Bloomberg New Energy Finance (BNEF) has released its annual forecast on the future of e-mobility, predicting that electric vehicles (EVs) will penetrate the global bus, van, truck and passenger car markets faster than it envisioned in previous years.
According to BNEF’s EV Outlook 2019, which was published late last week, pure EVs are likely to account for 57% of new passenger car sales by 2040 as automakers across the US, Asia and Europe electrify their portfolios and as charging infrastructure stocks expand across these markets, driven by investments from national governments, local authorities and private organisations.
During 2018, two million pure EVs were sold worldwide – a figure which BNEF sees rising to 28 million in 2030 and 56 million by 2040. At the same time, BNEF claims, the number of petrol and diesel passenger cars sold worldwide annually will fall from 85 million in 2018 to 42 million by 2040.
The EV revolution is set to grip the municipal bus market even faster, according to BNEF, with fully-electric buses on track to account for 81% of global bus sales by the same deadline. The analysts behind the outlook put this down to the proliferation of hydrogen technologies, the falling costs of EV batteries and the leadership of China. Of the 400,000 pure-electric buses currently operating worldwide, around 99% are thought to be located in China.
As for the battery cost factor, the Outlook claims that the average cost of lithium-ion batteries has fallen by 85% since 2010, on a “per kWh basis”. BNEF attributes this trend to a mixture of economies of scale and technology improvements.
Nonetheless, the report continues to envision challenges in electrifying heavier vehicles. It predicts that pure EVs will account for just 31% of mid-sized vehicles and 19% of heavy trucks sold in 2040, adding that these models are likely to be used for short-distance journeys rather than long-haul shipping.
According to BNEF’s head of advanced transport Colin McKerracher, the findings in the report suggest that there is a “real possibility that global sales of conventional passenger cars have already passed their peak.”
“Electrification will still take time because the global fleet changes over slowly but, once it gets rolling in the 2020s, it starts to spread to many other areas of road transport,” he said.
BNEF’s research also details the likely impact of the shift to EVs on the global fuel and power sectors.
In its 2018 analysis, it predicted that the uptake of EVs would reduce global on-road fuel demand by 7.3 million barrels per day by 2040. It has now almost doubled this figure to 13.7 million barrels per day – partly because of predictions for more rapid EV uptake, and partly because it believes that fuel efficiency progress is likely to “proceed more slowly than previously thought”.
What happens to oil demand in road transport over the next 20 years? Passenger vehicles down, commercial vehicles up. Combined they peak around 2030 in @BloombergNEF‘s latest Outlook. Fuel economy plays a big role.
More here: https://t.co/6OkcPAb950 pic.twitter.com/JVQ09keB1o
— Colin Mckerracher (@colinmckerrache) May 15, 2019
As for electricity, BNEF is forecasting that EVs will add 6.8% to global electricity consumption by 2040, against a 2018 baseline. In 2019, the power consumption of the world’s EV battery stock is likely to hit 151 GWh – a figure which BNEF sees rising to 1,748GWh by 2030. The analysts behind the report notably included a cost model factoring in the cost of home EV chargers for the first time to reach these conclusions.
On a national level, research by the National Grid has shown that the growth of the UK’s EV stock could add up 30% to peak power demand by 2050. In a bid to overcome this capacity gap, it is championing smart charging and vehicle-to-grid (V2G) technology.