Oz's EV sales: The Musk effect

 Australia's EV sales plunged in February.  This appears to be mostly because of a collapse in Tesla sales, down 75% in February over February last year.  And it's no good saying that it's because the market is waiting for the "refreshed" Model Y: Model 3 sales were down 80% over the same period.  

The new BYD sub-A$30,000 EV has been announced but not yet released.  I expect its sales will be phenomenal, because it's about the same size and same price as the cheapest Toyota Corolla, the Ascent Sport.   

If you routinely drive long distances, then you will prolly want a plug-in hybrid or an ICEV, because the rural charging network in Australia is still pretty feeble.   But if you mostly drive in the city, going to the supermarket or picking up the kids from school, while charging your EV in your garage, an EV will save you upwards of $2000 a year, and even more if you have your own solar panels, for the same up-front costs as the cheapest Corolla.  In addition, there's talk that the new BYD will allow V2H  (vehicle to house) charging later this year, which means you'll also save on your electricity bill.  In my case, I'd save $2,000 a year.  So your new BYD EV will pay for itself over 7 years.  Oh, and that's ignoring the tax incentives you'll get if you buy an EV (minimum 20% if you get average earnings, more if you earn more).

In short, I expect runaway sales of BYD's new EV.  Is this the low for EV sales?  Prolly; how much further can Tesla sales fall?  And, meanwhile, BYD has picked up the baton.

AU EV sales start to pick up

 The Labor government, after it took office, allowed EVs to be bought on a novated lease through your employer without having to pay fringe benefit tax.  Too complicated to explain to non-Australians, but in essence it allows you to have an EV on lease at a substantial discount equal to your marginal tax rate plus the 10% general sales tax.  For people on the lowest marginal tax rate (above zero), this equates to a ~30% tax cut.  The introduction of this incentive caused a huge jump in EV sales, followed by a bit of a slump.  This slump was worsened by Tesla sales declining fast, as Tesla has until recently made up most of the sales of EVs.

But over the last few months, the big jump in the number of models available in Oz has led to a rebound in sales.  BYD has just reduced the price on its entry-level EV to below A$30,000.   The cheapest Toyota Corolla starts at $26,400, but that isn't a hybrid.  The cheapest hybrid Corolla is $31,790.   At some point this year, V2H (vehicle to house) charging will be enabled.  Even at the lowest non-zero marginal tax rate, the cheapest BYD will cost just $20K, but will also be a house battery.  A comparable Tesla Powerwall will set you back ~$25K.  However, the bi-directional chargers are still pricey, though even adding that cost to your car still leaves you with big cost savings, especially when you consider how much cheaper EVs are to run than petrol vehicles.  The point about this is that EV price competition continues, and EVs are now very good value, and will get better.   Expect sales to rise fast.

Recent months showing a pick-up, but still down on the 2023 peak

Year-on-year sales growth is back above +30%, after a low of -27%

BYD slashes the price of its Dolphin EV

 

The BYD Dolphin

BYD has just cut the price of its cheapest Dolphin hatchback EV to A$29,990.  This compares with the cheapest Toyota Corolla at A$29,880.  

This is it, folks:  EVs now have a "sticker price" equal to petrol cars. (They've been much cheaper to run for ages)    This is before any tax incentives (if you lease a car through your company in Australia, you can save a minimum 30% off the price).  And remember, you can (or soon will be able to) run your house from your EV: while a single 13.5 kWh Tesla Powerwall costs $A13,500, you get a car and a battery with 45 kWh of storage for $A30,000.  

Right now, about half the electricity my solar panels generate is fed into the grid, but the feed-in tariff is negligible.  However, when I draw power from the grid in the evening, I pay peak rates.  20% of a Dolphin BYD's battery will produce enough electricity to run my house from 5 pm to 10 pm, and then I can charge the battery up using late night low price electricity.  My electricity bill will be negligible.  Not only will I be able to drive for zero cost, I will also save a few hundred dollars a year on my electricity.  In fact, it will pay me to put more panels on my roof.  Many commentators ignore the benefits for the grid of EVs with V2H capacity.  (V2H and V2G have just been introduced in Australia, and I don't know whether the BYD Dolphin is yet capable of this)

Even if you don't have solar panels, electricity utilities will soon see the sense of allowing EV owners to charge up their cars when there is excess supply of electricity (at midday and between midnight and 5 am), when wholesale prices are negative.

The decline in EV prices is just going to continue.   There is fierce competition between car makers in China.  Battery manufacturers are competing to cut battery prices, increase energy density, and make charging quicker, and their competition is driving battery prices down.  And the Chinese Yuan is falling because the Chinese economy is so weak.

Does anybody still think it's going to take until 2035 for EV sales to make up 100% of car sales?  They're currently stagnating in Australia because Tesla sales are falling so fast.  But in 2025, BYD will more than make up for that.

(I'll talk about BYD's luscious new PHEV ute (bakkie/pick-up) in my next piece.)

EV charging gets a makeover

From SEVR

If you are the owner of an Electric Vehicle (EV), at some point you have probably wondered whether you could use that enormous battery for anything else. Say, powering your home, or even feeding excess power into the energy grid and getting paid for it. This is what’s known as vehicle-to-home (V2H) and vehicle-to-grid (V2G) technology (we will use V2G in this article to refer to both). With the news that Australian regulations have been updated to allow this technology to go live by the end of 2024, we expect 2025 to be the year V2G becomes mainstream.

Before we get into the nitty-gritty of what this really means, let’s first cover some EV battery basics:EV owners can already power individual appliances and devices using their EV battery, with most vehicles including plugs/cables to do this. Powering devices is known as vehicle-to-load (V2L), and could mean powering a TV, laptop, or a combination of devices up to the 1.5-3.6kW maximum limited by the EV. Perfect when out camping, or during a blackout.

A typical EV battery in Australia will be around 50kWh and can be as high as 100kWh. For a 50kWh battery, this is enough to power the average 4-person Australian home for nearly 2.5 days (based on 2023 energy data). However, this power can’t be accessed through V2L (i.e. you can’t plug your entire home into a car’s V2L power socket).

For comparison, a home battery system such as Tesla Powerwall has a 13kWh rating. EV batteries are several times larger.

The average Australian driver only travels 35km per day, using a small fraction of an EVs battery capacity.

What’s so exciting about V2G coming online is that it now becomes possible to tap into the full capacity of an EV battery through the same connection used for charging. This means that just like controlling when and how your EV charges (e.g. only at night during off-peak times), you can also control when and how the EV feeds back into the home or grid (e.g. when prices are highest, or only when there is a blackout). The missing piece in this puzzle has been access to special V2G chargers that can manage this two-way load, called bidirectional charging. But with changes to regulations making it possible to buy and install these systems by the end of 2024, manufacturers and suppliers of EV chargers are now racing to gain approvals and bring these to market.

For consumers, tapping into V2G is going to require an upgrade of the charger as the one you currently have is only designed for the one-way flow of energy into the car. V2G charging has required new technologies to be added to chargers to allow two-way electrical flow. It has also required updates to standards, like Australia’s AS/NZS 4777.2 Grid connection of energy systems via inverters—Installation requirements, which is the same standard used for solar inverters. Why? Because most V2G chargers are inverters (or they must be connected to inverters), converting the DC power from the vehicle back to AC for the home. This also means that these new V2G chargers need to be approved and listed on the Clean Energy Council’s database just like a solar inverter system.

V2G is also going to require a software update for most vehicles to unlock this capability and tell the car how to manage the battery. Most of the major car manufacturers have announced they are working through this now. One of the big questions car companies and consumers alike will have is whether using the car battery for V2G will degrade the battery and shorten its lifespan? There is limited data about this right now, but it seems clear that some limits will be implemented, for example limiting the speed and extent of battery discharge through V2G. Some research even suggests that controlled V2G use can extend battery life by optimising the discharge to counteract battery fade. Understanding this will be critical for battery warranties and the appeal of V2G systems to the public.

At the time of writing, only the Nissan Leaf and a couple of Mitsubishi hybrid vehicles have the capacity to work with V2G in Australia, and a very small number of Australians have worked with their local energy providers to be early adopters of V2G systems. The CSIRO has also been running a large trial in Port Macquarie to understand the full impact of V2G systems on households and energy grids. For many, the allure of V2G is that a vehicle could be charging for free through the day using solar, and then feed this back into the home at night. Basically, off-grid living enabled by electric vehicles.

One of the other big selling points that EV manufacturers may hope to leverage is that V2G can be used to offset the cost of buying an EV – if you consider that a home battery system may cost $10-15k to buy and install today, you could put this money towards buying an EV instead and gain a significantly higher capacity battery, that can also drive you around.

Several articles have summarised the first V2G chargers likely to hit Australian markets. Other than the Sigenergy system, which is already available due to existing certifications of their stand-alone inverter, most companies are suggesting V2G charger releases in Q1/Q2 2025. However, some of the most exciting developments that will start to drive prices down are likely to come from the mainstream EV charging brands, like Myenergi (manufacturer of Zappi), and Zaptec (one of the largest European EV charger manufacturers), who have announced they are finalising their own V2G chargers. While this new generation of chargers is going to be more expensive than standard chargers for the foreseeable future, there will be a numbers and convenience factor that encourages many to either upgrade their existing charger, or buy into the EV market for the first time.

Follow SEVR to be the first to see our shift into the V2G market in 2025. Big things are coming!

Explosive growth in EV sales in Australia

I've been meaning to show a chart of EV sales in Australia for a while.  But I couldn't find timely data.  Now, The Driven is publishing monthly EV sales data, but just for this year, so far.  I've cobbled together monthly data for 2023 and 2022 and part of 2021, and before that I've used annual data.

Sales have risen from 10 a month at the beginning of 2012 to 10,000 a month in May 2024, an increase of two orders of magnitude in 12 years.   As it has been in other markets, that is a 50% annual rate of growth.   At that growth rate, even backward Australia will reach new sales EV saturation in 6 years.

True, there are incentives to buy EVs introduced over the last couple of years, and this will have lifted sales.  But those incentives won't go away for a while.  And meanwhile, battery costs have halved this year, and will halve again over the next 12 to 18 months; EV prices are going to continue to decline.  The charging network is growing every month.  More and more people are becoming familiar with EVs.  Sales are just going to continue to grow, fast.

Cars and light trucks cause 11% of Oz's emissions, and at current growth rates they will become the biggest contributor to total emissions by 2030.   EVs will be key to preventing that.

 The government is also pursuing "vehicle-to-grid/vehicle-to-house" (V2G/V2H) operations, which will allow EVs to help charge the grid when demand is high.  (Obviously, that will be done using price incentives rather than compulsion.)  An average EV has 60 kWh battery storage, and even if just 10% of that is used, it will still be enough to power your house overnight.  Our very high penetration of rooftop solar will make this option attractive to householders.  Your car will also be your house's battery. 

An electric bus fleet powers the grid

From The Driven

The large storage capacity of electric vehicles (EVs), including cars, trucks, buses and other forms of electrified transport currently sit under-utilised most of the time.

That is because the early EV models were (and many still are) designed to only store electricity to power the vehicles. Many manufacturers, however, have announced bidirectional capability for their 2025 and 2026 model EVs which will enable vehicle-to-home (V2H) and vehicle-to-grid (V2G) capability.

In the meantime, utilities, EV manufacturers and EV charging companies are beginning to experiment the practical feasibility of managing the aggregated load of hundreds or thousands of EV batteries as a valuable resource just as is currently done with utility-scale batteries (preceding article).

If you think this is pie in the sky, think again. In May 2024 Oakland Unified School District announced that its 74 electrified buses and charging infrastructure will begin to operate as a large bi-directional battery with 2.1 gigawatt hours (GWh) of energy, which it can arbitrage in the California market.

It is the first major school district in the US to transition to a 100% electrified bus system with V2G technology developed by Zum.

Student transportation is the largest mass transit system in the US, moving 27 million students twice daily. Today, over 90% of the nation’s 500,000 school buses run on diesel-powered buses, spewing over 8.4 million tons of greenhouse gases annually while exposing students and communities to harmful gases.

According to Ritu Narayan, Founder and CEO of Zum, the company has a goal of electrifying 10,000 bi-directional school buses across the country with the potential to supply 300 GWhs of energy to the power grids annually. It has set its eyes on the San Francisco Unified and Los Angeles Unified – which are 3 and 6 times the size of the Oakland district, respectively.

The term virtual power plants (VPPs), usually conjures an abstract and far-fetched concept. The example of electrified buses used as one brings it down to earth.

School buses offer an exceptionally attractive opportunity because they are usually used twice daily during the weekdays at predictable times, on predetermined routes and within a manageable range.

They can be charged during the mid-day sunny hours when they are normally sitting idle and can discharge some of the stored energy at the end of the school day, which happens to coincide with the ‘neck’ hours of the “duck curve”.

They can be recharged later at night or during early morning hours if needed. Other types of electrified transport can follow. The opportunity is simply too good to be missed.