Cars and Copper
This is part one of a three part series on the development of EVs and their supporting infrastructure in the United States. The automotive industry of the 21st century is experiencing a paradigm shift across all facets of vehicle production, distribution, maintenance, and consumer experience. Gas and internal combustion engines are no longer the sole method of powering automobiles. In fact, their long reign of dominance in the automotive market seems to be on the way out. In its place, EVs have exploded forth as an alternative capable of saving the environment through zero emissions and smart technology. Dedicated EV producers, led by Tesla, have gained substantial market share over the last five years, while long established OEMs like GM, Hyundai, VW, and Toyota have started to roll out brand new EVs at a breakneck pace. As EVs continue to gain ground, and with the introduction of medium and heavy duty commercial EVs to the market, the capacity for electrical charging will need to increase rapidly and efficiently in order to meet the ever increasing demand for electric vehicles. As this demand grows and more charging stations are built, a fundamentally important question must be addressed: how will the US power grid be able to keep up with and sustain America’s future power needs? Currently, only a minority of the total automotive market share is occupied by electric vehicles. A variety of news organizations including the New York Times and Automotive News reported that as of last year, only about 1% of the total cars on the road in the US were electric vehicles, and in 2022 made up a 7% of all new car purchases. Despite these relatively small numbers, there have been a number of incidents in which the electrical grid has struggled to support the charging demands even from existing electric vehicles. During a heatwave in California last September, grid operators advised customers to not charge their EVs in the evenings in order to avoid an overload of the grid. So we see that already problems have begun to surface in the power industry’s ability to keep up with demand, especially during times of inclement weather. As EVs continue to eat up more and more market share, incidents like what happened in California will become more widespread without major improvements to the power grid. https://www.linkedin.com/embeds/publishingEmbed.html?articleId=6925531279594137372&li_theme=light Another, and perhaps more arduous issue facing the American electrical infrastructure is the coming launch and mass marketization of larger commercial EVs. The Biden Administration’s Inflation Reduction Act (IRA) was signed into law last August, and the bill laid out enormous incentives for the mass adoption of medium duty and heavy duty EVs (over 14,000 lbs). With a $40,000 tax credit available for all medium and heavy duty EVs, the miniscule market share currently occupied by these vehicles is projected to take off by the end of the decade. While substantially cleaner for the environment than their diesel and gasoline counterparts, these kinds of vehicles also demand significantly more energy to go the same distance as a lighter passenger EV. The energy usage for medium and heavy duty EVs is between 0.5 and 5.2 kWh per mile, while light EVs consume 0.2 – 0.4 kWh per mile. In 2022, over four million semi-trucks were operated in the US alone, excluding all other types of medium and heavy duty vehicles. It isn’t hard to imagine that an already beleaguered electrical grid will noticeably struggle to provide enough power for four to five million new EV semi-trucks, let alone all of the other segments of the market. https://www.linkedin.com/embeds/publishingEmbed.html?articleId=7258730335952157014&li_theme=light However, these power concerns are not insurmountable. The Wall Street Journal reported in an article last month that the 2.1 million EVs on the road in 2021 only required 0.2% of the total electricity consumed for the entire year. It is not likely that the US power grid will be able to stay ahead of demand to such an extent as EVs shift towards a dominant position in the automotive market, but with such a head start, the problem is certainly not unsolvable. Continued investment in optimizing clean energy, nuclear power, and upgrading electrical infrastructure across the country will ensure that power needs are met 24/7. These upgrades are essential to ensure the solvency of the nation’s power grid as it grapples with the rise of EVs, but the next step requires thorough examination, expansion, and further investment in the powerpoints themselves. Part 2 of AMA’s EV story will dive into the progress, flaws, and necessary actions needed to shore up one of the most essential components of the United States’ switch to electric vehicles: EV charging stations Learn more about how the AutoMobility Advisors team can help you and your business seize the amazing opportunities to serve the new mobility market. Click on the link below and get in touch, we’d love to talk with you! https://www.linkedin.com/embeds/publishingEmbed.html?articleId=7797880136967695981&li_theme=light Read the latest AutoMobility Roadmap here and subscribe today. #evinfrastructure #electricvehicles #evcharging #newmobility #futuremobility AutoMobility Advisors