Electric cars and other green vehicles need another decade of support

Despite more than a decade of research, electric vehicles and other new automotive technologies are still far too expensive to compete with existing petrol and diesel engines. But that’s no reason to give up on them, says Lewis Fulton, Co-Director of the NextSTEPS Program within the Institute of Transportation Studies at the University of California, Davis.

Sustained investment over the next five to ten years should lower the cost of alternative technologies, such as electric vehicles and hydrogen fuel cells, to a point where they can compete with combustion engine, says Fulton, who leads research into how new vehicle technologies and fuels can gain rapid acceptance in the market.

“Political will is a big issue,” said Fulton, speaking on the sidelines of The Race to Produce Low Carbon Cars, a Science|Business policy symposium held on 21 June in Brussels. “But I believe, for 5-10 years, we need to see fairly significant incentives per vehicle, which could add up to a significant investment by society. But actually it represents a fairly small amount compared to what society spends are cars and fuels in general, and I think this investment will pay off in achieving a very low carbon vehicle fleet after 2030.”

Today new technologies, such as electric vehicles, lag internal combustion engines in a number of areas, such as driving range, cost, and refuelling infrastructure. That means the internal combustion engine, which is becoming increasingly efficient, is likely to continue to dominate the car market for ten years or longer. But Fulton believes that ultimately governments’ investments in new technologies will be paid back through fuel savings, lower greenhouse gas emissions and cleaner air. “I hope [the subsidies] don't go beyond about 10 more years,” he said. “We should be scaling back down by then.”

During the symposium, Fulton described the 200,000 electric vehicles (EV) sold worldwide in 2012 as “a good start”, noting that EV technology will get better quickly. He argued that on-going R&D efforts, for example on ultracapacitors, which store energy using a static charge, rather than in a chemical reaction, could result in a step-change in performance and cost. But Fulton stressed that the case for pumping public money into EV and other alternative technologies is a long-term one. “If I only cared about the next seven years, I wouldn't invest in EVs,” he said. “The people who are pushing EV hard are thinking about a market evolution toward where EVs dominate after 2030.”

Of course, widespread use of EVs will only significantly lower greenhouse gas emissions if the electricity they use is generated from low-carbon sources. Using power generated in coal-fired power stations, for example, would be counter-productive.

Although Angela Merkel, Germany’s chancellor, has called for one million EVs on German roads by 2020, Fulton said that a target of one million EVs across the whole of Europe by 2020 (out of five million EVs worldwide) is probably the best-case scenario. Still, one million electric cars would be an important milestone in scaling up the technology. “If we can do that, the costs will really come down,” he told the symposium. 

One of the key reasons that an electric car costs more than the internal combustion equivalent is the high cost of the battery. Fulton estimated that the cost of EV batteries have come down from $700 to $800 per kilowatt hour to $500 per kilowatt hour in the past three years. “We should be able to get down under $300 per kilowatt hour by 2030,” he said. “If we push hard and sell a lot of electric vehicles over the next 7 years, it is very possible we could get there by 2020 and that would be a revolution for EV marketability.”

Relatively rich countries, such as Norway and other EU countries, are at the forefront of electric car deployment, but China is also backing the technology in a bid to improve the air quality in its cities. Although Fulton noted that insufficient infrastructure means China is struggling to hit its EV sales targets, he added: “China is a special case among non-OECD countries because of its government's ability to fund large projects. I see China keeping pace with OECD countries.”

However, in terms of direct effects through 2020, new fuel efficiency standards in China, India and other emerging markets (modelled on those in the EU) are likely to make a far greater contribution to curbing transport’s environmental impact than electric vehicles and other new engine technologies. “The average new car is getting better,” acknowledged Fulton. “If manufacturers hit the [EU’s CO2] target of 95g/km, then it will take a bit of the wind out of the sails of the alternative technologies.”

But, in time, manufacturers will have wrung out all of the fuel efficiency gains they can from the internal combustion engine, meaning further progress will depend on new propulsion technologies and new energy systems, such as electricity and hydrogen. Lifestyle changes may also have an impact. “It seems many young people can't be bothered to drive, perhaps in some cases because they want to be online, so they are taking public transport,” he said. “But autonomous, self-driving cars could reverse that trend.”

Demand for autonomous cars may also give EV a boost. If people are riding in self-driving taxis, they won’t have to worry about the range of the vehicle: A passenger could simply swap from one taxi to another before the battery runs out. Fulton points out that simply ordering a car when you need one would be more efficient than owning one. “Today, the private car system is not optimised...most cars spend 23 hours a day parked, doing nothing but taking up space.”