Electric Mobility: Full Speed into the Future

Wednesday, December 11, 2019

No question, petroleum still rules the road. In most places, electric vehicles make up a miniscule percentage of cars and buses in circulation today. But several experts who spoke at the ECPA Ministerial Dialogue on Electric Mobility in the Americas said that changes are already underway—not just in the vehicles people drive but in the very way they think about mobility.

By 2030, between 10% and 20% of vehicles on the road will be electric, said panelist Camron Gorguinpour, Global Senior Manager, Electric Vehicles, at the World Resources Institute. “We know that within the next 10 years, we’re going to hit mass adoption globally,” he said, referring to multiple sources and projections.

Not that long ago, such an idea might have seemed fanciful. Guillermo Areas, the BMW Group’s Head of Government and External Affairs for Latin America and the Caribbean, said that when he first started working in the region in 2013, people he met with were sometimes confused when he promoted electric vehicles.

“They thought I was coming from another planet,” he said, adding that participants in one meeting thought he must be talking about golf carts, not automobiles. The situation is quite different today, he said; around 10% of the vehicles BMW sells in the Mexico City and Bogotá metropolitan areas are now either hybrid or full electric.

Taking a wider view of the map, though, the numbers for electric vehicles are still tiny, not only throughout Latin America and the Caribbean but in the United States. In 2018, gasoline and diesel accounted for nearly 92% of transportation-related energy use in the United States; electricity’s share was a mere 0.3%. (Natural gas and alcohol fuels such as ethanol made up the remainder.) In Latin America, the percentages are even smaller.

Mark Smith, Technology Integration Manager in the U.S. Department of Energy’s Vehicle Technologies Office, explained why it takes so long for electric vehicles to penetrate the marketplace. The United States has more than 240 million light-duty vehicles on the road, and about 16 million are sold every year, he said. Using simple math, that means it takes about 15 years to replace the entire fleet. In 2018, slightly over 700,000 electric vehicles (counting both hybrid and plug-in) were sold in the United States.

Several speakers at the Ministerial Dialogue talked about the global and regional prospects for electric transportation and looked at some of the obstacles and opportunities ahead. (A video of the event, which took place on September 17, is available here.)

“There’s a real need for clean transport, especially in cities,” said Lisa Viscidi, Program Director for Energy, Climate Change & Extractive Industries at the Inter-American Dialogue. “Electric mobility is a key part of this sustainable transport transition that needs to happen.”

Almost every major Latin American city has air pollution levels above what the World Health Organization considers safe, Viscidi said; at the same time, many of the region’s electric grids produce clean, renewable energy. That means electric vehicles can simultaneously reduce tailpipe pollutants that are harmful to health and cut greenhouse gas emissions that are harmful to the environment, she said.

In a region where most countries import rather than export fossil fuels, electric mobility can also contribute to greater energy security by reducing dependence on petroleum imports, said panelist Carlos Mojica, Urban Transport Senior Specialist for the Inter-American Development Bank (IDB).

Here are a few of the other observations made at the event:

The relatively high cost of electric vehicles still presents a challenge, but technology is making a difference. Battery costs are coming down; they are now about a third of what they were just three or four years ago and a tenth of what they were a decade ago, according to Smith. The up-front purchase price of an electric vehicle tends to be an obstacle for government agencies to change over their fleets or cities to invest in expensive electric buses. It’s important for procurement systems to factor in a range of criteria when making purchasing decisions, such as environmental and health concerns, Viscidi said.

Adequate charging infrastructure is essential. “It’s the single most glaring oversight in virtually every electric mobility project that we encounter,” said Gorguinpour of the World Resources Institute. Planners tend to underestimate the challenge of installing enough charging stations, especially for buses. In Latin America, the lack of sufficient infrastructure makes ownership of an electric vehicle much harder outside big cities.

Governments can jump-start the market through incentives, investments, policies, and laws. The U.S. government’s research and development efforts laid the groundwork for growth in electric vehicles, but the mandates created under California’s Zero Emission Vehicle program are what really made the market take off, Gorguinpour said. “For the most part, automakers will not produce for sale electric vehicles unless they’re compelled to do so,” he said. Tax and trade incentives can be effective in encouraging electric vehicle use, several of the speakers said, but they should be short term; ultimately, the market has to be sustainable.

The growing freight business presents a promising opportunity for electric vehicles. At a time when online shopping is on the rise, sellers are feeling pressure from their customers to deliver packages more sustainably, according to Smith. Eventually, he said, a company with a big fleet may even be able to put excess capacity from its electric vehicles into onsite storage, which then could be used to meet other power needs.

Electric vehicles won’t solve all transportation problems. As Mojica pointed out, electric vehicles can cause the same kinds of traffic jams as conventional vehicles. Several of the panelists noted that the transition to electric vehicles can provide an opening to reexamine the whole premise of personal vehicle ownership and put in place systemic improvements to get more cars off the street. The BMW Group has created an Urban Mobility Division to advise mega-cities on how to adopt different modes of transportation, including shared riding and autonomous vehicles, and be more efficient. “The future is not selling more cars. We’re going to be selling miles,” said Areas, who described BMW as no longer a car company but a “mobility service company.”

(For more on electric vehicles in the Americas, see these recent stories in the ECPA newsletter: Taking Electric Vehicles to a Higher Gear and Rethinking Urban Transportation.)