E-cars could go mass-market by 2030, IEA says

2 million e-cars on the road in 2016

E-car charging station, Vienna. @bberwyn photo.

Staff Report

Electric cars are likely to reach mass market adoption within the next decade, according to the International Energy Agency’s latest report on e-mobility. In 2016, the number of electric cars on the road globally reached 2 million, with China accounting for 40 percent of that total.

China has also deployed more than 200 million electric two-wheelers, as well as 300,000 elecric buses and leads the globe in electrification of the transport sector. China, the US and Europe made up the three main markets, totalling over 90 percent of all electric vehicles sold around the world.

Outside China, Norway is also moving ahead swiftly on electrification, with e-cars holding a 29 percent market share, the highest globally by far. The Netherlands is next, at 6.4 percent, followed by Sweden, at 3.4 percent.

According to the IEA, between 9 and 20 million electric car could be deployed by 2020, and between 40 and 70 million by 2025, based on estimates from carmakers.

For now, electric vehicles only made up 0.2 percent of total passenger light-duty vehicles in circulation in 2016. They have a long way to go before reaching numbers capable of making a significant contribution to greenhouse gas emission reduction targets.

In order to limit temperature increases to below 2°C by the end of the century, the number of electric cars will need to reach 600 million by 2040, according to IEA’s Energy Technology Perspectives. Strong policy support will be necessary to keep EVs on track.

Cities are taking leadership roles in encouraging EV adoption, often because of concerns about air quality. Major urban centres often achieve higher EV market shares compared to national averages. A third of global EV sales took place in 14 cities in 2015.

Paris, for instance, has mandated that any electric car is allowed to re-charge at the re-charge stations of its car-sharing program, called Autolib. Amsterdam has a unique strategy of offering the installation of charging points on public parking spaces to people who make a request, ensuring that charging infrastructure is installed where it’s actually needed. London for its part encourages EV adoption by waiving its congestion charge.

The analysis shows that fleet procurement is an important means of encouraging early EV uptake. Fleet operators, both public and private, can contribute significantly to the deployment of EVs, first from demand signals that they send to the market, and second thanks to their broader role as amplifiers in promoting and facilitating the uptake of EVs by their staff and customers.

In that respect, four major US cities – Los Angeles, Seattle, San Francisco and Portland – are leading a partnership of over 30 cities to mass-purchase EVs for their public fleets including police cruisers, street sweepers and trash haulers. The group is currently seeking to purchase over 110,000 EVs, a significant number when compared to the 160,000 total EVs sold in the United States in 2016.

The report offers a comprehensive collection of national-level data on EV deployment based on primary data collected from member governments of the Electric Vehicle Initiative (EVI). The EVI is a multi-government policy forum established in 2009 under the Clean Energy Ministerial (CEM), dedicated to accelerating the deployment of EVs worldwide.

EVI members will also launch the EV30@30 campaign during the Eighth CEM Meeting on June 8 in Beijing. The campaign will set a collective aspirational goal for all EVI members of a 30% market share for electric vehicles in the total of all passenger cars, light commercial vehicles, buses and trucks by 2030. The campaign will also raise support for accelerated deployment of charging infrastructure, commitments on fleet procurement, and exchange and replication of best practices for the promotion of EVs in cities.

Clear and ambitious policy support is vital to keeping the growth of EVs on track with IEA low-carbon scenarios, to improve urban air quality, and diversify transport energy sources. Despite impressive improvements in costs and energy density over the past decade, battery packs are still expensive, driving up retail prices. Financial incentives for EV adoption and taxes on fossil fuels will continue to be important in the current phase of EV technology deployment to initiate and reinforce a positive feedback loop that, through increasing sales, production scale-ups and technology learning, will further support cost reductions for batteries and other components.

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