BNEF report ‘EVs 35% of Global New Car Sales by 2040’ is ridiculously conservative
GULF OF MEXICO – APRIL 21: U.S. Coast Guard fire boat response crews battle the blazing remnants of offshore oil rig
The Bloomberg New Energy Finance report that came out last week (press release at bottom) says that in 25 years, electric vehicles will make up just 35% of new car sales. That means that in a generation from now, 65% of people will still be buying petroleum-based cars. It is hard to imagine a world where this few EVs makes any sense, even given BNEF’s own data.
The report and the numbers it presents are much too conservative for any reasonable circumstance. Take its own lede for instance:
“Continuing reductions in battery prices will bring the total cost of ownership of EVs below that for conventional-fuel vehicles by 2025, even with low oil prices.”.
Why would anyone buy a gasoline car when an electric or even a plug-in hybrid costs less than a gas car? Electric cars are cleaner, quieter, faster and safer than equivalent oil cars. Keep in mind that 2040 is 15 years after the cost of an electric car passes parity with oil in their scenario. Furthermore, by Bloomberg’s own estimates, batteries will reach less than one-third of today’s break-even prices.
At the core of this forecast is the work we have done on EV battery prices. Lithium-ion battery costs have already dropped by 65% since 2010, reaching $350 per kWh last year. We expect EV battery costs to be well below $120 per kWh by 2030, and to fall further after that as new chemistries come in.”
In fact, under certain reasonable circumstances, it costs less to own a Chevy SparkEV than a comparable gas version today. Fleet vehicles too. If you drive a lot and gas isn’t cheap but electricity is, the numbers already make sense.
The US department of energy has a handy calculator (above, current prices) which shows that in every state in the union, even with insanely cheap gas prices, it is still on average 50% cheaper to run on electricity than on gasoline. That means once battery/electric engine powertrains reach parity with combustion, it is really game over for oil.
So somehow 65% of people in the year 2040 will want to pay a huge premium for a fossil fuel engine car? Even if the world weren’t heating up this makes no sense at all…
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