Saturday, April 11, 2015

EV costs at a tipping point for un-American countries

Un-American developed countries, that is. See here:

Bloomberg reprinted the above graph from a 2011 McKinsey report, and I added the green line for where we are today. Bloomberg adds the info that we weren't supposed to hit $300 until 2020 and that the market leaders are already there.

Bloomberg goes on to note the obvious fall in gas prices so that currently, all EVs are less competitive than they were in 2011. A person buying a car today might think twice though about whether gas prices are going to remain low.

What I thought missing from the discussion is the existence of developed countries not named United States of America, because of a little thing called the gas tax. In most of them, the price is over $4.50 (and also in many developed countries that don't produce oil). Forget the US - for the rest of the world, the tipping point is here.

Sadly though, I'm not aware of EV purchases in the rest of the world matching this prediction. Part of it could be that Nissan Leafs and Teslas simply aren't cheap for other reasons, and they need more development and more competition to knock down prices. The other and more depressing factor is that people aren't economically rational and may discount the future savings from not buying gas more than they should. Or just not be able to finance.

Overall though it's good news, and it should be interesting to watch overseas EV sales in the next few years.

UPDATE:  some good comments worth checking out. One point was that in countries with high gas taxes the electricity is also often expensive. I'd agree, but I doubt it come close to making up the difference.

Another point was about electric bikes - if you put them on the chart above, I think they'd win under any circumstances, and they'll do even better as batteries improve. Developing world countries are building and rebuilding their cities and towns on a much more massive rate than developed nations, and they have a real opportunity to center personal transportation around electric bikes, not cars.


JohnMashey said...

Google: electric bicycles

and see Wikipedia, especially on China...

Fernando Leanme said...

Specifically for Europe:

1. Hard to find a charging station.
2. Poor range. Problems with battery running out when its cold.
3. That graph appears to be theoretical, not real.
4. My local mechanic says batteries lose capacity in cold weather, tgey don't have the full nominal charge.
5. We live in condo complexes, setting up chargers for individual vehicles takes a ton of paperwork.
6. Lack of battery lifetime record causes distrust.
7 New diesel powered vehicles get 50 plus mpg, are super reliable, known quantity.
8. Electricity costs more, it's bound to be even more expensive if they push more renewables which charge more due to sweety feed in.

I'm mentoring a student who's building a robotic vehicle, the design includes a rechargeable battery, solar panels, and very light plastics materials, but the battery weight is a killer, and it's using a lot of power for the IR sensors, servos, and of course the motors. Going uphill uses too much power. So we are learning how to optimize it. For a long range vehicle I think we need a small gasoline engine driving a generator. We don't want the engine coupled to the wheels directly, it's just an energy storage device gimmick. But it may be a solution to make EVs become a practical solution.

EliRabett said...

1. Rapidly changing and not really

JohnMashey said...

That map seems good in Europe, but only shows one at HP on the Peninsula South of San Francisco ... in the Land of Teslas, Leafs, etc. Offhand, I know of 4 within 2 miles of here, and they show up on map by ChargePoint.

I.e., to see more stations, one really needs to see more vendors.

This is a chicken-and-egg infrastructure/mobile issue, just like cellular radios were when the started in cars.

At first, cell coverage was limited to a few cities, which meant no one anywhere else bought it. As more people did buy, telcos kept extending the networks.

In some localities already, there really is little problem finding a charger.

jrkrideau said...

Stupid question but what kind of gallon? Imperial @ 4.55l or US @ 3.9l?

Mike Dombroski said...

There are some new engine designs such as this linear range extender for electric cars. It has few moving parts with magnets built in. I think cars might eventually have all electric drive with a modest battery or supercapacitor.

William M. Connolley said...

Are you now, or have you ever been, un-American?

Meanwhile, it seems odd that the graph compares fuel price to battery cost. That's like comparing electricity price to the cost of the fuel tank itself. Unless electricity is either free, or an insignificant portion of the cost of an electric vehicle mileage.

marke said...

William Connolley said... seems odd that the graph compares fuel price to battery cost...

Energy cost for a battery powered car is extremely low. Only a few dollars per 100 km, perhaps less than a quarter of the cost of running a petrol or diesel car the same distance.

So, why don't we all rush out and buy battery cars?

Cost and range. Cost is driven by high battery price. Range could be solved by changing batteries, but they are too expensive.

And, batteries have a limited life, and will need replacing.

It seems a useful comparison.

Fernando Leanme said...

I gave the charge map my location and it answered there were no charging stations available. I know they have one at Carrefour on the highway between Alicante and Campello, but that's impractical.

I also sustain the other items on the list are valid. I'm used to supervising young engineers and grad students, so I'll keep pushing to see if I can have a viable hybrid developed, which suits our local driving needs and layout. The pure battery design just doesn't make sense. Im sure I can beat it with a NGL fueled plug in hybrid. But that's going to require a program to have plugs located in all the parking spaces. And the condo board won't go for it unless there's an explicit government order, a subsidy, or easy financing.

Bryson said...

Background info on the comparison would be nice to see. Maintenance costs should be lower for EVs, for instance. Is that captured here?

Unknown said...

I live in Europe: I have an old diesel car for long distances and a LEAF as a daily driver. The Diesel gets about 16-18km/litre, currently that costs about 7-8 Euro cents/km. I've had the LEAf for 2 years now and done just over 40,000 km. Average consumption according to the onboard computer is 0.16 kWH/km. That's about 2-3 Eurocents/km depending on whether I charge during the day or at night.

In my area we also get free charging at municipal charge points. However, sometimes I have to leave my car to charge and actually walk a couple of hundred metres to my destination!!!

The Rational Pessimist said...

Even in Europe, we still seem to be a battery generation away from the tipping point.

The problem is that the Nissan Leaf, for example, only has a 24kWh battery but one litre of petrol will give you 10 kWh. A Mini has a 40 litre tank, so it's a veritable store house of energy. OK, an internal combustion engine (ICE) is less efficient at getting that energy to the wheels compared with an EV (roughly 30% versus 90%), but that only partially closes the energy storage gap.

UK petrol price currently 110 pence per litre, so that's 11 pence per kWh or 33 pence per kWh of motion. UK electricity price around 10 pence per kWh or 11 pence per kWh of motion for an EV. So EV fuel cost a third of ICE in UK.

However, you need to take a levelled cost approach depreciating the battery over its life. Battery cost currently around US$300/£200 per kWh. So the Leaf battery costs about $7,000. Leaf range is 75 miles, so you need to double or treble it in size to get rid of range anxiety gong forward.

And a big battery is still currently very bulky which presents a raft of engineering challenges if you scale it up. (In the Tesla, the whole car floor is basically a battery.)

In sum, you can't get to the tipping point just on the relative fuel cost. You need to see dramatic improvements in a) energy density to shrink the battery volume and b) the cost per kWh of the battery.

I just did a series of blog posts on this issue and get progressively more cautious over when the tipping point would come as I dug deeper into the issue.

Brian said...

Folks might want to read the McKinsey article (2d link in the OP). My impression is the model they use is proprietary and they're just giving us a taste.

So, it's hard to say if it covers everything people have asked about.

I think some of the factors Fernando mentions are legitimate to some extent but also temporary, so even if McKinsey is no more than somewhat off, then there still should be a surge in purchasing EVs in high gas tax countries. We'll find that out soon.

Range anxiety in particular seems like an overplayed issue, mainly by people who don't own EVs. And their ranges are getting better, soon.

Brian said...

And John Mashey's point about EBs is a great one. I saw lots of them in Vietnam two years ago, and I think many Third World countries have an entire alternative future for personal transportation.


Unfortunately, when faced with a $25,000 battery replacement bill some upwardly mobile third wolders may be temped to economize by sticking a $750 diesel generator in the trunk, - 12.5 kwh a gallon remains a pretty good deal

Let us hope it burns nothing worse than palm oil

Fernando Leanme said...

Come on, Russell, I'm trying to stay positive. The latest twist in the robotic car project is a tiny gasoline engine. The project is a model to demonstrate labyrinth navigation capabilities, but the boys want to jazz it up, so it's getting solar panels (already ordered from China), and batteries, purchased from Amazon.

We have discussed potential range extenders and decided to use the small gasoline engine. In a scaled up version it would be a 10kw engine driving a generator.

If the vehicle has to function for a long time the engine starts, the solar panels help a little bit, and the batteries supply the missing power. The generator runs at a single speed so it's always charging the batteries. And if the load is excessive then it has to be parked and the small generator keeps charging the batteries. It's not a perfect solution but we want to get away from the excess battery weight and the extremely long charging period.

Andrew said...

I do think - as per NF above - that EVs are currently suitable as 'second car replacements'. Cars that are never going more than perhaps 20 miles from home, that will do many short journeys and rarely be required to go fast.

Ironically, to make full use of this segment we might want a cheaper car with fewer batteries, rather than trying to completely replace the one-size-fits-all ICE car. A towable range extender might work with this as well.

Marlowe Johnson said...

Thanks for sharing Brian. Was just looking at the McKinsey report the other day and did a similar update :). A few points that are worth keeping in mind. First, as already pointed out the fuel costs for pure EVs are relatively small on a total cost of ownership basis. In jurisdictions that have high electricity prices, gasoline/diesel prices also tend to be relatively higher because of taxes, so the two tend to offset each other when looking at comparisons as described in the chart you posted. Second, the maintenance costs of EVs are much lower, so even if you do include electricity consumption costs, they'd be further offset on a TCO basis.

When it comes to charging stations and range anxiety, it's important to distinguish between pure EVs and PHEVs like the Volt and public vs private charging infrastructure. While public and private charging infrastructure is indeed critical for more widespread pure EV adoption, only access to private charging stations will be critical for PHEVs.

oh and visitors to the great white north can find a map of charging stations here:

JohnMashey said...

The 2D graph is a simple projection from a much more complex space, often described in more detail at lectures one can attend, if one lives somewhere that has lots of experts on this.

It's a really simple model, but within the constraints, I think it is OK, and it does show the major variable costs that differ between ICEs and the various EV's.

Among the bunch of Tesla's around here that I see often, one has license:


I asked the owner once if that was:
a) a subtle lament for Greenland
b) Saying goodbye to Internal Combustion Engines (yes)

Unknown said...

When calculating the miles per kWh for EVs don't forget to take into account regenerative braking.

I use my LEAF 90% of the time and the old diesel for the rest. I kept it because it has a tow hook and as it's less than pristine, it can be used for taking the dog to the vet. That was something that my wife vetoed in the LEAF. Otherwise, a hire car for the long trips would be almost as cheap as keeping the diesel.

Once I got used to planning a bit before driving, range anxiety was not a problem. However, you can't always guarantee that a charge point is available, so if I make a long trip, I generally stop en route for a short fast charge to ensure that if the charge point at my destination is unavailable I can reach an alternative.

EliRabett said...

A thought occurred to Eli about recharging EVs. Penetration is high enough many places that you are going to start seeing charging stations in mall parking lots and similar because the merchants want to attract customers. As penetration increases, you are going to start seeing those charging stations powered by solar roofs over the parking.

That way the charging becomes even more profitable for the parking lot owners. Dano should comment on this, integrating the solar parking deck with the urban forest.

Marlowe Johnson said...

can't imagine that the panels could generate enough electricity to come close to meeting the charging requirements. which isn't to say that such a thing is a bad idea.

the big issue for public charging in most places is at the transformer level. lots of headaches for for utilities that don't start planning and addressing upgrades now.

where things get really interesting with higher penetration levels is V2G. that's when the synergy between renewables and EVs will really shine. of course it will also be a pain in the ass for uncle sam due to lost gas tax revenue but them's the breaks.


OK let's stay positive and install rain turbines on the roofs of PV electric cars, so filling water can recharge them when the sun fails to shine

OnymousGuy said...

William Connelly,

I pay $.025 US / mile for carbon-free electricity, a small slice of the total lifetime cost over 100 k miles, $.34 US/mile. It is a white car. I spend more on washing the car (at a car wash that recycles its water) than I spend on electricity. I thought you would appreciate the figures.


P.S. I also estimate that by the time I need to replace the battery pack, it will cost be less than $200/kWh. FYI, I have a 2014 Chevy Spark EV, first one sold in Oregon. There really is no maintenance aside form the tires and window-washing fluid. 25k miles without a hitch.

markogts said...

Hello, I am an Italian guy with a brand new PHEV (the Outlander). I agree in some measure with Fernando, let me elaborate:

1. Hard to find a charging station.
Depends on the country. Netherlands, Austria are well covered. Italy is a desert.

2. Poor range. Problems with battery running out when its cold.
Well, depends from the application. Remember the car gets charged every night, so the range may be well enough for daily commute. Anyway, I feel an ICE range extender is still necessary for the time being.

4. My local mechanic says batteries lose capacity in cold weather, tgey don't have the full nominal charge.
I see some FUD. Yes, range gets lower in cold temperature, but see point 2.

5. We live in condo complexes, setting up chargers for individual vehicles takes a ton of paperwork.
Strange. I live in arguably THE country of paperwork, but there is a law from 2012 which ensures the right to install a charging station to the parking place owner. Big problem is the majority of people WITHOUT a parking place at all.

6. Lack of battery lifetime record causes distrust.
Yes, but IMHO it is unmotivated. Automotive industry has been very conservative in the sizing of batteries. Notice that, except for Tesla, other makers went for Manganese Oxide Li-ion batteries, which are more robust than the usual cells.

7 New diesel powered vehicles get 50 plus mpg, are super reliable, known quantity.
I beg to differ on the "super reliable". All the exhaust treatment, turbocharger and high pressure injectors is a real pain for many brands. Yes, they have good mileage, but I have the feeling they will be targeted in the next years with taxes because of NOx and PM. I would not bet on diesel nowadays. BTW, did you notice that many patents on common rail technology are expiring right now and VW is finally building PHEVs? ;-)

8. Electricity costs more, it's bound to be even more expensive if they push more renewables which charge more due to sweety feed in.
Cost of electricity is a non-issue: even with 40 €cent/kWh, which is a robbery, you still get 8/10€ per 100km, a break-even with the best diesel, not even now that the fuel is cheap.

I feel the tipping point is here for PHEVs, while for pure BEVs we need another generation of cars with a capillary charging network.