Are Electric Cars a Cost Effective Invention?

With the recent government stimulus spending, automobile manufacturers are finding it attractive to explore new methods of personal propulsion. One of these methods is through the use of all-electric cars such as the Nissan Leaf. The question remains: is it cost effective to operate these cars without government stimulus? Is there any market scenario in which electric cars are comparable to or better than ICE (internal combustion engine) automobiles? The simple answer is yes, but it depends greatly upon the electric power grid currently in place. It is also important to note that electric cars require some lifestyle changes.

Electric cars are cost effective in France. There, a spirited 1970s nuclear program has the country producing over 90% of its power from more than 50 nuclear plants, and a large majority of the rest from hydroelectric stations. France exports surplus electricity to other European nations for over 30 billion Euros per year. It has the surplus power grid infrastructure to support the increased electrical demand from electric cars.

Electric cars are not cost effective in the United States. The United States does not export a significant amount of electricity, and increased demand here would cause power prices to rise. Our electrical grid is fueled by about 50% coal, 25 percent natural gas, and perhaps 15-20% nuclear power. The nuclear industry, which has the potential to supply cheap, sustainable energy in large quantities, has been beaten down here by extremely rigid regulation (stemming from incidents like Chernobyl and Three Mile Island).

This brings into question the second argument regarding electric cars: that they reduce pollution. Pollution is also a factor of the electrical system currently in place. The Nissan Leaf advertises that it has no tailpipe and no emissions, but the emissions are coming from our power plants. The main advantage here is that those emissions are centralized, easy to control, and can be located away from large population sectors.

Note that electric cars require a different usage mentality than ICE automobiles. Even a slow gasoline pump only takes several minutes to fill up the tank of an average car. However, the “fast charge” times of electric cars are usually no faster than 6 hours, and the realistic range typically is no better than 100 miles in summer and 75 or so in winter. Road trips are not yet an option with the current offerings of electric cars, because batteries are an extremely costly way to store electricity.