Page 58 - European Energy Innovation - Winter 2014
P. 58
Winter 2014 European Energy Innovation


EV adoption calls for political

Strong deflation of electric vehicles cost justifies the need for state support and makes it even a necessity
in the early technology adaptation phase.

By Bert Witkamp, Secretary General, AVERE,

SUMMARY achieve the necessary technology One thing is certain, for a mass
Electric vehicles (EV’s) have the improvements and reduce scale introduction of electric
potential to become a major costs. Support is needed and vehicles we need to get the cost
alternative drivetrain option for can be provided in different down significantly. However
passenger cars. The advantages ways. Government leadership the first question is whether
for consumers and society are and deployment support will consumers like EV’s and will buy
considerable promising a more determine whether the Valley of them when costs are comparable
enjoyable driving experience, Death can be crossed safely. with the current internal
cleaner and healthier urban combustion engine (ICE) cars.
environments and drastically DEFLATION IS SLOWING
of fossil fuel import dependence POSTPONING PURCHASE CONSUMERS LIKE EV’S
and the capital outflow which DECISIONS Authorities worldwide love
is threatening our political Economic wisdom says that them! In the USA, China, Japan,
independence and the potential deflation is one of the greatest Western-Europa to name a few,
for building a new high-tech dangers for our economy. People authorities are promoting the
innovative industry, are other will postpone purchasing while development of EV technologies
important benefits. However waiting for lower prices, creating a and promoting market
EV’s are still in the very early downward circle of lower consumer introduction by giving incentives.
phase of production and market spending. I doubt the generality This is easy to understand, in
development. Governmental of this statement, for example will all these countries EV’s have a
support is needed to reduce the we eat less because food is getting large potential, when deployed
risks accompanied with early cheaper or drive less because on a large scale, to reduce
commitments of consumers and gasoline gets cheaper? the dependence of fossil fuel
industry. These are essential to imports, to improve the air
For consumer goods which are quality and sound levels in
Bert Witkamp evolving very fast, deflation has, urban areas, and to reduce CO2
for decades, been the name emissions in order to combat
of the game, but this does not climate change. They also see
seem to reduce the appetite this innovative technology as
of consumers to invest in the potential for their industries and
latest technology, knowing very look at the possibility of linking
well that what they buy will be EV’s and smart grids to develop
outdated in one or two years. an “internet of (clean!) energy”.
In the case of mobile phones, Consumers who are familiar with
which now have become EV’s love them and EV’s score
smart phones, price are much very high in consumer satisfaction
lower when looking at like for surveys. In Norway and California,
like functionality. However, where EV’s are financially
replacement happens very competitive with ICE vehicles, the
quickly because people would sales increase in double or triple
rather pay more in order to get digits every year. In Norway EV
the new functionalities. sales represent 15% of new car
sales and this despite the fact that
What about the effect of deflation only a few models are available
for electric vehicles sales? on the market.
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