Mass adoption of EVs inevitable: Z Energy

Z Energy’s house view is that the global mass adoption of electric vehicles (EVs) is inevitable.

This poses a future disruptive threat to the use of fossil fuels in transportation.

The company underscores though that the timing is difficult to predict given uncertainties associated with technological breakthroughs and the scope of regulatory intervention.

Within this uncertainty though it certainly sees New Zealand as being well placed to be part of the EV revolution given its relatively high renewable electricity base.

In this context it says the most transformational scenario would be the exponential uptake of electric powertrains in electric light duty vehicle fleets from EVs and plug-in hybrid electric vehicles (PHEVs) to hybrid vehicles (HEVs)
from 2020.

The company sets out two scenarios for how New Zealand’s energy demand may evolve in coming years:

• The ‘Kayak’ future, which has characteristics such as “individualistic, volatile, unconstrained, autonomous” and would see population and energy growth adding 0.4% to energy demand by 2030, with an increase in kilometres driven, 33,000 extra EVs and an 11% reduction in energy demand due to efficiencies.
• The ‘Waka’ future, with characteristics such as “for the greater public good, interdependence, coordination and harmony”, would see energy demand reducing by 0.4% by 2010 in the face of population and energy growth, a decline in kilometres driven by 10%, and a surge in EVs on the road by 475,000.

Under the Kayak scenario economic growth and population growth would be faster, while the Waka scenario would see a weaker track of economic

growth as some energy and carbon intensive industries exit New Zealand.

The carbon price would reach $18 a tonne under Kayak, and $60/tonne under Waka.

“Z is monitoring the two main signposts to watch for as tipping points for exponential EV uptake – regulatory intervention and battery development,” it says. “Z is also maintaining a watching brief on speculative technology that could see a more aggressive reduction in demand for fossil fuels over the long-term horizon – autonomous vehicles and electric powertrain adoption in the heavy vehicle task.”

For the moment though – with no upstream interest in fossil fuels – Z Energy says it will continue to look for opportunities to meet the needs of customers as the transport energy landscape changes.