By Will Adams, Manager of Research Services –
In the wake of the VW emissions scandal, my colleague KC Boyce recently outlined a potential business opportunity for utilities to provide a more robust public charging infrastructure by inducing demand for greater adoption of electric vehicles as a hedge against essentially flat load growth.
The prospects for such a scenario – at least so far – seem pretty good. Studies show Nissan LEAF owners, for example, drive 50% more than traditional car or truck owners and, by all indications, EV drivers would remain loyal, likely purchasing another EV. In addition, the prospects for autonomous vehicles, especially of the electric variety, bode well for this idea given the potential increase in total vehicle miles traveled.
But what does this mean for consumers, especially future utility customers, i.e., young people?
Well, if the largest voting demographic since baby boomers – young people aged 18 to 34 – is less likely to obtain a driver’s license and is also buying fewer cars, maybe the prospects aren’t so rosy? Young people are also moving to cities in droves, eschewing a rigorous commute by private car in favor of greater density, walkability and access to public transit. But the issue is not just the gradual, long-term cultural or demographic shift away from owning and driving cars to using public transit or Uber. Some studies question the supposed environmental benefits of EVs.
Sweden, a country with extremely generous subsidies for EVs, once led the world in per-capita sales of ‘green cars’ and now has double the market share of the U.S. for EVs. According to Fermin DeBranbander, greenhouse gas emissions from Sweden’s transportation sector actually increased following the introduction of its green car subsidies and a few years later, traffic congestion increased in Stockholm. Nevermind the resource intensive and environmentally destructive infrastructure – more parking lots, parking decks, roads, bridges and highways – necessary to provide for increases in driving habits from EVs and before too long, autonomous vehicles from Google and Tesla.
Even if offering EV charging stations could, at best, help some utilities nominally increase electricity sales, there are hugely significant and extremely negative externalities to goosing an increase in society’s driving habits.
According to blog post from the Wall Street Journal, car dependency has “hidden costs to the United States economy that come to more than $1 trillion a year.” That’s trillion with a T. Much of this is related to the significantly detrimental financial (public and private), health, safety and environmental consequences from driving. Making driving cheaper, easier and more accessible with increased fuel efficiency standards or with EVs could simply induce demand for more driving and potentially exacerbate all of these negative externalities. Preliminary studies on traffic fatalities in 2015 alone are quite troubling.
Elon Musk and the Google guys are obviously extremely intelligent, but as Jeff Speck and Andres Duany like to say, “If we’ve learned one thing, it is that you can’t grow a green economy on blacktop.”