A couple of weeks ago, we had a brief discussion about the world’s premature rush to electrification, and I thought to share some figures.
This is Volvo’s life cycle analysis report for its 2024 XC40 recharge EV. Other manufacturers are not much different:
volvo-cars-lca-report-xc40.pdf (volvocars.com)As the graph below shows, for the petrol version, bulk of the greenhouse emission occurs during the usage phase, whereas for the EV it occurs mainly during the production phase. It is interesting that the difference between EV and ICE over their life cycle is just 4 Tonnes of CO2 (58 vs 54). Of course, this depends on the source of energy used to power up the EV. Let's be real, the world is not going to be powered purely by the wind energy any time in the near future. At best, the world can catch up with EU28 basket of energy. In that case, the difference is 13 Tonnes of CO2 (58 vs 45).
Now, I asked my wife how much does it cost to capture and store 1 ton of CO2. She was an academic in this area for many years and is now a manager in a carbon capture company. Her answer was: the technology is still very young, and a lot of research is still going on. But currently it costs anywhere between $50 - $1000 per ton of CO2. The $50 figure is for the best technology available and in-situ capture of CO2 (e.g. from a factory chimney), and the $1000 figure is for the least efficient tech and when it's not possible to capture CO2 at the source (e.g. a car exhaust).
So, it costs between $650 and $13000 to capture and store that extra 13-ton CO2 released by a patrol car compared to an EV over its entire lifetime. My question is: governments appear to spend a lot more than that $650 figure to subsidies EVs. Isn't it better to invest that money in carbon capture technology which is currently very young as opposed to milking taxpayers to fill Elon Musk's pocket?
To put that in perspective, let's have a look at some of the EV subsidies.
In the Netherlands, where we currently live, an XC40 EV and ICE are roughly the same price to purchase. To achieve this, the Dutch government pays:
- Roughly 10,000 euros of tax subsidy on the EV version.
- Roughly 10,000 euros of subsidy in annual registration fees over 10 years on the EV version.
- Roughly 2,000 - 3,000 euros of grant as an incentive to buy the EV.
So, overall, taxpayers pay around 22000 euros to subsidize the EV version. This is around $35000.
My question is why the government pays $35,000 in EV subsidy on a car as opposed to spending $650-13000 on carbon capture technology. It seems like a no brainer to me.
Now, let's look at the break-even time frame. According to the same life cycle analysis report by Volvo:
For an EU28 driver, it takes just under 100,000 km of drive before the EV Co2 pollution breaks even with that of the petrol version. For someone an average global citizen that figure is around 150,000 km.
Most of us dump the car well before 150,000 Km. But hey globally, the average life of a car is around 200,000 Km.
So, until we squeeze every mile of life out of an EV we won't actually get much of reduced pollution.
Now let's look at the financials for the customer, assuming there was no government subsidy.
The price difference between the two versions is around 10,0000 euros.
Let's do the math:
* For the petrol car, assuming 8litre/100km consumption and 2.30 euro/litre petrol price, it costs ~18 euros per 100Km.
* For the EV, with the official 18Kwh/100Km figure and 0.31 euro cents/kwh electricity price, it costs ~6 euros per 100Km.
So, the owner has to drive the car for around 100,000 Km to just earn back the initial extra purchase cost - in the absence of any government incentive. Again, that doesn't seem very exciting for most owners.
So, I think this whole electrification campaign was rushed. In the next decade, Sodium batteries, hydrogen fuel, or perhaps another tech may very well make the current technology obsolete and bring in real savings both in terms of $ and Co2 emission. But at the moment, the numbers don't really add up.
To me, this whole thing seems more like a strategic war between West and East, where the west is trying to gain energy dominance, and kick ME and Russia out.
(20min delay)