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Increase in electric vehicles isn’t the end of the road for oil


In 2016 electric vehicles represented about 1pc of global vehicle sales.

However, by 2030 demand for such vehicles could rise to almost 20pc of annual global sales, according to a report from consulting firm McKinsey.

In addition, recent surveys from suggest that 30pc of car-buying individuals and nearly 50pc of millennials around the world will consider purchasing electric vehicles for their next car instead of one powered by a traditional internal combustion engine.

Increased adoption of electric vehicles will have an impact on more and different natural resources, as well as multiple industries, geographies, and levels of carbon emissions.

Despite the projected increase in demand for electric vehicles, this will not spell the end of peak demand for oil. Instead, having more electric and hybrid vehicles on the road is expected to reduce oil demand only modestly over the next 10 to 15 years, according to the report.

McKinsey estimates that the extent to which there is downward pressure on oil demand will in fact come largely from improvements in vehicle engine efficiency and from making vehicles more lightweight.

Already these efficiencies have been increasing at about 2pc per year since 2005, which has seen the average kilometres per gallon for a standard internal combustion engine vehicle in the US increase to 52km today from 42km in 2005.

These efficiencies are expected to continue to rise at more than 2.5pc per year through to 2025.

Instead of the global demand for oil reducing, it is expected that demand for oil will continue to increase overall, in particular from a number of sources including industries such as chemicals and aviation, as well as growing regions, in particular China and other emerging markets, and the sale of more cars globally.

However, one commodity that is set to be significantly hit by increasing demand for electric vehicles is natural gas.

More electric vehicles means that more electricity will have to be produced.

While coal will be part of the equation, McKinsey estimates that in the US, which is expected to be one of the larger markets for electric vehicles, approximately 80pc of the forecast growth in electricity demand is expected to be met with natural gas.

If half of the automobiles on American roads were electric vehicles, daily natural-gas demand in the US would be expected to increase by more than 20pc, the consulting firm finds.

The rise in popularity of electric vehicles is also expected to have an impact on land use around the world.

There are currently more than 400,000 public charging points that support the more than three million electric vehicles now in use globally.

However, this number will have to rise significantly to meet the global electric vehicle-adoption increases forecast by 2030.

According to McKinsey, simply replacing gas stations with charging points or adding more charging points that are the size of filling stations won’t be sufficient to service the expected number of electric vehicles.

Instead, it will take multiple rapid 120-kilowatt charging to dispense a similar amount of range per hour as the standard-size filling station of today.

The possibility of a land squeeze will be much greater in Europe and China than in the US, where more people have access to private parking and wall charges.

Irish Independent

17 Comments on "Increase in electric vehicles isn’t the end of the road for oil"

  1. baha on Fri, 8th Jun 2018 7:04 am 

    No matter who’s side your on, that is all pure speculation. Lot’s of ‘will, should, and expected to’

  2. eugene on Fri, 8th Jun 2018 7:55 am 

    We live in the age of dreams and schemes. And we’ve elected the messiah who is going to make all things wonderful again.

  3. LetStupidPeopleDie on Fri, 8th Jun 2018 8:12 am 

    The human specie is such a joke. Genetic entropy is making each new generation stupider and physically weaker.

    The stupid reproduce while the intelligent have given up on the human specie and have decided to not reproduce. Really soon, all that will be left is stupid people doing stupid.

    The white opinoid pandemic is the intelligent white people given up on the human specie.

    I had one old man telling that he had 12 children. He seems proud of that and for him is this was his legacy to the human specie.

  4. asg70 on Fri, 8th Jun 2018 8:37 am 

    “No matter who’s side your on, that is all pure speculation. Lot’s of ‘will, should, and expected to’”

    How is that different from doomerism?

  5. BobInget on Fri, 8th Jun 2018 9:25 am 

    My power company never bothered to reply to my query about building a solar farm on unused farmland. IOW’s we are ignoring potentially ruinous gasoline and diesel prices.

    As rather simple electric vehicles take hold big-time, cyber-coinage mining, climate change, un-affordable liquid fuels force change to CNG/ electric vehicles.

  6. dave thompson on Fri, 8th Jun 2018 9:49 am 

    Thinking that EV use will lesson the amount of oil being used is silly. Any gasoline that is not burned because an EV came along, the gasoline is shipped else where and still sold to be burned.

  7. penury on Fri, 8th Jun 2018 10:01 am 

    dave is correct, humans will merely find new needs and desires which will continue the strip mining of all resources o the planet until everything is gone. Including humans,

  8. deadly on Fri, 8th Jun 2018 10:40 am 

    I don’t know about electric vehicles everywhere, but I would have a decent electric pickup truck if it would be a more efficient method of transport.

    I have a little Mantis gas-powered tiller for cultivating some parts of the weeded areas. It doesn’t go, the carburetor is gummed up with varnish because of that stupid gasohol.

    Gone to be fixed. I go and buy a brand new lithium-ion battery powered garden tiller and I don’t have to buy gas, it lasts long enough to want to quit using it for the session of cultivating this and that hither and yon in the large garden space.

    I won’t get rid of the gas-powered tiller, but the lithium-ion battery power to provide electricity to operate the new tiller is going to have its place.

    Going to have to burn more coal if you want more electric vehicles on the roads.

    Utilities stand to profit more than oil companies. Nine billion metric ton burned each year here we come.

    Less vehicles are what is needed. One person per car is obscene, pure unadulterated waste.

    I hardly ever do that, there is at least one dog in the passenger seat hanging his head out the window.

  9. onlooker on Fri, 8th Jun 2018 11:04 am 

    Yep Dave and Penury are right- Jevon”s Paradox

  10. Cloggie on Fri, 8th Jun 2018 12:15 pm 

    I don’t know about electric vehicles everywhere, but I would have a decent electric pickup truck if it would be a more efficient method of transport.

  11. JuanP on Fri, 8th Jun 2018 2:04 pm 

    Did we stop burning wood when we started burning coal? No. Did we stop burning coal when we started burning gas and oil? No. Are we using more fossil fuels today than ever before? Yes. Electric vehicles will not keep us from using as much oil as possible.

  12. Outcast_Searcher on Fri, 8th Jun 2018 2:21 pm 

    Baha said: “No matter who’s side your on, that is all pure speculation. Lot’s of ‘will, should, and expected to’ “.

    Fair enough, but at least the article isn’t like so many, going off the deep end and making wild claims that math shows are nonsense. Or pretending like the future is engraved in stone.

    I hadn’t thought about the land use issue, for example. If replacing gas stations doesn’t cut it in crowded (i.e. city) venues, then that could be a real issue.

    It doesn’t mean BEV’s can’t take over — it is just a cost that should be considered.

    In the US where things are more spread out, I can imagine things like rest areas with lots of charging being an option. Or parking areas.

    And inductive charging that is only on if the billing goes to a credit card (or similar option) might well help for apartment dwellers, etc. And such an option could be used for public on-street parking spaces (like metered spaces).

    So there are potentially lots of ways to try to ameliorate land use issues, especially as battery technology improves.

  13. Boat on Sat, 9th Jun 2018 12:39 am 

    How could doomers forget climate change. That will slow consumption. Mother nature will consume land and humans in growing numbers over time.

  14. Boat on Sat, 9th Jun 2018 12:42 am 


    And all those batteries supporting the duck profile from renewables.

  15. Kat C on Sat, 9th Jun 2018 3:57 am 

    We currently have an electric grid in the US that is supplying what electricity we currently use. If we convert all fossil fuel use to electric use and try to make it all produced by using “renewables” we will have to generate much more electricity than we currently use and we will have to upgrade the grid to carry the extra current. The grid needs upgrading just to tread water, not to carry extra load

  16. rockman on Sat, 9th Jun 2018 10:28 am 

    Outcast – So true. One might as easily say “However, by 2030 demand for such vehicles could rise to almost 5pc of annual global sales.” Neither projection can be proven. Often it is obvious that such overly optimistic speculations are based on what someone WANTS to see develop. The danger there is having many folks believe such stories if they see it in print or on the net. It gives them confidence that they need not change their personal choices or support proposed political policies that seriously address the problems.

  17. rockman on Sat, 9th Jun 2018 10:36 am 

    Kat – Great point. So many incorrect economic models ignore such factors. I go back to folks who argue against the big expansion of wind power in Texas. Had we not done so the huge increase in our electricity demand would have driven us to build more NG fired plants. And maybe coal fired plants given our huge reserve base.

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