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The age of the electric vehicle is dawning

After being massively over-hyped and then written off as wishful thinking, electric vehicles (EVs) are now coming of age

2013 could well be remembered as the year when EVs turned the corner. With the Netherlands about to install a nationwide fast-charging network, the number of charging stations is starting to approach critical mass in several EU countries, as well as in Japan and the United States. China is also making substantial investments with around a dozen new EV models being introduced in a government-driven program to reduce air pollution.

At the same time, common standards in EV charging infrastructure are emerging – the fast-chargers being installed by ABB in the Netherlands are compatible with EVs offered by all the major car brands. Even Elon Musk of Tesla, which has its own proprietary connection standard, is promising to bring an adapter unit to market that would allow the new Tesla Model S to be compatible with other standards.

2013 is also shaping up to be a symbolic year for EVs. With 17 million people, the Netherlands is the most populous country to date to build a nationwide network of fast-charging stations and it is also going to equip its charging stations with solar canopies, enabling them to generate much of their own energy.

For potential buyers concerned with so-called “range anxiety”, expected increases in range are likely to boost sales of EVs considerably. BMW, which recently unveiled its soon-to-be released “i3” EV, predicts that EVs will double their range within five years. Brands without a legacy to protect, such as Tesla and the Chinese manufacturers, are likely to forge ahead here, bypassing intermediate improvements, to long-range EVs, with larger batteries and higher charging power.

On the cost side, the price of EVs and especially their batteries has also been falling and, according to some estimates, the total ownership cost for some drivers is already less than gasoline vehicles. If developments in the market for solar panels are anything to go by, prices for EV batteries can be expected to plunge within the next few years.

The financial markets also seem to have regained their faith in EVs. Shares in Tesla have risen by 250 percent this year and the company’s market capitalization is now worth almost a third that of General Motors or Nissan and exceeds the market value of Fiat, for example.

Perhaps the most telling change in the EV market is the less remarked upon – but never to be underestimated – value of electric vehicles as a status symbol. If the pictures are anything to go by, the new BMW i3 is going to be as much a draw for its appearance as for the fact that its engine produces zero emissions. The same applies to the Tesla Model S, which has managed to combine the coolness of being green with the suave sophistication of a luxury motor.

One driver of the Model S, writing on Tesla’s forum for aficionados put it thus: “…owning the Model S has made me dislike my Ferrari and every other car I once loved…. In the Tesla, I am driving the future. In the Ferrari (or any other car), I am still stuck in the Industrial Age.”

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  • Philip Lewin

    Interesting post, Jonas. It will be interesting to see how the legal battles Tesla are having in the US play out. I am personally disgusted by how the US auto industry is waging a state-by-state war to shut down Tesla dealerships or prevent them from opening.

    The US e-car industry needs all the traction it can get; if the big automakers close out innovators in the interest of protecting their market share this thing will go nowhere - they are fighting a battle over centimeters when the rest of the world is leaping meters ahead. If the US wants to be a serious e-car player, its big automakers need to stand on their own feet and compete (and win) in an open market place, not a court room!

    • http://www.abb.com/ Jonas Hughes

      Thanks for taking the time to share your thoughts, Philip. I'm pretty sure that, in the US, the market will prevail (as it has in shale gas).

      • Rex Arul

        @jonashughes:disqus - Thanks for that insightful article on EVs. As renewables are steadily added more to the overall portfolio mix, this will certainly be an attractive proposition from an emissions standpoint. However, what is the current initiative (if any) that is preparing the Utilities to step-up or plan to step-up Generation for projected addition of EVs over the coming years? Are there any major initiatives that are currently in progress, that encourages sustained investments to add more renewables into the generation mix to support a larger fleet of EVs?

        If the primary supply of those electrons for EVs are going to come from fossil-fuel, I am sure, it turns into a zero-sum game with a contestable claim of zero-emissions. I think, this month's cover-story on IEEE is precisely on this topic, which, I should confess, I didn't have time to peruse yet. Probably, will take a look there too.

        Once again, thanks for sharing this article. Great read.

        • http://www.abb.com/ Jonas Hughes

          Thanks for your kind comments, Rex. I'm not aware of specific renewables' schemes linked to EVs (other than the plan by the Netherlands to equip fast-charging stations with solar canopies). But as you say, e-mobility will have significant implications for the way energy is
          managed. I suspect the growth of EVs will become an additional driver behind the changing energy mix.

          • Rex Arul

            Thanks a lot for your clarifications, Jonas Hughes. It is amazing to see how quickly, customers' choices are going to be major drivers of Utility planning for the future. Any projected increase in EV, somewhat reminds me of the rampant growth of AC installations in the mid-20th century, that pushed demand-growth, which in turn rejuvenated additional capacity planning and monetizing at the Utilities' end.

            Thanks, once again.

        • Hans Streng

          @Rex - There are a number of grid-side activities regarding the integration of the three core functions of renewables (generation, storage, conversion). Germany has launched an incentive program for local storage to avoid large feed-in of solar power (Germany generates 100GWh of solarpower on a sunny day). There are a number of companies working on combining this local storage setup with EV charging. In the USA a company http://www.EV4Oregon.com deploys charging stations according to this concept and we expect that multiple variations of this ''trinitas energetica'' will emerge, especially when cheap storage comes to the market. Think about 2-3 years from now when second-hand EV batteries gradually become available at low cost while still having 70-80% of original capacity remaining; ABB is working on this as well with carOEMs. And hey...why would Elon Musk of Tesla be interested both in EVs and in solar http://www.solarcity.com ? and why would Tesla be interested in an easy replacement of batteries http://www.tesla.com/batteryswap ?? definitely not to build nationwide swappingstations, that model failed with BetterPlace..no, they are well aware that the batteries have an additional value as stationary storage. They will need ABB to glue all grid-side local powermanagement together..stay tuned ;-)

          • Rex Arul

            Very interesting, @hansstreng:disqus. Thanks a lot for that edifying response. Much appreciated. I loved your neologism: "trinitas energetica" :)) Thank you.

          • chromebars

            A key technology of EV's is the next gen' Lithium battery technology. A really amazing tech which is still in the development phase:

            http://www.gizmag.com/m13-virus-electrode-lithium-air-battery/29791/

            The final piece to the puzzle is the ready supply of cheap renewable energy. Unfortunately ABB has bet the farm on DC power transmission.

            The bad news is that the next generation of "ultra low loss AC power cables" for high power transmission deployment is around the corner @ next 2yrs.

            The strategic problem with large scale renewable energy is that on a global scale, the energy sources are a very long distance from the major demand centers.

            Currently ABB uses AC-to-DC technologies (i.e cables and converters) to transmit electrical power over these long distances.

            But what if there was a AC cable that performed better than the combined DC technology??? :-).
            Well a new dawn is coming and it is coming out of the UK.

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