The Top 5 Issues in LCFVs This Week: “The Age of the Automobile Is Over”

09.29.16 | Blog | By:

Happy Thursday friends! Here’s my weekly take on the five most interesting developments in LCFV trends over the last week:

  1. The Age of the Automobile Is Over: Columbia University’s Jeffrey Sachs is calling for more infrastructure investment, but it’s not for patching the existing decrepit system in the U.S. It’s for low-carbon infrastructure. And  reimagining what we need in the future starts with the “realization that the Age of the Automobile is over.”
  2. More Electricity Needed to Support EVs in Europe: Taking a more middle-of-the-road approach, the European Environment Agency released a briefing paper on the implications for emissions and Europe’s energy system arising from the potential wide-scale use of electric cars in 2050. Increasing the numbers of electric vehicles can significantly reduce direct emissions of CO2 and air pollutants from road transport, but will require additional electricity generation. The Agency noted that electric vehicles aren’t the only transport solution for reducing CO2, noting biofuels as a potential solution as well.
  3. Low Carbon Cars Are Cheaper to Operate: A new study by MIT shows that when operating and maintenance costs are included in a vehicle’s price, cars emitting less carbon are among the U.S. market’s least expensive options, on a per-mile basis. These cars include electric vehicles, most hybrids on the market and the Toyota Mirai. The point of the study is to educate consumers and MIT has even developed an app to help spur cleaner car purchases, but current gasoline demand (and vehicle purchase patterns) seems to belie their interest.
  4. “Peak Car” by 2020: Echoing Sach’s op-ed, Rocky Mountain Institute in a study announced that “Peak car” ownership in the U.S. will occur around 2020 and will drop quickly after that. They believe that autonomous electric vehicles with ride-sharing services will begin to dominate after that because it will simply be cheaper for consumers. That’s a lot of consumer education, trust and regulatory hurdles to jump in just a few short years.
  5. Finland Calling on Nordic Countries to Increase Biofuels Targets: Finland is the latest country to call for an increase in biofuels targets. It’s clear that policymakers do continue to view biofuels as a viable carbon reduction solution for transport.

1. Boston Globe: Sustainable Infrastructure After the Automobile Age

In an op-ed penned for the Boston Globe this week, Jeffrey Sachs of Columbia University’s Center for Sustainable Development called for more investment in infrastructure, which is chronically underfunded in the U.S.  Consider that the American Society of Civil Engineers has estimated that $3 trillion is needed to upgrade existing infrastructure (e.g. highways, the power grid, water treatment facilities, etc.). However, there is only funding for half of that, $1.4 trillion. He notes:

Instead of building new cutting-edge infrastructure, we began merely to patch the existing system. We’ve done that now for more than three decades. But with the advanced aging of the existing infrastructure, patching alone will no longer suffice; we need a more fundamental overhaul.

The chart below shows the paltry percentage of GDP invested in infrastructure. By comparison, China spends 9% of GDP on infrastructure and India spends 8%.

corrected0926_sachschart-1745

But Sachs is not talking about bridges necessarily. He’s talking about investing in infrastructure in line with “new needs” that include “climate safety”.  He said:

I propose that we envision the kind of built environment we want for the next 60 years. With a shared vision of America’s infrastructure goals, actually designing and building the new transport, energy, communications, and water systems will surely require at least a generation… The new vision should start with a basic realization: The Age of the Automobile is drawing to a close. Yes, cars will still be with us, but never again as centrally in our lives, economy, and culture. The era of the internal combustion engine is also drawing to an end, to be replaced by climate-friendly electric vehicles and other forms of low-carbon mobility. American households will no longer aspire to own two cars in every garage, but instead will have mobility apps on every phone, to hail self-driving vehicles that they will share rather than own. In high-density cities, the overall number of vehicles will fall considerably, while the intensity of their use (passenger trips per day) will soar. Low-income households will likely reap enormous advantages in improved access to transport services, similar to the gains in access to low-cost mobile phone services.

Sachs notes that to achieve Paris Agreement targets, low-carbon infrastructure will be required and that it must be based on high end-use efficiency of energy (i.e. smart grids), zero-carbon power generation and switching to electric vehicles. How will it be financed? The trillions it will take to develop this infrastructure is expected to come from taxes on fossil fuels, user fees, general government revenues, bond issues, taxes on land improvements, public leasing and royalties, and private-project financing, and even Wall Street. Ready?

2. European Environment Agency (EEA): Electric Vehicles and the Energy Sector – Impacts On Europe’s Future Emissions

EEA this week released a briefing paper on the implications for emissions and Europe’s energy system arising from the potential wide-scale use of electric cars in 2050. Read more about it here.

3. MIT: Low Emissions Vehicles Are Less Expensive Overall

A new study by MIT about to be published in Environmental Science and Technology shows that when operating and maintenance costs are included in a vehicle’s price, cars emitting less carbon are among the U.S. market’s least expensive options, on a per-mile basis. These cars include the electric vehicles, most hybrids on the market and the Toyota Mirai.

The study also evaluates the U.S. automotive fleet as represented by these 125 model types against Paris Agreement emissions-reduction targets the set for the years from 2030-2050. The results have been turned into an app that consumers can use to evaluate any or all of the 125 vehicle types.  It’s also available online here.

Overall, the research finds, the average carbon intensity of vehicles that consumers bought in 2014 is more than 50% higher than the level it must meet to help reach the 2030 target. But interesting, the lowest-emissions autos have already surpassed the 2030 target, even with the current coal- and natural-gas dominant electricity supply mix.

In order to estimate the cost of the vehicles, the researchers accounted for both the sticker price and the operating costs over the vehicle lifetime. When estimating emissions, the calculations included emissions from each vehicle’s operations and the emissions stemming from manufacturing it, and producing its fuel.

Dr. Jessika Trancik, the lead author of the study, also authored another study recently showing that 87% of personal vehicles on the road in the U.S. can be replaced by the EVs on the market today with the current ranges and at an overall cost to their owners (purchase and operating) no greater than that of internal combustion engines even if they can only charge overnight.

About this study, she noted:

Private citizens are the investors that will ultimately decide whether a clean-energy transition occurs in personal transportation. It’s important to consider the problem from the viewpoint of consumers on the ground. The goal here is to bring this information on the performance of cars to people’s fingertips, to empower them with the information needed to make emission- and energy-saving choices.

Meantime, these same consumers are driving more than ever. Gasoline demand in August hit a new record of nearly 10 million barrels per day as shown in the following chart.

image-20160922-22514-fwpal2

Source: Constructed by Lucas Davis (UC Berkeley) using EIA data ‘Motor Gasoline, 4-Week Averages.’

4. Rocky Mountain Institute (RMI): Peak Car Ownership

Late last week RMI released a study on the future of personal vehicle ownership is essentially over. “Peak car” ownership in the U.S. will occur around 2020 and will drop quickly after that.  Read more about it here.

5. Reuters: Finland Proposes Nordic Countries to Lift Biofuel Target

Reuters reported this week that Finland is proposing that Nordic countries set a joint target on biofuels and increase the minimum percentage in all fuels. The proposals will be discussed by ministers in an upcoming meeting. Finland has set itself a target for 20% of all transport fuel to come from renewable sources by 2020, rising to 40% by 2030. The European Union target for 2020 is 10 percent.

Now why am I including this?  It shows the disconnect or dichotomy between policymakers looking to biofuels as a pathway toward reducing gasoline and diesel use and those that believe biofuels should be completely eliminated as a transport policy option (like, yesterday). And here we are. Policymakers by and large do tend to view biofuels (even first-generation) as a viable pathway toward carbon reduction.

lcfv_presentation_oct2016

Finland follows India and some countries in Latin America in reconsidering their biofuels programs and even increasing targets under them.