By 2050, plug in and fuel cell vehicles account for more than two thirds of all sales. Though electric vehicles and PHEVs represent only 2% of the world vehicle fleet by 2020, it is essential to reach those intermediate (yet fastgrowing) steps in order to achieve substantial electric car penetration later (e.g. 10% of stocks by 2030 and around half by 2050).
An early indicator for electric vehicles and PHEVs is the availability of electric vehicles with lithium ion batteries. The numbers and types of models available to consumers to purchase must be large enough to attract a wide range of buyers, and thus enable rapid growth in market share and sales.
The number of EV and PHEV models that have been announced, and planned to be introduced in the future, was over 200 at the end of 2010. About half of these models are from Chinese companies, and most of the rest are from manufacturers in OECD countries.
However, plans must become reality; and as of the end of 2010 only about 30 models were actually available on markets around the world (and far fewer on the market for any one country). This appears likely to change soon, with the expectation of about 40 more models to be introduced in 2011 and close to 40 more in 2012.
An increase in the availability of different models will give consumers greater choice and make it easier for governments to fully implement electric vehicles programmes. The final step will be to see if consumers respond by buying these electric vehicles in the numbers hoped: based on national targets, this amounts to hundreds of thousands worldwide within the next 2]3 years, over one million per year by 2015 and 7 million by 2020.
Other key indicators are the budgets countries are allocating for deployment, through grants and purchase incentives, and the per vehicle level of incentives. During 2010, a number of important EV/PHEV policy developments were announced:
Japan announced that by 2020, PHEV/EV sales would represent 15-20% of total LDV sales. The country has announced a pervehicle subsidy of half of the price difference between EVs/PHEVs and a base, comparable ICE vehicle.
China has tentatively announced a stock target of five million EV/PHEVs by 2020. The country has announced subsidies of Yuan 60,000 (USD 9 100) per vehicle for electric cars in pilot cities, with funds allocated through 2012.
Denmark exempts the vehicle purchase tax for electric cars (equivalent to an exemption of 105% of the electric car value below DKK 76 500 (USD 14 400), and 180 % of the car value above this, plus an exemption from annual registration fee of between DKK 500 and 10,000 (USD 95 and 1900). Additional funding of DKK 35 million (USD 6.6 million) is provided for a test programme with business and municipal fleet operators.
France announced a stock target of 2 million PHEVs/EVs by 2020. The country has announced up to a EUR 5 000 (USD 7 000) tax credit per vehicle through 2012 for the first 100 000 electric vehicles, with a total budget of EUR 400 million (USD 560 million).
Spain announced stock targets of 250 000 by 2014 and 2.5 million by 2020. Incentives outlined are up 25% of electric car cost, with an upper limit of EUR 6 000 (USD 8 200) per vehicle. EUR 72 million (USD 100 million) are allocated in 2011 and EUR 160 million (USD 225 million) in 2012.
Sweden announced a stock target of 600 000 for 2020 and EUR 20 million (USD 28 million) worth of purchase incentives through 2014.
The United States announced a stock target of 1 million by 2015 with up to a USD 7 500 incentive per vehicle, for the first 200 000 vehicles sold by a manufacturer. The US Department of Energy is providing relevant funding and grants of over USD 2 billion for lithium ion batteries and electricdrive component manufacturing.
The United Kingdom has not announced a firm sales or stock target (though 800 000 on road by 2020 has been mentioned in reports). An EV/PHEV purchase incentive of GBP 5 000 (about USD 8 000) is set through 2012.
Taking into account caps, current programmes could result in total expenditures of around USD 20 billion. Total worldwide spending through 2020 could be far higher if incentive programmes continue, even if incentive levels decline over time. For example, if the average incentive were USD 5 000 per vehicle for the next 10 years, total incentive spending for those vehicles would be USD 100 billion if 20 million vehicles are sold.
Improving the fuel economy of internal combustion engine vehicles over the next 10 years is also a priority for cutting fuel use and CO2 emissions. There is a wide range of current average new LDV fuel economy, with countries like France and India selling cars with the lowest fuel consumption per kilometre, while the United States and Australia are among the highest. The global average in 2005 was estimated to be about 8.1 litres per 100 km (about 29MPG), improving to 7.7 litres by 2008. However, most of the improvements were in OECD countries; nonOECD countries overall experienced a slight worsening of fuel economy.
The Global Fuel Economy Initiative has called for a global target of half the 2005 level of 8.1 L/100km – or about 4 L/100km – by 2030. Good progress in this direction appears likely to occur in OECD countries over the next five years, thanks to relatively strong fuel economy standards now in force in most countries. But it will be important to continue strong improvements after 2015, and the best way to do this will be for countries to set targets – and standards – through 2020 and beyond, sooner rather than later. It will also be important for more countries in the developing world to set strong policies, whether these are standards or marketbased policies (like CO2differentiated vehicle registration fees).
Fuel economy policy developments during 2010 included:
United States set revised CAFÉ standards for LDVs with target 35.5 mpg by 2016 (about a 25% improvement compared to today). The United States also proposed fuel economy/greenhouse gas standards for heavyduty vehicles, in development.
EU – New CO2 regulation for passenger LDVs was adopted, requiring 120 G/km maximum CO2 levels by 2015 and 95 G/km was adopted in 2009); CO2 standards for commercial vans was proposed and is under consideration (proposal: 175 gCO2/km by 2014, 135 gCO2/km by 2020).
China has proposed tightening its fuel economy standards (only nonOECD country with standards) through 2020, but
Many countries, especially in the EU, have implemented fuel economy or CO2based vehicle taxation schemes, or “bonusmalus” schemes (with higher taxes for high fuel consumption/CO2 vehicles and rebates for the most efficient models). There are a wide range of such schemes now in place, sometimes sending mixed signals to manufacturers.
Public spending on research, development and demonstration
The RD&D data on vehicle efficiency include on and offroad transport vehicles as well as agricultural transport systems and waste heat recovery. Electric vehicles include infrastructure and storage systems and hydrogen and fuel cells for mobile applications.
RD&D spending in electric/ PHEV and vehicle efficiency. Spending dramatically increased since 2003 in all countries, from USD 265 million to USD 1.6 billion in 2010. The countries with large vehicle markets (and manufacturing) dominate the spending: the United States, France, Japan and Sweden made up more than 80% of total RD&D between 2005 and 2010.
Germany shows surprisingly low amounts of spending in these technology areas while Australia spent impressive amounts between 2009 and 2011 (USD 270 million) against previous decadal average of less than USD 4 million in the period 1999-2009. No data is available for China and other emerging economies. Few countries recently submitted detailed RD&D data which permit to make a split on different research categories.
For example, the United States spent over USD 500 million on electric vehicles, vehicle lithium ion batteries and electric car infrastructure, at least USD 280 million on fuel and onroad vehicle efficiency and further USD 350 million on other transport efficiency in 2010. In Japan, only about 10% of total budgets for transport efficiency were spent on onroad vehicles the same year. Still, both countries were not able to allocate more than 50% of the amounts spent on transport RD&D in 2010.
The totals for 2008-2011 show that fuel cell research still ranks high in spending, slightly ahead of lithium ion batteries research. Other vehicle R&D (such as motors and advanced drive trains) is also significant. Spending on demonstration projects – a form of deployment – also received more than USD 1.4 billion over this period. This is likely to grow in coming years, particularly in the form of incentive programmes for purchases of EVs, PHEVs and other advanced vehicles.