Will electric cars displace oil?

Over Christmas, I read Vacliv Smil’s Energy Myths and Realities.

I was reluctant to buy a book published by the America Enterprise Institute (where former Vice President and Halliburton Chairman Dick Cheney has emeritus) on the belief that it would be biased to “drill baby drill”. I was wrong in that Mr Smil correctly throws cold water on pseudo-science, political grandstanding, and near-religious fervor surrounding all things green. But I was right, in that the primary take aways are:

  • we have enough oil to last until the 22st century
  • we have enough coal to cook the planet, if we choose to
  • and renewable energy is a waste of energy, more or less

The book takes on three “myths” – electric cars, nuclear energy and soft energy (i.e. biofuels) through a combination of facts and fiction. For instance, the syllogistic error that forecasts made today about nuclear energy will fail, because forecasts made 60 years ago proved false. Humans may not be any smarter than we were 50 or 100 years ago, but our “tools” are. When NASA was trying to launch rockets in the middle of the last century, they couldn’t predict the next day’s weather. Today I can watch Pacific storms heading to California on my iPod. Mr. Smil is correct that Moore’s Law has little to do with solar cells – a planar diode doesn’t benefit from nanometer line widths. But he errs by discounting how technology can change the boundary conditions for the deployment of solar generation, transmission, storage, etc. All three of his “myths” do have technical and economic flaws – but technology advances exponentially. We won’t solve problems in 2050 the way we solve them today. The right question to ask is which problems should we be working on now. To that end, I am going to focus on the future of electric cars. First with a statement of facts and then an assumption to use for a thought experiment.

Fact set 1. America today consumes ~20 million barrels of oil per day (a barrel is a term for 42 gallons). About sixty percent of that is used for transportation – gasoline for cars, diesel for trucks & trains, and kerosene for airplanes. At $90 per barrel, America spends over $650 billion dollars per year. (One of third of that is imported which currently constitutes about one-third of our trade deficit.) Assuming gasoline is 50% of the oil consumption and an average price per gallon of $3.00, American’s spend $1.2B per day at the pump.

Fact set 2. There are 245 million cars, SUVs, light trucks and minivans on the roads and in the driveways of America. I recently watched a video of Jay Leno taking delivery of a Chevy Volt and contrasting it with his 1906 Baker Electric. Jay owns a lot of cars and there are more cars than drivers, but let’s assume 250M cars for the calculation. According to the EPA the average fuel efficiency is 21 mpg. Thus the total miles driven by cars, pick-ups, and vans is 3 trillion per year or ~12,000 per year per car.

The Chevy Volt has a battery powered electric drive with a gasoline powered battery charger. The battery powers the first 50 miles (from a 16KW-Hr battery), then the 9.3 gallon gasoline engine provides an additional 250 miles. It is essentially a hybrid with a different drive train than the Toyota and Honda version introduced in the last decade.

For our experiment, let’s pretend that we replace all of our vehicles with Chevy Volts (buy American). Let’s assume that half of our driving is 50 miles per day (the average is more like 40 so this is conservative). Then across America on an annual basis, 1.5T miles run on electricity and 1.5T miles run on gas. The gas mileage for the Volt is 44mpg. The net result is a 75% reduction in gasoline, a savings of $335B/year.

The Chevy Volt consumes ~300W-hr/mile (or 6 meters per Watt-hour in future-speak). Let’s assume 400 W-hrs to account for battery degradation. Thus our 50 miles trips will require 640 TW-hrs of electricity per year. We would need ~400GW of solar and/or wind to provide this. To put this in perspective the US has ~1GW of installed solar with 6GW in construction and 40GW of wind power. Solar is growing rapidly, wind is slowing due to grid limitations.

Let’s assume that every Chevy Volt comes with a solar generator and battery charger. We need ~2KW of solar panels to charge our Volts. At today’s cost that equates to $5T. Putting a Chevy Volt in every driveway adds another $10T. Both of these trillion dollar numbers assume no learning-curve or volume-manufacturing benefits. Together they equal about one GDP, which equates to 40 years of gasoline consumption. And that cost is misleading since it doesn’t account for the 100’s of billions of dollars needed to extract oil from old and new fields over the next forty years. Plus the hidden costs of higher trade deficits, defending our country from foreign actors who benefit from the river of oil money flowing to the Middle East, and good old Global Warming.

Vacliv Smil uses a scenario where every drop of gasoline is replaced by electrons from crummy batteries, with the result that we will never generate enough electricity to make electric cars a significant part of our future. I assert that we can eliminate a lot of gasoline with electric cars – if

  • We significantly improve battery technology to increase capacity & cycles while reducing cost.
  • We dramatically increase local (residential and commercial rooftop) solar generation (see The Ultimate Saving Machine ).

How long will this take? Can electric cars reduce our oil consumption by 10% in 10 years?

At a run-rate of 12 million cars purchased per year it would take >30 years to “turn-over the fleet” – if every new car was electric. Estimates of hybrid/electric car sales for the next few years range from 1% to 7%. Thus an “electric turn-over” is several decades away. Mandates for high mpg cars (and higher gas prices) will accelerate that trend. And at some point in the future, most cars will be electric of some flavor. The early adopters buy anything “green”, the mainstream buys value (cost, comfort, convenience, reliability), and the late adopters buy used. It will also take decades to shift large segments of US GDP from oil to renewable sources of energy. Sectors that see it coming will shift their businesses, which is why the oil industry is investing in renewable energy. Sectors that don’t tend to hunker down and hire lobbyists.

Leave a Reply