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Government Nudges, Not Pricey Prods, Will Force Electric Liftoff

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Concessions Would Help Electric Car Drivers, But Antagonize The Rest
All Cars Could Be Electric By 2030, Says One Proselytizer

U.N.’s Intergovernmental Panel on Climate Change (IPCC) edicts are based on flimsy ground. 

Predictions about the future of electric cars are all over the place, suggesting more than a degree of uncertainty about their likely success. Will prices be low enough, will range eventually be acceptable to mass market buyers, will the technology be revolutionized by the kind of Moore’s Law (processing power doubles every 18 months) progress made by mobile phones and computers, will governments be able to afford the gigantic subsidies needed to bankroll electric cars?  

The biggest movers for electrification like Renault of France and its Japanese alliance partner Nissan of Japan talk about a 10 per cent global market share in 2020 for battery electric vehicles. Other experts say, hang on, the hurdles are simply too high. It won’t be much more than one per cent.

Jacques de Selliers, managing director of Brussels-based Going Electric, is reluctant to predict electric market share for 2020, but if you think he’s guilty of lack of conviction and understating his case, think again. By 2030 at the earliest and 2040 at the latest, cars globally will be almost 100 per cent electric, says de Selliers. That’s right; there might be almost no internal combustion engine vehicles on the road at all 19 years from now. De Selliers says government action is required to make electric vehicle ownership attractive, but it should be in the form of relatively cheap concessions for parking and access which will speed drivers on their way, not hugely expensive subsidies.

Going Electric calls itself the Association for Electric Vehicles in Europe. It’s a non-profit association including wannabe electric vehicle businesses and non-governmental organizations. Going Electric is seeking to influence the European Commission, the executive arm of the European Union (E.U.) which proposes and enforces legislation. Going Electric defines electric cars as battery electric ones like the Nissan Leaf, Extended Range Electric Vehicles like the Chevrolet Volt and plug-in hybrids, and fuel cell vehicles, like the, well they don’t exist yet, although Honda of Japan has been showcasing the principle with its experimental FCX Clarity.

No case
De Selliers accepts that currently there is no compelling case for the purchase of an electric vehicle. He concedes that for government subsidy to be effective it will be hugely and prohibitively expensive, but he reckons that there is one sweet spot which can be hit to make the public see the light, and which won’t break the bank.

“Electric vehicles bring many benefits to society and little to their owners. It is therefore the duty of public authorities to break this chicken-and-egg situation. Governments must provide incentives to car manufacturers and consumers until mass-production makes EVs competitive,” said de Selliers in a recent report.

Incentives would comprise more than crude money bribes which would be too expensive anyway. Just offering money alone won’t persuade reluctant buyers, who may reason that even with the free gift, or because of it, there is no cogent case for buying electric.

De Selliers reckons he has an ace up his sleave, which will convince doubters that going electric makes sense. Time; or rather the saving of it.

“If you’re looking for a good reason to drive electric vehicles, the best one is to save time. That means free bus lanes, the use of high occupancy lanes which have been so effective in persuading Americans to buy the (gasoline electric hybrid) Toyota Prius, free unlimited public parking in towns to save time from looking for one, parking spots reserved for EVs, and toll and congestion charging exemption. Such incentives are not only very effective, they cost little to governments,” de Selliers said in a telephone interview.

We pay taxes and vote too
But one man’s incentives are another’s penalties. It remains to be seen how the vast majority of drivers of regular gasoline-engined cars will react to being forced into congested roads and being denied easy access to parking or access into city centers for work and leisure. You can almost hear them saying “Hey, we pay huge taxes to use our cars, and we vote in elections too.”

The Going Electric report talks about trying to make the European Union (E.U.) automotive industry competitive and seeking sustainable mobility and growth in 2020 and beyond. Some would say that the best judges of how to invest for the future is the industry itself, but de Selliers thinks that Europe is in danger of being overtaken by China without a little nudge from the politicians.

“We need to maintain the competiveness of the car industry and decide what cars we need. The manufacturers in Europe have invested a lot in making the best petrol engines in the world and they don’t like the idea it might be obsolete one day. That’s how dinosaurs disappeared. Evolution got the dinosaurs. The industry is sometimes a bit shortsighted. They like petrol cars and they’ve been working on them for ever. They are reluctant to change. China might be the leaders because it is going to be much easier for them than Europe,” de Selliers said.

Chicoms
China, being a communist state with a command economy can insist on what actions its companies take. Of course, when governments pick economic winners, there is no competitive market mechanism which might provide an early warning that the choice was wrong. But experts reckon that China is likely to take a lead in electric cars, not least because it has little oil and much coal for generating electricity. But some of the assumptions that have driven energy policy of governments in general over the last 20 years are being questioned.

The idea that oil and therefore useable fossil fuel supplies had peaked meant that the case for carefully eking out the planet’s remaining reserves made sense. Governments in Europe and the U.S. have been persuaded to impose tough tax or regulation to force automotive manufacturers to produce ever smaller, fuel sipping cars. But the gas-fracking revolution threatens to overturn this conventional wisdom with its promise of huge, centuries-long supplies of natural gas in the U.S., Europe and China among other places. Natural gas also burns off relatively little CO2 in comparison to coal.

Another key assumption of the electrification-of-cars lobby is that carbon dioxide emissions by humans are warming the planet. Governments have been unwilling to concede that the science behind this theory might be unsound, despite mounting evidence that questions the link. Last week in Britain the Global Warming Policy Foundation published a report on energy policy saying the U.N.’s Intergovernmental Panel on Climate Change (IPCC) edicts are based on flimsy ground. The IPCC ignores many other worthy theories to explain fluctuating temperatures including activity from the sun, cosmic rays, clouds and the oceans. The report pointed out that there is little correlation between rising CO2 levels and global temperature. Between 1940 and 1970, CO2 production rose remorselessly, but temperatures dipped. Over the last 12 years, temperatures have leveled out as CO2 levels accelerated.

“What is frequently described as a (scientific) “consensus” (on human induced global warming) is no such thing. There is huge controversy at each level of the analysis,” the report, authored by prominent ex-British government bureaucrat Lord Turnbull, said.

Technology will do it
Going Electric’s de Selliers though expects technology to provide a compelling case for the success of electric cars.

“Think of the first mobile phones only 25 years ago. They were 800 grammes (about two pounds) a foot long and cost $4,000. The technology needs to evolve and get a lot cheaper. Batteries are very expensive now because manufacturers have invested millions and need to get their money back. Look at the progress of mobile phones and portable computers; it’s such a huge business it will stimulate innovation but it won’t happen overnight.”

Governments need to get the ball rolling, then the consumer will take over.

“We need government to act. Look at what President Kennedy said (in 1961) that by end of the decade an American will be walking on the moon. Then it happened. If you start by making no choice you get nowhere. Mobile phones (with no government help) had an advantage because they had obvious benefits. But electric cars bring advantage to society and not to drivers so that’s why governments should make the choices. It is therefore the duty of governments to stimulate the initial EV spread, until EVs become sufficiently inexpensive to enter consumer habits,” said de Selliers.


Neil Winton – May 28, 2011

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