Spark plug: can EVs save the climate and the motor industry?

A hundred years after the petrol revolution swamped the first fragile wave of electric cars, they’re back. But are they back for good? And can they really save both the motor industry and the climate? April Streeter peers under the bonnet.

If you wanted to see a snapshot of an industry in quick-fire transition, there was no better place to be than the 2009 New York Auto Show. Gone were the heavy duty Hummers and the lumbering SUVs. In their place, the sexy Tesla Model S, the funky MINI E, and the friendly bug of the Mitsubishi i MiEV: all of them spanking new – all of them electric.

“It’s a gold rush – with shades of the dotcom boom”

For the moment at least, it’s something of a gold rush, with shades of the dotcom boom as brash start-ups like Fiskar, Tesla and Aptera challenge the struggling industry giants.

But if all the hype around ‘EVs’, as electric vehicles are known, sounds a touch familiar, it should. Back in the mid-90s, electric cars popped up from major manufacturers such as General Motors and Toyota, partly in response to California’s ambitious zero emissions standards.

However, a federal court challenge and subsequent weakening of those standards helped dampen EV development, and when GM scrapped its EV-1 project – an electric vehicle designed to be leased, rather than owned – it seemed to sound the death-knell for EVs. Carmakers blamed weak consumer demand; environmentalists smelled conspiracy. In the film Who Killed the Electric Car? Chris Paine concluded that the culprit was a mixture of cheap oil, industry resistance to change, and behind-the-scenes lobbying and deal making.

This time, though, it could be different. Shocked by last year’s soaring oil prices, and humbled by a recession which has wiped out the market for their gas-guzzling staples, the world’s major car companies are desperate for a new idea. And now they’re at the mercy of governments keen to concoct a ‘green recovery’, which have made clear that they expect significant environmental progress in return for state aid to the struggling industry.

Policy makers from Barack Obama to London Mayor Boris Johnson and Chinese Premier Wen Jaibao have jumped on the zero emissions bandwagon, introducing subsidies to help people scrap petrol cars and buy hybrid or all-electric, as well as pledging infrastructure and grid improvements.

One difference between the EV fever of a decade ago and today’s excitement is its global reach. It spreads from US billionaire Warren Buffet, who is investing in Chinese battery maker BYD [see box in Crouching Tiger], to China’s huge domestic subsidies for EV buyers, to Bolivia’s fast growing lithium industry, supplying the essential component of EV batteries.

Active involvement by both governments and power utilities is key, however. The cars won’t roll out of the showrooms in vast numbers unless there’s an infrastructure to support them. There are several visions of what that might look like.

America’s Natural Renewable Energy Laboratory imagines small, nimble electric or hybrid vehicles at the core of neighbourhood mobility by 2030. Power for these plug-ins would come from local grids producing renewable energy from solar, small wind and perhaps fuel cells. The cars, acting as mini power stations [see box, 'Hot air equation' below], would plug in from users’ homes and download electricity when they needed a boost, sending power back when the grid required it.

In another scenario, a vast network of kerb and roadside charging posts will riddle cities and suburbs alike – with power utilities acting as middlemen, ready to give your EV its juice. In London, the first few kerbside rechargers – looking a little like enlarged parking meters, sporting a signature blue light – are sprouting up on the kerbsides. Mayor Boris Johnson is promising that there will be 25,000 of them in place by 2015. And a new government initiative, the Low Carbon Demonstrator Competition, is launching a real-life trial of over 300 vehicles – mostly EVs – in eight locations around the UK within the next 6-18 months. As with household home electrification, though, any power network gets prohibitively more expensive as it spreads away from cities and densely populated areas.

Then there is Better Place, Shai Agassi’s unique view of an EV future, in which drivers nearing the end of their battery’s range simply pull in to a ‘swapping station’ to have it switched for a fully-charged one. Operated by robots, the swap should only take seconds. The flat battery is then recharged at the station, ready for use in another car. With the batteries leased, rather than forming a fixed part of the vehicle, the EVs should cost less to buy. The prospect of lots of roadside swapping points similar to petrol stations may also help quell EV users’ ‘range anxiety’ (see below).

One imaginative way of extending that range is to electrify major roads. That’s the approach favoured by Rupert Fausset, Sustainability Adviser at Forum for the Future. In this vision, highways would have some sort of electrified track on which cars could travel either individually or in convoy, recharging as they go. “Highway electrification has been left out of the vision,” says Fausset, “but building something like that is entirely plausible – we already do it with our train and tram systems.”

It’s easy to see how governments and carmakers around the world are seizing on electrification as the ultimate magic wand: one that will both save an industry and force it down the road of sustainable innovation, while ensuring that consumers addicted to personal mobility don’t have to sacrifice their rides to save the climate.

“Creating an industry is not the problem. The full cast of characters – scallywags and entrepreneurs, and of course the government – are all here now”

But these are still early days. Global Insight analyst Philip Gott likens the current state of the electric car industry to the dawn of the railway boom. “All of the things people worried about then – funds for start up, who would do the infrastructure etc – we worry about with electric. Creating an industry is not the problem. The full cast of characters – scallywags and entrepreneurs, and of course the government – are all here now.”

But to move from this frenzied entrepreneurial phase to being a viable – even dominant – part of the global car market is harder, Gott says. He sees that happening somewhere between 2012 and 2030 – but he’s not willing to predict exactly when the tipping point might be. Developers need to solve a lot of problems before making the big push for mass electrification, he says.

Batteries are the biggest barrier. On the business side, the industry is booming. In the US state of Michigan alone, tax credits of over $543.5 million have lured four companies to invest $1.7 billion in battery factories. Even so, demand for the lithium ion (Li-ion) batteries used in EVs is outstripping production. Take Mitsubishi. Its i MiEV is ready for sale in the UK in November, after which the company hopes to roll it out across the US. But a lack of batteries means its first year of so-called ‘full production’ (sometime after 2012) will be limited to around 10,000 vehicles.

Eventually, new capacity will catch up with demand. But the next challenge to tackle is ‘range anxiety’. Drivers used to travelling 400 miles on a single tank won’t be impressed by something which struggles to take you a quarter of that distance. Brighton-based Calvey Taylor-Haw of Elektrobay, a company making many of the charging posts being installed in London and across Europe, is an early EV adopter. He owns a Mercedes Smart EV – but says that even for fans like him, range anxiety is all too real. Until batteries have far longer ranges, the only cure is more recharging points. “In Brighton there’s no [charging] infrastructure, and the car has a 60-70 mile range,” he says. “So will I take it on a 26-mile journey to Gatwick Airport? No, not yet. I’m in the business, but I’m still getting up the confidence. The government is waking up with grants and incentives [for recharging points] but, outside London, councils are still sitting on the fence. If we put these in now it’s 12 months to two years before the cars are available – they think. So they don’t do anything. I believe the government is going to have to mandate that councils put in the infrastructure.”

“The holy grail of the electric car is a battery that rivals a petrol tank’s capacity and recharges in minutes”

The holy grail of the electric car is a battery that, in range terms, rivals a petrol tank, and recharges in minutes, not hours. Recent years have seen a surge of R&D efforts in these areas, notably at the Massachusetts Institute of Technology (MIT). Researchers there have discovered a way to recharge Li-ion batteries much more quickly by reshaping the surfaces of the ions to make them move faster. They’re also hoping to reduce battery cost significantly and improve storage capacity over the next few years. Researchers also have high hopes that lithium-sulphur (Li-S) batteries could eventually be developed with a battery range five times that of Li-ion equivalents – more than a match for a tank of petrol.

Sources of easily extractable lithium are, however, finite. As energy writer Jim Motavelli explains, “lithium itself is abundant, but, like hydrogen, it does not occur naturally: it needs to be obtained and processed”. Estimates on reserves vary wildly from 4 million to 28 million tons; the best estimate, from the US Geological Survey, is around 11 million. Roughly 40-50% of these reserves are in Bolivia, with smaller amounts in Russia, Argentina, Australia, China and Chile. Security of supply is by no means assured – Bolivia’s leader Evo Morales is doing his best to build a domestic industry, but threats of nationalisation have dampened multinational prospecting. Mitsubishi has estimated EV production may outstrip lithium supply as early as 2015, adding substantially to the cost of electric cars. Others are more sanguine, suggesting that ‘easy lithium’ will last into the 2020s, by which time new cost-effective extraction methods – including from seawater – will be on stream.

So there don’t seem to be any insurmountable barriers to EVs’ eventual dominance. But that doesn’t mean they are poised to sweep the internal combustion engine into oblivion just yet. According to Boston Consulting, there could be as many as 1.5 million EVs rolling off assembly lines by 2020 – but that would only represent 3% of the global car market.

Electric cars may take market share in the mid-range bracket, but even the most optimistic EV enthusiast wouldn’t claim they could be priced to rival the cheapest petrol versions – like the Tata Nano, selling in India at under £1,500 [see ‘And another thing’, GF68].

To have an all-electric paradigm shift within the next decade, says Richard Gott, we’ll need some sort of major disruption to petroleum supplies – like a war, or some other huge economic or climatic disaster. Otherwise, the transition will be much slower and longer than enthusiasts hope. Rupert Fausset, by contrast, suggests a surge in petrol prices might speed the process, providing “the right stick at the right time” to catapult EVs to market share of 20 or 30% in a few years’ time.

So where does this leave us? By the middle of this century, it seems likely that EVs will occupy a substantial – perhaps a dominant – place in the world transport market. Hydrogen and biofuels will be there too, along perhaps with a small slice of highly efficient internal combustion cars.

But it will be a very different kind of market. If present trends continue, the number of cars on the road will rise from 800 million today to three billion by 2050. Will we really choose to live in a world with three billion cars clogging the streets, however clean they are? It seems unlikely. Most mobility experts predict that, instead, we’ll get better at sharing cars, whether informally or through car clubs, better at developing smart public transit to cut out the need for individual car ownership – and maybe even better at planning our cities and our working lives, so as not to rely so much on a frenzy of constant rushing around.

April Streeter is a freelance writer with Upstart Publishing, based in Sweden.

3 August 2009

April Streeter