3-year study raises doubts about EVs’ future

Source: By David Iaconangelo, E&E News reporter • Posted: Wednesday, November 20, 2019

The future of transportation may be less electric and less shared than some think, and millennials won’t change that, according to a study published yesterday by the MIT Energy Initiative.

The initiative’s engineers, economists and transportation planners spent three years investigating how technology, policy, infrastructure and consumer choice would affect the transportation sector of the future. They came away with a dim view about the pace of global change toward the most low-carbon forms of travel.

Within the next decade, EVs aren’t likely to reach parity with gas cars on the upfront cost — a projection that contradicts much of the settled wisdom among energy researchers and would likely dampen the competitiveness of all-electric models, according to the Massachusetts Institute of Technology report.

The problem is that lithium-ion batteries, the chief source of cost for EVs, are “very unlikely” to hit their key price threshold of $100 per kilowatt-hour by 2030, the researchers wrote.

Battery packs were about two to three times that cost in 2017, and the Energy Department is aiming to bring the price to $125 per kilowatt-hour by 2022.

The $100 target could be reached only if the prices of battery minerals — cobalt, lithium and nickel — remain at the level they were at in 2016.

But the rise of electric cars is expected to vastly increase demand for those minerals, potentially lifting the price in the process. By 2030, for instance, global demand for cobalt derived from EV sales alone would equal about 80% of the total cobalt demand in 2016, according to the study.

“For cobalt, it’s highly uncertain what the future price is,” said Joanna Moody, a coordinating author and research program manager at the MIT Energy Initiative.

“Overall, we project that for battery materials, the prices will increase a little bit, with demand on these highly volatile markets,” she added.

‘Not the best news for the climate’

The team still envisioned strong growth for electric cars in the coming decades. By 2050, 33% of light-duty vehicles would be electric, in a modeled reference scenario that didn’t include new climate policies.

If all countries fulfilled their Paris climate accord pledges by 2030, that proportion would grow to 50% of the world’s fleet, MIT said.

But the generation whose personal preferences are often assumed to be most in line with climate goals, millennials, may not actually prefer more emissions-friendly modes of transportation.

Young people are indeed racking up fewer vehicle miles traveled, and they’re less likely than previous generations to own a vehicle. That’s led some researchers and analysts to assert that millennials are simply less invested in the culture of car ownership.

Major automakers have poured money into shared mobility and ride-hailing platforms, in part to hedge their bets against the decline of the personal car.

Yet the MIT researchers found that what was assumed to be personal preference may be entirely a matter of socioeconomics: Millennials, for instance, are simply taking longer to enter long-term careers and achieve incomes that would allow them to buy a car.

Overall, growth in population and in the number of households — which are less likely to share cars between each other than people under the same roof — will keep demand for new cars healthy.

Over the next three decades, light-duty fleets will grow 30% in the U.S., along with the number of vehicle miles traveled, according to the study.

“That might be good news for automakers, that there’s still an appetite for car sales. It’s maybe not the best news for the climate,” said Moody.

In climate terms, improved efficiency of gas cars was “as critical as electrification,” she added. And the power grid’s sources would need to decarbonize in order for the transportation sector’s electrification to be meaningful.

“It’s really clear that we’re gonna need more policies or other types of nudges to create a new social norm,” she said.