UK: Electric vehicles could drive 40% cut in oil imports by 2030


A report commissioned by the European Climate Foundation has forecast that oil imports into the U.K. could be slashed by as much as 40% by 2030 if the country can properly develop its electric vehicle market and infrastructure.

In a study conducted on behalf of the Foundation by Cambridge Econometrics, a surge in electric vehicle (EV) adoption could see the average motorist save £1,000 ($1,500) in fuel costs per year, triggering a 47% decrease in carbon emissions by 2030 and a huge reduction in the U.K.’s reliance on oil imports.

Further, by the middle of the century widespread adoption of electric vehicles would see air pollutants such as nitrogen oxide all-but disappear from the atmosphere, sparking a secondary health benefit nationwide that could save more than £1 billion ($1.5 billion) in healthcare costs.

However, to reach the desired deployment target of six million electric vehicles by 2030 – a figure that could rise to 23 million by 2050 – the U.K. will have to begin a renewable-energy-powered overhaul of its infrastructure immediately, said the report.

"There will be a transition in the next five-10 years but you won’t see a sudden shift to electric vehicles until consumers have got over their ‘range anxiety’ concerns, and that will only happen with infrastructure spending," said one of the report’s authors, Philip Summerton.

Tackling range anxiety

Range anxiety is a huge concern for traditional motorists weaned on the gleaming roadside markers indicating an impending gas station. Currently, electric vehicle charging stations are few and far between in the U.K., and today’s battery powered models do not currently have the range – or recharge speed – to match traditional combustion engines.

A recent study by the Human Factors and Ergonomics Society stated that such anxiety is an acute problem, with the EU also aware that the lack of recharging infrastructure across the continent is a barrier to progress that needs to be addressed.

In the U.K. there are only 703 EV charging stations, but a proposal two years ago by the European Commission to plow €10 billion into a public works program designed to increase the number of stations across Europe would have propelled the U.K.’s infrastructure to 1.22 million stations by 2020.

This mandate was repelled by the U.K. coalition government, however, due to the costs associated with ensuring 10% of recharging stations would be publicly accessible in every country. However, current subsidies designed to encourage adoption of EVs in the U.K. – which stand at around £5,000 ($7,540) per vehicle – have had a positive impact in boosting the industry.

Last year, around 15,000 EVs were purchased in the U.K., compared to less than 5,000 in 2013. Each of Germany, France and Sweden have seen similar growth patterns, but a survey carried out by the British Automobile Association (AA) in December found that of 16,000 drivers polled, just 1% are likely to opt for an EV in the next five years – suggesting that change may happen slowly.

The same survey did find, however, that 84% and 55% of drivers were concerned with fuel economy and low emissions respectively, with hybrid vehicles viewed as the more attractive option currently.

"Our research shows that drivers’ attitudes are changing when it comes to choice of car," said AA president Edmund King. "Drivers want fuel efficient cars that are also reliable, safe, comfortable and easy to service. However, there is still a massive leap of faith to be made before drivers fully embrace full zero emission vehicles."

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Price as factor

While the U.K. House of Commons has called upon the EV industry to conduct greater awareness and information campaigns, and the European Commission is still exploring ways to augment the recharging infrastructure, industry leaders are increasingly focusing on lowering the cost of EVs in order to grow the industry.

Tesla Motors says that it is likely to be able to produce battery packs at $220/kWh by 2020, although Bloomberg New Energy Finance (BNEF) told pv magazine that it expects that price to be reached a little later, around the mid-2020s.

Tony Seba, Stanford Professor and author of Clean Disruption, calculates that the cost of storage could be as low as $200/kWh by 2020, with grid storage vendor Acquion announcing that it is working towards a cost of $150/kWh by 2018.

With batteries accounting for the bulk of the price of a Tesla vehicle, for example, any progress made in the storage sector will likely bring about seriously benefits for the average motorist seeking affordability, performance and low running costs – a typical EV costs just $0.04/mile to run, compared to around $0.15/mile for internal combustion engines.

And with solar costs also coming down rapidly, the tide may already have turned, according to a recent report by European investment bank UBS.

"Our proprietary model shows it is the combination of solar, storage and the EV market that has the potential to bring disruptive changes to the electricity sector," said UBS. "Here is the math: One can leverage the EV purchase with an investment in a solar system and a stationary battery. By doing so, one can optimize the self-consumption of solar power and minimize the ‘excess waste’ of solar electricity.

"The combination of an EV + solar + battery should have a payback of 7-11 years, depending on the country-specific economics. In other words, based on a 20-year technical life of a solar system, a buyer should receive 12 years of electricity for free (purchase in 2020)."

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