“electric Vehicles Surge: Impact On Electricity Demand And Infrastructure”

“electric Vehicles Surge: Impact On Electricity Demand And Infrastructure” – We explore what it might take to achieve 100% electric vehicle adoption, and the ripple effect the revolution will have on industries and governments.

The internal combustion engine is dead; long live the battery electric car (powered by lithium-ion batteries charged by coal-fired power plants).

“electric Vehicles Surge: Impact On Electricity Demand And Infrastructure”

Wait, that part in parentheses can’t be true, can it? Although today’s electric vehicle (EV) market is largely powered by the same technology that powered steam locomotives in the late 1800s, things are changing rapidly.

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About 30 percent of US electricity now comes from coal. In China, this figure has risen to two-thirds. Even the Netherlands, with its iconic windmills, generates 29 percent of its electricity from coal. Globally, approximately 37 percent of the world’s electricity comes from coal-burning power plants.

However, these numbers have been declining over the past few years. Globally, coal demand has fallen from its peak in 2014 as countries around the world began implementing initiatives to curb greenhouse gas emissions, also helped by cheap natural gas and local pollution concerns. But for every action that spurs the development of clean cars and the energy sources to power them, there are reactions that affect everything from raw material sources to consumer behavior and the development of new technologies.

As automakers ramp up production of more and more electric vehicles, the demand for electric vehicles will grow exponentially. According to the best estimates, the growth in the use of electric vehicles could lead to a 300-fold increase in electricity consumption by 2040 compared to 2016. The current grid must evolve significantly to accommodate this growth, which will lead to rapid innovation in wind and solar energy. , which will eventually shift global dependence on coal toward clean energy alternatives.

But even this transition, while cleaner, is not without environmental, economic, and legislative impacts. Whatever form it takes, the rise in demand for electric vehicles will lead to a surge in demand for other organic elements used in electric vehicles and in the clean energy process, particularly lithium, cobalt and rare earth elements, each of which comes with its own set of requirements. environmental, economic and geopolitical challenges.

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In this new report, Thomson Reuters examines the additional implications of the rise in electric vehicle production, creating a “what-if” analysis that predicts the impact of large-scale growth in electric vehicle use on everything from consumer purchasing patterns to global energy use and carbon emissions. We also weigh the impact of the electric vehicle revolution on the metals and mining, automotive and energy sectors; highlight the various legislative initiatives that are being rolled out around the world; and share insights from our research teams working on the front lines of this transformation.

To understand the full significance of electric vehicles, it’s worth taking a closer look at what drives them. Unlike other huge shifts in consumer preferences, such as the rise of smartphones, the rise of e-commerce, or even the first automobile revolution, which were driven almost entirely by technological innovation, technology is only one part of the three-pronged phenomenon behind the EV revolution. Two other important variables are growing environmental awareness and rapid changes in political policy.

Let’s start with the environment. According to Johan Wiebe, a leading metals analyst, while estimates vary, the automotive sector accounts for between 15 and 25 percent of polluting emissions such as nitrogen oxide, particulate matter and carbon dioxide.

Together, these pollutants, whose concentration in the Earth’s atmosphere exceeds the maximum in the last 650,000 years, are associated with climate change. Studies show that the Earth’s temperature will rise by well over two degrees Celsius by the end of this century unless significant changes are made to global production, energy supply and consumption practices. At the same time, these pollutants created smog and localized pollution, causing health problems and choking major cities.

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It was no coincidence then that, as a large-scale public outcry began to build in response to this trend, car manufacturers began selling alternative-powered cars that produced lower emissions by supplementing internal combustion engines with electric motors. Toyota was the first to really capture this market with its hybrid Prius, which was launched in Japan in 1997.

By 2003, the Prius had gone from novelty to status symbol, thanks in part to clever marketing from a California Toyota dealer. He lent cars to celebrities and prominent environmental activists such as Leonardo DiCaprio and Cameron Diaz, who drove them to the 2003 Academy Awards instead of gas-guzzling limousines. Suddenly, the Prius was more than a car, and the hybrid was more than technology; they were statements about the environmental consciousness of the people who ran them.

As momentum continued to build in support of greater environmental awareness, governments around the world began to get the message that even Leonardo DiCaprio didn’t have enough star power to single-handedly change the buying habits of car consumers. Although the Prius is growing in popularity, its annual sales figures are only a fraction of those of conventionally powered light trucks and SUVs. In 2012, the Prius’ best year ever, Toyota sold 247,500 units in the US. Meanwhile, Ford sold more than 650,000 full-size F-150 pickup trucks in the U.S. during the same period.

It was also the year the US adopted the new Corporate Average Fuel Economy (CAFE) standards, which were introduced by the Environmental Protection Agency (EPA) under President Barack Obama, requiring car manufacturers to have an average fuel economy of 54.5 mpg. per gallon (mpg) in their fleets through the 2025 model year. For reference, the average fuel economy for all vehicles sold in 2012 was 23.2 mpg (10 L/100 km).

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The electric vehicle revolution is being driven by institutions of all kinds. According to Thomson Reuters Westlaw, Hawaii (the first state to adopt electric vehicle regulation) requires one for every 100 parking spaces to be equipped with an electric vehicle charging system. In Hartford, Connecticut, it’s one in every 35.

The US was not alone. The European Union, which implemented a deal with car manufacturers to cut carbon emissions back in 1998, has since gradually increased its fuel efficiency targets.

More recently, a number of countries have announced even stricter emissions standards, proposing deadlines to completely ban the sale of internal combustion engine vehicles. Norway has set the toughest targets, banning sales of conventionally powered cars by 2025. Other countries such as India, the Netherlands and Israel have proposed a 2030 target, while China (the world’s largest car market) is actively considering and exploring prohibition.

Sources: Thomson Reuters GFMS team, Thomson Reuters Eikon and Reuters News. Current data as of March 20, 2018.

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These are not just limitations. A number of national and local incentives have also been implemented in the US and around the world to encourage greater consumer adoption of electric vehicles.

Norway, the world leader in electric vehicle market share, is a compelling case study. In 2017, EVs and hybrids reached 39% of the market, thanks in large part to a number of government incentives, including:

As consumer awareness continued to grow and governments around the world set strict new fuel economy standards, automotive technology also upped its game. While the Prius became a Hollywood darling, delivering 56 mpg but very little in the way of performance or luxury, the electric Tesla Model S, introduced in 2012, set a whole new standard for what’s possible in an alternative-powered car. . Capable of accelerating from 0 to 60 mph in 2.5 seconds, the four-door luxury sedan became the fastest production car in the world.

Suddenly, environmentalists and enthusiasts alike could find something to get excited about in the burgeoning electric car movement. However, despite rapid growth from several different directions, only six countries – China, the US, Japan, Canada, Norway and the UK – currently have an EV market share of more than one percent of total vehicle sales . This number is expected to grow exponentially over the next few years.

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The key to this growth was the technological improvement of lithium-ion batteries. As Thomson Reuters senior energy analyst John Berntsen explains, technological advances in this space are driving energy storage prices down dramatically.

“Thanks to economies of scale, the price of a lithium-ion battery is steadily falling by 15 percent every year, while the energy density is increasing,” explains Berntsen. “This results in a greater range for the same price. If the range expands further, consumers will embrace EVs and adoption will follow the classic technology adoption curve: from early adopters to laggards. This market is no different from other technology markets.”

“With this development, electric vehicles will sooner or later reach the price/quality ratio that will make them competitive with fossil fuel alternatives,” adds Berntsen. “If that happens, the market will quickly turn in a new direction.”

This surge of converging trends has provoked the global automotive industry to take electric vehicles seriously. Perhaps the clearest evidence of how seriously it happened

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