We are now in the midst of a gradual but inevitable evolution to electric vehicles and green renewable energy. Recently released reports on climate change spelled out the urgency for accelerating the timing of these changes. We should embolden the forces of entrepreneurial innovation to create solutions for liberating ourselves from fossil fuels.
Incentives have already succeeded in making the evolution from gas-powered cars to electric vehicles, or EVs, irreversible. EVs are faster, more responsive and more fun to drive than internal combustion engine, or ICE, vehicles. Tesla's success has impelled other automakers to begin producing their own electric cars. Volkswagen will move totally to electric vehicles by 2030 and other carmakers are trending in the same direction. Two companies, Sono Motors and Lightyear One, are in the process of developing cars that can be entirely charged by their own built-in solar panels. And electric SUVs and trucks, with battery ranges up to 400 miles or more, will soon be hitting the roads.
The biggest drawback to electric cars has been their price. But as production scales up, efficiencies increase and prices drop, especially for the battery, which is the main component of electric vehicles. Battery costs have been decreasing by 15 percent per year. When that level reaches $100/kilowatt, electric cars will start to undercut the price of ICE vehicles. Tesla expects to reach this threshold this year while Envision Energy, a Chinese company, expects its battery costs to drop to an astounding $50/kilowatt by 2025, And maintenance costs of EVs are miniscule compared to ICE vehicles (no oil changes, no timing belt, no tuneups, etc.) while their lifespan will be exceptional. So overall operating costs will be much less for EVs, and as renewable energy makes electricity cheaper and more abundant, fuel costs will become insignificant.
Long-range freight trucks are also going electric, with several companies planning to go into production. Tesla plans to make trucks with ranges of 300-600 miles and a quick charge of 80 percent in 30 minutes. These will feature operational costs of about $1.25/mile versus about $1.50 for a conventional diesel. And the first solar-powered train has been developed by the Byron Bay Railroad Company, although its range so far is very limited.
Incentives have also forged a revolution of clean power production. Solar and wind power have scaled up to where both now compete head-on with coal. The cost of solar has declined by over 99 percent since 1975 and continues to drop. California now produces so much solar energy that occasionally, it has to dump excess electricity. Batteries for backup power storage are scaling up and decreasing in costs as their efficiency increases. Paired with solar and wind, batteries will increasingly be used to store excess energy during sunny and windy periods — and will help even out the power generation.
Rocky Mountain Power, the power company for most of Utah, relies on coal as its primary fuel source. However, it would actually be less expensive for RMP to totally dismantle most of its coal power stations and replace them with totally new built wind and solar power plants than to continue to fuel and operate existing facilities. This would save money for both customers and shareholders with added benefits of reduced pollution and health care costs.20 comments on this story
California has mandated solar panels on the roofs of all new houses built starting in 2020. This has been endorsed by both environmentalists and the California Building Industry Association. The added average monthly expense of $40 will be more than offset by $80 in savings. This will have the added benefits of creating jobs and freeing up capital for other investments in our economy.
The transformation to renewable energy is now inevitable. We should expedite this progression by speeding up incentives for electric vehicles and renewable power while also enacting disincentives for fossil fuels, including a carbon tax, to stimulate and accelerate the movement away from hydrocarbons.