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07 August 2017

Big Oil Makes Big Increase on EV Forecasts

Even Big Oil is making big increases on its forecasts on just how many electric vehicles will be on the world’s roads by the year 2040.

Exxon Mobil, BP, the International Energy Agency, even OPEC are all boosting their predictions for the number of EVs operating at by that point, according to Bloomberg New Energy Finance.

The increases aren’t small, either. Exxon Mobil boosted its forecast nearly 50 percent from last year’s to 100 million EVs. BP is also predicting 100 million. And OPEC’s new forecast is almost six-times what it was last year, at 266 million EVs on the road by 2040.

Bloomberg’s own predictions are even more optimistic. It predicts 530 million of the world’s vehicle fleet will be electric by 2040. That’s an increase of about 124 million compared with the prediction it made last year – 530 million is nearly a third of the world’s total vehicle fleet.

The BNEF forecast includes plug-in hybrid vehicles, which helps raise the adoption rate. But, it noted that plug-ins will be on the decline, and will just be 15 percent of the EV total by 2040.

So what has driven the change in the last year? Costs have fallen, choices have increased, and legislation has changed.

Lithium-ion battery packs were $1,000 per kilowatt-hour in 2010. That cost has plummeted to under $300 now, according to BNEF. Forecasts put the costs of an entire pack under $100 by 2026.

There are more EVs, with more on the way. Tesla has about 500,000 deposits on the Model 3, showing that there is demand for that car. Chevrolet’s new Bolt EV shows that the big automakers can do affordable long-range EVs too. Mercedes-Benz and Volkswagen have new EV brands on the way, and Volvo has spun off their Polestar brand to make performance electrics.

More options mean that competition increases, development speeds up, and the appeal should broaden. It’s also a sign that automakers are starting to embrace EV tech.

Finally, legislation. Governments in France and the UK have pledged in the last year to eliminate gas and diesel cars by 2040. While those bans might be hot air and difficult promises to keep, they are certainly signs of a sea change in transportation as we know it.

So the mainstream EV is on the way. Even the oil companies are forecasting it now.

Bloomberg New Energy Finance

 

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