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Electric Vehicles on the Road Are Set to Triple in Two Years

Jun 24, 2020 | Industry Trends, Renewable Energy

The global fleet of electric vehicles is likely to more than triple to  13 million by the end of the decade from 3.7 million last year.

Teslas and Nissan Leafs are likely to become a much more common sight  on the world’s roads in the next two years, the International Energy  Agency says.

The global fleet of electric vehicles is likely to more than triple  to 13 million by the end of the decade from 3.7 million last year,  according to a report released Wednesday from the Paris-based  institution, which was set up to advise industrial nations on energy  policy.

Sales may soar 24% each year on average through to 2030.

The findings illustrate the speed at which the world’s transportation  system is shifting toward cleaner fuels as governments focus on  limiting pollution and greenhouse gases. Tesla Inc. and Nissan Motor Co.  have some of the best-known EVs on the road now, but major automakers  from Volkswagen AG to General Motors Co. and Audi AG have followed suit  in announcing dozens of battery-powered versions of their models.

“The dynamic policy developments that are characterizing the electric car market are expected to mobilize investments   in battery production, facilitating cost reductions and ensuring that  battery production takes place at scales that exceed significantly what  has been seen so far,” said Pierpaolo Cazzola, senior energy and  transport analyst at the IEA.

Here are some of the key findings of the IEA’s report:

  1. China will remain the biggest market.

Electric vehicles are expected to take just over a quarter of  vehicles sold in the Asian nation by 2030, up from 2.2% last year,  according to the IEA’s estimates. More than half of global sales in 2017  were in China, followed by the U.S.

The Chinese government has put a number of policies in place to  encourage EVs, part of an effort to cut air pollution in smog-choked  cities. In 2017, the government in Beijing it set minimum requirements  for domestic carmakers on electric vehicle production through a credit  trading system. It also extended a 10 percent tax rebate for consumers  until 2020.

  1. EVs will displace lots of oil from the market.

Electric cars run on batteries charged by power plants, instead of on  gasoline or diesel fuel. With an estimated 130 million light-duty  vehicles expected on the world’s roads by 2030, the IEA estimates about  2.57 million barrels of oil per day won’t be needed. That’s about as  much as Germany uses each day. Last year, the global EV fleet displaced  380,000 barrels a day of demand, about half of what Belgium consumes.

The IEA’s estimate is more punchy than Bloomberg New Energy Finance’s  expectation that 2.23 million barrels per day will be displaced from  the market by electric vehicles by the end of the next decade.

For BNEF’s report on electric cars and the oil market, click here.

  1. Governments will have to find new sources of tax revenue.

Governments around the world may lose out on $42 billion in tax  revenue from road fuel sales by 2030 in the IEA’s central scenario. In  the report’s most aggressive forecast for EV uptake, it was as high as  $92 billion.

Last year, China’s fuel tax revenue was already cut by $2.6 billion  because of the growing share of electric vehicles on the country’s  roads, the IEA said.

  1. At least 10 more giant battery gigafactories will be needed.

Demand for batteries is expected to rise by a factor of 15 by 2030,  largely driven by light-duty vehicles such as cars and vans. China’s  burgeoning market is expected to make up half of the world’s demand,  followed by Europe, India and the U.S.

That means the world needs many more battery production plants like  the Gigafactory that billionaire Elon Musk’s Tesla is building in  Nevada. That facility draws its name from the word giga, meaning  billion. It will produce 35 gigawatt-hours of batteries over 4.9 million  square feet of operating area.

  1. Buses are going electric too

There will be 1.5 million electric buses in use worldwide by 2030, up from 370,000 last year, according to the IEA.

Almost 100,000 electrified city buses were sold last year, 99 percent  of them in China. The Chinese city of Shenzhen is leading the pack with  an all-electric bus fleet. A number of cities in Europe’s Nordic region  such as Oslo, Trondheim and Gothenburg also have electric buses in  operation.

  1. Cobalt and lithium demand is surging

Cobalt and lithium are key ingredients in the rechargeable batteries  that power electric vehicles as well as electronics from mobile phones  to laptops. Demand could possibly rise tenfold, but technological  advances and adjustments to battery chemistry could also significantly  reduce this.

Since about 60% of the world’s cobalt is mined in the Democratic  Republic of Congo where child labor still exists, battery makers are  under pressure to show that their products are made sustainably. This  may provide an incentive to shift away from cobalt-heavy batteries.





Original Article by Industry Week/ Anna Hirtenstein/2018

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