Finally as the first mass marketed EVs arrive on the streets and the hype is big. While predictions by policy makers and industry representatives at numerous events around the world are optimistic, the expert meeting in Pasadena at the 11th Advanced Automotive Battery Conference draws a more sober (or more realistic?) picture.
Find below a first overview of presentations and the point of views expressed by Menahem Anderman from ABB, Tom Cackette from the California Air Resources Board, and John German from the International Council on Clean Transportation.
Dr. Anderman started his presentation by noting what he terms a poor “value proposition” for electric vehicles, citing several limitations compared to internal combustion engine vehicles. The unsubsidised breakeven business case for EVs in the US, Anderman believes, is $7 per gallon fuel price.
In the U.S., the market share of EVs is small and mainly driven by California's CARB. PHEVs manage to secure a slightly bigger share but the motivating factor is again the CARB mandate, applied also beyond California's borders. In general will the federal government's EV policy, existing and new incentives as well as the prospect of a carbon tax play a key role in the promotion of electric vehicles. A second key factor that will have a considerable commercial impact, is battery life and the level of end-of-life performance will be required of batteries to guarantee further credits.
The European market's higher fuel costs, the tendency to smaller cars and the higher percentage of city driving the other hand make it more susceptible to electric mobility than the U.S. The European Union is furthermore issuing ever stricter regulations on CO2 emissions from road traffic and some member states push the EV agenda. However, history has shown that the political will is not always enough. Nonetheless, European automakers are developing a full array of electrified vehicles from micro-hybrids to full electric vehicles.
In the 3rd and probably the most promising EV market China, the government holds the key to the market development of EVs. Contrary to the U.S. and Europe, EVs are easier to produce for Chinese car makers than HEVs. Also the lower reliability threshold in the Chinese market is in the short-term an advantage, although reliability and durability of electric vehicles are paramount for their durable uptake in the medium to long-term. Another clear advantage is the size of the Chinese EV battery market as well as the possibility for the central government to simply mandate the large-scale integration of EVs into public fleets.
Dr. Anderman further cited electric vehicle market forecasts from major manufacturers which sum up to approximately 125,000 EVs and 130,000 PHEVs by 2015 for all markets together. In other terms, the car industry calculates with the production of around 255,000 electric vehicles by 2015, while President Obama wishes for 4 times this figure to roll on America's streets by the same time.
In his outlook over the next five years, Dr. Anderman sees strong potential for li-ion batteries in the HEV market which is expected to reach 1.8 million annual units by 2015 - a market of approximately $800 million. PHEVs start to enter the market but their production numbers will rest below 20,000 units for most car manufacturers. The same goes for EVs, for which production numbers will rest even below 10,000 units, with the possible exception of Renault-Nissan.
Again, Dr. Anderman strongly underlined that government policies and mandates such as the CARB as well as subsidies and incentives, are the driving force in the uptake of EVs and PHEVs. However, it is unclear whether this governmental support will suffice to counterbalance the largest commercial risk in the uptake of electric mobility which is battery reliability, including safety and durability.
In conclusion, Dr. Anderman believes that the combined market share of EVs and PHEVs will rest well below 2% through 2020. Nonetheless, even at a combined market share of EVs and PHEVs of only 1.5% and additional 4% for HEVs, the market of automotive li-ion batteries will exceed $10 billion by 2020.
Mr. Cackette looked at CARB policies and what they would mean for cars today and EVs in the future. CARB currently is targeting a 30% reduction in greenhouse gas (GHG) emissions by 2016 and the deployment of 40,000 plug-in EVs in California by 2016. Currently, the ZEV program has produced zero plug-in hybrids for California.
Regarding implementation of the plug-in collaboration, Mr. Cackette noted, “we’re trying our best to prepare the infrastructure”.Selected recommendations included:
It was noted that one national GHG standard is still the goal with EPA/NHTSA standards still in formulation, with possible development in late 2012. CARB will be submitting to the board their refined technical and economic assessments needed for the proposed California rule by October 2011.
Mr. German started his presentation with two key messages: conventional technologies are ‘still’ the most cost effective, but mass-market acceptance of hybrids can be expected over the next 10 years, with a 75% market share by 2030-2035; major barriers to the broad introduction of EVs and PHEVs are "real fuel" costs and "consumer behavior".
Fuel costs are expected to be close to $4 per gallon in the future. However, when combined with higher fuel efficiencies of cars (CAFÉ) the actual cost of driving cars will be lower. New vehicle miles per gallon (MPG) in CAFÉ values for combined cars and light trucks is expected to hit 34.8 mpg by 2016 with a 4% yearly increase (up from the current 28 mpg).
When also accounting for higher incomes by 2030, fuel prices per gallon would have to be $11 to equal the 2008 cost of fuel, and $19 per gallon to equal the 2002 cost of fuel. Therefore, fuel costs will be cheap in the future, creating a barrier for the adoption of EVs and PHEVs on the basis of fuel prices.