Electric vehicles (EVs) need recharging stations before we even think of what can make them viable for usage.

An equally relevant issue, however, is their cost, or more precisely the cost of the battery, which exceeds today half the price of the actual car.

A recent two-day Future of Energy summit in Shanghai concluded that lithium-ion battery prices need to drop by more than half, before electric vehicles become competitive with internal combustion cars.

Summit experts said that fuel-powered cars would cost on average $30,000 by 2030, which will only make electric vehicles competitive provided battery costs drop by 67% in the next nine years.

Also, by 2026, it is probable that the cost for lithium-ion battery packs is projected to fall to $100 per kilowatt hour.

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EV growth

A report by the International Energy Agency (IEA), entitled “Global EV Outlook 2017”, said that in 2016, China became the country with the largest electric car stock, with a third of the global total approximately.

“With more than 200 million electric two-wheelers, 3 to 4 million low-speed electric vehicles (LSEVs) and more than 300 thousand electric buses, China is also by far the global leader in the electrification of other transport modes,” said the report.

“The electric car stock has been growing since 2010 and surpassed the 2 million-vehicle threshold in 2016. So far, battery electric vehicle (BEV) uptake has been consistently ahead of the uptake of plug-in hybrid electric vehicles (PHEVs).”

It added there was a good chance that the electric car stock would range between 9 million and 20 million by 2020 and between 40 million and 70 million by 2025,” it said.

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UAE EVs

DEWA successfully installed 100 electric charging stations in different areas of Dubai as part of the Green Charger initiative and announced plans to increase the number of charging stations to 200 in 2018.

Saeed Al Tayer, DEWA’s Managing Director and Chief Executive, said that the Dubai government had previously set the tariff for charging EVs by the green chargers at 29 fills per kilowatt hour (kWh), but until the end of 2019, public charging stations will be free.

Selfdrive.ae, an online car rental portal, became the first to offer electric cars in Dubai at introductory price of AED 5 per hour ($1.36), with a minimum billing cycle of 24 hours and a range of 250 kilometres per day.

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Cost declines

Research, development and deployment (RD&D) and mass production prospects are leading to rapid battery cost declines and increases in energy density, according to IEA.

According to the US Department of Energy, increasing production volumes from 25,000 units to 100,000 units for a 100 kWh battery pack allows a cut in battery pack production costs per kWh by 13%.

Other studies confirm that volumes of more than 200,000 battery packs per year are estimated to cost $200/kWh, compared to $300/kWh estimated for production volumes between 10,000 and 30,000 units.

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Subsidy programs

In Japan, a new subsidy scheme was introduced in 2016, granting progressively higher subsidies as the electric range of the model increases.

For a Nissan Leaf with a 30kWh battery, the purchase incentive amounts to $3,000.

As of 2017, Denmark will introduce a purchase tax rebate on electric cars based on battery capacity of $225/kWh, applicable to a maximum of 45kWh, representing $10,000.

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Electric buses (EBs)

According to IEA, the global battery-powered electric bus stock grew to 345,000 vehicles approximately in 2016, double the number in 2015 and 95% of which are in China.

“Shenzhen has also set the goal of having a 100% electric bus fleet in 2017,” said IEA.

Europe accounted for 1,273 vehicles in the global electric bus stock in 2016.

The public transport operator of the city of Paris opened its first electric bus line in 2016, and getting ready for widespread electrification planning to replace 80% of its existing bus fleet with electric buses by 2025, adding roughly 4,000 electric buses the next eight years.

As for the United States, it accounted for 200 EBs.