“Cost is really huge, in terms of adoption of electric vehicles,” said F. Noel Perry, founder of the organization Next 10, a research think tank studying the environment and the economy, based in San Francisco. Next 10 recently released a report, The Road Ahead for Zero-Emission Vehicles in California: Market Trends & Policy Analysis.
The study found that sales of zero-emission vehicles, which are fully battery-powered electric cars, plug-in hybrid electric cars and cars powered by fuel cells, increased 29.1 percent from October 2016 to October 2017. In fact, roughly 4.5 percent of the cars on the road in California are electric vehicles. (Fuel cell-powered cars make up a “miniscule” share of the car market.) U.S. sales of ZEVs grew 28.8 percent during the same period, according to the report.
The growth in non-gasoline-powered cars is showing no signs of easing up, said Perry. “The analysis shows that ZEVs could be as ubiquitous by 2040 as cell phones are today,” he noted.
That growth is largely related to increasing cost competitiveness of ZEVs, aided by the fact that an electric car costs only a fraction to operate, compared to a gas-powered vehicle. A study published in January by the University of Michigan found that in many states a gas-powered car would need to reach 55 to 60 mpg in order to operate on par with the cost of electric power needed to power an electric vehicle in those states. In fact, the average annual cost of operating a gas-powered car ranges from $1,509 in Hawaii to $993 in Alabama, the study concluded. Compare this to the annual cost of operating an electric car: $1,106 in Hawaii to a low $367 in Louisiana.
California is not alone in its interest to grow ZEV purchases. The state has signed a memorandum of understanding with seven other states — Connecticut, Maryland, Massachusetts, New York, Oregon, Rhode Island and Vermont — to adopt policies to bring 3.5 million ZEVs on the road by 2025.
But if ZEVs will ever become as ubiquitous as cellphones — in California or other states — drivers will need to be confident they can take them out, and easily charge the car once arriving at a destination. That means states will have to invest heavily in charging infrastructure or change public policy to make the charging units a fixture of parking lots at workplaces, schools, retail centers, as well as multifamily housing developments.
“We’re going to have to really increase our charging infrastructure,” said Perry.
“The hope is that some of the technology advancements in charging stations will also push the cost down as well,” said Adam Fowler, an economist with Beacon Economics, who also contributed to the Next 10 study of ZEVs.
Today, there about 16,500 non-residential, public charging locations in California.
“Studies have estimated that roughly between 120,000 to 250,000 chargers are what we need to get up to a more stable kind of equilibrium for the relationship between cars on the road and chargers,” said Fowler.
Stimulating the growth in charging stations could come from sources such as the settlement Volkswagen reached with California, following an investigation related to the company’s use of illegal “defeat devices” on some of Volkswagen’s diesel-powered cars. In that settlement Volkswagen would pay $800 million into ZEV-related investments, according to the California Air Resources Board.
Evidence suggests the state may have some work to do when it comes to beefing up its charging infrastructure.
“Because we have a large number of (ZEV) vehicles on the road, that ratio between the charging outlets and the ZEVs is one of the lowest in the country,” said Fowler. “So, we’ve got a lot of work to do. And hopefully, technology advancements in the actual charging stations themselves will help to make those easier to install.”
Drivers should not expect charging stations to replace gas pumps on roadsides. Instead, they will likely find chargers in places where drivers park: offices, apartment buildings, parks and other places.
“Wherever you sleep at night, expect to see the charging station there, and the same at your place of work or education,” Fowler noted. “A lot of our land is zoned and built in parking. And reimagining a lot of the parking we already do to include charging is how we need to think about the kind of challenge we face.”
Roughly 46 percent of residents in California are renters, according the American Community Survey by the U.S. Census, making it imperative that multifamily housing buildings include charging locations. And electric providers as well as cities ought to devise incentive programs for charging stations in these areas, according to Fowler.
“So it’s not just this idea of putting an electric version of a gas station on the side of the road. It’s kind of repurposing the existing infrastructure we have,” he said.
In short, the growth of the electric car market represents one of the biggest shakeups the auto industry has ever encountered, say observers.
“A number of major countries around the world, such as China, U.K., France, The Netherlands, India are starting to create plans and intentions to phase out internal combustion engines,” said Perry.
“And for me, I thought that was stunning,” he added. “I thought that that was very important. Because it showed a major inflexion point, or a shift away from the type of vehicles that we’ve had since the beginning, for the most part.”
ZEVs By the Numbers
Percentage of total ZEVs in the U.S. in 2017 sold in Calif. – 49.3
ZEV market share in Calif. in 2017 – 4.5 percent
ZEV market share in the U.S. in 2017 – 1.1 percent
ZEV market share in China in 2017 – 1.8 percent
World’s ZEVs produced in China – 43 percent
World’s ZEVs produced in the U.S. – 17 percent
Drop in battery costs for ZEVs from 2010 to 2016 –74 percent
Increase in charging stations in the U.S. from 2011 to 2016 – 1,138 percent
Number of non-residential charging stations in Calif. – 16,549
Source: Next 10
