EVs cheaper than ICEVs by 2020

If we can transition electricity generation to renewables, and replace ICEVs (internal combustion engine vehicles) with EVs (electric vehicles) we could cut global greenhouse gas emissions by half.

A key factor in this is cost.  With electricity generation we are at or past the tipping point, where the costs of renewables are cheaper than fossil fuels, so much cheaper than I believe we will shortly see rapid closures of coal-fired power stations across the world.  But EVs still have a higher "sticker price" than ICEVs.  And storage is also necessary to compensate for variable renewables in electricity generation.  The cost of storage is critical.  So this news is extremely interesting:

Envision Energy, a Chinese company that bought Nissan's former AESC battery business, says it will be able to make battery packs for less than $100 per kilowatt-hour in the next two years.

That number is significant, because it's the threshold at which automakers and analysts say electric cars will become cheaper to manufacture and sell than gas cars.

Currently, the Union of Concerned Scientists estimates that manufacturing automotive-quality lithium-ion cells costs about $145 per kwh, and that rises to $190 per kwh for automakers to build them into packs for cars.

Stanford's Arun Majumdar, who was formerly a founding director of the Department of Energy's ARPA-E energy research program, opened the forum by raving that those $100-per-kwh battery packs would be attainable in the next five to seven years. That development, he said, would lead to "deep penetration of EVs around the world" in another 15 to 20 years.

Envision CEO Lei Zhang responded with a much more optimistic prediction: that envision will have battery packs that cheap by 2020, and that by 2025, the cost of its battery packs will drop to $50 per kwh. Stanford recently posted a video of his speech on YouTube.

At that level, he said that widespread adoption of electric cars will come almost "overnight." Electric cars will be 20 to 30 percent cheaper (than a diesel), and any government subsidies will be unnecessary. "Overnight, people are going t change, because it's a consumer market," Lei said.

That doesn't mean, though that cheap electric cars will become ubiquitous by 2020. Once a supplier like Envision is able to produce packs that cheaply, it could take as long as five years for automakers to build them into new car models.

Envision's immediate interest is in batteries appears to be for its primary business installing wind turbines and energy management systems.

[Read more here]

One point: car makers who are thinking ahead won't wait to plan for cheap EVs.  And those that don't plan ahead will be bankrupted by those that do.  Another point:  EVs are already much cheaper to run than ICEVs.  They're quieter, smoother, and more fun to drive.  When they cost 20 to 30% less than ICEVs the apparent long life of cars globally (12 years in the US, 18 for the world) won't save oil.  Just as with coal, when the operating cost of coal exceeds the total cost of renewables even newish coal power stations will be shuttered, so with cars and lorries.  If the up front cost of EVs as well as running costs are lower than ICEVs, even petrol or diesel cars with some life left in them will prolly be replaced.