Electric cars

Road transport is Europe' s largest source of CO2 emissions, accounting for 20% of all emissions. Cars are the biggest problem and their emissions keep rising. To achieve the Paris Agreement goal of limiting global temperature rise to 1.5ºC, car emissions must be zero by 2050 at the latest, meaning the last diesel or petrol car should be sold no later than early 2030s.

 

By far the most efficient and convenient zero emission technology available to drivers across Europe today are battery electric cars. Thanks to the EU 2020/21 CO2 standard for cars of 95g/km, carmakers are finally getting serious about selling electric cars - around 200 plug-in models will be available on the EU market from next year onwards. Reforming taxes to help drive the purchase price down, adapting supply chains and transforming factories on time, rolling out smart charging points and ensuring batteries are produced sustainably are all crucial pillars of sustainable emobility and should be accelerated in the coming years.

Electric cars and the environment

While electric cars have zero tailpipe (or tank-to-wheel) emissions, there are upstream emissions from manufacturing the battery and from electricity generation. But analyses of full life cycle CO2 consistently show that on average battery electric vehicles emit less CO2 over their lifetime than diesel cars. A meta-analysis of 11 independent LCA studies done in recent years concludes that a battery electric car over its lifetime produces 50% less CO2 emissions than an average EU car today.

In Europe, even a EV charged on Polish electricity produces 25% less CO2 than a diesel car. As the EU power sector decarbonises the benefit over oil becomes ever greater. 

Battery cell manufacturing today is largely in China and South Korea but as the market expands so does production into Europe, where the electricity is less carbon intensive, reducing significantly battery production emissions.  

Cost of electric cars

While purchase prices for most EV models is higher than comparable diesel and petrol cars, electric cars in some segments are expected to reach parity with conventional models around 2022. (Source: Bloomberg)

However, the total costs of ownership (TCO) is more important to consumers and is already lower for EVs taking into account how much it costs to fuel, maintain and insure the car. A study by the EU Consumer Organisation (BEUC) shows that by 2024 the average 4-year cost of running an electric vehicle will match that of a petrol car, and a diesel one by 2030 with tax breaks of just €500 per year. 

More recent studies are even more positive, with EVs already cheaper to own and run in the UK, Japan and US markets with current incentives.  For the second and third owners, EV’s are substantially cheaper with much lower operating and maintenance costs.

A lack of investment in manufacturing of EVs and batteries in Europe is a key reason for higher prices. In Europe, expensive small volume manufacturing and minimal competition has kept prices high. Until 2019, just 10 battery electric models represent around 90% of sales and most models are not available for sale in showrooms or have long waiting times. Just 1.5% of advertisement spend was on zero emission models in 2018 and 1.4% on plug-in hybrid models in the EU’s largest car markets. But this is expected to change as carmakers need to sell higher shares of electric cars in order to comply with the EU CO2 standards - so prices are expected to drop with scaling volumes.

Smartly designed taxation is key to make electric cars more affordable, notably bonus-malus tax systems in countries such as France, Italy and Sweden that compensate financial support for zero emission cars with higher taxes on polluting vehicles.  In the short term, the most promising segment will be company cars and corporate fleets - driven by TCO considerations, electric cars are perfectly suited for such often premium and high mileage markets. 

Charging infrastructure

Up to 2020, there will be enough EV chargers for the expected number of plug-in cars on EU roads according to the reports from member states. But the roll-out needs to speed up in the 2020s to enable drivers to seamlessly charge the growing number of electric cars on the road. 

Around 1,000 ultra-fast (150-350 kW) charging sites are already planned for 2020, or one site every 34 km in average on the strategic EU road network, allowing drivers to replenish up to 400 km driving in 15 minutes. By 2020, there will be nearly 5,000 medium-fast chargers and 220,000 regular chargers across Europe. This is in line with the Commission guidelines of having 1 charger per 10 vehicles.  In reality only 5% of recharging happens at public sites so the current volumes are sufficient to kick start the market.

Going forward, it is crucial to roll-out strategically located, smart and interoperable infrastructure. Smart charging at home and workplace is a priority as most charging will happen there. Rolling-out fast charging hubs across all EU roads and outside cities to allow charging for top-ups and shared fleets is also important. Commercial property, fuel stations, park & ride schemes, shops, hotels etc should all provide charging solutions as a standard. It should be as easy for a driver to charge their EV as it is to fill up their tank today, with transparent pricing and easy to pay solutions. 

Electric cars and jobs

The car industry is expected to change more in the next five years than it has in the last 100. It is a moment at which it must adapt and change to survive. Famously, other great European companies, like Nokia, failed because they were too slow to change. Europe needs to help its leading carmakers in the global race to electrify mobility and avoid being overtaken by US, Korean and Chinese competitors.

The shift to electric vehicles will help European carmakers remain competitive and contribute to job creation across the continent. An economic analysis, which gathered input from carmakers, auto suppliers, energy companies, NGOs and consumer groups, shows that more than 200,000 jobs can be created with a shift from fossil fuel powered cars to electric vehicles. By 2030 the shift in spending away from diesel and gasoline use in road transport would reduce Europeans’ spending on imported oil by €49 billion.

There is a serious threat to auto jobs due to automation and outsourcing to regions with lower labour costs and modern factories. European carmakers in the past  invested seven times more in electric vehicle production in China than at home. But carmakers in Europe are also embracing electrification and have started investing in car and battery production. Jointly EU carmakers plan to spend around EUR 145 billion on electric cars, so success in this field is now a top industrial priority for Europe.

Batteries for electric cars 

Fears about raw materials availability for batteries are not backed up by the evidence, and instead are rumours spread by the oil industry. The latest report on battery materials from the Commission shows that critical materials such as cobalt, nickel and lithium are available across Europe. Globally there are enough natural resources  even if all vehicles were electrified, but short-term shortages are possible as the mining, refining and smelting capacity ramps up.

16 battery gigafactories are already planned in Europe for early 2020s. Some of the most notable plans are: NorthVolt gigafactory in Sweden and Germany, CATL battery factory in Germany, LG Chem in Poland and Samsung SKI in Hungary and Austria.

A solution with potential short-term supply bottlenecks is to boost recycling and repurposing of batteries in use. A study on the supply of raw materials for electric vehicles by Agora concluded that secondary cobalt from recycling can meet up to 10% of EU demand in 2030; secondary lithium 10% of 2030 demand; and secondary nickel can further meet 7% of the 2030 demand. But the current recycling capacity in Europe is not sufficient and the upcoming EU Battery Directive should ensure that it scales up fast and that all battery materials are fully recovered at the end of their life.

New and shared mobility 

In addition to electrification, vehicle automation, and app-based sharing services such as car, ride or bike and scooter sharing will disrupt mobility as we know it. 

Vehicle automation can drastically reduce the number of road fatalities, given that 90% of them are caused by human errors. Even if accidents involving autonomous vehicles (AVs) have happened and will certainly occur in the future, expected safety benefits will be significant.  However, depending on whether they are regulated, autonomous vehicles could either worsen congestion and emissions (traffic hell) or decrease them (traffic heaven).

In the hell scenario, self-driving cars remain privately owned, and run on internal combustion engine. Because of the convenience of autonomous cars (you don't need to find a parking spot and the vehicle is always available) vehicle kilometres increase and so do congestion, noise levels, and emissions. There’s less space available for other modes or for social activities.

On the opposite, in the autonomous heaven scenario, self-driving cars run on renewable-based electricity and are available on demand. Autonomous cars are part of shared fleets people can subscribe to in order to book a ride on an as-needed basis. They’re charged less if they share their rides with other people. 

Vehicle utilisation becomes much more efficient as these vehicles are shared and sometimes pooled. In this scenario, there are up to 90% fewer vehicles on the road, meaning less road space is needed, sidewalks and bike lanes get bigger. There’s no need for many parking spaces, which frees up (expensive) city space for housing or social activities. Congestion and road transport pollution are eliminated.

Ultimately, the outcome will depend on the policy framework, and most importantly on whether autonomous vehicles are electric and shared.

In parallel, rapid development of app-based on demand mobility services such as ride  sharing have great potential to theoretically reduce car ownership and emissions, as the International Transport Forum has shown

But according to US city data available in San Francisco or Boston, ride sharing services like Uber are currently adding kilometers to the road, leading to more congestion and pollution. 

For instance, in San Francisco, Uber and Lyft are the biggest contributor to the growing traffic congestion. Researchers found that between 2010 and 2016, weekday vehicle hours of delay increased by 62% compared to 22% in a counterfactual 2016 scenario without these services available.

In Massachusetts, the department of public utilities estimated that ride sharing services had a net carbon footprint of nearly 100,000 tons of CO2 equivalent in 2018.  

This data stresses the importance to accelerate the transition of ride sharing services to zero-emission to limit their negative impacts on air pollution, which should be a prerequisite to their operations, at least in big European cities within the next few years.

Shared mobility isn’t only limited to cars, but also include lighter transport modes such as micromobillity. Since Lime and Bird first started to offer on-demand, shared e-scooters in the US, the number of e-scooter sharing companies has quickly multiplied, offering their services in many European cities. As flexible mobility solutions similar to (e)-bike sharing, they can offer first and last mile connections in dense urban areas.

However first usage data from e-scooters indicate that these micro-mobility options are barely replacing private cars and are mostly substituting trips that would have been made walking, cycling, or using public transport. There are also environmental concerns about the scooters’ sustainability and longevity.

Some key principles can help maximise the benefits from autonomous and shared transport: On-demand, shared transport solutions should be integrated with the existing public transport network, making public transport more flexible and attractive. This implies appropriate data sharing between different mobility providers.

Given their potential impact on increasing the number of kilometers driven, all AVs should only be electric and available on-demand, as part of fleets. 

The roll-out of micromobility vehicles shall ensure a matching supply and demand as well as safe usage conditions, including clear parking rules. 

In parallel, regulating road and curb use to favour shared modes over private mobility (e.g. congestion charging and low and zero emission zones, bike lanes, exclusive parking rights for shared vehicles) will encourage people to share.

Electric cars and energy independence

Battery electric and hydrogen cars rely on renewable electricity that the EU can produce locally. Instead, fossil-fuelled cars are driving Europe's addiction to foreign oil.

Five facts about the EU’s oil use:

1. Oil (crude oil plus petroleum products) represents around a third of the EU’s total energy consumption;

2. The EU imports around 90% of the oil it needs and this share is expected to rise in the future.

3. Two-thirds of the EU’s oil is used in transport.

4. Around a third of the oil used in Europe is bought from Russia and this is forecast to rise in the next decade

5. Around 70% of Russia’s oil production is sold in Europe.

Towards energy sovereignty

But there is the prospect of the EU ending its bank-rolling of military superpowers hostile to its democracy. Electric and hydrogen cars rely on renewable electricity that the EU can produce locally. By buying locally produced electricity for our cars we create growth and 200,000 jobs in Europe.

A shift to electric cars is good for jobs, good for drivers, good for our planet and cuts off the funds to regimes that threaten and try to destabilise our democracy. It is a win-win solution.