BloombergNEF: Electric Vehicles = 58% of New Car Sales by 2040
Everybody knows that auto sales are down, down, down. The same goes for oil prices. The real question is whether or not today’s low oil prices will give gasmobiles an edge when the economy picks up. The jury is still out but there are some early indications that the electric vehicle will emerge in the pole position, low oil prices or no low oil prices.
BNEF Is Bullish On Electric Vehicle Sales
If you heard a lot of whooping and hollering from electric vehicle fans on the Intertubes this morning, that was probably because BloombergNEF released its new Long-Term Electric Vehicle Outlook report.
In a nutshell, the outlook calls for electric vehicles to make up 31% of the total 2040 car fleet. That’s a world away from the current market share of 3%. Can the EV market really grow 10 times in 20 years?
That’s a good question, considering how long people like to hold on to their old clunkers, especially when the economy is in bad shape. If you have some answers, drop a note in the comment thread.
Meanwhile, BNEF also took a look at new car sales. By 2040, they forecast, combustion engine cars will hold onto a respectable market share of 42%, but will be overshadowed by EVs at 58% of new car sales.
The outlook for combustion engines to rule other vehicle categories is mixed. Bloomberg is looking at a 67% share for the total bus fleet in 2040, 47% of two-wheeled vehicles, and 24% of light duty commercial vehicles.
A harbinger of things to come may be found in the 2020 COVID-19 crisis. BNEF found that global sales of internal combustion engine cars are on track to drop by 23% this year, compared to a lesser dropoff of 18% for electric vehicles.
Wait, What’s Making All Those Electric Vehicles Go?
Looking at the big picture, BNEF also points out that the transition from petroleum to electric mobility will drive down the demand for oil. That’s too bad for oil stakeholders, but what about coal and fossil gas? After all, a sharp increase in electric vehicle sales could drive up global demand for electricity, which could mean more coal and gas.
That would be a safe assumption in an earlier era, but it’s a brand new day for power generation, so let’s take a bit of a deeper dive into that angle in relation to the COVID-19 recovery.
Here in the US, fossil fuel stakeholders have been slurping up dollars at the COVID-19 recovery trough. However, they are boxed into a pen that is occupying a lower deck on the Titanic, so to speak.
First, forget coal. Nobody thinks that new coal units will suddenly start peppering the landscape when the economy picks up. Here in the US, coal has become the least-preferred option for grid managers seeking bargains in the electricity department.
As one sure sign of further decline, the nation’s own coal Booster-in-Chief has already given up the ghost. President* Trump sailed into the Oval Office on the backs of coal workers, but lately he’s been giving them the bum’s rush. Those crickets you heard during the 2019 and 2020 State of the Union addresses were filling the blanks in between hearty shoutouts for the oil and gas industry.
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Fossil Gas On The Rocks
As for fossil gas, cracks are beginning to appear in the armor — with not a little help from the President’s own Department of Energy.
Somewhat ironically, the Energy Department has been pursuing clean technology full speed throughout the past 3½ years, and that has set the stage for knocking the pins out from under fossil gas for power generation.
For example, check out these recent Energy Department maneuvers, which can help push clean technology to the driver’s seat for COVID-19 recovery:
1. A major new energy storage R&D initiative that includes workforce training.
2. A new public-private consortium aimed at launching low-cost perovskite solar cells into the market.
3. A community solar initiative aimed at ensuring that every household — yes, that’s every household — in the US has access to affordable solar power by 2025. Yes, by 2025.
4. A new offshore wind energy study that lays the groundwork for bringing cost-competitive wind power to the Gulf Coast states of Texas, Mississippi, Louisiana, Alabama, and Florida.
That last item is a big deal because renewable energy has been slow to take off in a number of states in the Southeast. Onshore wind resources are not ideal in the region, and politics are in play for solar power. That has left the field open for fossil gas to grow at coal’s expense. A new influx of competitively priced offshore wind power could turn that around (noting, for the record, that onshore wind in West Texas is a whole ‘nother kettle of fish).
Outside of the fossil fuel sector, big business has been organizing in support of clean technology since the Obama years and those initiatives are coming into full force to advocate for a green COVID-19 recovery, so stay tuned for more on that.
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Photo: GM Bolt by Tina Casey.
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