Do we really need electric cars in India?

Everybody is now going electric, and India is also doing it. In the last 6 months Norway, Germany, Britain, France and China have declared their intentions to eliminate the use of fossil fuels in vehicles in 2040, at the earliest. Germany plans to complete it in 2025.

While a few of these governments have deflected their claims that they are planning to change to electric vehicles or alternative fuels, it is a fact that in all likelihood, with the possible one exception, China that already has large coal-based methanol programs that is in place, they are talking about electric vehicles. To no one’s surprise it is no surprise that the Indian government has also been quick to follow suit.

In May of this year, NITI Aayog, India’s overhauled Planning Commission, electrified the Indian elite by the announcement that India will aim to replace its entire fleet of vehicles with electric vehicles in 2040. “India could reduce 64% of transportation-related energy consumption for passengers and 37 percent of carbon dioxide emissions in 2030 by seeking the shared, electric as well as connected future for mobility,” it announced. “This will lead to a decrease of the equivalent of 156 Mtoe (million tonnes equivalent to oil) in petrol and diesel consumption for the time period.” That same month Piyush Goyal, the-then minister of power, said that there should be no motor vehicle that was diesel or petrol is to sell in India starting in that year.

On the 7th of September Amitabh Kant, chief executive of NITI Aayog, told the annual gathering of the Society of Indian Automobile Manufacturers (SIAM) which is an industry group in India, that India will be home to 30.81 million electric vehicles in the country in 2030. Nobody present could explain how he was capable of arriving at the second decimal place which is within 10,000 cars of the scenario in 13 years’ time.

The next day the newly-appointed minister of transportation, somewhat incoherently, stated to the automakers they were to have to be “bulldozed” towards switching their vehicles to electricity and alternative energy vehicles, if the do not choose to do so in a voluntary manner.

Automobile companies are likely to be furious with their anger is evident. Modi government’s electric car vision is just the latest chapter in a series of industry policy changes that have been general.

Not well thought-out

Was it thought-out well? Did any analysis of costs or returns have preceded this announcement? An examination of the draft energy policy plan for 2040, released in June suggests that there was no analysis. The policy that estimates that India’s energy consumption will double in 2040, it suggests that in the event of an “ambitious energy-saving model,” the proportion of fossil fuels will decrease from 81 percent from 2012, to 78% by 2040. Transport will make up 25 percent of this.

Just 16% of the fuel and 5 percent of gas required by is what the “business as normal” plan would’ve needed would have been saved mostly through improvements in efficiency of the fuel. Evidently, at the time the policy was being formulated electric vehicles had not yet made it into the plans of the government.

What no of the government who have signed this pledge have considered its viability. The first question that any transportation minister could have asked was, “Is it feasible?”. A single question would have proved that it was not. The batteries that provide electric vehicles with power make use of nickel, cobalt, graphite, aluminum, and lithium. These are all rare earths, which means their presence within the earth’s crust is significantly less than that of oil and coal.

There are two challenges. One, will there be enough electricity to power the two billion vehicles that will be in the roads by 2040, and not forgetting the billions and billions of electric bikes and scooters? The second question is, can enough new reserves of these be discovered to counteract the amount that is taken in each year? If the finding of reserves is not enough to meet the requirements of the annual growth in consumption, it’ll cause speculation on the future price of these reserves in the markets for commodities, which could propel their prices into the upper reaches of the market.

How sensitive to these prices is evident from an observation that shows the drop in the price of lithium has reversed dramatically towards the end of 2015 and the automakers of the world have committed to producing electric vehicles. At the time of mid-2017, lithium prices had increased 50% more than the price of 2015.

Automobile companies are likely to be furious over the Modi government’s electric car vision is just the latest step in a long line of industry policy reversals. Credit: Reuters

Wishful thought

The proponents of the electric car claim that because lithium is less than 2% in weight of the most sophisticated automobile batteries today the production capacity is able to keep pace with the demand and eliminate the short-term price fluctuation. But this is just wishful thinking.

The lithium-ion battery in the most recent Tesla weighs 540 kilograms and is packed with close to 10 kilograms of lithium. If world governments want to get rid of fossil fuels, then they will need to transition two billion traditional passenger vehicles from fossil-fuels. This would require nearly twenty million tonnes of lithium. If the number of passengers cars increases by 2% per year and batteries run for an average of 8 months (the current warranty period for the Tesla) The annually required amount of lithium could be around 580,000 tonnes.

This will also decrease the consumption of petroleum-based fuels approximately half, since it doesn’t include the usage of the road haulage industry , or the millions of two-wheelers which consume gasoline as well. In comparison, the worldwide production of lithium was around 160,000 tonnes in 2015. With a rate of growth of 8.8 percent, it’s predicted to grow to 23,900 tonnes in 2021 in accordance with Macquarie Research. At this rate it could reach 1 million tonnes prior to 2040. Is the rate of increase sustainable? The answer is no. The amount of lithium found in the earth’s crust is 13.1 million tonnes in accordance with the US Geological Survey.

Led through the nose

Then why are governments falling over each other in order to declare plans to end the production of vehicles which run on diesel or petrol in the next two years? The reason is that they are being pushed around by the ear of the automobile industry worldwide. In the present, Volvo, Toyota, BMW, Daimler-Benz, General Motors Chrysler-Fiat Renault, Honda, Kia, Mitsubishi, Nissan, Volkswagen and Tata have all announced plans to develop electric vehicles. They’ve done this because they are aware that even the governments of their countries do not exist, there aren’t enough rare earths or metals within the earth’s crust to allow a complete removal of diesel and petrol. Thus, their enormous investment in the auto industry will be safe even as they capitalize on the consumer’s ever-growing worry about climate change to earn quick money.

Electric vehicles are an unintentional path through which the massive oligopolies that control the economy of markets are taking over the entire world. It’s not the only one, since solar and wind power aren’t in any situation to substitute even a tiny percentage of the electricity people around the world use. If there was a real alternative to petroleum-based petrol or diesel, the rush to switch to electric cars would not be excused. However, the process of converting carbon monoxide and hydrogen generated through biomass into transportation fuel or olefin via the Fischer-Tropsch process has been since the past 100 years and was the first to transform urban waste into methanol for commercial use in the US in 1922.

It can now achieve this feat with any type of biomass found in the world. So the determination of the big companies to guide the entire world down the path of the electric vehicles at a time where climate change is evidently accelerating is completely unacceptable. The decision of for the Indian government to be a victim of this is simply stupid.

 

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