
The $6T Barrier Holding Electric Cars Back - nikbackm
https://www.bloomberg.com/opinion/articles/2018-11-04/electric-cars-face-a-6-trillion-barrier-to-widespread-adoption
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GnarfGnarf
I look forward to no longer having to deal with the absurd complexity of the
internal combustion engine: pistons, cylinders, crankshafts, distributors, oil
pumps, water pumps, radiators, valves, belts, mufflers... The fact that this
finally works semi-reliably is a testament to the genius of the engineers and
managers of the automobile industry.

Remember that wherever there is a gasoline pump, there is electricity, and the
possibility of a charging station.

One day the internal combustion vehicle will be seen as quaint as a horse
defecating in the street.

~~~
chrisseaton
> I look forward to no longer having to deal with the absurd complexity of the
> internal combustion engine: pistons, cylinders, crankshafts, distributors,
> oil pumps, water pumps, radiators, valves, belts, mufflers...

I'm looking forward to pervasive electric cars as well, but really how much of
this 'absurd complexity' do you need to deal with in a conventional car? And
how exactly do you have to 'deal with' it? You get a mechanic to look at for a
couple of hours once a year and that's it.

You could dramatically list all the complex components in an electric vehicle
- down to the microscopic integrated circuits - as well and say that they all
need to be 'dealt with' because it's serviced once a year.

~~~
varjag
The manufacturer recommended maintenance schedule for our EV consists of
rotating tires, checking braking fluid and changing salon air filter.

~~~
chrisseaton
Right so that isn’t much less than a conventional car? My Land Rover has one
three-hour service once a year. Is an EV done in one hour? Doesn’t seem like a
huge difference.

~~~
varjag
No, this is a lot less work than conventional car would see for the same 7
years. Basically there's no need to get to dealership service.

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rmtech
It would be nice to have a comparison cost for the cost of gasoline
infrastructure globally.

Also, $6Tr seems on the high side to me. That's the same as 150 million
$40,000 electric cars. Is the infrastructure really that expensive?

------
Brakenshire
I don’t really understand why figures like this matter, if people are willing
to pay for the electricity at a profitable rate, then the grid infrastructure
to meet that demand can be built. There must be very high global costs in
maintaining the existing grid, but we don’t get breathless articles saying
“global grid must find $x trillion or else blackouts will occur within 5
years”. If there was a sudden spike in demand there would be a sudden
availability of private capital willing to meet that demand, the barrier
should that occur would be equipment, materials and skill related, but I doubt
it would be held back by access to capital.

Also, it doesn’t make sense to talk about “affordable electric cars” as a
monolith. Electric cars are already cheaper than the alternatives for some
people when you calculate Total Cost of Ownership, it depends on your
requirements and use case. That will become mainstream step by step in
different sections of the market.

~~~
neogodless
The assumption you used helps to answer your question.

"at a profitable rate"

So this assumes that the chicken-and-egg electric car/infrastructure can
evolve together profitably while reaching critical mass. (To be sure, I
believe they can, but it will take either government or brave investors to get
there.) So the question really is "can $6T be divided up into the cost of
whoever is paying for it, i.e. electricity users to maintain profitability as
it is built?"

If you assume the answer is yes, there is no question!

(As for the "maintaining the grid", yes, obviously we are already maintaining
it profitably. No need to build critical mass/adoption or initial
infrastructure investment, so no interesting stories to write!)

~~~
Brakenshire
Yes, you’re right that is the important assumption which needs to be proven or
disproven, all I’m saying is that the $6T is immaterial, if the investment can
be done profitably it can happen very quickly, if it can’t then it won’t.

Also worth saying that how many years in the history of the electricity grid
has demand not been growing? That may not be the normal state recently, but it
has been for the majority of the history of the industry.

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justtopost
Flagged comment is correct. Gas cars are still superior for actual normal use.
The issue is, as long as electric are priced above or similar to conventional
cars, is and will continue to be, superior demand. Electrics are for the well
to do only still in most areas. I say that as someone who would love an ecar,
but find them both unaffordable, and mildly unsuitable for the driving I do
regularly. But this is not a shiny metro-dwelling sentiment, so I suspect this
comment, dispite being useful and relevant, will end up the same.

A plea: There are people outside cities. Lots of them. Stop pretending we
don't exist, and calling us rednecks/flyover/etc. Its become a staple of HN
and getting worse. It makes me sick to read the comments sometimes. We grow
your food, build your infrastructure, but get no empathy when we have no
internet access. Its bigotry plain and simple, and rampant here. Usually
stated in cowardly downvotes rather than reasoned debate to perserve image. I
fully think you should be required to respond, or upvote a response, before
downvoting. It would surface the real bias entrenched here.

~~~
rcMgD2BwE72F
>The issue is, as long as electric are priced above or similar to conventional
cars, is and will continue to be, superior demand.

Tesla's sales prove you wrong: people are already replacing their current ICEs
with higher-priced EV, although on a /km basis, the Model 3 is already cheaper
than an equivalent ICE (e.g the BMW Series 3). We just need Tesla to ramp up
its production and introduce economy models, and the other manufacturers to
try to compete.

I am _not_ saying that you can buy a low-cost EV for your needs/budget, but
that your first 3 assertions are plainly false.

~~~
lrem
What about comparing to something that isn't a status symbol? Personally, I
paid 6k for my car and according to my bank statements seem to be spending
1.7k yearly on fuel and maintenance. I would love to drive an EV, as the
distances I drive are small, but Nissan Leaf is way too small for my family
and a Tesla 3 would mean I'm paying a bit too much for that warm fuzzy
feeling. Is there another choice?

~~~
Brakenshire
> I would love to drive an EV, as the distances I drive are small, but Nissan
> Leaf is way too small for my family and a Tesla 3 would mean I'm paying a
> bit too much for that warm fuzzy feeling. Is there another choice?

Something like a Mitsubishi Outlander? You’d need to run the calculations, but
$17k over the course of a decade in fuel and maintenance costs leaves a lost
of leeway.

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joaorico
It's always going to take a few years.

The global fleet is about 2 billion passenger and commercial vehicles, and the
global yearly production is about 100 million. So even if all new cars sold
from now are electric, it will take 20 years.

But who knows what kind of autonomous vehicles and other innovations we'll
have in 20 years. Buckle up :)

~~~
rcMgD2BwE72F
A change like the transition to EV won't be linear. As more ICEs get replaced
by EVs, people and businesses will realize that it doesn't make sens to
sustain an aging ICE infrastructure for a shrinking fleet of old, toxic cars.
Dense cities will gradually ban them, gas stations and car dealerships will
close, banks will stop financing ICE leases (and more important, they will
stop financing the entire fossil fuel industry), etc.

As the resale value of ICEs will plummet and their cost of ownership/operation
will increase, a vicious circle will accelerate to quickly make them a
liability.

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ethagknight
There is no $6T barrier, the infrastructure already exists. TLDR: This article
focuses more on the cost of electric cars (which is valid but not really
relevant) with a passing mention on infrastructure.

Bloomberg provides no clear backup on the math (“according to Goldman”) but
I’m guessing they are pricing a scenario where all electric cars are
completely drained and charging to full all at once. Practical usage is more
like a trickle charge every night. A step further, electric utilities are
thrilled to get to supply this energy to you, and there will be a cat and
mouse game as car charging software works to avoid peak electric surge
pricing. Electric utility remains the winner, since they can heavily
incentivize time-shifted charging (i.e. dont start charging until 1 am, get
half price kws!), and they can run their traditional plants more efficiently
or even issue firesale pricing notices for sudden oversupply from renewables.

There is no barrier, there is modest opportunity, and the implication of the
barrier is “i’m not buying a car because the national grad can’t support me!”
In the same breath, the article discusses how electric autos are selling like
hot cakes.

~~~
neogodless
I have no comment on whether the _grid_ can support the electricity demand.
The _charging network_ is the bigger picture item. Basically, locations where
you can charge your car have to become as ubiquitous as gas stations, or, more
likely, more ubiquitous because you want to rely on dormant vehicle periods to
charge to avoid humans standing around waiting.

It's very easy to picture this in a modern metro area which probably already
has a well-planned (and mostly Tesla) charger network. But just the U.S. alone
has 2.3 billion acres of land to cover with chargers at homes, businesses,
parking garages, apartments and dedicated charging points. It's not trivial,
and it absolutely does not yet exist.

(But I believe it's a surmountable business/engineering challenge, if not an
expensive one.)

~~~
ethagknight
Charging endpoints just seems like a very simple solution. Charges don’t need
to be ubiquitous for Tesla to sell another 10,000 electric cars this month.
Tesla is clearly supply constrained. That’s my beef with the article or really
the headline, sales are off the charts.There are certainly complicated
scenarios, like the urban apartment dwellers out there, and they may have to
be among the last to adopt, and that’s a ‘barrier’ several orders of magnitude
smaller than $6T. the 100+ million housing units in the US alone can rapidly
adopt electric cars in a distributed manner. A surge in gas pricing could flip
that switch too. I’ve argued elsewhere on HN that gas stations, commercial
garages, and retailers, and employers are in position add some circuits. It
MAY be a $6B problem sprinkling 1,000,000 connections across the country at a
generous $6,000ea, but it isn’t a $6T problem.

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arbuge
"Wouldn’t it be great if we could all drive without dirtying the air we
breathe? Alas, not everyone can afford an electric car."

These claims always bother me. Besides the obvious pollution from the
generation of electricity required to run the car (in places where clean
energy isn't available), there are also the issues of energy required to
manufacture the car, energy required to replace battery packs after several
years, energy required to recycle the car at end of life, etc. Driving without
dirtying the air is really hard to achieve if you think about the whole chain
of events that goes into that. Far better to live and work within easy
travelling distance if you want to have less of a negative impact on the
environment.

~~~
rzwitserloot
This issue is very complicated.

Your average make-tiny-explosions-in-a-chamber based vehicle can give you
about 250,000 to 1 million km (150k-625k miles). Then it's just done. The
parts are worn down. It's given its all.

Your average move-power-from-batteries-to-engines based vehcile can EASILY
keep on going for 10 million km or more. Yes, even the battery pack can get
there, though it would indeed be by far the first thing that will fail. It is
far cheaper to replace that, than to replace an entire combustion engine.

Given that, you could draw the conclusion that the energy required to make the
chair, the radio, the dashboard, etc – can be divided by at least 10, probably
more.

But your average person does not ride more than ~250000 KM in a decade, and
for sheer matters of safety engineering, style, conveniences like supporting
modern electronics – most people consider a 10 year old car pretty old, and a
20 year old one ancient, and want to replace it simply because it is old.
Which, for combustion cars, is not a big deal: It's pretty worn down by then.

But for EVs? That's a real problem. A 20 year old EV with 250k on the odometer
is a damn shame. Nobody wants it anymore but all the parts still work.

Solve this problem and EVs are _INCREDIBLY_ better for the environment.

I guess self-driving cars helps; you can share a car and just order it to
drive to your front door. But to make that a success, you need to do something
about the 9-to-5 culture; people need to go to work, say, anywhere between 7am
to 1pm, work 6 to 8 hours, and return home, and any job that needs full
staffing the entire time people are at the office needs 2 shifts. That's a
huge social upheaval (but it also gets rid of traffic jams, creates jobs, and
probably boosts the economy because it is easier to do stuff because things
are still open).

At which point we're in 'change the world, man!' hippie territory.

But one can dream, I guess.

~~~
Symbiote
If they become like taxis, and a taxi company owns a fleet of cars, then we
could see similarities to how trains are engineered: an expected life of
several decades, with refurbishment of the interior if it starts to look worn
and dated. Replacement will only be when key parts like the chassis are worn,
or no longer meets modern requirements (step-free access for a train, perhaps
crash-worthiness for a car).

In some countries, buses probably already follow this pattern, but in richer
countries improving emissions standards obsolete the old ones.

