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Bloomberg release EV outlook

Posted on 18 August, 2017

By 2040, 54 per cent of new car sales and 33 per cent of the global car fleet will be electric, according to a report released by Bloomberg New Energy Finance earlier this week. The Electric Vehicle Outlook report is published by Bloomberg each year, and aims to analyse and predict global trends of EV adoption. The report is ambitious in its scope, providing a look at how economics, technology, policy, and consumer behaviour will impact EV adoption between now and 2040. The report’s key findings revise predictions of EV uptake upwards on the previous year’s predictions. Bloomberg attribute this to battery costs falling faster than expected and rising commitments from automakers. While a mass EV uptake isn’t expected for some time, the report predicts it will come within the next 10-15 years. “…by 2029 most [EVs] will have reached parity with comparable internal combustion engine (ICE) vehicles. Real mass market adoption only starts after this point in most markets” the report says, though it also predicts that some EVs will become price competitive on an unsubsidised basis by 2025. The US Federal Government currently offers financial incentives to encourage EV uptake while the New Zealand government is currently involved in projects to subsidise and encourage the embrace of EV technology. In September 2016, the Road User Charges exemption for light electric vehicles was extended until 31 December 2021, and the government has committed $1 million annually to a nationwide electric vehicle information and promotion campaign over the next five years. A $6 million per year Low Emission Vehicles Contestable Fund has also been established, awarding funding for 15 projects in 2017. The Bloomberg report also predicts that battery electric vehicles (EV) will make up the majority of EV sales after 2030, mostly replacing plug-in hybrid electric vehicles (PHEV). This is currently the case in New Zealand, with EVs making up around 78% of total light EV and PHEV registrations. Fossil fuel demand will be displaced by a growing fleet of EVs if the above predictions prove accurate. With the predicted 33 per cent of cars on the road by 2040 being EVs, around 8 million barrels of transportation fuel could be displaced per day. New Zealand’s small level of carbon emissions relative to the rest of the world makes it difficult for the country to make meaningful contributions to curbing global climate change. If the predictions of the Bloomberg report come to pass it would be a positive development for New Zealand, being largely at the whim of the rest of the world’s decisions related to fossil fuel use and emissions policy. The EV market in New Zealand also stands to benefit from increased global uptake, as economies of scale bring prices down. The government has ambitious plans to reach 64,000 EVs on the road by 2021, with the total New Zealand EV fleet currently sitting at about 4,200 cars.