Speculation about the future of transportation, like common flu, appears to be contagious. Not a week goes by without another celebrity, business guru or executive predicting that future of transportation is electric.
That, you may say, is probable and not newsworthy. What is newsworthy is that many of the same people are predicting that the transition is likely to be at a pace much faster than many had expected.
In July 2016, for example, Virgin Group founder Richard Branson was quoted as saying that he suspected that 15 years from now every car on the road would be electric. Chances are that he made up the number – 15 years – without giving it much thought. One can also assume that he was talking about new cars sold in 15 years, not all cars on the road.
That, of course, is what makes Branson Branson. He was talking to CNN at a Formula E race, which he was attending to support the Virgin Racing team. He said, “Formula E is pushing the boundaries forward into what will be the future.
Fifteen years from now, I suspect every car on the road will be electric.” He went on to elaborate: “If governments set the ground rules — and they sometimes have to be brave and set positive ground rules — and for instance said, ‘more than 50% of cars must be battery-driven in 10 years and 100% in 15 years,’ we could make that happen.
Currently, roughly 1 million EVs represent a mere 0.1% of the total number of passenger cars in the world. Oil majors need not panic yet. Nor can they afford to be complacent. That, however, does not prevent people from making bold projections. A report released by Lux Research in July 2016 (graph below) says 30% of the world’s – we assume new vehicles sold – will be EVs by 2030, powered by renewable energy.
Not the sort of message oil company executives like to hear or talk about. Tony Seba, a Silicon Valley guru on emerging technologies is equally certain about the rapid disruption about to hit the $12 Trillion energy and transportation sectors. He claims the disruption is happening as we speak, yet dismissed by many insiders in both the oil and auto industry.
Seba says the tipping point may come as early as 2020 when new EVs will be cheaper than comparable internal combustion engine (ICE) cars. By 2025, he says all new cars will be electric and not just in Silicon Valley, or California, or the US but globally.
Pointing to Elon Musk’s recent announcements, Seba believes Tesla is already on its way to deliver affordable EVs with decent range and superior More EVs and running on renewable energy by 2030 5 September 2016 EEnergy Informer Page 5 performance, to be charged with solar energy from customers’ rooftops.
Musk spelled out his vision of the future of Tesla and it is decidedly disruptive. Describing his master plan for merging Tesla and SolarCity – reported in Aug 2016 issue of this newsletter – he seems intent to dominate the autonomous vehicle and car-sharing business.
When it comes to charging all these EVs, Musk plans to “create a smoothly integrated and beautiful solar-roof-withbattery product that just works, empowering the individual as their own utility, and then scale that throughout the world.” As for Musk’s vision of charging the EVs with rooftop solar panels augmented with batteries in the garage, Tesla will face competition from others, including the utility companies.