Will 2010 Mark the Shift from the Backward-Looking and Unaffordable Electric Cars to Forward-Thinking Smart Mobility?

Cleantech Group Chairman Nicholas Parker Thinks So

Tom Konrad, Ph.D.

I’ve long argued that the future of mobility in the peak oil era will center on alternative modes of transport, not alternative fuels for the same old car infrastructure.  Electric cars are probably the car of the future, but the cost of batteries and escalating cost of oil will mean that the number of electric vehicles is likely to remain low, while how often we use conventional vehicles will decline as fuel prices rise.

In his annual clean technology predictions for 2010, Cleantech Group Chairman Nicholas Parker prophesies,

Electric cars take the back seat to smart mobility

In 2009, electric vehicles and hybrids eclipsed fuel cell vehicles as the undeniable new center of gravity of the auto industry. Virtually every car company in Asia, Europe and North America announced ambitious clean car strategies, and many brought new models to market, in addition to startups funded by venture capitalists.

In 2010, clean cars will form part of a broader shift to smart mobility. Smart mobility will quickly permeate beyond simply the transport sector, and will be integrated into the new energy paradigm and influence the design of urban systems, even shipping ports. Look increasingly in 2010 for eco-city designs based on concepts such as “new urbanism.” Leading governments around the world will rethink tax systems, fiscal incentives and budgets to encourage greener forms of work and transport based on smart mobility concepts (SNCF, the French state-owned rail operator, set up a fund in 2009 specifically to invest in e-mobility.)

I think he’s being too optimistic on the time frame, but I sincerely hope he is right.   If he is, it will be good for my investments.  Three of my forthcoming Ten Clean Energy Stocks for 2010, to be published on AltEnergyStocks.com in this coming week are currently profitable companies focused on alternative forms of transport.

Two of his other predictions should also be good for my stock pick, if they come to pass.  Mr. Parker sees energy efficiency (three picks) eclipsing solar (no picks), and growing interest in waste-to-energy (one pick.)  You can see the rest of his predictions here.

 

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2 Comments

  1. Uh.. battery prices are dropping. Battery developments are promising better batteries in the future. Why do you think todays battery prices will continue being a drag on EV prices?

    On the other hand swapping “fuel” (gas => electricity) and otherwise leaving the predominant transportation paradigm as it is – that leaves unfixed lots of issues. The focus on carbon emissions and climate change means these other issues aren’t getting attention. Such as the horrid land use that highways are – highways are an ugly blight, and are an inefficient use of land to move people around. You can transport more people per square mile of land using mass transit or bicycles rather than cars. Presumably “smart transport” would make for better land use as well.

  2. Tom said

    David,
    Regarding battery economics, batteries are dropping in price about 8% a year. In order for the economics of EVs to be comparable to that of ICEs today, they will probably need to drop by a factor of 4 or five, or about 2 decades of decline at current rates. We don’t have two decades to make the transition, hence I conclude that we’re going to be using fewer cars in 10 years.
    Subsidies from the government can help get the industry jump-started, but they cannot get EVs to high penetrations because the government does not have enough money to subsidize even 10% of new vehicles to the tune of $10,000 that would be needed to make EVs financially comparable to ICEs for the average driver (there are special cases with drivers who drive daily and make short commutes where a lower subsidy is needed, but these are special cases.)

    On the other hand, Electric busses with battery swapping capability might make a lot of sense, because this would allow the batteries to be used often enough and predictably enough to make the economics work. Electric trolleys already make sense, and a installing some battery capability to charge when on a trolley line might be the best of both worlds.

    My underlying point is that in order to make EVs economic, the batteries must be used very intensively. We’re going to need much cheaper batteries than we’re likely to get in the next decade to change this.

    The result will be fewer cars, a growing share (but small number) of which will be EVs.

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