Realising the promise of EV technology

Reducing CO2 emissions from cars is essential if the world is to meet carbon emission targets set in response to environmental concerns. Many consumers assume that electric vehicles (EVs) will become a viable alternative to conventionally powered vehicles within a few years.

However, a realistic assessment of the technology shows there are still significant barriers preventing EVs from becoming a mainstream mode of transport. Governments, cities and the car industry need to take decisive action if they are to persuade consumers to switch from conventionally powered vehicles to a greener alternative.

EVs can be less green than conventional cars

Electric vehicles are not automatically cleaner than vehicles powered by combustion engine. The decisive factor in calculating their environmental advantage is the type and combination of energy sources generating the power by which the electric car battery is charged.

For example, the average CO2 emissions from an EV charged on the grid in China, where coal-fired power stations account for 79% of energy generated, are higher than for a conventional car. By contrast, CO2 emissions from EVs charged in France, which has a high proportion of nuclear in its energy mix, are ten times lower than those for EVs charged in China.

Batteries for EVs will remain expensive

Batteries are set to remain the most expensive component of an EV for a long time and will continue to be more expensive than conventional combustion engines. PA Consulting Group calculates that even by 2015 the purchase price of a lithium car battery pack of 25 kWh for car manufacturers will be €8,750, more than four times that of a conventional engine.

EVs will continue to have a limited range

Current technology means that the batteries required for an electric car appealing to consumers in terms of range and speed are large and heavy. Electric cars can not match the range of petrol-fuelled vehicles in the foreseeable future. As long as the distance EVs can cover between charges is less than 100 miles, they will only be attractive to consumers as a mode of transport in large cities.

How can public bodies and the car industry make EVs attractive to consumers?

Given current technology, PA believes that a mass market for e-mobility will only emerge after 2015. Then it will develop slowly over the following ten years to become a viable alternative to conventional modes of transport.

Even to achieve this degree of progress, the market requires significant support:

• public bodies will have to offer consumers direct and substantial subsidies on the cost of purchasing EVs

• cities will need to promote EV technology rigorously with measures such as exemption from toll charges, extra parking spaces and free use of commuter lanes

• governments will have to offer focused research and development grants for industry projects to cover some of the risks and to encourage universities to build a body of knowledge around EV technologies

• the car industry will have to tackle the high cost of EVs by promoting affordable vehicles at higher volumes and by using economies of scale to reduce the cost of EV components.

PA’s experience of helping businesses to realise the promise of greener vehicles includes work to help Magna Steyr identify where parts of a lithium-ion battery for buses and commercial vehicles could be sourced at a lower price. This included developing 40 different technical changes that could deliver cost reductions. As a result, Magna Steyr met its cost savings target whilst reducing emissions from these vehicles for which it supplies batteries.

To find out how PA can help your business take a lead in realising the promise of EV technology, please contact us now.