All-electric cars only by 2040?

I should have looked into this more closely before making my previous post. The UK government is also looking to ban the sale of hybrid cars in 23 years’ time. This beggars belief, without some plan for how these electric cars are going to be reliably powered while – and we have to assume that this is the main long-term goal despite the talk about air pollution – cutting carbon dioxide emissions.

Without rationing times for driving, either directly or because batteries can’t be charged, the only option would be to build a whole fleet of nuclear power stations. Since it’s doubtful at the moment whether even Hinkley Point C is going to be built, there is little chance of this eminently sensible option coming to pass.

This proposal is either going to be watered down, or there will be some face-saving U-turn or postponement by 2030. In the meantime, subsidising the purchase of electric cars and the provision of charging facilities will be a massive drain on the economy which could largely be avoided if hybrid cars were the choice.

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The internal combustion engine isn’t dead yet

The UK government has now joined with France in banning the sale of new diesel and petrol cars from 2040. At least, that’s the headline, but in practice it’s likely that hybrids with modest battery range will become the new norm, with all-electric cars still waiting on a quantum leap in battery technology, massive investment in charging infrastructure and, last but not least, a large expansion in electricity generation.

The present generation of plug-in hybrids, with maybe a 30 mile range on battery and a small petrol or diesel engine for longer journeys, would certainly help to improve urban air quality, while still be practical all-round cars. Without such a government edict, however, their higher price would mean that the internal combustion engine would still be the choice of many. Over the next couple of decades, we can expect hybrids to become more capable and the price gap to reduce. Don’t expect much of a running cost advantage, though: governments aren’t going to lose billions in fuel tax without recouping the income in some other way.

There are, however, two elephants in the room. The first is that this move will require a big investment in electricity generation, and the power has to be there when drivers want it. Not everyone will be able to charge their cars overnight, particularly in cities where many people live in flats or terraced houses. But the alternative to thousands of accessible daytime charging points is simply to run the petrol or diesel engine to power the car and recharge the battery, significantly reducing the supposed impact on air pollution.

The other elephant, and one we hear less about, is the fact that car exhausts only contribute a fraction of the pollutants in urban air. Cars would have to be taken off the road entirely to avoid the particulates shed by brakes and tyres, for example. And, more importantly, the ubiquitous gas boilers put out significant quantities of NOx. If you think that the introduction of electric cars would cause a problem, that’s nothing compared to the infrastructure challenge created by a move to electric heating.

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Battery power

UK business secretary Greg Clark has announced a £200m+ investment in developing battery technology, as part of a broader industrial strategy. Despite being late in the game compared to some Asian countries, the intention is to boost the UK economy by making the country a leader in energy storage. There are a lot worse things the government could be spending taxpayers’ money on. We have been calling for investment in energy storage R&D for years. Without it, most of the current (subsidised) spending on renewable electricity is wasted.

At the same time, the plan is to reduce peak demand by enabling domestic consumers to have appliances turned off for short periods when demand is high. This has some merit, as long as it relates to non-essential items such as water heaters, fridges and washing machines.

But the policy is flawed because it also proposes to encourage domestic generation and storage of electricity from solar panels, with surplus to be fed into the grid tariff-free. While this may be of some benefit in summer, such households will inevitably be net consumers from the grid after dark and during the winter months. Conventional backup generators will still be needed, but will operate (expensively) for somewhat less of the year. The government hopes that fewer power stations will be needed, but this is very much a moot point at the moment.

And, importantly, the system costs will not go down. In fact, they are likely to increase further, because someone has to pay for the solar panels and batteries and few people will do so themselves without grants, subsidies and a guaranteed price for the electricity they export. However this system is constructed, taxpayers and most consumers will pay more. The projected £40bn that consumers are projected to save by 2050 (cumulative? per year? relative to what and making what assumptions?) is likely to go to those lucky house owners with south-facing roofs and enough money for the initial capital outlay. That means relatively well-off suburban and village dwellers, by and large.

So, it’s good that more R&D is being funded, but markets will respond naturally when breakthroughs in performance and price are made. In the meantime, subsidising inadequate solutions is not the answer.

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On the right tracks?

Major infrastructure projects can be fraught with difficulties of various kinds, not least political, where the UK planning system can drag out decision-making for years. Even before reaching that stage, governments are loath to make decisions that are subject to significant local or national opposition.

The intended third runway at Heathrow is a case in point. A number of major new airports have been built in other countries while each government of the day in Westminster has failed to bite the bullet. In the meantime, the country’s primary airport – and one of the world’s busiest – continues to run very close to maximum capacity, with inevitable delays.

Not that Brits are necessarily bad at implementation. Once the protracted planning inquiry had been completed, the much-needed Terminal 5 at Heathrow was built on time and to budget, for example. In comparison, countries with excellent skills and capacity to get things right can sometimes get them badly wrong. Construction of the yet-to-be-completed Berlin Brandenburg airport has been a catalogue of disasters; it is still at least two years from opening, and will be massively over-budget.

Another project that went well on the UK side of the Channel was the high-speed rail link to the Channel Tunnel, the so-called High Speed 1 (HS1). The country is now well on the way to building HS2, and the good experience with HS1 might seem to bode well for this, but this is a very different beast and already subject to intense criticism. There was a strong case for Heathrow T5 (and just as strong a case for one or more extra runways either here or at another SE England airport) and a strong(ish) case for HS1, but some critics see the planned high-speed line as an expensive vanity project rather than an essential addition to the country’s infrastructure.

HS1 shaved some time off the London to Paris/Brussels journey time and provided a high-class modern terminus at St Pancras, plus a brand-new station at Ebbsfleet in Kent, effectively replacing Ashford as the secondary UK stop. There were major tunnels to be built, as well as the two new stations and the line itself, but the line followed the route of the existing track, which minimised some of the problems of building from scratch.

But, although the project was delivered to budget, the cost of £51.3 million per kilometre was much more than that of the Paris-Strasbourg TGV line, also completed in 2007. To a large extent, this is an inevitable consequence of building a railway line in a densely populated country with a number of natural obstacles to overcome. Suffice it to say that building a high-speed railway line in the UK is very expensive.

Not surprising then to read headlines such as this even in 2015 – Revealed: HS2 ‘abysmal value for money’ at 10 times the cost of high-speed rail in Europe.  At the time, the project cost was estimated as £42.6bn, at a cost of £78.5m per kilometre (£125m per mile). But it was widely expected that these costs would increase and a new report – based on an estimate commissioned by the Department for Transport – lends credence to this. As reported in the Sunday Times, building of HS2 to cost £403m per mile, bringing the cost of the entire two-phase project up to £104bn. [For those who noticed the discrepancy with the figures quoted, the £125m/mile above is for the entire project, while £403/mile is for phase 1, including the very expensive first stage in north London.]

Michael Byng, the expert who produced the latest figures, was asked to comment on the costs:

Asked why the project was so costly, Byng said: “We live in a very heavily populated, property-owning democracy which has very high use of railways, so land is very expensive and disruption is very expensive. People have rights and are prepared to stand up for them. “The railways have also inherited the malaise of British construction — an inflation of consultants. In the rest of the world soft costs, such as consultancy and planning, make up 12-15%. Here it can be as high as 35%.”

In the meantime, the government insists that this latest estimate is way too high (although the budget has now increased to £55.7bn). At the same time, the route of the second phase through Yorkshire was announced. Not surprisingly, this has been controversial, leading to headlines such as HS2 route to destroy new homes in Yorkshire, while not providing any stations in the area.

But, to a large extent, the details are unimportant. The cost may be justified by the benefits. However, the ostensible reason for starting the project (apart from having a bright shiny new high-speed railway to show the world) was to provide more capacity as an alternative to the over-crowded west and east coast mainlines. The problem is that there may be much more cost-effective ways of doing this.

For those committed to the project (which would, of course, be very embarrassing to cancel at this stage) everything is rosy. But passenger projections are very high, which seems questionable given that the already high cost of rail travel would be subject to a large premium for HS2. It is likely that trains would be used by business people (although many companies will surely look askance at the cost) and leisure travellers who have booked well in advance to get more affordable fares. Breaking even will be a challenge for any franchisee.

But the economic case is made partly on the basis that shorter journey times mean people can be more productive, which takes no account of the realities of laptops, tablets and wifi. There is also a somewhat Panglossian quote from Philippa Oldham of the Institution of Mechanical Engineers in the BBC piece:

“By freeing up the capacity on the East Coast Mainline, West Coast Mainline, through the HS2 route we’ll be able to shift some of our freight network onto the rail network from the road network,” she said. “So that will ease congestion on our roads providing that we have an integrated transport strategy.”

As Boris Johnson might say, go whistle on that one. If HS2 is not to become a massively expensive white elephant, some serious thinking has to be done. The first phase, to Birmingham, is not due to open till 2026, a date that the National Audit Office says is unlikely to be met, with the links to Manchester and Leeds not being ready till 2033. Well before then, the £50-100bn (not including trains) could have been spent on more affordable conventional railway upgrades and more motorways.

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National Grid’s Future Energy Scenarios 2016

In the autumn, the Scientific Alliance published two very important papers on the most recent National Grid FES study. Dr Capell Aris and Colin Gibson, both highly respected engineers with many years of experience at senior level in the electricity supply sector, covered both security of supply and costs, and their findings should be required reading for all policymakers and senior managers in the sector. The papers can be downloaded from the links below.

Security of supply Aris Gibson Sept 16

Energy cost Aris Gibson Oct 16

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Take one barrel of oil…

Electrification is the future if the world’s energy use is to be radically ‘decarbonised’ as the IPCC says is necessary. The somewhat contentious Paris accord is the latest stab at a concerted approach to this, albeit without the involvement of the USA and with a number of other countries – notably Turkey – apparently wavering in their support.

Debating the extent of human influence on climate is, unfortunately futile at present; this is one issue where there is precious little common ground, despite the best efforts of some people. But what we do still need to think long and hard about is how this dramatic change might take place and what its implications are for our future energy security and prosperity.

Oil is convenient shorthand for the fossil fuels on which modern societies still depend. Together, oil, coal and gas provide 85% of global energy needs, with oil contributing about a third of the total and projected to remain top of the list even as the domination by fossil fuels declines gradually in coming years.

In 2016, the world consumed a little over 13 billion tonnes of oil equivalent of energy (the standard comparative metric; figures from the BP Statistical Review of World Energy). Of this, over 11 btoe was fossil fuels. This is a staggering amount, over one and a half tonnes for every person on Earth.

For historical reasons, oil production and prices are quoted in barrels, equivalent to 42 US gallons or about 159 litres. A tonne of oil is 7.33 barrels. This brings total consumption of oil, coal and gas to 82 billion barrels annually. Currently, a large amount of the oil itself is used for motorised transport of various forms, while the gas and coal go largely to provide heat and electricity.

The most versatile fuel, and the simplest to consider, is gas. It can be used with minimal post-treatment after extraction and can drive turbines to generate electricity, be burnt in boilers to warm homes and offices or on hobs to cook food and can also be used directly in conventional petrol engines. For the sake of argument, let’s think what the implications are for using gas in various ways, but for easy comparison I’ll use the unit of a barrel of oil equivalent.

In energy terms, a boe is 1.7MWh. Using that directly to fuel a car engine, about 30% of the total energy goes to move the vehicle, with most of the rest being lost as heat (efficiency is very difficult to put a single figure on because it depends on driving conditions, length of journey, speed etc, but this is a good rule of thumb). This sounds incredibly inefficient, but is actually a big improvement even on engines of a decade or two ago.

A better assessment would be to put this in the context of how far a unit of energy would take us. Again, this is a very difficult comparison to make with any accuracy, but figures from the USA (Alternative Fuels Data Center) are for a unit of fuel (the ‘gasoline gallon equivalent’) a car delivers nearly 40 passenger miles, surprisingly close to the 50+ achievable by planes or the 55 by intercity rail, particularly considering that load factors on planes and trains are much higher than for the average car journey. Although they may use road space quite poorly, it turns out that cars are quite an efficient means of transport.

But the really interesting comparison is how that same amount of gas could be used to power an electric car. Burning the fuel in a modern Combined Cycle Gas Turbine, efficiencies of around 55% can be reached. So, in round terms, 55% of the gas will generate useful energy in the form of electricity. Getting that to the consumer will incur transmission losses, which will vary with distance, but a 10% loss is towards the lower end of the range. The result so far is to deliver 50% of the energy from a boe of gas to the consumer as electricity.

To drive an electric car, that electricity must be used to charge a battery. Charging and discharging are not 100% efficient processes, as we can tell when batteries warm up. Let’s conservatively assume a further 10% loss. We are now down to 45%. Electric motors run at up to 75% efficiency. Let’s assume that, even though in practice it is likely to be lower than that for normal driving. The energy extracted from the gas now falls to about 33%, pretty much the same as an internal combustion engine.

So, in round terms, for an all-electric fleet, we would need to use all the oil used to power cars at present and burn it (or its equivalent) in power stations to provide electricity. Total energy demand would be very similar or, in practice, somewhat higher as I’ve assumed quite generous efficiency factors.  However, the situation is a bit different for home heating.

Most homes that are connected to a mains gas supply have gas central heating. Modern condenser gas boilers are about 90% efficient, so nearly all of the energy in the gas is available for useful heating. What happens beyond that, of course, depends on how well a house is insulated and the temperature at which the thermostat is set. Given this very high efficiency, converting to centrally-generated electricity will inevitably mean an increase in overall energy demand.

As we saw above, burning gas to generate electricity is about 50% efficient at delivering energy to consumers. If houses are converted to electric heating, there would be very little further drop in efficiency. Heat is what all other forms of energy ultimately degrade to, so it’s just a case of making sure that heat is generated in the right place. Converting from gas to electric heating would roughly double energy use in this sector.

This back-of-an-envelope estimate shows that energy demand would increase if there is a wholesale move to electrification. But, although that isn’t an inconsiderable challenge, it’s not as simple as that. To have any impact on the decarbonisation agenda, this electricity itself has to be low-carbon. The renewables lobby would point to the falling generation costs of wind and solar, without addressing the continuity of supply issue, but storage technology is simply inadequate to cope with this.

Burning more gas or coal would need carbon capture and storage, which never seems likely to be deployable on a useful scale. Which brings us back to the currently unfashionable topic of nuclear energy. In the UK, the Hinkley Point C fiasco rumbles on but, if it is successfully commissioned, it will be a much more valuable national asset than the hundreds of acres of wind farms that would be its nominal equivalent.

The big problem is how to facilitate a global revival in nuclear construction, as well as pursuing promising options such as Small Modular Reactors and thorium reactors. Until we can do that, fossil fuels will continue to dominate. Electrification coupled with low emissions inevitably means nuclear.

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Are electric cars going mainstream?

As governments continue to push for cars with lower CO2 emissions, most manufacturers have gone beyond simply making their diesel- and petrol-engined models more efficient (although the results of this have been impressive). They have also begun to introduce more electric and hybrid cars. Toyota took the lead with the domestic launch of its first Prius model in 1997, with worldwide rollout from 2000, but more recently Tesla has captured the headlines as a manufacturer of all-electric cars.

Until now, Tesla cars have been high-end models such as the Model S, popular with prosperous first adopters and now an everyday sight in some areas, but it is only now, with the first Model 3 rolling off the production line, that it is targeting the mass market. The entry point is $35,000, with prices in the UK and elsewhere to be announced soon, and governments are offering incentives to purchasers (funded, of course, by taxpayers, most of who own conventional cars). That’s nominally £27,000 at current exchange rates and ignoring import costs and different rates of tax. Take off the present £4,500 grant and you have an all-electric car with a nominal 215 mile range for £22,700.

That’s still quite a lot to pay for what looks like a smallish family car, but then car buying is not simply about capital cost, otherwise the road would be filled with imported Chinese models. Market forces take over. In practice, there will initially be plenty of reasonably well-off people who would be prepared to pay the price and the relatively modest production capacity will doubtless be taken up in the short term: Elon Musk says the company is looking at 5,000 units per week by the end of 2017 and double that in 2018, with initial reservations at the 400,000 mark.

Of course, despite the hype, Tesla is not the only player in town. The Nissan Leaf, for example, is on sale and, with an admittedly more modest specification, is priced at below £17,000 when the subsidy is taken into account. But until now Tesla has been the only player to produce solely electric vehicles. On the face of it that is changing, with the announcement that Volvo goes electric across the board.

Actually, this is clever public relations as much as a real game changer. What the company (now owned by the Chinese company, Geely) is actually saying is that, from 2019, all new models will be either all-electric or have hybrid drives, although the company will continue to produce petrol and diesel models. This is a change of emphasis, which leaves the market to decide on the split of actual sales, but will still be seen by some as another nail in the coffin of the internal combustion engine.

Certainly, the Volvo announcement caused a drop in the Tesla share price, but this has been very volatile in any case, being boosted a couple of days previously by the announcement that the first Model 3 would be rolling off the production line two weeks early. And we shouldn’t forget that the company, though still loss-making, has a market capitalisation greater than that of Ford (see The Tesla Bubble). Some investors really do think the future is electric.

Whether or not most car companies do at the moment is a moot point. Volvo’s conventional cars will probably continue to outsell its new electric models for some time to come, and the majority of what the company calls ‘electric’ cars will not be fully electric, but have hybrid drive systems. In fact currently, and indeed for the foreseeable future, all-electric cars are really only suitable for regular fairly short distance driving. Plug-in hybrids, on the other hand, could make a real difference to urban air pollution while retaining the long-distance flexibility of the internal combustion engine, albeit at a price and weight premium.

With governments demanding lower and lower emissions from the range of models produced by any single manufacturer, it makes absolute sense to launch a hybrid and electric vehicles to be sold in a competitive market, while continuing incremental improvement of petrol- and diesel-fuelled models. And, although expensive to produce, electric and hybrid drive trains once developed can be fitted across a wide range of vehicles. For fully electric vehicles, the engineering is indeed simpler than for conventional cars.

The really big issue for Tesla, Volvo and others is consumer reaction. Tesla’s future depends upon the Model 3, as sales of its current upmarket range have plateaued. The company can probably continue to attract investment without making a profit for some time to come, as long as Model 3 sales are close to the projections over the next two years. Elon Musk is a high profile front man and key to the company’s success so far, in a way analogous to Steve Job’s role in Apple. But it is uniquely vulnerable, being totally committed to a single technology.

Meanwhile, Toyota, Volvo and others will continue to offer a range of models and individual motorists will make their choice. Even with subsidies, electric and hybrid vehicles remain relatively expensive for their capabilities and currently are not for everyone. It would be easy to foresee a near future in which hybrids became the largest sector in some urban areas, with benefits to the local air quality, but in other respects the end of the internal combustion engine has, like Mark Twain’s death, been exaggerated.

Charging points are becoming more common but, given the time needed to replenish batteries, it is not simply a case of providing them in similar numbers to current petrol pumps. What would be an adequate coverage currently lies in the realm of mathematical modellers. In the meantime, range anxiety will be an every present problem. Lower fuel costs are also promised, but it is inconceivable that the £30bn plus that the Treasury receives in fuel duty will not be recouped from drivers of electric cars in some other way.

Ultimately, most buyers of electric cars believe them to be more environmentally friendly, but this is certainly not a black and white issue. Forgetting for now about urban air pollution, the use of battery power simply pushes emissions back to the power station. Unless the generating system changes quite dramatically, overall emissions will barely drop. And, of course, we will need a lot more power stations.

This week’s news from Tesla and Volvo is interesting, but certainly does not mean that fully electric cars will soon be taking a significant market share.

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