It all comes down to the price of the lithium-ion battery
GETTING the equivalent of 106 mpg (2.2 litres/100km), the Nissan Leaf electric car would seem a motoring skinflint’s dream come true. Even an advanced plug-in hybrid like the Chevrolet Volt (Opel/Vauxhall Ampera in Europe), with an energy consumption equivalent to 61mpg, sounds pretty miserly, too. Yet, for all their frugality, neither has been selling particularly well, despite the present sky-high price of petrol (see “Priced off the road”, July 15th 2011).
With big-ticket items like motor cars, consumers have learned to do their calculations carefully. As far as electric cars are concerned, motorists have sussed out that they do not make particularly good financial sense, even with a $7,500 handout from the federal government. They would have to keep their hybrids or plug-in electrics for seven to ten years to recoup the reward of better fuel economy. Few keep their cars anything like that long. Even in these depressed times, American motorists tend to trade in their vehicles after no more than six years.
And when it comes to replacing hybrids like the Toyota Prius, two out of three owners revert back to petrol power, finds Edmunds.com, America’s most popular site for independent car-buying advice. “Even as gas prices soar, the economics of buying a hybrid vehicle don’t make much sense in many cases,” notes Lacey Plache, Edmunds.com’s chief economist.
It all comes down to the price of the lithium-ion battery, which nowadays costs a shade under $600 per kilowatt-hour (kWh) of storage capacity. As an electric car capable of travelling 75 miles or so between charges needs around 24kWh of capacity, the battery alone adds $14,000 to the price of the vehicle. The result is a car that costs way too much for what it offers in fuel savings.
A state-of-the-art electric vehicle like Ford’s forthcoming Focus EV, with a claimed range of 100 miles (say, 70 miles in real-world conditions) and an equivalent fuel economy up there with the Nissan Leaf’s 106mpg, has a base price of $39,200. The petrol-powered version of the same vehicle, which averages around 40mpg, costs just $16,500. In other words, batteries have to come down to less than $200 per kWh before electrics can go mainstream. Clearly, those who buy a plug-in electric like the Ford Focus EV or Nissan Leaf today are making some kind of statement about their green credentials.
But what kind of statement? While it is impossible to justify buying an electric vehicle, or even a hybrid, on purely financial grounds, it is fair to say that most people assume that electric vehicles are far more gentle on the environment than are petrol-powered cars. But is that necessarily the case?
via The Economist
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