IEA: Government support 'crucial' for electric cars roll-out

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SPECIAL REPORT / Public subsidies, legislative innovations and consumer education are vital for the development of Europe’s fledgling electric cars industry, an energy analyst at the International Energy Agency (IEA) has told EurActiv.

He was speaking as the European Commission issued a transport and technology communication calling for EU governments to “break away from conventional thinking” in the paradigm shift to alternative propulsion systems, and embrace “new financial instruments to increase the leverage of public budgets”.

Public intervention could take the form of regulations, standards to ensure interoperability, public procurement, intellectual property rights, financial services, politically-set industrial targets, and voluntary commitments, the document says.  

“As a new technology, government support for electric cars is especially crucial over the next 10 years,” Tali Trigg said over the phone from the IEA’s Paris headquarters. “This is when subsidies and education are needed.”

Clean technology subsidies are widely seen as a necessity in the electric cars sector – with France setting the pace – but they have been contested in other renewable energy fields such as solar, in which the EU is currently exploring an anti-dumping suit against China.

Green Cars Initiative

Brussels has pledged €5 billion for a European Green Cars Initiative, €4 billion in the form of loans from the European Investment Bank and the rest through support for research, some of which will come from the private sector.

By comparison, China has invested $15 billion in electric vehicles and their infrastructure, while the US has stumped up $2.4 billion.   

But according to an EU memo released on 18 September, 90% of the €43 billion of investment in EU transport-related research and development has come from corporate groups.

As EU states purchase around 110,000 passenger cars, 110,000 light duty vehicles, 35,000 heavy duty vehicles, and 17,000 buses, the Commission believes that “the potential for innovation through public procurement is currently under-exploited in the EU.”

The same principle applies in infrastructure where “capacity building on local, regional and national level is needed for both public authorities responsible for the provision of services and transport operators,” according to the new communication.

It says that EU roadmapping to begin this month will put “particular emphasis” on fields where the market has failed to deliver clean transport infrastructure, and “identifying where action at the European level can yield the biggest impact.” 

"We support any government that takes clear measures for the uptake of, or transition to electric vehicles," Gunnar Lorenz, the Networks head at the electricity industry association, Eurelectric, told EurActiv.

Policy options could cover pollution fees, congestion charges and tax breaks, as well direct aid, he said.  Norway had "a really good spectrum" of policies in place, Eurelectric's Sophie Tielemans added.

Municipal car sharing schemes

So far, publicly-funded programmes have a good record of success. One municipal electric car sharing schemes called Autolib in Paris which benefitted from €235 million of funding has spurred imitators such as the Zen car system in Brussels, while an eco-tourism project offering drivers on Denmark’s Bornholm island wind energy-powered electric vehicles has captured the Danish imagination.

Amsterdam now has the highest density of public electric charging stations in the world, with the introduction of 500 electric vehicles planned by 2015, and Berlin is considering electrifying its freight transport system.

Both cities are part of an ambitious scheme to unite the transport networks of 16 cities around the world, demonstrating the sort of public intervention that Trigg believes can make a real difference. 

“You can do fast [battery] charging in shopping malls, offices or garages,” he said. “You can have driving in special [electric car] lanes, access to municipal parking spots, parking or zoning ordnances demanding that you install electric vehicle charging stations, and this has happened in Stockholm and Geneva.”

“These are interesting ways that governments can promote electric vehicles at a very low cost,” he added. 

Trigg also pinpointed non-material factors in the uptake of electric vehicles. “There are not enough behavioural scientists, psychologists and organisational theorists working in this field, and right now that is a big part of this,” he said.

“Only 12% of Americans drive over 100km a day, but 48% think they do,” he added. “People are a bit more scared [of range anxiety] than they have reason to be”.

Common European Standards

A lack of common European standards is also holding electric cars up at the lights, industry sources say, and Brussels has contributed to a €42 million green eMotion project to try to address this.

Inter-operability, or the connection of information flows between cars and charging infrastructure, is seen as a lightning conductor issue by many in the battery electric car industry.  

“Interoperability is essential for the long term success of electric cars, because in the longer term we need to have that fluid way of working so that they can cross borders and travel from city to city,” said Alfons Westgeest, the secretary-general of EUROBAT, the Association of European Automotive and Industrial Battery Manufacturers.

In the short term though, the unpacking of recharging infrastructure is being most hampered by the lack of a standardised design for all plugs and charging equipment, as Germany and France continue to bicker over which country’s design should become dominant.

"If you have a new technology, you need standards to secure your investment climate," Tielemans said. "This is a problem that [electric cars] infrastructure is facing: Without an agreed standard, investors are delaying their investments."

Timeline: 
  • By end of 2012: DG Move to publish clean transport communication
  • 2013: Review of 2020 target expected to wrap up
  • 31 Dec. 2014: EU expected to complete review of targets for 2020 and 2025
  • 1 Jan. 2015: 130 grams of CO2 per km target to be enforced across Europe
  • 2016: US to introduce 35 mpg standard for all new passenger cars
  • 2020: 95 grams of CO2 per km target expected to enter force across Europe
  • 2025: European Commission could impose another milestone on the road to decarbonsiation by 2050
  • 2025: US to introduce 54.5 mpg standard for all new passenger cars
  • 2030: European Commission could impose another milestone on the road to decarbonsiation by 2050
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