Tuesday, November 25, 2008

Towards an Electric Car Economy...

A break from the usual articles on politics.

For those of you who are more than 35 years old, you might remember this person called Sir Clive Sinclair[wiki]. He was an engineer entrepreneur who had a number of interest inventions which made him a lot of money. My first computer was a Sinclair ZX81 not Steve Jobs' Apple II. Sinclair was a visionary and a risk taker. Having made a fortune on electronic gadgets, Clive Sinclair eyed bigger things - he wanted to revolutionalise the auto industry by introducing the electric car in 1985, unfortunately the technology (battery, engine etc) was not matured enough and the electric car developed by his company was a flop - too small, too underpowered, too long to charge.

Today's electric cars are completely different. Watch this video of a sports car by a company called Tesla:

There are many benefits of using electric cars besides environmental friendliness. It will make the world less dependent on oil. Many alternative energy sources can be converted to electricity for use by electric cars. The main problem is charging time. You take only 5 minutes to get petrol into your regular car but 2 hours to charge the electric car. One way is to charge it overnight the other idea to overcome this was developed by an Israeli entrepreneur Shai Agassi and he has persuaded the Israeli govt to develop the world's first electric car network by 2011. How it works is like this : each car has a removable battery that is replaced at one of the many exchange stations in the network when the battery is flat. Drivers pay a fee to the exchange station for the exchange. Given its political situation, Israeli probably more motivated than other countries to get rid of its oil dependency (ask yourself which are the countries producing oil). The idea of electric cars is workable and practical. Unfortunately, under President Bush, a successful pilot of an electric car by GM was ended ....conspiracy theorists think the Bush did it because of pressure from Big Oil. There was an interesting documentary called "Who killed the electric car?". This documentary was made in 2006 and interestingly a few experts in the documentary warned about the potential pain of high oil prices unless we goes electric and also the need for the motor industry in US to switch to this in order to survive. This idea will be revived under President Obama who is committed to clean energy and will probably sign the Kyoto Protocol.

The electric car economy
Electric cars are as good for the economy as the environment and could put $80 billion in consumers’ pockets by 2030, according to a new study from the University of California.
Not surprisingly, the oil industry would take a $175 billion hit under the scenario sketched by UC Berkeley’s Global Venture Lab, while a booming battery business would gain $130 billion as the internal combustion engine sputters out. “There will also be significant changes in the balance of payments among nations as petroleum imports decline,” the authors wrote. “We find the net imports of the U.S. will decline by $20 billion.”
The report makes several assumptions to arrive at its optimistic conclusions: The Cal researchers are counting on 39% of cars on the road to be electric by 2030 and powered by electricity generated from renewable sources like wind and solar.
Electric car owners would save an estimated $7,203 in operating costs, mainly because with no engines to maintain, battery-powered vehicles rarely see the inside of mechanic’s garage.
Left unexplored in the report was the impact of electric cars on the United States auto industry. If General Motors (GM), Ford (F) and Chrysler survive - and that’s a big if these days - they stand to benefit assuming they retool for the electric age and produce cars consumers want to buy before rivals like Toyota (TM), Honda (HMC) and Renault-Nissan beat them to the punch. But their dealer networks are sure to suffer once their lucrative repair and maintenance business evaporates.
Another winner in the electric car economy will be solar and wind companies and utilities, particularly those like PG&E (PCG) and Southern California Edison (EIX) that are making multi billion-dollar investments in renewable energy.
One of the biggest assumption the Cal report makes involves the rise of a U.S. battery industry. “We don’t have a battery industry today,” said Shai Agassi, CEO of electric car infrastructure startup Better Place, on Friday at a panel Green Wombat moderated for the University of California’s Global Technology Leaders Conference. “Either we make them here or they’re going to be made in China.”
Agassi and the mayors of San Francisco, San Jose and Oakland on Friday announced that Better Place would build a $1 billion network of charging stations throughout the Bay Area. Renault-Nissan has agreen to provide Better Place with the hundreds of thousands of electric cars it’ll need to put on the road make its business model profitable.
photo: Better Place
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AlphavilleSG said...

Great that you highlight this... I'll go along the way in the context of Singapore, one might also like to examine the PAP govt. priorities in a green economy.

Under the current road tax structure, green cars (hybrid or electric) are bracketed according to the kW ratings of their electric motor and its equivalent petrol engines (in the case of hybrids).

Thee idiocy of this system is 1) there's no incentive for cleaner more fuel efficient cars based on carbon emission (as applies to all vehicles) 2) little amount of forward thinking is placed on reducing emission on the basis of changing technology and its adoption.

Consider the Tax structure based on engine capacity, how stupid is this? If I chance upon a brand new Datsun 100A, compared with the new Nissan, any possible that the former might be a bit more polluting? For that matter, is a diesel car really more polluting considering the carbon emission per kilometer?

Why are we using this method of ineffective taxation that is simply another way of choking your great grandchildren?

Why not modify tax structure in the form of a more sensible pigou tax?

Hybrids cost a premium compared to normal car, it has to be, manufacturer do have to commit significant resources to develop these cars, but we should gear towards it adoption simply because, the benefits will at some point outweigh its cost.

Have the right incentive, instead of mere static measurement of amount tax dollar. Just another reflection of how the PAP govt. care more about $$$ than your life.

Vehicle Tax Structure

Onlooker said...

Note: Nissan (electric car) is the one to look out for(at this moment anyway).
Plus There also seem to be a breakthrough in Fuel cell technology.
Once electric cars are cheap enough ....
About GM and Chrysler, R&D would be their primary focus.
PS Jaguar(luxury Car) is owned by Tata(India) but still dare to ask for Bailout from their Govt leh.
Isn't Tata going to profit from that?

ZAP Alias said...

There are aspects of the EV that are ideal for city driving: if you have ever been stuck in stop and go traffic you will realize the beauty of an EV which stitches off when you stop or even brake. there is no sound, smell, fumes, smoke it is a different experience altogether.