Simply Automotive Sales

[Magdalen Dano]

The world has a strange infatuation with cars. That is part of the reason why the electric car has become the poster child for the fight against climate change, despite its rather limited potential to avoid CO2 emissions.

Behind the rapid growth in battery electric vehicle (BEV) sales lie a wide range of supporting policies. And behind these policies are governments that want to tap every last bit of marketing value from this highly visible climate action poster child. This is why pure BEV companies are now worth as much as the entire legacy auto industry, even though these companies (mainly Tesla) sell only about 1% of global light-duty vehicles.

This article will cover ten fundamental problems with BEVs as a leading climate change mitigation option. The aim is not to discredit electric cars as a sustainable technology (they can certainly avoid CO2 and reduce fossil fuel dependence). Instead, this article aims to illustrate the huge disconnect between the ongoing BEV investment boom and the questionable societal benefit of the technology.

Enthusiasts like to equate the rise of the electric car with the rise of the car itself. A little over a century ago, mass-produced automobiles quickly displaced horses as the primary mode of transport. This is not surprising as the car is a superior transportation medium in almost every way.

Back to our analogy, BEVs are just heavier and shinier horses that eat smaller quantities of a more expensive and (mostly) cleaner feed. The real horse-banishing automobiles in this analogy are the twin forces of virtual mobility and human-oriented city design.

Just imagine living in a neighbourhood where the car-filled streets are replaced by peaceful walkways and cycle paths lined with greenery. Every service your household needs is within easy walking/cycling distance, and there are happy and friendly neighbours all around. Thus, even though you love working and playing virtually in the ever-expanding metaverse, your physical environment remains so attractive that you naturally spend lots of time outside in the sun, interacting with real humans.

Yes, transitioning from our current car-centred reality to such a high-tech human-oriented future has its challenges. But this does not justify our current trajectory of patching an expensive BEV band-aid over our massive car problem. Indeed, a global transition to human-friendly cities will take care of all the problems BEVs aspire to solve as well as many much more severe problems they never can.

The first of these niches is the suburban commuter, where a BEV with a relatively small battery pack is a compelling solution (especially for two-car families). I updated my earlier estimate of the total societal costs of the car commuter philosophy and arrived at a whopping $23,100/year (see below). This is about half the average wage of rich-world citizens. If we assume a worker creates about twice as much value as his salary, it means that about a quarter of the value created by the average commuter is cancelled by the costs of the (stressful and frustrating) model of getting to work.

Other forms of urban car transport are no better. Consider one of the most iconic symbols of a car-centred society: the supermall. People haul their 2.5-ton SUVs many miles to this structure to go and pick up 0.05 tons of stuff (much of it being wasteful impulse buys). Another highly ironic use-case for the urban SUV is burning 15,000 kcal of fuel to go and burn 500 kcal of fat by running like a hamster on a treadmill in a distant gym.

On the positive end of the competitiveness spectrum is the suburban commuter car. These vehicles can get away with small battery packs, do all their driving in stop-and-go city traffic where electric drive excels, and operate exclusively on cheap slow charging at home.

On the other end, we have niches like unstructured, long-distance journeys for holidays or business. These vehicles need large battery packs, do most of their driving on highways where the ICE is at its best, and rely more on public chargers (which can easily cost more than gasoline).

The main drivers of lost BEV competitiveness when moving from left to right in the graph are the need for a larger battery pack, the increase in average electricity costs from more public charging, and a narrowing efficiency advantage on the highway.

Another common misconception, illustrated by the graph below, is that BEV competitiveness will rapidly improve over the coming years. In fact, the most dramatic battery cost declines are already behind us, and hybrid technology has plenty of headroom for further development (see Notes).

Charge times and charge point availability are the next issues. DC fast-charging infrastructure has come a long way, but even modern fast chargers at 350 kW are sluggish relative to 20,000 kW from a standard gas pump (10 gallons per minute).

More importantly, the ubiquitous availability of very fast chargers at a reasonable cost will remain problematic. The issue is not so much the cost of the charging infrastructure itself, but rather the cost of the grid connection required for very high charging speeds.

A single 350 kW charger needs a grid connection equal to about 70 homes. Even in the city, a connection to the distribution network costs about $75/kW/year, which translates into a levelised cost of $86/MWh at a 10% utilisation factor. When looking at a remote location, this cost would be several times higher because of the need for large upgrades to long transmission and distribution lines. Utilisation factors may also be considerably lower, adding another cost multiplier.

Similar to wind and solar power covered in an earlier article, BEVs are much more material-intensive than their ICE counterparts. As shown below, BEVs require about 6x more critical minerals than conventional cars.

This high material intensity also brings end-of-life concerns. If BEVs are to be sustainable, a highly efficient recycling industry will need to boom while the mining industry busts around mid-century to prevent serious environmental impacts from battery waste. This will be challenging. There are good reasons why only about 5% of Li-ion batteries are recycled despite their high content of valuable materials like cobalt. As battery chemistries move away from expensive materials (especially cobalt), profitable recycling will only become more challenging.

BEVs are often portrayed as good complements to variable and non-dispatchable wind and solar generators. After all, if the BEV can charge during times of excess wind and sun, it could access cheaper electricity and help integrate more renewables. It could even discharge when there is little wind and sun to generate some revenue.

Unfortunately, there are several problems with this idea. First, implementing such weather-dependent charging and discharging at no inconvenience to the car owner will be very difficult. The only practical option I see is to oversize the battery to reserve a certain excess capacity for such grid services. But this means that people need to buy cars with larger batteries than they need, creating a substantial cost.

Next, wind and solar each present their own challenges. Wind simply varies too irregularly over too long timescales to be a practical option for smart charging. Exploiting such wide-ranging variations effectively will also require unnecessarily large battery packs. Solar, on the other hand, is inherently misaligned with prime charging time: the middle of the night.

The synergy illustrated above makes BEVs (and plug-in hybrids) ideal for integration into a baseload (e.g., nuclear) electricity system. Everyone can conveniently charge their cars at night when demand and prices are low, thus allowing the power plants to operate at a higher capacity factor to lower electricity costs. In addition, charging only during off-peak hours avoids the need for costly grid expansions.

Indeed, grid expansion is another big challenge for BEV grid integration. Since BEVs will charge from the low-voltage distribution network, their power needs to flow through hundreds of miles of transmission and distribution lines (and several substations). If they increase the peak system load (as would certainly be the case for solar charging), the required grid upgrades will quickly erode any economic benefits.

All told, nuclear advocates can certainly claim good synergy with BEVs, but wind and solar advocates cannot. This challenges the notion that electric vehicles can be a leading driver of electrification in a renewables-dominated future where electricity grows far beyond its relatively small share of the current energy mix.

Several countries have announced imminent bans on ICE vehicle sales to comply with this narrative (and to exploit the climate action poster child mentioned in the introduction). Since BEVs are the most mature non-ICE technology option, such strict timelines make them the only viable option in such a scenario. Hence, the BEV investment boom.

In such a scenario, the old ICE still has a lot to give, halving fuel consumption. If urban driving is largely displaced by human-oriented city design and virtual mobility (see Problem 1), fuel savings can be even greater as driving happens mostly on the highway where the ICE is at its best.

As illustrated below, hybridised ICE drivetrains can cut global passenger transportation CO2 emissions by more than half. BEVs applied in their best niches, gasoline blends with lower-carbon fuels, and fuel cell vehicles could halve emissions again, reducing the global total below 1 Gton/year.

c80f0f1006