Electric Cars Will Be Great Someday. Just Not Now.

Commentaries on economics and technology.
April 14 2013 7:00 AM

Someday, Electric Cars Will Be Great

Right now, they are expensive, inconvenient, and not very good for the environment.

108305448
A Nissan Leaf in production

Photo by KAZUHIRO NOGI/AFP/Getty Images

The idea of the electric car has long captured the imaginations of innovators,  including even Henry Ford and Thomas Edison more than a century ago. Celebrities, pundits, and political leaders alike have cast these vehicles as the apotheosis of an environmentally responsible future. German Chancellor Angela Merkel has proclaimed that there will be 1 million electric cars on the Autobahn by 2020. President Barack Obama has likewise promised 1 million electric cars in the United States, but five years sooner.

Someday, the electric car will, indeed, be a great product—just not now. It costs too much; it is inconvenient; and its environmental benefits are negligible (and, in some cases, nonexistent).

Many developed countries provide lavish subsidies for electric cars: amounts up to $7,500 in the U.S., $8,500 in Canada, 9,000 euros in Belgium, and 6,000 euros even in cash-strapped Spain. Denmark offers the most lavish subsidy of all, exempting electric cars from the country’s marginal 180 percent registration tax on all other vehicles. For the world’s most popular electric car, the Nissan Leaf, this exemption is worth 63,000 euros.

Advertisement

Yet this is clearly not enough. In Denmark, there are still only 1,224 electric cars. In Germany, car sales totaled 3.2 million in 2011, but only 2,154 were electric.

The numbers have forced Obama and Merkel to reconcile their projections with reality. The US Department of Energy now expects only about 250,000 electric cars by 2015, or  0.1 percent of all cars on America’s roads. Merkel recently admitted that Germany will not get anywhere near 1 million electric cars by 2020.

No one should be surprised. According to an analysis by the Congressional Budget Office, a typical electric car’s lifetime cost is roughly $12,000 higher than a gasoline-powered car. Recent research indicates that electric cars may reach break-even price with hybrids only in 2026, and with conventional cars in 2032, after governments spend hundreds of billions of dollars in subsidies.

Costs and subsidies aside, electric cars have so far proved to be incredibly inconvenient. A BBC reporter drove the 484 miles from London to Edinburgh in an electric Mini and had to stop eight times to recharge, often waiting six hours or more. In total, he spent 80 hours waiting or driving, averaging just over six miles an hour—an unenviable pace even before the advent of the steam engine.

Electric cars also fail to live up to their environmental billing. They are often sold as “zero emissions” vehicles, but that is true only when they are moving.

For starters, the manufacturing process that produces electric cars—especially their batteries—requires an enormous amount of energy, most of it generated with fossil fuels. A life-cycle analysis shows that almost half of an electric car’s entire CO2 emissions result from its production, more than double the emissions resulting from the production of a gasoline-powered car.

Moreover, the electricity required to charge an electric car is overwhelmingly produced with fossil fuels. Yes, it then emits about half the CO2 of a conventional car for every mile driven (using European electricity). But, given its high CO2 emissions at the outset, it needs to be driven a lot to come out ahead.