• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 13 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 5 days Does Toyota Know Something That We Don’t?
  • 5 days World could get rid of Putin and Russia but nobody is bold enough
  • 23 hours America should go after China but it should be done in a wise way.
  • 7 days China is using Chinese Names of Cities on their Border with Russia.
  • 8 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 8 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 8 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 7 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 8 days Putin and Xi Bet on the Global South
  • 8 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 9 days United States LNG Exports Reach Third Place
  • 9 days Biden's $2 trillion Plan for Insfrastructure and Jobs
ZeroHedge

ZeroHedge

The leading economics blog online covering financial issues, geopolitics and trading.

More Info

Premium Content

Will Electric Vehicles Continue To Thrive Without Subsidies?

  • Sales of electric vehicles in Germany have fallen after subsidies were reduced.
  • Politicians have used subsidies to fuel electric vehicle sales, but governments can’t afford to keep the subsidies in place forever.
  • Electric vehicles also pose a problem for aging power grids, which, if not updated, will not be able to support a full transition.

Sales in Germany plunged after subsidies were reduced...

Think Twice About Electric Vehicles

The Wall Street Journal reports Germans Think Twice About Electric Vehicles

Sales of fully electric vehicles (EVs) fell 13.2% in January compared to January 2022, Germany’s Motor Transport Authority reports. Sales of hybrids declined 6.2%. This compares to an increase of 3.5% in the number of new gasoline-powered cars sold, and a modest decline of 1.2% for diesel.

The main explanation is the end of Berlin’s subsidies for EVs and hybrids at the new year. Until December the subsidy had offered up to €9,000 split between consumer and producer for EVs with a net list price below €40,000. Hybrids in that price range received €6,750. Berlin has ditched the subsidy for hybrids entirely, and cut the payout to €4,500 for EVs below €40,000. 

This year will thus be a market test for electric vehicle demand in the Vatican of climate-change belief. Politicians in the West have used subsidies and mandates to drive EV sales, no matter that they aren’t as green as their advertising. The cars are only as carbon-friendly to operate as the power grids they refuel from, and Berlin’s refusal to embrace nuclear power means Germany is burning more coal to cover for the end of natural-gas imports from Russia. Then there’s the environmental cost of mining for all that cobalt, copper and lithium for EVs and their batteries.

If consumers want to buy EVs, go for it. But what does it say about their appeal if people need subsidies to buy them?

Can the Power Grid Handle a Wave of New Electric Vehicles?

Also consider the question Can the Power Grid Handle a Wave of New Electric Vehicles?

Experts believe EVs will make up a third or even half of all light vehicles sold annually in the U.S. by 2030, up from about 7% in 2022.

If those predictions are correct, that leaves a big question: Will the power grid be capable of charging the batteries in those tens of millions of vehicles?

Some grid operators already are struggling to keep up with demand in certain areas and at certain times—California power authorities, for example, asked residents to avoid charging electric cars in the evening during a heat wave last September to help avoid overloading the grid, while utility officials in other areas have warned at times of possible rolling blackouts to prevent system collapses.

First, the good news: Many experts think the utility industry will be ready to generate enough power for the coming EV wave, thanks to planned capacity increases costing hundreds of billions of dollars.

But that isn’t the whole story. The potential for much more serious bottlenecks looms in the local legs of the grid that transmit electricity to individual homes and businesses. Expensive upgrades could be needed for these neighborhood power-distribution systems. Additional spending will be needed to bolster the wires and transformers serving commercial sites as electric trucks and delivery vans become common.

Combined, all these investments likely would result in higher electric rates, many industry analysts say. “The more they invest in the grid, the more those costs go back to consumers,” says Brad Stansberry, U.S. energy advisory leader at audit and consulting firm KPMG.

Let that last sentence paragraph in. Utilities will have to spend a lot of money to add capacity. It will cost even more if the capacity is a clean energy input source.

Cleaner energy will eventually come from solar, but how do we get that energy to Chicago? At what price?

I still wonder how the heck an evacuation of Florida happens when everyone needs to drive hundreds of miles to escape a hurricane. 

Are you convinced we have enough lithium, nickel, and other materials to make enough batteries? I am not. The more EVs we do build, the more metals we need. At what cost, and at how much pollution mining them?

Distance and Convenience

For me, it's all about distance and convenience. 

ADVERTISEMENT

It's convenient to charge at home, provided you don't go anywhere. I dive long distances and to the middle of nowhere frequently.

It is not so convenient to have to stop whatever you are doing to charge a vehicle (assuming you can find a charger in the middle of nowhere) or to rent a car if you want to drive five hours straight.

EV Sales Spiked in California

For a different take, Wolf Street reports EV Sales Spiked in California. First Uptick in Electricity Sales after 13 Years of Decline

But what about subsidies and the extraordinarily high price of gasoline in California?

By Zerohedge.com via MishTalk.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • John Galt on February 15 2023 said:
    They ask the wrong question. All EVs are not created equal.

    Lithium Ion EVs are likely to take a dive. They make very nice toys for rich people, allowing them to virtue-signal to their fellow wealthy and taunt the poor with their performance. But, there isn't enough lithium in the world to power the entire vehicle fleet, let alone the grid - it is a dead end technology.

    There are, however, other competitors coming to viability. Influit Energy received their first hard order for products from the USAF. That will be a low-volume operation, relatively speaking, but will fund the necessary trial and error to improve their product and design processes around automation to make them truly cost competitive. Not limited by expensive, rare, or toxic materials, they will be able to scale up rapidly as orders grow. Once they succeed with their Gen 2 product, with energy density 4-5x LiIon, we will see Teslas with a 1,500 mile range. And, their technology allows "refueling" in minutes - just like ICE vehicles at a gas station.

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News