huge range of benefits, including an exemption from sales, import and road taxes. Until recently, emission-free vehicles could park for free and were excused all toll and ferry charges. Those policies have changed, but owners of electric vehicles still enjoy a 50% reduction for tolls and parking.

In China, one of the main drivers for the rise of electric transportation is the need to combat air pollution in urban areas. China leads the world in terms of the production and sales of electric cars. By 2020, the country is expected to account for almost 60% of global sales. The rise of mini-EVs with small battery packs for short-range driving (100–150 km) has played a key role in this. In 2020, EV production in China is expected to hit 2.5 million units. The principal drivers include

  • Rapid reductions in the cost of batteries: battery prices are falling by 15–20% each year as production increases. By 2020, compact EVs produced in China will be available at a cost similar to cars with internal combustion engines.
  • A rapidly developing charging facility network: the State Council’s 2020 target calls for 4.5 million charging posts and 12,000 charging stations
  • Public transport policies: China’s local government policy requires 30% of all new buses to be electric powered.

 

What does it mean for consumers?

In the past, purchase costs for EVs were seen as prohibitively high. The emergence of compact models such the Nissan Leaf and the Renault Zoe, which are relatively low cost and offer very respectable ranges of 250–300 km, is changing this perception. Ongoing range improvements are extending the market for EV ownership from passionate early adopters to mainstream customers. The range for the 2019 model of the Nissan Leaf, for example, is about the weekly mileage of a typical EU customer.

As the use of EVs grows, charging infrastructure needs to match it and banish the range anxiety that plagues EV drivers. In this market, the main challenge for energy and fuel retailers is to provide simple, reliable and fast charging facilities for drivers who are charging their vehicle at home or on the go. In Europe, utilities and oil majors are emerging as the main players in this market. In the UK, for example, BP has entered the EV charging market with its acquisition of Chargemaster, while Shell is modifying existing fuelling sites to accommodate electric vehicles and offering electricity from 100% renewable sources.

The end of the internal combustion engine is in sight. The future of personal transportation is electric. Advances in battery technology, higher vehicle ranges, lower purchase costs and adequate charging infrastructure are already making electric dreams come true.