Electric vehicles are
finally going mainstream. After decades of waiting for the EV revolution, more
and more people worldwide are finally driving them. Driven by strong growth in
China and Europe, EV sales crossed a critical milestone in 2022 with 10 percent of the global vehicle market
share.
اضافة اعلان
As more governments,
large and small, look to promote
electric vehicle usage to combat climate
change, the sector should continue to take market share in the short term. The
US state of California has even mandated that all new cars sold must be electric or hybrid by 2035. The
explosion in electric vehicle usage comes down to simple economics, but that could
also end up being the sector’s undoing.
One of the world’s
most recognizable
electric vehicle companies,
Tesla, started 2023 with deep price cuts to its most popular cars. The
company cut prices of its flagship offerings by up to a fifth across the US and
Europe in response to cooling market demand spurred by the global economic slowdown
and more competition from other brands, especially in China.
The explosion in electric vehicle usage comes down to simple economics, but that could also end up being the sector’s undoing.
The price cuts were
also in response to falling supply chain costs from the COVID-19 pandemic era.
China, one of the world’s fastest growing markets for EVs, accounts for nearly
two-thirds of global sales. As a result, there has been a boom in domestic
Chinese
EV manufacturing that could soon result in Chinese EVs making inroads
in the European and US market.
Hidden costs of an EV
world
China’s emergence as
a key EV market highlights the hidden costs of the EV revolution. While
consumers have long been concerned by the cost and viability of owning an
electric vehicle, the actual costs to the planet have been glossed over in the
public imagination. One glaring challenge is the increased carbon debt of
electric car usage in colder and more cloudy climates. The unavoidable reality
is that electric cars are only as clean as their energy supplies.
In markets where
renewable energy is not fully utilized to
power EV charging stations, the power
comes from carbon-dirty sources such as coal and natural gas. This raises the
carbon debt of an electric vehicle dramatically, which goes against the general
tone of electric vehicles. Then there is the issue of underdeveloped
infrastructure. Large parts of the world where renewable energy is abundant
lack the necessary infrastructure to kickstart their own electric vehicle
revolution. Countries like South Africa, blessed with consistent wind and solar
energy reserves, have virtually no infrastructure to support electric
vehicles.
The unavoidable reality is that electric cars are only as clean as their energy supplies.
There are notable
bright spots. As part of Abu Dhabi Sustainability Week, Regency and
EVGateway unveiled a partnership to deploy
10,000
EV charging stations throughout the UAE by 2030. Given the country’s
nearly endless solar energy reserves, the UAE could soon look like a pilot
project for the clean use of electric cars. The rest of the Middle East and
North Africa are prime for electric vehicles given how much sunshine they get
through the year.
The mineral deficit
Yet, there is another
roadblock to more widespread usage.
Electric vehicles require significant
amounts of minerals such as graphite, nickel, cobalt, and lithium that
traditional cars do not need. Many of these minerals are used in the batteries
and microchips that make these vehicles function. The challenge is extracting
these minerals and how much supply we have on the planet.
Many of these
minerals are only available in select countries. In some countries, the
extraction infrastructure is lacking especially compared with our ability to
drill for oil and other hydrocarbons. If the infrastructure was there, the
question would then shift to the amount of minerals in the ground. Thus,
greater expansion of
electric cars to new markets could translate to serious
shortages of vital minerals.
Greater expansion of electric cars to new markets could translate to serious shortages of vital minerals
If South Africa, for
example, decided to make a significant push toward electric vehicles and
devoted state resources to the infrastructure challenges, it would put a strain
on the mining of vital minerals like lithium. Put simply, there is not the
global infrastructure to support the large-scale mining required for a massive
expansion of
electric vehicles.
Considering EV
challenges
Some mineral
producing countries are taking aggressive actions to protect their natural resources. Last month,
Zimbabwe banned the export of raw lithium from its
borders. The southern African nation is home to the world’s sixth-largest known
lithium reserves, and the move could signal a new wave of resource
nationalism.
Falling prices for
electric vehicles in the West will drive new drivers. The sector is growing
exponentially, which is both a good and a bad thing. Now that electric vehicles
are a viable alternative to traditional cars, it is time for a fresh
conversation about the real impact of this new approach to transport.
If we delude
ourselves to thinking that
electric vehicles by their essence will help climate
change, we are in for a rude surprise. Like any new technology, EVs bring a
host of opportunities and challenges. It is time to think clearly about those
challenges before we end up doing more harm than good.
Joseph Dana is the
former senior editor of Exponential View, a weekly newsletter about technology
and its impact on society. He was also the editor-in-chief of emerge85, a lab
exploring change in emerging markets and its global impact. Twitter: @ibnezra. Copyright: Syndication Bureau.
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