The report entitled Electric Vehicles – Driving a Revolution says that by 2025 one third of all passenger car sales will be electric.

Author of the report, Ezra Beeman, says “Electric vehicles are the future because they will be a win-win for all major stakeholders.”

“Consumers will save money, policymakers can reduce urban pollution and transportation emissions (with incentives), suppliers can increase electricity sales, and networks can lower peak demand. The question is, what is being done to accelerate their arrival, and the answer is, not much.”

Customer demand for electric cars is currently outstripping supply, and Mitsubishi and Nissan have both announced 50–100 per cent increases in their near-term production capacity.

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High demand, low funding

Despite this, and despite major manufacturers’ plans to introduce five models over the next two years, the report finds that Australian drivers will be relatively slow to purchase electric vehicles over the next decade due to a lack of choice, immature battery and charging technology, and nascent government and electricity industry support.

Based on its analysis, Energeia sees international pricing and technology developments as driving a major acceleration in Australian sales from 2020. Energeia says that dominance of the electric vehicle industry is up for grabs. This is an opportunity that has attracted strong policy support overseas, but not in Australia.

Mr Beeman says that when Energeia commenced research on the industry in Australia, it was surprising how relatively immature Australia’s policy and regulatory framework towards electric vehicles was, compared with other countries.

The Energeia report highlights that “Unlike the United States, China, Germany, France or Spain, Australia lacks a national target for electric vehicle adoption, or the programs required to achieve them. The absence of consumer subsidies will mean that Australian purchase premiums will be nearly double those in the United States, United Kingdom, and Japan, and almost four times higher than leading markets like California.”

Infrastructure improvements

Other key barriers facing Australia’s electric vehicle market include a lack of charging infrastructure, charging network roaming arrangements, industry standards for fast charging, and preferential tariffs to minimise the impact of electric vehicles on the grid.

The report states that eventually, the superior torque curve of electric vehicles, as well as increasingly longer driving range, lower total cost of ownership and environmental benefits mean that electric cars will begin to displace internal combustion cars from about 2020, as technology matures and infrastructure is put in place.

Driving ahead

Mr Beeman says that price reduction caused by development of technology in other countries will eventually have a flow on effect into Australia; so although we may not see a large number of electric vehicles in the short term, there will be a dramatic increase in the long term.

By 2030, Energeia’s modelling shows there will be 3.4 million electric cars on Australian roads – around 25 per cent of all cars, which will require 6 terawatt hours of electricity generation annually.

Mr Beeman concludes that “Australians will have to wait a while before electric cars present a cost-effective alternative to the petrol engine. Nevertheless, the electric car revolution is coming to Australia, and the new world order that we eventually expect to emerge will include zero carbon transport, a decentralised, renewable energy-based electricity system, and abundant storage that will bring an end to wholesale electricity market price spikes and the peak electricity problem for distribution networks.”