Charging Forward? Examining the True Cost of Electric Vehicles

June 26, 2024

Charging Forward? Examining the True Cost of Electric Vehicles

Listen and subscribe to the podcast

Join The American Idea’s Listener Email list – get news about upcoming episodes and a chance to offer questions for them, too!

Tipping Point in Battery Technology A major project was launched in the 1990s by GM and a Consortium to make electric vehicles. Hybrids started to evolve more quickly than EVs because a small battery can improve the fuel economy of gas vehicles. When the battery is expensive and heavy, making it smaller to improve fuel economy is a big deal. Tesla eventually came along and thrived due to a combination of technology and regulatory environment.

Tesla’s Innovation in the Electric Vehicle Industry

Tesla’s founders dreamed of scaling up cell phone batteries to create car batteries. They redesigned the vehicle around the battery and electric architecture, which led to better performance and cost-effectiveness. Tesla’s ability to market themselves and raise money consistently was also crucial to their success. Other automakers struggle to change their business models to sell electric vehicles profitably.

Understanding Wealth Transfer and Electric Vehicle Credits

Electric vehicle (EV) buyers can sell the credits they earn for purchasing EVs, which effectively transfers wealth from automakers to EV buyers. This wealth transfer mechanism incentivizes EV purchases and helps meet fuel efficiency standards. The skewed credit system favors EVs over hybrids, discouraging the production and sale of more fuel-efficient hybrid vehicles. This unintended consequence hampers efforts to improve the overall fuel efficiency of the vehicle fleet.

Energy Consumption and Fuel Economy Calculations for EVs

EVs are rated for fuel economy on an energy equivalent basis, considering the efficiency of converting battery power to energy for driving. This rating system differs from traditional gasoline-powered vehicles and highlights the higher energy efficiency of EVs. However, it raises questions about the actual energy sources used to generate the electricity consumed by EVs. Additionally, the production of an electric vehicle results in higher embodied emissions compared to an internal combustion vehicle. This disparity is due to the increased energy and resources required in battery manufacturing. Over time, these emissions can be mitigated by utilizing electricity from low-carbon sources for vehicle charging.

Exaggerated Multiplier in Fuel Economy Standards

The current fuel economy standards employ an inflated multiplier for electric vehicles, overstating their environmental benefits. This exaggerated multiplier leads to the issuance of more credits for EV sales, resulting in a lack of transparency and an inaccurate assessment of their true carbon footprint.

Unfortunately, none of these factors are widely know by consumers – and perhaps even policymakers – and they are discussed even less. Whether or not EVs, for personal and/or commercial use, are a good idea can never be determined if the whole picture – the entire cost of production and ownership – is not understood. Only then can we, as individuals and a society, decide what’s best for our transportation and energy usage needs.