Published on March 30th, 2016 | by Guest Contributor


Electric Vehicles Will Deflate Demand For Oil

March 30th, 2016 by  

Originally published on Energy Post.
By Andreas de Vries and Salman Ghouri

The major oil companies greatly underestimate the impact electric vehicles will have on their market, write independent energy advisors Salman Ghouri and Andreas de Vries. According to Ghouri and De Vries, the trends currently underway in the auto industry are likely to have a substantial impact on oil demand in the medium term, and even a devastating impact in the longer term.

If there is one event in history that has shaped the crude oil industry, it is the popularization of the internal combustion engine (ICE) by the auto industry.

At the beginning of the 20th century, coal and wood were the dominant sources of energy, together providing more than 90% of global energy consumption. From 1910 onward, however, the Automotive Revolution triggered by Henry Ford spurred on demand for liquid fuels, causing crude oil’s contribution to global energy supply to more than double every decade. Consequently, by 1970 crude oil had taken top-spot in the global energy mix.

Continued growth in the transportation sector ever since has provided the world’s oil companies with plenty of organic growth opportunities. And judging by the energy outlooks the major oil companies have published, they appear to expect this status quo to continue. For example, BP’s most recent Energy Outlook 2035 assumes that non-oil based transport will grow just 5% per annum for the next 20 years, and that essentially all of this growth will be in the gas-powered transport segment. Similarly, The Outlook for Energy: A View to 2040 published by ExxonMobil assumes that by 2040 “plug in” electric vehicles (EVs) and fuel cell vehicles (FCVs) will have no more than a 4% market share. Chevron, meanwhile, has indicated that it plans on the basis of the assumption that the auto industry will remain fundamentally the same for at least another 50 years.

Alternative assumptions

However, as we documented elsewhere, the auto industry itself expects its future to be radically different from its present. To assess how the new vision of the auto industry would impact crude oil demand, we have developed an Alternative Energy Outlook (AEO).

The starting point of our AEO is research by Navigant Research, which predicts that by 2035 the total number of vehicles on the world’s roads will have grown to over 2 billion, from some 1.2 billion today. We assumed this growth to go through three distinct stages: during the period 2016 – 2020 a continuation of the 4% annual growth witnessed from 2010 to 2014, 2.5% annual growth during the period 2021 – 2030 as growth in China and India slows, and finally 1.5% annual growth for the outer period 2031 – 2040.


Figure 1: Vehicle pool growth assumptions of the AEO

We have looked at the implications of this growth of the transport sector for crude oil demand, under three sets of assumptions:

  • First, that the EV share in the global vehicle pool will increase based on a continuation of the current 50% annual growth rate in EV sales until the end of this decade, after which EV sales growth will slow down to 30% per annum during the period 2021 – 2030 and further slow down to 15% per annum during the period 2031 – 2040. This is the reference case in our alternative outlook.
  • Second, that the EV share in the global vehicle pool will increase based on a slightly lower 42% annual growth rate in EV sales until the end of this decade, after which it will slow down further to 25% per annum during the period 2021 – 2030 and 12% per annum during the period 2031 – 2040. This is the low case in our alternative outlook.
  • Third, that the EV share in the global vehicle pool will increase based on a 60% per annum growth in EV sales until the end of this decade, after which it will slow down to 36% per annum during the period 2021 – 2030 and further slow down to 18% per annum during the period 2031 – 2040. This is the high case in our alternative outlook.

The Alternative Energy Outlook

Using data from the IEA we estimate that in 2015 the global vehicle pool consumed 42% of the total crude consumption of 93.0 mmbd (million barrels per day), or roughly 39.5 mmbd. This data point enabled us to estimate what global crude oil demand would look like for 2020, 2030 and 2040, if the mentioned growth in vehicles will be entirely in the ICE segment of the transportation, as the conventional energy outlooks of the oil companies assume, and that average vehicle efficiency remains constant.

Our alternative energy outlook uses the same assumption for growth in the global vehicle pool, but assumes that EVs will displace some ICE vehicles. This enables us to assess the number of barrels lost from global crude oil demand due to EV penetration, through performing the following calculation for each of the mentioned periods (where CEO means “conventional energy outlook” and AEO means “alternative energy outlook”):

(Total number of ICE Vehicles CEO – Total number of ICE Vehicles AEO) * Average fuel consumption of ICE vehicle 2015 actual)


Figure 2: Vehicle pool compositions of the AEO

In the reference case of our alternative energy outlook, the number of EVs grows from its current 1 million to 8 million by 2020 (1% of the total vehicle pool), to 105 million by 2030 (6%), and to 424 million by 2040 (19%). The displacement of 7 million ICE vehicles by EVs during the period 2016 – 2015 would by 2020 result in a crude oil demand that is 0.3 mmbd lower than the forecast that is based on the assumptions of the conventional energy outlooks.

In the reference case a further 97 million ICE vehicles would be replaced by EVs during 2021 – 2030, and another 319 million during 2031 – 2040. This would remove 3.4 mmbd from the crude oil demand forecasted by the conventional energy outlooks by 2030, and 13.8 mmbd by 2040.

In the low case of the alternative energy outlook the number of EVs grows from its current 1 million to 6 million by 2020 (<1% of the total vehicle pool), 54 million by 2030 (3%), and 167 million by 2040 (8%). Here, crude oil demand would be lower than forecasted by the conventional energy outlooks by 0.2 mmbd by 2020, 1.7 mmbd by 2030 and 5.4 mmbd by 2040.

In the high case of the alternative energy outlook the number of EVs grows from its current 1 million to 10 million by 2020 (1% of the total vehicle pool), 227 million by 2030 (12%) and 1,188 million by 2040 (55%). The oil companies’ forecast for crude oil demand would then be reduced by 0.3 mmbd by 2020, 7.5 mmbd by 2030 and 38.9 mmbd by 2040.


Figure 3: Crude oil demand losses according to the AEO


From an oil industry perspective, the positive news in our Alternative Energy Outlook is that EVs will have no meaningful impact on crude oil demand in the short term, irrespective of the assumptions used.

For the evaluation of the medium term impact of EVs it is important to remember that the recent crash of the oil price was caused by a supply – demand imbalance estimated to be around 2 mmbd. The low case of the AEO would already remove a similar quantity from crude oil demand, meaning that EVs should be expected to have a substantial impact on crude oil demand, and hence the crude oil price, in the medium term.

In the longer term the impact of the trends currently underway in the auto industry could well be devastating for the crude oil industry. The sooner the industry realizes this, the bigger the chances it will find new opportunities for growth in the future that the auto industry intends to create. 

Dr. Salman Ghouri is an oil and gas industry advisor with expertise in long-term forecasting, macroeconomic analysis and market assessments. 

Andreas de Vries is a strategy consultant in the oil and gas industry, supporting companies to not only develop strategies for success but also execute them.

Reprinted with permission.

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  • J.H.
  • J.H.

    One thing over looked in this article is the pricing of carbon emission. With the back lash from share holders and investors in the fossil fuel industry, from the Fraud and concealment on climate charges ( ) . When the dust settles, from the law suites and price of doing business as usual increases , eventually will drive the cost of fuel to the point that it will be uneconomical and driven out of the market place. These new facts of concealment, suck the wind out of the deniers arguments. And when the political campaign funds dry up from the fossil industry, The short term assumptions will be out of wack. The only reason major oil companies are down playing the growth of the EV industry, is so that they can prolong the exit from share holders and investors, a continuation to DEFRAUD.

  • Matjaž Ciglar

    2025 all new cars will be EV. Lorries and buses will become electric mainstream. Within couple of years new really cheap batteries will emerge. EV are safer, simper, after 5-10 years cheaper than cheapest ICE. Ford alone announced 13 new EV models till 2020! By same time Tesla capacity will reach 2M/a, VW is plaining new EV factory in US, Nissan, BMW and others already on market with plethora of cars… EV is in ICE is out.
    So who will want to buy stinky, noisy, low performance car that is more expensive?

    • Kraylin

      While I admire your enthusiasm 100% EV by 2025 is unfortunately going to be way wrong… Some of the guesses above I think are closer to the truth. EV sales are going to be hampered by supply for quite some time I think. It is just too risky to switch over night and so we are years away from announcements for battery plants. Years more to build those plants. You get the idea… 2025 will come far too quickly to make the switch.

      • For BEV you’re almost certainly right. But to meet emission standards, I wonder if small-battery PHEVs will begin to dominate the market much sooner than expected. Those could quickly soak up new battery production, and since most driving is local, impact the oil industry much faster than the study (which didn’t seem to address this scenario – did I miss it?) predicts.

      • Mike Dill

        Kraylin, unfortunately I think you are correct. The next five Giga-Factories will still take about five years each to build, and will not double the current battery production.

        • Philip W

          The good thing is, you can build as many Gigafactories at the same time as you want (and have money for).
          Construction of Gigafactory 2 will start well before Gigafactory 1 is finished in 2020, I’m pretty certain of that.

          • Bob_Wallace

            Sure. Start one in several different companies. They’re nothing more than big buildings, the skills needed to build them is commonly found.

            And during construction multiple companies manufacture the machines which are used in manufacturing batteries. And mines/processing scales up.

  • Brian

    All dirty gas cars should be banned. This would force manufacturers to mass produce only electric cars, and further force the price down. We should build a national network of solar electric charging stations like Fastned in Denmark. Electric cars like the Nissan Leaf, and future Chevy Bolt, that will get 200 miles to a charge, are the future, and should replace all dirty gas cars. Electric cars have less moving parts, and are much cheaper to operate. As the price of solar continues to drop, it only makes more sense to stop using dirty oil, because more and more people will get free energy from their solar panels on their houses.

    • Ross

      Overnight ban or softly phased in through requirements for increased fuel efficiency and reduced emissions?

      Looking forward to all the clean air.

      • Banning cars would never fly politically. But escalating carbon taxes would achieve the same result over time. Investing in new battery factories looks like a sure bet when gasoline pricing begins to include atmospheric impact.

  • nakedChimp

    1.000.000 as a prefix is shortened as UPPERCASE ‘M’, not lowercase ‘m’.
    Lowercase ‘m’ stands for Milli, which means 1/1000, x0.001 or 1×10^-3.

    • Ross

      Why does your 1M have two decimal points in it ? 🙂

      • neroden

        European, I assume. They traditionally swap the meanings of “,” and “.”

        • John Norris

          Except the Brits 🙂

          • Ross

            And the Irish.

      • nakedChimp

        As neroden mentioned.. European notion.
        I’m born/raised German – habits are hard to get rid off and you can see up there I used the dot again for the decimal point.. confusing to say the least.

        According to Wikipedia I can blame the english speaking countries and the world domination of the US after WW1/2 for this crap.

        “Later, a “separatrix” (a short, roughly vertical ink stroke) between the units and tenths position became the norm among Arab mathematicians, e.g. 99ˌ95. When this character was typeset, it was convenient to use the existing comma (99,95) or full stop (99.95) instead.”

        “In France, the full stop was already in use in printing to make Roman numerals more readable, so the comma was chosen.[5] Many other countries, such as Italy, also chose to use the comma to mark the decimal units position.[5] It has been made standard by the ISO for international blueprints.[6] However, English-speaking countries took the comma to separate sequences of three digits. In some countries, a raised dot or dash (upper comma) may be used for grouping or decimal mark; this is particularly common in handwriting.”

        PPS: and to be completely with international standard, the “1.000.000” up there should be written either: 1000000 or 1 000 000 (or to be more scientific 1×10^6), using any of the decimal ‘separatrix’ to group the thousands is not advised.
        My apologies.

        • Ross

          No need to apologise, I was only kidding.
          The use of space in 1 000 000 seems like a good compromise for use as the thousands separator.

  • John

    All these forecasts make the grave assumption that car ownership rates will remain intact. As majority of high purchase power communities are urban, the need for car ownership is drastically reduced with the introduction of fully autonomous cars (“uber without a driver”).

    If the current car utilization rate is around 5-15%/day, one autonomous vehicle can replace 5-8 ICE cars (with the prenotion of car pooling during rush hour)

    Then we can reach scenario where in urban environment out of every 10 ICE cars:
    – 3-5 will be removed
    – More than half of new cars will be electric (average lifespan of a new car in Central-Europe is 13+ years)
    – Leaving 3/10 ICE cars on the road in 2030

    What this does to a new ICE car’s price depreciation rate is anyone’s guess.

    • Steve Grinwis

      When we finally see a future of ratcheting carbon taxes that increase over time, suddenly your V8 Biturbo Mercedes is going to seem like less of an investment….

      I suspect ICE depreciation will depend largely on regulation of carbon though. Otherwise people who don’t care will buy them and enjoy the cheap gas that the rest of us aren’t burning.

      • nakedChimp

        Gas won’t become cheap, just because less people use it. This gas needs to pay for a lot of large scale stuff.
        If the large scale vanishes, so does the efficiency and all of a sudden it becomes expensive to use gas.

        • phineasjw

          I’m sure there are economies of scale, but raising gas prices in an environment where electric cars are plentiful would be suicidal for the oil industry. They’re more likely to accept shrinking profits as long as they can, I would suspect.

          • Jens Stubbe

            Soon you will not use the term profit but merely positive margin. The entire US oil industry and their creditors are desperately looking for the return of higher prices that are very unlikely to materialize anytime soon and probably will not materialize ever again.

        • Frank

          In the short term it does. Just look at the coal industry. Of course investments in the future dry up almost right away. The efficiency would go down, but the low demand would also mean higher cost oil would never get produced, like drilling 4 miles down from the 1 mile deep seafloor, so that would help prices some.

        • Steve Grinwis

          When oil had a very modest oversupply compared to demand, oil prices fell like a rock, to nearly 50% of it’s peak value over night. And that was roughly a 3% oversupply.

          Now imagine a world where EV’s dominate and year over year, the demand for oil drops.

          That’s a world with a lot of oversupply, and low prices.

          Economies of scale won’t become a problem for decades, since the infrastructure is already there.

          • RobertM

            Yes but it depends on how fast it hits and the true numbers not the public numbers the oil company’s are working with. 3% oversupply cause the reduction but a 3% under supply could cause the price to go way up. If exploration is greatly reduced then supply will start to dry up. If the supply drys up faster the demand prices will go up. If demand before prices then prices will go down.

          • Steve Grinwis

            Supply drying up means people intentionally turning off taps, and reducing their potential income, and giving it away to the people who don’t want to turn off their taps.

            You’ll note how that didn’t happen last time.

          • RobertM

            An Oil well will only produce so much oil. The industry keeps the oil flowing by finding more oil and producing more wells. If it doesn’t pay to find new wells and they stop or greatly reduce exploration then oil production will go down that is already happening since the price drop. As the prices goes back up more exploration will happen but there is always a delay between when exploration starts and oil hits the market.

          • Steve Grinwis

            Not all oil wells are fracking wells in the US. There are wells in Saudi Arabia that have been pumping for 30 years, and still have a few decades left in them. They’ll be able to continue producing cheaply for a long time. If demand drops faster than output would drop naturally, you end up with oil being dirt cheap

          • RobertM

            Don’t disagree. It all comes down to supply vs demand. If the supply shrinks faster then demand prices will go up. If the demand shrinks faster the price will go down.

        • Jens Stubbe

          To the contrary gas will become cheap because it is a commodity and everyone in the entire value chain are cash strapped and needs to make any possible margin to satisfy their creditors.

          For every well that has to close the creditors are left with an asset that is literally worthless unless they can restructure the business, which means that selling at a big loss and sometimes with extra money tied to the deal to avoid costly decommissioning will be the norm as it already is for coal infrastructure.

          Even worse for oil and in some respect for EV’s Synfuels will decrease in cost and seal the fate for fossils.

          Any car running on Synfuels will pollute far less due to the chemically clean fuel and they will be completely CO2 neutral provided the Synfuels are produced from renewable electricity and excess CO2.

          • Ulenspiegel

            “Even worse for oil and in some respect for EV’s Synfuels will decrease in cost and seal the fate for fossils.”

            This will not happen. P2G or P2L need expensive hardware (+high FLH required ) and will produce a kWh liquid fuel in the 10-15 cent/kWh range, a barrel would cost around 200 USD. To burn this stuff in a ICE is not economic. Hint: we know the costs of chemical reactors, there is not room for huge improvement.

            In contrast, EVs -batteries on wheels – can provide the same less money and are at bthe same time efficient storage for RE peak production.

          • Jens Stubbe

            You can not use static assessments based upon trial production to proper assess the economic viability of any technology.

            This link is written by a nuclear proponent but the interesting part is that he has studied the literature and provide a spreadsheet where you can enter your own numbers to analyze the probability. Most of the numbers are from US Navy research.

            Since then the conversion efficiency has risen by about 33% which impacts cost both by lowering plant construction cost and by lowering the energy consumption cost.

            The best Synfuel conversion efficiencies obtainable are into the plus ninety percentages but clearly not economically viable due to the constraints on volume.

            Is you browse through the article and look into the spreadsheet you will see that the cost of electricity is the overwhelmingly biggest cost factor whereas plant utilization, CAPEX and OPEX matters quite a bit less to the overall economy.

            Also you will note that only the income from Synfuels are part of the factored in the spreadsheet whereas all sorts of other revenue streams based on producing freshwater, extracting minerals from the sea etc. are not calculated.

            All over the globe there are port side refineries and port side coal power plants that will go out of operation. They both has a lot of the needed infrastructure for storing fuels or for connecting to the grid – and both types of sites are heavily polluted and costly to decommission, which makes them ideal for being converted into Synfuel production sites.

          • Ulenspiegel

            A P2G reactor is foremost a chemical reactor with many known features, therefore, you can make – like the guys at Fraunhofer – some reasonable assumptions for capex and even with zero costs for electricity it will become quite expensive. 🙂

          • Jens Stubbe

            Surprise I have just learned that researchers have succeeded in making Ruthenium nano frames with a significantly higher surface area, which means that catalysts for turning CO2 into Methanol has just potentially can become far more compact and thus cheaper.


            These kinds of progress are very similar to what researchers into batteries report and the trend towards more efficient catalyst will make Synfuels cheaper to produce.

          • Ulenspiegel

            The reactor is the main contribution to the costs, there is not so much room for improvement. IIRC Catalysts are a minor player.

            The high capital costs require high FLH for the reactor, this limits P2G/P2L as competitors of batteries, esp. for peak management.

          • Jens Stubbe

            I see you did not bother examining the excel sheet I linked to and you do not appreciate that reactors scale with the surface area of the catalyst which means that the other link I brought about researchers that have been successful in increasing the surface area of Ruthenium by factors really means a lot on the bottom-line.

            The cost of the reactors are subject to learning curves just as any other industrial product.

            Novozymes the worlds largest producer of industrial enzymes has invested heavily in biofuels based upon an enzymatic process and are close to their initial goal of being price competitive with fuels derived from crude oil at €100/barrel. (Their bet was that the oil price would stabilize around or above that level) In this decade they have brought cost down by 30% and a new innovation for inline sensors and software control of processing parameters by two of my friends has been tested for more than a year and promise 30% cost reduction too. This goes to show that industrial learning is happening and will continue to lower cost.

          • Ulenspiegel

            OK, then you assume that you can provide synfuels from biomass. You have to show that enough sustainable biomass is available. (IIRC It is not).

            My argument was for P2G from H2, CO2.

          • Jens Stubbe

            Sorry about that misunderstanding. I am only mentioning that Novozymes dare set goals well beyond the present day status, which I think is valid for battery development as well as other electrochemical endeavors such as Synfuels plants.

            In the Synfuel process I linked to there is a reversal of the current to lift up built up contaminants that I think it is feasible to work around and as mentioned the surface area of the catalyst is decisive for performance.

            If you had told that you thought solar would be cheaper than coal within this decade in 2010 you would either have been Kurzweil or laughing stock and the same goes for wind power. Elon Musk was also met with quite a bit trepidation

          • Ulenspiegel

            OK,then you should think harder about thermodynamics and try to understand the difference between thermodynamics -that is the minmum energetical price you have to pay- and kinetics, which are negatioable.

            If you start with the same educts like H2 and CO2, then the thermodynamics are the same for all systems which give the same products – it is selling snakeoil to claim otherwise.

            The consequence is you have a minimum price which is determined by the energy content of fuel (10 kWh/l) and the price of electricity for all systems.

            Biological system as catalysts do of course not change the thermodynamics and, therefore, do not change the minimum price.

            Only a different input, like biomass instead of hydrogen and CO2, changes the thermodynamics. You have then a different reaction that uses the captured sun light (you have outsourced a part of the reaction), but biomass is limited.

          • JonathanMaddox

            High usage rates for expensive synthesis reactors are quite easily achievable, simply by storing hydrogen feedstock on site, without requiring constant power input for the full P2G supply chain. Only the electrolysis step need be regarded as dispatchable load.

            Electrolysers aren’t necessarily very cheap either, but if you’re talking about making synthetic methane, methanol, urea (for fertiliser) or even heavier liquid products like F-T alkanes, then electrolysis is only a smallish component of the entire train.

          • Ulenspiegel

            No dispute her. However, we are talking about the claim that synfuel can be cost copetitive with oil.

            Here I (as chemist) have some basic issues. You have, if you start with hydrogen and CO2, to provide the energy (1 litre oil = 10 kWh) as electricity, this gives a minimum price of 40 cent litre, you have to provide production facilities which generate capex….

            A biological system in contrast to a classical chemical reactor only changes the kinetics by providing other catalysts (enzymes) the thermodynamic is of course not changed.

            The thermodynamic can only be affected by using other input as CO2 and water, i.e. by using biomass, which is a bottleneck when we are talking about fuel for ICEs.

          • Jens Stubbe

            I am not unaware of the laws of thermodynamics and I am not unaware of the amount of energy in Gasoline.

            If you open the excel spreadsheet that I have provided you with that models an older method of converting seawater into Synfuels you can analyze both economy and energy consumption by entering your own values.

            Your renewable energy cost per litre at 40 cent is downright wrong.

            In the first place the average US wind PPA as of 2014 for a 20 year period was $0.035/kWh on an unsubsidized basis which means more like $0.03/kWh seen over design life.

            In a second place the anticipated slowdown in wind cost reduction still means that the majors expect 40% cost reduction by 2025 or respectively $0.021/kWh or $0.018/kWh unsubsidized.

            In a third place over provisioned renewables means excess electricity that is sold at a lower rates to customers that agree to accept deliveries when the grid decides to. Synfuels can suck up that excess energy and as you know Nordpool every year have cost running negative and all never wind turbines are routinely curtailed over the year. At $0.005/kWh you will spend electricity for $0.08/litre Synfuels.

            In a fourth place there is already reported significant process progress regarding Synfuel reactions.

            In a fifth place there is no real economical viable alternative to over provision in sight despite even the rosiest forecast for battery storage (needs to scale thousands of factors) unless you accept keeping and paying for mothballed fossil energy generation – not cheap and not GHG acceptable.

            In a sixth place the cost of renewables will go further down if you allow over provision, which means that despite the obvious wanting efficiency the cost side and the GHG side of the equations are actually excellent – this point clearly does not have any bearing if you just like BP, EIA, IEA and others that constantly gets things wrong think renewables all of the sudden has arrived on a magic plateau where it won’t get cheaper.

            In a seventh place you can believe that batteries can sort the GHG trouble faster by replacing fossils and that it will be pervasive even for pour people but do you really think is will be faster or a cheaper process to drop the entire fossil value chain and replace it with a non existing battery infrastructure ?

          • Ulenspiegel

            I have no problems with lower electrcity price:

            Lets assume 0.02 EUR/kwh, then the energy contributes 30 EUR per barrel to the costs, let us half the current costs for the reactor (around 5 cent/kWh) we have another 40 EUR, the energy to maintain a useful kinetics, i.e. higher temperatures and pressure come on top.

            In best case I see synfule around 80 EUR/barrel, this with rosy assumption for FLH and price of wind energy. You really would use this in large scale for fuel that is burnt in ICEs with 30% efficiency?

            At this price batteries make more sense for most cars/trucks.

          • Jens Stubbe

            You use very unorthodox calculating methods.

            You are dealing with excess electricity. The Nordpool average is already close to your suggested 0.02 EUR/kwh and the excess electricity cost via Nordpool is most certainly much lower and will be significantly lower in the future (my suggestion at $0.005/kWh is certainly more in the correct ballgame when Synfuel expands) otherwise there will never be any point in trying to use batteries to store excess electrons – let alone use them for Synfuels. Meaning you will be stuck with Fracking gas peak power plants.

            Your reactor costing is not supported by the link I posted, which does not include innovation progress already demonstrated or the classic cost drop due to industry of scale that for instance battery producers are harvesting at the moment, so you persist with unrealistically high cost.

            Also you completely miss revenue streams from co-production of clean freshwater, minerals and metals, which will benefit the economics of Synfuels.

            Then you suggest ICE’s with 30% efficiency. The standard in trucks is above 40% and Toyota has just claimed plus 40% in their Prius. In the future the standard will be plus 40% except for of cause all the existing ICE’s that will be running for a time to come. But then again so would they be in a battery scenario and without Synfuels that would mean continued GHG emissions and millions of people with health damages and fatalities caused by poisonous exhaust.

            At least for trucks it will be a very tall order to introduce batteries because they are so heavy and because trucks use so efficient ICE engines. I have a good friend that has built a MAN delivery truck with a 1600kilo battery, which is just enough for 110 km range (despite many really smart innovations it is sitting idle in his garage). Larger trucks going full throttle will empty even the largest Tesla batteries in less than 15 minutes.

          • Bob_Wallace

            Trying to build a case for synfuel based on “excess” electricity sold at close to zero per kWh is foolish. There will be storage, there will be EVs, there will be dispatchable loads. Those applications will smooth out the demand curve and wipe out almost all times of oversupply.

            As thermal plants close and subsidies drop away there will be no reason for the sorts of low prices we infrequently see now due to thermal plants selling for “nothing” in order to avoid cycling off.

            Your numbers for battery powered trucks is off. For a fully loaded 18-wheeler the need is roughly 2.5 kWh/mile. About 35 miles per Tesla 90 kWh packs. Over half an hour at 60 MPH.

          • Jens Stubbe

            I am not building the case on selling electricity at close to zero. I am building on a perfectly reasonable discount for accepting grid control over your consumption.

            What financial compensation do you expect that your other dispatchable loads will demand ? And how do you imagine battery storage that cannot buy electricity cheap and sell expensive ?

            Average electricity consumption is about half of max consumption and min consumption is about half of average consumption.

            Apart from biomass and hydro there is no large supply of renewable semi dispatchable electricity.

            Like it or not over capacity will just like today also be the case in the future. The only major difference is that idle renewable capacity can still earn a net margin at a very low selling price so rather than willingly curtailing excess production owners of solar panels and wind turbines would rather let them run at positive margins, which my suggested buying price certainly guarantee.

            And like it or not Fracking gas power generation will in a few years be hanging on by threads due to ever decreasing utilization so matching demand/supply requires serious over provision of renewables despite dispatchable loads, smart grid etc.

            What are you suggesting we do with the excess power ?

            Ps. EV’s can charge off hours and perhaps some EV owners are willing to hook up to the grid and let the grid decide how much charge they get to have. But this is not going to time shift more than minutes and at a cost too.

            Ps. Ps. I specifically wrote full throttle. Besides adding weight to a drivetrain reduce payload or increase wheels, which is at the expense of efficiency and adds more cost.

          • Bob_Wallace

            “What financial compensation do you expect that your other dispatchable loads will demand ? And how do you imagine battery storage that cannot buy electricity cheap and sell expensive ?”

            I expect there will several opportunistic buyers on the grid and seldom will supply exceed what they will be willing to purchase.

            This will lead to a cost floor that will be no lower than the operating costs plus profits for generators. If the price drops below that point then the wind and farm operators will simply cease to produce.

            Assume unavoidable operating cost of 1c/kWh for wind and solar. I’m not sure what profit the operators would demand, but there would be something. And then there’s the delivery cost that the grid would demand. The floor might be 3c/kWh, but that’s a pure guess on my part.

            As the price drops below the normal low the opportunistic consumers will come into play.

            We’ve been through this several times already. Unless your plant infrastructure and storage costs are close to zero you can’t afford to built a bunch of plants only to run them a few hours a year. If your price model can’t work using the industrial rate for electricity then you’re not going to be convincing.

          • Jens Stubbe

            Assume unavoidable operating cost of 1c/kWh for wind and solar. What is that ?

            When you run a wind farm you sign a contract with a maintenance company independent of your utilization unless the contract stipulates a minimum plant availability percentage. There is no marginal cost on that score. The marginal costs are related to tear and wear, which is a decreasing problem as the quality of wind turbines surge.

            $0.005/kWh will leave plenty of room for positive margins.

            Most wind turbines however operates with a PPA and in that case the cost of electricity is fixed and the party that has bought the electricity needs to sell it at the best price possible right down to more than zero.

            There is no difference in tear and wear on grids no matter the utilization may be and utilities too have to start using market based cost models. Residential solar and storage and ultimately grid deflection in regions where it is possible will keep them in check.

            You just wrote “I expect there will several opportunistic buyers on the grid and seldom will supply exceed what they will be willing to purchase.”

            I do not imagine you expect them to buy electricity at market prices and to pay 3c/kWh to get it delivered, suffer roundtrip losses, pay for battery cost including profits and then 3c/kWh again when they put it up for sale.

          • Bob_Wallace

            The EIA Open EI database gives a median variable operating cost for wind farms of $0.01/kWh. That’s the cost incurred by wind farms when the blades are spinning, not still.


            PPAs fix the price of electricity. There’s not going to be any “almost free” electricity if it is pre-sold for a fixed price. Utilities are highly unlikely to sign PPAs that provide them more power than they can use.

            I’m not sure what you’re saying here –

            “I do not imagine you expect them to buy electricity at market prices and to pay 3c/kWh to get it delivered, suffer roundtrip losses, pay for battery cost including profits and then 3c/kWh again when they put it up for sale.”

            I don’t expect to see many, if any, companies engaging in power arbitrage. Storage is most likely to happen at the utility level. There will be no distribution losses, storage will be mostly located at the substation. Or at the point of generation (that storage owned by the generator).

            i certainly expect to see “3c/kWh” off peak stored and sold during peak demand times for a much higher price. Utilities are going to store most of the ‘extra’ generation as part of their operations. What they don’t need to fill up their storage will be sold at lower rate (off peak) prices where it will be grabbed by EVs, ice storage systems, and other opportunistic buyers.

          • Jens Stubbe

            Every single Cleantechnica reader distrust EIA numbers and in the case of your numbers quite rightly so.

            They are old, they are average and they are just as you write yourself when the blades are spinning.

            The number you should be looking for is the minimal sales figure that will still give you a positive marginal income. If you actually want to study this the Nordpool numbers are public with no time delay.

            Utilities will go through fire to deliver on demand electricity to premium paying customers.

            In a 100% renewable grid this forces utilities to buy more electricity than they can sell to premium paying customers.

            This has led to speculation in electron storage and you seems to be a believer despite the truly daunting challenges to scale battery production by several thousands factors.

            Alternatively you could just scale current renewable production by a factor 20 and accept to curtail 80% of the time.

            However for the good of mankind and of cause for the utilities bottom-lines otherwise curtailed electricity should be used to end fossils once and for all.

            I expect wind power to lower cost by at least 40% by 2025 corresponding to the general belief in the business, which means average unsubsidized wind PPA in USA will be down from 2014 level at $0.035/kWh to $0.021/kWh.

            I also expect that solar despite the more economically strained value chain can deliver on promise and trail after pretty close.

            When the 100% renewable grid begins to shape up in about 15 years then the PPA cost of renewable energy on average will probably be around $0.015/kWh.

            PPA’s to meet premium customers demand will cost $0.075/kWh, if excess is sold off for average $0.005/kWh then the utilities can service their premium customers with electricity generation bought at an average at $0.055/kWh, which is a lower cost point than today.

            Ps. Interesting that Cleantechnica is still missing out on the clean tech news of the century. Researchers at KU has published a way to degrade biological material to sugar a factor 100 faster with almost no energy consumption. They have signed contracts with Novozymes the worlds largest manufacturer of industrial enzymes.

          • Bob_Wallace

            It’s becoming foolish to try to discuss synfuels with you. You are such a strong advocate that you are willing to bend reality in an attempt to support your bias.

            “In a 100% renewable grid this forces utilities to buy more electricity than they can sell to premium paying customers.”

            You think utilities are going to keep a dumpster out back where they can toss the electricity they are forced to buy but can’t sell?

          • Jens Stubbe

            The dumpster analogy does not quite cut it because producers of electricity are actually forced to pay for offloading electricity on the grid when the cost of electricity go below zero.

            This is the daily reality for hundreds of utilities already – the dumpsters and whats worse are already here.

            If you somehow could quantify a global grid based upon renewables and electron storage and explain why such a grid can become cheaper than the grid I outlined, I would find it very interesting.

            I would also very much like to know why anyone will argue that renewables should stay confined to the electric grid and not compete head on against fossil fuels.

            It seems to me that you are sitting in the comforts of your own beliefs and gets annoyed because not everyone thinks the world is flat.

          • Bob_Wallace

            You misunderstand why grid prices occasionally go to zero or even a bit below.

            And please quit making unrealistic assumptions about synfuel getting electricity priced below the cost of industrial electricity. You’re powered your dreams with unicorn farts.

            I suspect synfuels have a role to play in our energy future but let’s use reasonable numbers, not fantasy numbers.

          • Jens Stubbe

            My assumption that Synfuel will get electricity priced below industrial rates is absolutely going to be the way it will be done and many other processes that can accept loads when the grid decides to will get the same access to cheep electricity. And this will probably include batteries too. Synfuels however is for all practical reasons unlimited in storage capacity and does not return electrons to compete against load following renewables like hydro and biomass.

            Your “reasonable number” bit begs the question what reasonable numbers. The grid is CAPEX heavy and OPEX is unrelated to the amount of energy flowing through the grid. My suggested 66% discount and free grid transport is partly self fueled by the industrial learning curve cost drop caused by extra doublings of renewable energy production.

          • Bob_Wallace

            “My assumption that Synfuel will get electricity priced below industrial rates is absolutely going to be the way it will be done”

            Check back in with reality. I think there’s still room on the bus.

          • Jens Stubbe
          • Bob_Wallace

            Let me copy over the parts to which you should have attended:

            “wholesale power prices in Southern California have gone negative on about a dozen days over the past year”

            “In Texas, power at one major hub traded below zero for almost 50 hours in November and again in March”

            Doesn’t happen very often. 3% of the nights in California. 1% of the time in Texas. You build your speculations around syn fuel plants sitting idle over 95% of the time waiting for prices that allow you to do your math.

            And you do not acknowledge the fact that there will be new off peak demand coming online that will eliminate those few annual hours of zero/negative supply

            “The growing frequency of these price plunges are a testament to how renewable power is reshaping U.S. power markets and squeezing the profits of traditional power generators.”

            As those traditional power generators go away price cease going negative.

            Surprise me, use realistic numbers.

          • Jens Stubbe

            Your claim that traditional power generators cause the negative prices is incorrect but I expect you will be wanting to change that statement.

            A Grid based upon renewables has limited control over generation and especially so for wind and solar that you can basically only curtail.

            It is perfectly realistic numbers that I have presented. You just happen to disagree. I think it will be fair to summarize your points to:
            1. The cost outlook for wind and solar
            2, The willingness to discount over provisioned electricity
            3. The willingness to accept free grid transport of discounted electricity for Synfuel

            Interestingly you have not ventured to describe how a renewable grid can be constructed without synfuels as the major dispatchable load.

            Currently we have what constitutes seconds of battery storage and what is required is more like days if you strive for a 100% renewable grid balanced with battery storage.

            Battery storage niche markets will be behind the meter, mission critical installations and for grid deflectors. Given the cost of establishing grid scale battery storage we can probably safely conclude that only cost models based on arbitrage will be realistic and probably also conclude that batteries must be able to access wholesale realtime prices and be freed from grid transport cost. I think you expected that this requirement would be met by letting the utilities own the batteries and by co-locating batteries with generators.

            I do not ask for any other sort of arrangement for Synfuel plants except that I think that is is stupid to demand co-location (not likely for batteries either).

            For both Synfuel producers and for utilities you have to find a common ground and both have something the other party needs. The utilities have the grid and contracts with the power generators and Synfuel producers have a major dispatchable load that can give the utilities a net margin even though the market is flooded.

            The producers of renewable power generators will support the concept that raise demand for their products and for mankind it will be a feat to end the fossil age – hopefully in time to reduce the worst GHG catastrophes.

            Ps. I assumed a fair discount but you can still make a very good business case for Synfuel on a significantly higher electricity price point.

            Ps. Ps, I expect the market to be nearly constantly over flooded and consequently that the Synfuel plants will have a reasonable high utilization rate. I have absolutely no idea why you suspect 5% utilization ??? The whole point with dispatchable loads is to allow sufficient over provision to always retain the ability to meet demand.

            Ps. Ps. Ps. I also foresee various off peak loads coming online but suspect that those that can be of real significance will be few and will take time to expand.

          • Bob_Wallace

            “Your claim that traditional power generators cause the negative prices is incorrect ”

            Prove it.

            If I own a wind farm and you own a synfuel why would I turn on my turbines and give you electricity for nothing?

            If I own the grid and you own a synfuel why would I allow power to flow over my wires to your synfuel plant for nothing?

          • Jens Stubbe

            Traditional power generation before the advent of intermittent renewables met demand at all times with limited overshooting production, but now everyone has realized that traditional power sources are too expensive, too health hazardous, too polluting and a major GHG threat.

            The owners of wind turbines enters into PPA contracts to utilities that use the purchased electricity to meet demand.

            Just like since the first grids was established utilities needs excess power generation capacity but renewables and especially wind and solar is weather dependent so unless you accept 100% loss of potential income, which is the case when you curtail (which is nearly all the time) in a 100% renewable grid you need a market segmentation strategy.

            My baker across the park where I live closes at noon and in the last 30 minutes of his business day he give away bread and cakes and after hours he takes the remains to feed homeless and refugees.

            Utilities already segment the market in for instance:
            1. Private households that pay a fee for the service and a price per delivered kWh.
            2. Small businesses and offices that get a similar deal but with better discounts.
            3. Larger businesses that have stronger buying power and gets a better deal.
            4. Businesses that accept dispatchable loads controlled by the grid.
            5. Synfuel plants could be new entities that guarantee a stable market for excess power.

            The strange thing with all your disbelief is that you cannot establish a 100% renewable grid unless you engineer the business model. This is true for Synfuel or any other dispatchable load strategy and it is true for battery storage.

            Ps. In the Nordpool area a large part of the wind capacity does not receive any FIT or have any PPA, so you could trouble yourself to look at the online graph and historic data to see when the owners decide to curtail.

            Ps. Ps. Utilities around the world are now demanding money for moth balling fossil power plants and for providing grid stability by keeping power plants online that no longer are commercially viable. Synfuel plants is a simple way to shut down the operation on a permanent basis.

          • Bob_Wallace

            You did not answer my questions.

            Now you’re suggesting we’ll run massive synfuel plants on charity.

            Wind/solar farms and utilities will donate electricity to synfuel plants because they like to feed the homeless.

          • Jens Stubbe

            The plants will run whenever there is oversupply of electricity, which is nearly always.

            The installed power generation capacity around the world is several times bigger than average demand and always greater than peak demand too.

            This will not magically change once you switch of the last fossil power generation plant.

            Wind and solar can be curtailed and it happens but it is plain stupid not use the excess energy. In a 100% renewable grid most of the energy produced will be excess.

            To believe that storage, which is at fractions of a second today I guess, can scale in size and drop in cost to a point that meets the challenge is really extraordinary.

            The much likelier development is that solar and wind continue the cost drop and become cheap enough to over porvision and especially so if the excess power can fetch a price that gives a net margin.

            The same thing that will eventually kill the gas peak power plants is also going to kill battery storage – the economics become terrible once the average utilization goes down.

          • Bob_Wallace

            “The plants will run whenever there is oversupply of electricity, which is nearly always.”

            Today, if you want to use that “oversupply” you’ll be paying for fuel and losing very big time in terms of ERoEI.

            Tomorrow we almost certainly will have massive storage on our grids because storage is needed to make a reliable grid function.

        • Ronald Brakels

          In 1950 oil use was one eighth what it is now and oil cost about $20 a barrel in today’s money. Now I’m not saying that if oil use suddenly fell to 1950 levels oil would fall to $20 a barrel. It would actually fall to less than that as existing oil wells would be able to meet that level of demand for a long time without the need for any money to be spent on the expensive processes of exploration or drilling new wells. Generally, all existing wells need to do to get oil is pump. Cheap solar/wind can supply the energy for that pumping and the more slowly oil is extracted from a field the more oil and less water will come up with each stroke.

          Of course, inherently expensive processes such as tar sands processing would be a thing of the past in a one eighth of today’s oil consumption world.

          On the distribution side of things, people did not have trouble getting access to oil products in the 50s despite using an eighth as much as today. In fact, they haven’t really had much of a problem since 1880. Feel free to blame Carnegie for that.

          • RobertM

            Are you saying in the 1950 world consumption was 1/8 of today’s demand? No surprise on that. Most of the world population back then still walked everywhere and cars were pretty rear outside the first world. Fast forward too today and cars are everywhere. I don’t believe we can get back to that level of use anytime soon.

          • Ronald Brakels

            Depends what you mean by soon. Bloomberg estimates 6 years until electric vehicles start causing significant reductions in oil use and have a major effect on depressing oil prices. With suitable incentives and a high enough run up in oil prices I think it could be sooner. Of course, it would take longer to cut consumption to 1/8 of today’s. But once we reach the tipping point where electric cars simply out compete internal combustion engine cars for the majority of users, it won’t take long for oil demand to plummet.

          • RobertM

            I would have no problem predicting a 10% drop of gas usage in under 10 years that might even be a constitutive est based on the model 3 results over the weekend. But a 85% to 90% drop in oil / gas usage will take decades. I don’t think you could describe soon to mean decades in the context.

      • neroden

        The gas may be cheap, but after a while
        (a) gas stations will close, making owning a gasmobile highly inconvenient due to range anxiety. Believe it or not this has already been happening for several years.
        (b) eventually, diseconomies of scale will kick in as the volume of gasoline sales drops, and the retail price will start to creep up to cover the fixed costs with a lower volume of sales….

        That’s when gasmobiles start to depreciate really badly.

        • nordlyst

          Yes, but these things will happen long after sales of ICE cars have been reduced to only a small part of the market. Recall that 99,5% of new vehicles sold in 2016 will be ICE powered, globally.

          Things are moving in the right direction, but far, FAR too slowly and in far too few areas compared to what’s required to live up to COP-21.

          If by 2030 BEVs have a 20% share of global new car sales, I’d say things have gone pretty well.

          • neroden

            They’ll be well ahead of that. I think in 2030 BEVs will be selling roughly as fast as they can make them. I think the demand limit during the 2020s will be about 50% of new cars, but I think the supply limit will be much lower than that. The supply limit should exceed 20% of new cars by 2030, though; it’ll become obvious around 2020 that manufacturing BEVs is a license to print money so a bunch of factories will get built during the 2020s.

    • Frank

      I think what you suggest is a huge risk to the oil industry. I think autonomous cars, espeially electric ones owened by uber or whatever, have the potential to become cheaper and more convenient for many. If a car shows up whenever you need one, and it’s cheap, why would you want to buy, insure, fuel, maintain, park, or store one? Especially, if the mobile app integrates with other transport, and keeps the electric car appraised of your cooordinates and is waiting for you and three others heading to the same place.

  • Graphite Gus

    As has been said elsewhere, it seems EV manufacturers and suppliers do not have this sort of forecast either. Battery capacity will not be able to meet the (low) 6M 2020 forecast. Battery manufacturers, charging infrastructure, etc. do not have this capacity planned

    • neroden

      Even Tesla won’t have the capacity. Battery factory capacity limitations will slow down adoption (but be good for the profits of the electric carmakers).

  • JamesWimberley

    Gratifying. The key takeaway is that the no-change forecasts of the oil industry are not shared by the automakers. Nor, I would add, but the equally powerful electric utilities: the three Californian ones are deeply engaged in planning for mass ev adoption, in home, workplace, and highway charging.

    My feeling is that the analysts’ forecasts are conservative. They expect the growth rate of evs to slow down from the current 50% CAGR as time goes on. Why? It’s not as if ICEVs have significant intrinsic advantages that would tend to slow down the adoption S-curve. (I assume that continued progress on batteries will remove the range and cost barriers.) The number of car drivers who think it really important to be able to drive 500 miles non-stop is essentially zero.

    In fact, economies of scale and networking, as well as regulation and peer pressure, will work the other way. Zero-pollution traffic zones in city centres, as already in London, will become common. Gasoline stations will become scarcer while the electric charging infrastructure becomes denser. Social opprobrium for gas-polluters will grow. Norway is considering banning the sale of new ICEV cars from 2025.

    I would be interested to see the authors’ take on heavy trucks. The electric transition is going much more slowly than in cars. There is no equivalent of Tesla, a pioneer dragging the rest of the industry along in its wake. We can expect to see rapid change in vans and light trucks under regulatory pressure from city halls, and early mass adoption of electric buses, but the long-distance trucks require new technology.

    What about two-wheelers? As with buses and taxis, electric ones are close to the point of clear superiority on every metric. Mileages are low, and typically urban.

    It’s not clear if the authors have considered relative mileage effects in the impact of evs on oil consumption. One would expect this to be more than simply proportional to the numbers. In a household where the second car becomes an ev, I bet that it comes to take a bigger share of the miles. Where cities push for taxis, buses and delivery vans to go electric, these also are high-mileage users.

    • neroden

      I believe two-wheelers are still dealing with purchase-price-parity issues. Zero makes gorgeous motorcycles and the price drops every year, but they’re still only in the high end of the market. Same as Tesla’s situation… not sure when the economies of scale will start to really bring the price down and make inroads on the market. All the major motorcycle makers are planning electric offerings now, but some of them seem as half-hearted as the carmakers…

    • nordlyst

      > They expect the growth rate of evs to slow down from the current 50% CAGR as time goes on. Why?

      Because of how geometric growth works..? 50% from a low base is possible. 50% every year for many years is not. From a 0,5% market share, 13 years of 50% growth in number of EVs sold takes it to 100%. That’s clearly not going to happen. (I’ve ignored overall market growth, but that adds less than one year anyways.)

      I think EVs will grow and demand for oil will be reduced – if not, there wouldn’t be any point. But while the oil companies projections are too optimistic on behalf of oil, these are too optimistic on behalf of EVs. If we get to 20% of total new vehicle sales by 2030 things are going well.

      • neroden

        From a strictly demand-based perspective, I think 50% growth every year until we reach 50% electric cars looks right. After 50% it’ll slow down a lot. (There’s a reason for this: we can now match the *median* price of a gas car. The bottom half of the gas car market is going to be harder to match the price of.)

        BUT, there’s serious evidence that we’ll be production-limited — they won’t be able to manufacture the batteries fast enough. So that ill determine how fast adoption actually happens.

        • Bob_Wallace

          I suspect we’ll see battery constricted EV sales around 2020 when the Gigafactory and LG Chem’s various factories are fully committed. But if Tesla’s Model 3 makes the sort of splash that their Model S did then we may see a number of new, large battery plants start construction.

          I’ve got to believe that every company that produces batteries is carefully studying how the EV market is developing and trying to determine the proper time for them to jump in. Storage is going to be an enormous market.

          • eveee

            Unless other mfrs see the light and there is a major investment in battery supplies. I vote for that. Once the lagging companies see the EV success, they will scramble to survive.

          • Bob_Wallace

            It’s now tomorrow in all of the US except Hawaii.

            That makes it today, the day when Elon pulls back the curtain and shows the next generation of EVs. I’m hoping he’s going to answer our questions and has an extra surprise or two….

          • eveee


      • Jens Stubbe

        While I agree with you that EV sales will slow down your made up arguments for this development are simply not true – actually quite to the contrary.

        Disruptive technologies always maintain growth until the old technologies are completely out of business. Recently Kodak met their moment and CRT’s became museum pieces since every one wants flat panel displays. Currently solar and wind persist with high growth, which very likely will even accelerate as the entire coal value chain is extremely wobbly and near worthless according to the stock market.

    • Jens Stubbe

      MAN and Volvo which happens to be the two biggest truck companies in the world are EV pioneers.

      The problem is that trucks have far better engines than cars and use far more energy, so the batteries required are huge. Also the usage is much heavier with most trucks driving up to two million miles before being decommissioned.

      Two wheelers will be near 100% EV. Here in Denmark they are selling several hundred thousands every year. I tried to get one for my mother but she declined after having tried it out in a month.

    • Ronald Brakels

      If batteries become cheaper than other alternatives they will be used in heavy trucks. It is possible to get early adopters to pay for the smooth ride ride and luxury electric passenger cars provide, but it’s not really possible to get freight companies to pay for the same, so electric cars, electric delivery vehicles, and electric light trucks will have to pave the way for big rigs to go electric. But electric drive heavy trucks are on cards anyway and would be even without the decline in battery prices. This is because in a world of low interest rates in developed countries it does not make sense to use direct drive ICE engines for big trucks. Instead, as in the mining industry, it makes sense to shift to electric drive vehicles because of the lower fuel and maintenance costs. Hybrid trucks in other words. Currently mining trucks use onboard diesel generators, or in a few cases CNG, but if they get cheap enough batteries will also do.

      • Ronald Brakels

        I’ll mention that one reason why we don’t have hybrid heavy trucks at the moment is because road accidents reduce average truck lifespan. But improved road safety, up to and including autonomous driving will help with that.

      • Mike Dill

        Large ‘on the road’ trucks use about five times the energy as a large sedan, or slightly less than 2kWh per mile. A 400kWh battery pack and fast charging at truck stops would be enough for that mode of transport to go electric.
        At $200/kWh the trucks are economically viable. We now need the ‘super-chargers’ for the truck stops, which would need to be about 400kW, or twice the charging rate of the current generation of Tesla ‘SuperCharger’.

        • Ronald Brakels

          A 24 tonne truck gets about 2.1 kilometers per liter of diesel in Australia. That’s about 34 megajoules per kilometer. A diesel truck is about 40% efficient while an electric battery truck will be about 90% efficient. That’s about 2.25 times more efficient. So the truck will need about 15 megajoules per kilometer, which comes to 4.2 kilowatt-hours. At 100 kilometers an hour that comes to 420 kilowatt-hours an hour. And that’s a considerable power draw that these days generally requires a large battery to handle.

          If a truck has 1,000 kilowatt-hours (one megawatt-hour) of storage it will give it about 2 hours endurance at the usual Australian maximum speed limit of 110 kilometers an hour. At $100 a kilowatt-hour, which doesn’t seem unreasonable in the nearish future for battery storage, that will only cost $100,000 dollars.

          If that battery lasts 200,000 kilometers, which would be a substantial improvement over today’s battery packs, it will cost 50 cents per kilometer and might last 2.5 years. At current Tesla battery pack weight it would come to about 6.4 tonnes which will cut endurance by about a quarter or more. But if energy density is doubled it becomes a much more manageable 3.2 tonnes.

          Diesel comes to about 40 US cents a kilometer at the moment at the pump in Australia. Over a third of which is tax which electric trucks will presumably have to pay at least a portion of, unless they are lucky. Electric trucks will require less maintenance, but the need to recharge or battery swap will increase their operating costs. LPG, CNG, and LNG, are fuels that can also potentially lower operating costs, particulate pollution and CO2 emissions compared to diesel.

          So electric heavy trucks can compete with diesel, but battery costs will have to become lower than what they are today and/or the externalities of using diesel need to be priced in. And even with a $100 a tonne carbon price using LNG or other fuel would be cheaper at current battery prices.

          Note that articulated trucks with Gross Combination Mass of over 40 tonnes haul 95.1% of Australia’s road freight tonne kilometers, so the figures will have to be bumped up a bit to cover them.

          • Mike Dill

            Ron, those look like good numbers, but do not take into account the effect of regenerative braking. We do not have the road trains or articulated trucks in the USA, so I have no information on them.

          • Ronald Brakels

            Regen is much less important on the highway than in town and is included in the approximate 90% efficiency figure for electric rigs. The US does have road trains, we know because we assemble US road train prime movers in Australia, but they are limited to certain areas of the United States. Also, in the US no one is apparently allowed to have four trailers like in Australia’s Northern Territory.

    • NRG4All

      I hope that the oil industry keeps whistling past the graveyard. When they do wake up, they have the resources to buy a majority of Congressmen to enact laws limiting the adoption of EVs. We’ve seen this in many states that refuse to allow Tesla to sell in their state and that was just the car dealer associations flexing their political muscle.

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