Making the leap – barriers and benefits to a world moved by electric vehicles

The electric vehicle market is making strides toward becoming a mainstream choice in the automotive industry, but we still need greater energy behind education and policy.

The electric vehicle market is making strides toward becoming a mainstream choice in the automotive industry. We are seeing continued progress in lowering technical barriers to adoption, but need greater energy behind education and policy. This will further ensure that benefits and broader opportunities, which are ripe and readily available, are optimised rather than overlooked.

Technology barriers are rapidly falling down – faster than perception and policy barriers

Common barriers to widespread adoption of electric vehicles relate to the upfront purchase and ongoing practicality of the driving experience for personal use – and initial investments and changing fleet management behaviours for commercial use.

In the personal electric vehicle space, the upfront purchase is led by the two factors of model and price. We have a fairly small range in Australia, though new models are entering every year. Many are still priced in the premium range, which was a core reason for electric vehicles being something of an early-adopter choice that was out of reach for most consumers. However, the market for vehicles under $65,000 is growing. With better upfront affordability, and an improved range of models to select from, we will see electric vehicles increasingly move out of consumers’ ‘consider later’ list into a ‘consider next’ list.

Then the driving experience comes into play. At the centre is the distance a vehicle can reliably cover on a single charge. Outstanding progress has been made on this front. A standard electric vehicle under $50,000 can offer an impressive 480km range [1], and we are seeing continual advancements in those distances. This is important because range anxiety is a very real factor and roadblock for many consumers – even though the distances most people cover in a day are substantially less than the range of today’s electric vehicles.

A car’s capacity is either supported or held back by charging station accessibility – or lack thereof. I’ve spoken about this previously. This presents the other key hurdle in the personal electric vehicle space. Australia is still sitting at the sub-2,000 charging station level nationwide. That’s a small share of an estimated nearly 1 million public charging points globally and well short of the fast growth we’re seeing in regions such as Europe and China, according to BloombergNEF [2].

In the commercial arena, those barriers are substantially lower as companies and governments realise that initial investments are offset by an extremely competitive total cost of ownership compared to internal combustion engine vehicles. And where charging infrastructure remains a barrier for individual consumers, the growing range of charging solutions means that fleet management is increasingly adaptive and flexible, albeit with the need to rethink old behaviours in commercial fleet use.

The two final barriers that are critically impacting the adoption of electrical vehicles in Australia will both be the topic of future blogs. The first is a lack of focus on consumer education and the second is a lack of national policy and prioritisation. As we look overseas to electric vehicle success stories, these two elements are key.

Triple-bottom-line benefits stand out

The benefits of electric vehicles are compelling, delivering triple-bottom-line value that cannot be matched by internal combustion engine vehicles.

Environmental value – although electric vehicles are recognised as key pillars in a much broader approach to reversing the damaging impacts of climate change, the short-run benefits are huge. In particular, the immediate reductions in air and noise pollution offer outstanding value in terms of environmental health and, in turn, individual health.

Economic value – as upfront costs continue to reduce, the real win is in the ongoing cost savings afforded by electric vehicles – approximately one third the cost to recharge a personal electric vehicle versus the cost of petrol [3]. Governments around the world are fast-tracking their move to e-fleets in part because of the cost savings they are delivering.

Social value – there are many points of social value and just one exciting example is that of convenience. People have the ability to charge their vehicles from home, work and a growing range of public places including petrol stations which are already moving towards becoming “energy hubs”. Even for commercial fleets, this shift is major, because charging, or ‘fuelling’, a vehicle is now user-centric, rather than fuel-centric.

Nearly limitless opportunities

E-mobility as a whole is an arena that is all about possibilities. The continual reduction of barriers and growing evidence of benefits underpin exciting advancements that will only expand over the coming decades.

Car manufacturers are stepping up their research and development efforts. That will see greater growth in more affordable cars across a wider range of models, spurring sales, improving economies of scale during production and continuing the beneficial cycle.

Charging stations are also diversifying – an area in which we are proud to be market leaders. There are now numerous solutions for residential and commercial charging, including workplaces, retail centres, carparks and more. Greater availability of fast-charging stations around our major highways is another important move that will help to reduce barriers and realise benefits.

And one less promoted area of opportunity is the application of electric vehicles to a broad range of industries, such as ebuses and even heavy haulage. Alongside the environmental gains, moving to electric is far more cost effective and makes the switch an even easier decision for governments and businesses. We are working with clients on some exciting applications in port operations and also airside vehicles for an airport. Far from being future opportunities, these are live projects and pilots that are showing outstanding potential today.

The future is certainly bright for major growth in electric vehicles.

 

[1] https://electricvehiclecouncil.com.au/about-ev/key-facts/

[2] https://about.bnef.com/electric-vehicle-outlook/

[3] https://www.ergon.com.au/network/smarter-energy/electric-vehicles

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About the author

David Sullivan

David Sullivan is the Head of Electrification business for ABB in Australia. He leads a technology portfolio that covers the full electrical value chain from substation to the point of consumption, enabling safer and more reliable power. He also oversees ABB Australia’s Electric Vehicle Charging Infrastructure and is a former Board Member of the Electrical Vehicle Council of Australia. David was appointed Head of Electrification in 2016 after leading the Medium Voltage business for three years and, prior to this, managing national sales and account management for the Power divisions. David has more than 20 years’ experience, both locally and internationally, in the electrical supply industry as it relates to Utilities, Process Industries and Minerals. He holds an Electrical Engineering Degree from University of NSW and a Masters of Business Administration from Open University UK.
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