WEBVTT 00:00:00.000 --> 00:00:01.446 align:middle line:90% 00:00:01.446 --> 00:00:04.338 align:middle line:90% [SQUEAKING][RUSTLING][CLICKING] 00:00:04.338 --> 00:00:09.640 align:middle line:90% 00:00:09.640 --> 00:00:11.370 align:middle line:90% DAVID HSU: Hi, everyone. 00:00:11.370 --> 00:00:15.410 align:middle line:84% Welcome back to the MIT Lecture Series on Urban Energy Systems 00:00:15.410 --> 00:00:16.580 align:middle line:90% and Policy. 00:00:16.580 --> 00:00:19.100 align:middle line:84% Today, we're going to be talking about cities 00:00:19.100 --> 00:00:22.760 align:middle line:84% and personal transportation, the first of a number of lectures 00:00:22.760 --> 00:00:26.210 align:middle line:84% on transportation and energy systems in cities. 00:00:26.210 --> 00:00:28.400 align:middle line:84% Again, if you've been watching these lectures, 00:00:28.400 --> 00:00:29.780 align:middle line:90% my name is David Hsu. 00:00:29.780 --> 00:00:32.600 align:middle line:84% I'm an associate professor of Urban Studies and Planning 00:00:32.600 --> 00:00:33.800 align:middle line:90% at MIT. 00:00:33.800 --> 00:00:36.980 align:middle line:84% Today, we're going to talk about energy and personal transport. 00:00:36.980 --> 00:00:39.590 align:middle line:84% Again, the materials assigned for the lecture today, 00:00:39.590 --> 00:00:44.018 align:middle line:84% a lot of them are available online if you search around. 00:00:44.018 --> 00:00:45.560 align:middle line:84% And the main questions I want to talk 00:00:45.560 --> 00:00:49.730 align:middle line:84% about today are, why is personal mobility important in terms 00:00:49.730 --> 00:00:50.450 align:middle line:90% of energy. 00:00:50.450 --> 00:00:52.285 align:middle line:84% We're going to talk about why or whether 00:00:52.285 --> 00:00:53.660 align:middle line:84% or not electric vehicles are more 00:00:53.660 --> 00:00:56.810 align:middle line:84% efficient than internal combustion engine cars. 00:00:56.810 --> 00:00:58.580 align:middle line:84% We're going to ask by how much, and is 00:00:58.580 --> 00:01:01.010 align:middle line:90% this the same in all places. 00:01:01.010 --> 00:01:03.230 align:middle line:84% We're going to talk about other kinds of vehicles 00:01:03.230 --> 00:01:06.830 align:middle line:84% such as bicycles, electric bicycles, and scooters. 00:01:06.830 --> 00:01:09.920 align:middle line:84% And one little chapter of our talk today 00:01:09.920 --> 00:01:12.260 align:middle line:84% will be on what policies can be used 00:01:12.260 --> 00:01:14.450 align:middle line:84% to move the international vehicle market 00:01:14.450 --> 00:01:16.790 align:middle line:84% and to sway international automakers. 00:01:16.790 --> 00:01:19.790 align:middle line:84% One answer is what Mary Nichols and the California Air 00:01:19.790 --> 00:01:22.423 align:middle line:84% Resources Board have done in California. 00:01:22.423 --> 00:01:24.590 align:middle line:84% And we'll talk a little bit about what the Inflation 00:01:24.590 --> 00:01:27.590 align:middle line:84% Reduction Act does to encourage electric vehicles 00:01:27.590 --> 00:01:29.813 align:middle line:84% and how its policy incentives work. 00:01:29.813 --> 00:01:31.730 align:middle line:84% And next week, we'll start talking about, what 00:01:31.730 --> 00:01:34.220 align:middle line:90% about larger infrastructure? 00:01:34.220 --> 00:01:36.560 align:middle line:84% How do roads, fueling infrastructure 00:01:36.560 --> 00:01:41.180 align:middle line:84% such as oil and electric grid, play into the energy 00:01:41.180 --> 00:01:44.410 align:middle line:90% use of transportation? 00:01:44.410 --> 00:01:46.540 align:middle line:84% And so we'll just start by talking about why 00:01:46.540 --> 00:01:48.550 align:middle line:90% mobility is so important. 00:01:48.550 --> 00:01:52.250 align:middle line:84% Mobility is, essentially, a superpower. 00:01:52.250 --> 00:01:57.050 align:middle line:84% Mobility gives us the ability to access jobs, housing, services, 00:01:57.050 --> 00:01:58.190 align:middle line:90% and leisure. 00:01:58.190 --> 00:01:59.960 align:middle line:84% The more mobility we have, the more 00:01:59.960 --> 00:02:02.030 align:middle line:84% ability we have to dis-aggregate all 00:02:02.030 --> 00:02:04.160 align:middle line:84% of these things we want to access. 00:02:04.160 --> 00:02:07.730 align:middle line:84% If you live in a dense, compact neighborhood, your job, 00:02:07.730 --> 00:02:10.130 align:middle line:84% housing, and services could be in the same place. 00:02:10.130 --> 00:02:12.980 align:middle line:84% But you may want to travel around the city, hopefully 00:02:12.980 --> 00:02:16.640 align:middle line:84% by easily-accessible modes of transportation. 00:02:16.640 --> 00:02:19.550 align:middle line:84% Or if you live in a place that has a very low population 00:02:19.550 --> 00:02:23.190 align:middle line:84% density, your job, your housing, your services, 00:02:23.190 --> 00:02:25.670 align:middle line:84% your leisure opportunities may be far-flung, 00:02:25.670 --> 00:02:29.780 align:middle line:90% like in many US cities. 00:02:29.780 --> 00:02:32.780 align:middle line:84% But it's also particularly important 00:02:32.780 --> 00:02:35.870 align:middle line:84% to note that enabling mobility in cities 00:02:35.870 --> 00:02:38.840 align:middle line:84% is particularly hard due to population density. 00:02:38.840 --> 00:02:41.120 align:middle line:84% If you want to build good infrastructure 00:02:41.120 --> 00:02:44.180 align:middle line:84% to enable mobility, you have to plan that. 00:02:44.180 --> 00:02:46.490 align:middle line:84% If you are trying to retrofit cities 00:02:46.490 --> 00:02:49.160 align:middle line:84% with new infrastructure that enables mobility 00:02:49.160 --> 00:02:51.860 align:middle line:84% without inducing, let's say, more traffic or more 00:02:51.860 --> 00:02:53.780 align:middle line:84% congestion, you also have to think 00:02:53.780 --> 00:02:57.500 align:middle line:84% very hard about how to retrofit cities that already have 00:02:57.500 --> 00:03:00.980 align:middle line:90% a certain level of population. 00:03:00.980 --> 00:03:03.190 align:middle line:84% And so there's a nice way to think about the carbon 00:03:03.190 --> 00:03:05.590 align:middle line:84% emissions from personal transportation. 00:03:05.590 --> 00:03:07.900 align:middle line:84% Daniel Sperling at UC Davis, also 00:03:07.900 --> 00:03:10.000 align:middle line:84% a member of the California Air Resources Board, 00:03:10.000 --> 00:03:13.520 align:middle line:84% has a nice little identity, or a nice way to think about this. 00:03:13.520 --> 00:03:15.580 align:middle line:84% It's an identity that goes like this. 00:03:15.580 --> 00:03:19.570 align:middle line:84% You measure mobility in terms of vehicle miles traveled. 00:03:19.570 --> 00:03:22.330 align:middle line:84% That's essentially indication of demand. 00:03:22.330 --> 00:03:24.950 align:middle line:84% You multiply times vehicle energy efficiency, 00:03:24.950 --> 00:03:28.180 align:middle line:84% which is measured in terms of energy used per vehicle mile. 00:03:28.180 --> 00:03:32.410 align:middle line:84% That's a measure of how efficient the technology is. 00:03:32.410 --> 00:03:34.270 align:middle line:84% And you multiply times the carbon intensity 00:03:34.270 --> 00:03:36.790 align:middle line:84% of the energy going in, measuring, essentially, 00:03:36.790 --> 00:03:38.920 align:middle line:84% the carbon intensity of the fuel going in, which 00:03:38.920 --> 00:03:41.410 align:middle line:84% is measured in terms of greenhouse gases per unit 00:03:41.410 --> 00:03:42.540 align:middle line:90% of energy. 00:03:42.540 --> 00:03:44.540 align:middle line:84% If you multiply all these three things together, 00:03:44.540 --> 00:03:46.360 align:middle line:84% you get greenhouse gas emissions. 00:03:46.360 --> 00:03:49.150 align:middle line:84% But this is a way of decomposing greenhouse gas emissions 00:03:49.150 --> 00:03:51.850 align:middle line:84% to say that it matters how much we demand in the first place, 00:03:51.850 --> 00:03:53.560 align:middle line:90% in terms of mobility. 00:03:53.560 --> 00:03:55.690 align:middle line:84% It matters how efficient our technology 00:03:55.690 --> 00:04:01.880 align:middle line:84% is, in terms of turning energy into transportation. 00:04:01.880 --> 00:04:03.530 align:middle line:90% And then it matters how much-- 00:04:03.530 --> 00:04:06.680 align:middle line:84% what the fuel intensity of our energy going in is. 00:04:06.680 --> 00:04:08.720 align:middle line:84% In other words, how much emissions 00:04:08.720 --> 00:04:12.020 align:middle line:84% do we incur to create the fuels for the technology 00:04:12.020 --> 00:04:15.170 align:middle line:90% to satisfy our demand? 00:04:15.170 --> 00:04:18.730 align:middle line:84% And so another way to answer what the importance of energy 00:04:18.730 --> 00:04:21.250 align:middle line:84% is, or why energy and transportation are linked, 00:04:21.250 --> 00:04:24.820 align:middle line:84% is to go back to our helpful Sankey diagram. 00:04:24.820 --> 00:04:27.940 align:middle line:84% I think I showed you this in a few lectures past. 00:04:27.940 --> 00:04:32.140 align:middle line:84% This is the estimated US energy consumption in 2021. 00:04:32.140 --> 00:04:37.090 align:middle line:84% Roughly 97 quads, which are quadrillion BTUs. 00:04:37.090 --> 00:04:39.940 align:middle line:84% It's a helpful number, because the US economy has roughly 00:04:39.940 --> 00:04:42.220 align:middle line:90% been at around 100 quads. 00:04:42.220 --> 00:04:46.240 align:middle line:84% So when you look at the source energy used on the left, 00:04:46.240 --> 00:04:49.030 align:middle line:84% over here, you can think of most of these numbers 00:04:49.030 --> 00:04:52.180 align:middle line:84% as roughly within about 3% of the percentage 00:04:52.180 --> 00:04:55.870 align:middle line:84% of the total source energy, or primary energy for the US 00:04:55.870 --> 00:04:56.830 align:middle line:90% economy. 00:04:56.830 --> 00:04:59.800 align:middle line:84% When you look at these final sectors of use, 00:04:59.800 --> 00:05:03.250 align:middle line:84% you can get a sense of how much energy 00:05:03.250 --> 00:05:07.570 align:middle line:84% is converted from the primary sources into final consumption. 00:05:07.570 --> 00:05:09.700 align:middle line:84% And of course, we have intermediate steps 00:05:09.700 --> 00:05:12.790 align:middle line:84% like generating electricity for lighting. 00:05:12.790 --> 00:05:14.560 align:middle line:84% At the same time, we also have this kind 00:05:14.560 --> 00:05:17.950 align:middle line:84% of gray bar, which breaks down the total amount of energy 00:05:17.950 --> 00:05:21.610 align:middle line:84% that's rejected through heat loss versus how much is 00:05:21.610 --> 00:05:24.130 align:middle line:84% actually converted into the services we want. 00:05:24.130 --> 00:05:27.220 align:middle line:84% So energy services are the services or final consumption 00:05:27.220 --> 00:05:28.120 align:middle line:90% we want. 00:05:28.120 --> 00:05:31.300 align:middle line:84% In order to do that, we actually have some rejected energy, 00:05:31.300 --> 00:05:33.310 align:middle line:84% mostly energy that's lost as heat 00:05:33.310 --> 00:05:35.920 align:middle line:90% as we combust fossil fuels. 00:05:35.920 --> 00:05:39.250 align:middle line:84% And so just to understand again, to break down 00:05:39.250 --> 00:05:41.080 align:middle line:84% the numbers on the Sankey diagram 00:05:41.080 --> 00:05:44.230 align:middle line:84% and understand why energy is so important for transportation, 00:05:44.230 --> 00:05:46.360 align:middle line:84% you can see that the vast majority of petroleum 00:05:46.360 --> 00:05:51.340 align:middle line:84% here goes towards-- about maybe 2/3 of it or 3/4 of it 00:05:51.340 --> 00:05:55.870 align:middle line:84% goes to transportation, 1/4 of it goes to industrial uses. 00:05:55.870 --> 00:05:57.940 align:middle line:84% And then you can see that of the energy that 00:05:57.940 --> 00:05:59.590 align:middle line:84% went to transportation, a lot of it 00:05:59.590 --> 00:06:03.820 align:middle line:84% gets rejected as heat, basically out of the tailpipe of the car, 00:06:03.820 --> 00:06:05.980 align:middle line:84% or out of the smokestack of a power plant 00:06:05.980 --> 00:06:07.540 align:middle line:90% if we're generating electricity. 00:06:07.540 --> 00:06:09.340 align:middle line:84% And so actually, a very small fraction 00:06:09.340 --> 00:06:11.980 align:middle line:84% of the energy for transportation is actually 00:06:11.980 --> 00:06:15.140 align:middle line:84% the service we want of moving people and goods. 00:06:15.140 --> 00:06:19.090 align:middle line:84% So we want to look at the percentages of how this plays 00:06:19.090 --> 00:06:20.680 align:middle line:90% out in terms of transportation. 00:06:20.680 --> 00:06:22.900 align:middle line:84% You can see the percentages for transportation 00:06:22.900 --> 00:06:24.010 align:middle line:90% are relatively unique. 00:06:24.010 --> 00:06:26.200 align:middle line:84% And we'll calculate some of those directly 00:06:26.200 --> 00:06:29.780 align:middle line:84% using the numbers off the Sankey diagram. 00:06:29.780 --> 00:06:32.470 align:middle line:84% And so if you are seeing this for the first time, 00:06:32.470 --> 00:06:35.400 align:middle line:84% I encourage you to flip back and forth between these two slides 00:06:35.400 --> 00:06:37.900 align:middle line:84% and spend some time figuring out where the blue numbers come 00:06:37.900 --> 00:06:41.210 align:middle line:84% from and how we do these calculations. 00:06:41.210 --> 00:06:43.370 align:middle line:84% If you want to see how much petroleum 00:06:43.370 --> 00:06:46.400 align:middle line:84% is of the total amount of energy in the economy, 00:06:46.400 --> 00:06:51.710 align:middle line:84% it's 35.1 quads divided by 97.3 quads total. 00:06:51.710 --> 00:06:57.860 align:middle line:84% It means that petroleum is 36% of all US primary energy. 00:06:57.860 --> 00:07:01.280 align:middle line:84% If you want to understand the percentages of petroleum used 00:07:01.280 --> 00:07:05.150 align:middle line:84% in transportation, it's about 24.3 quads 00:07:05.150 --> 00:07:08.750 align:middle line:84% out of 35.1 quads of petroleum total, 00:07:08.750 --> 00:07:12.770 align:middle line:84% meaning that, essentially, about 70% of all petroleum 00:07:12.770 --> 00:07:14.270 align:middle line:90% is used for transportation. 00:07:14.270 --> 00:07:16.610 align:middle line:84% As you can see from our Sankey diagram-- 00:07:16.610 --> 00:07:17.900 align:middle line:90% I'll flip back here. 00:07:17.900 --> 00:07:21.170 align:middle line:84% You can see that's fairly unique among all the energy sources 00:07:21.170 --> 00:07:22.430 align:middle line:90% here on the left. 00:07:22.430 --> 00:07:24.080 align:middle line:84% Now, we know that we've been talking 00:07:24.080 --> 00:07:28.950 align:middle line:84% about the energy implications of petroleum for many years. 00:07:28.950 --> 00:07:34.220 align:middle line:84% Not only in terms of our reliance on overseas imports, 00:07:34.220 --> 00:07:37.160 align:middle line:84% but more recently, in terms of the greenhouse gas emissions 00:07:37.160 --> 00:07:38.090 align:middle line:90% implications. 00:07:38.090 --> 00:07:40.400 align:middle line:84% And also in terms of energy security. 00:07:40.400 --> 00:07:42.680 align:middle line:84% Where do we get this energy from? 00:07:42.680 --> 00:07:44.180 align:middle line:84% And, of course, a more recent story 00:07:44.180 --> 00:07:46.430 align:middle line:84% is that the US has become one of the largest petroleum 00:07:46.430 --> 00:07:47.730 align:middle line:90% producers in the world also. 00:07:47.730 --> 00:07:52.080 align:middle line:84% So we are also contributing petroleum to the world, 00:07:52.080 --> 00:07:55.610 align:middle line:84% which has definite implications for our production 00:07:55.610 --> 00:07:58.190 align:middle line:84% and how much greenhouse gas emissions we're exporting 00:07:58.190 --> 00:08:00.270 align:middle line:90% to the rest of the world. 00:08:00.270 --> 00:08:03.420 align:middle line:84% If you look at the total amount of energy in transportation, 00:08:03.420 --> 00:08:08.870 align:middle line:84% you can see that we use about 26.9 quads of energy, divided 00:08:08.870 --> 00:08:13.160 align:middle line:84% by 73.7 quads of all sector energy use. 00:08:13.160 --> 00:08:16.250 align:middle line:84% It means that transportation is one of the largest 00:08:16.250 --> 00:08:17.300 align:middle line:90% energy-using sectors. 00:08:17.300 --> 00:08:22.750 align:middle line:84% It represents 36% of all energy use. 00:08:22.750 --> 00:08:25.060 align:middle line:84% And in terms of energy services, we only 00:08:25.060 --> 00:08:30.400 align:middle line:84% get 5.65 quads out of 26.9 quads input energy, 00:08:30.400 --> 00:08:32.710 align:middle line:84% meaning that only 21% of the energy that we 00:08:32.710 --> 00:08:36.370 align:middle line:84% put into transportation becomes the final service we want, 00:08:36.370 --> 00:08:38.679 align:middle line:84% the actual mobility or the actual movement 00:08:38.679 --> 00:08:40.490 align:middle line:90% of goods and services. 00:08:40.490 --> 00:08:43.630 align:middle line:84% And so, as I pointed out before, the rejected energy, 00:08:43.630 --> 00:08:45.220 align:middle line:84% that's all mostly heat energy that 00:08:45.220 --> 00:08:48.370 align:middle line:84% goes out of the tailpipe of internal combustion engines. 00:08:48.370 --> 00:08:52.390 align:middle line:84% 21.2 quads divided by 26.9 quads means that we basically 00:08:52.390 --> 00:08:56.410 align:middle line:84% wasted 78% of our energy inputs into transportation. 00:08:56.410 --> 00:09:00.430 align:middle line:84% And so thinking back to the Sperling's identity, 00:09:00.430 --> 00:09:06.130 align:middle line:84% weighing demand and efficiency of vehicles versus the carbon 00:09:06.130 --> 00:09:08.980 align:middle line:84% intensity of energy, we can use all these percentages 00:09:08.980 --> 00:09:12.290 align:middle line:84% to think about how do we perhaps reduce our demand, 00:09:12.290 --> 00:09:15.160 align:middle line:84% how do we perhaps increase the efficiency of our vehicles, 00:09:15.160 --> 00:09:19.270 align:middle line:84% and how do we reduce the carbon intensity of our fuels. 00:09:19.270 --> 00:09:22.320 align:middle line:84% So this is why it's exciting to talk about electrification. 00:09:22.320 --> 00:09:24.810 align:middle line:84% And this is why I'd start with electrification or building 00:09:24.810 --> 00:09:26.970 align:middle line:84% the energy system from the bottom-up. 00:09:26.970 --> 00:09:30.330 align:middle line:84% When I started teaching this class around 2017, 00:09:30.330 --> 00:09:33.870 align:middle line:84% The Economist had this cover on the left declaring 00:09:33.870 --> 00:09:36.600 align:middle line:84% the internal combustion engine "Roadkill." 00:09:36.600 --> 00:09:39.060 align:middle line:84% And one of the figures they used to support this 00:09:39.060 --> 00:09:42.510 align:middle line:84% were the estimates showing that all of these major forecasting 00:09:42.510 --> 00:09:46.200 align:middle line:84% organizations, Bloomberg New Energy Finance, OPEC, 00:09:46.200 --> 00:09:50.850 align:middle line:84% the Organization of Petroleum Exporting Countries, 00:09:50.850 --> 00:09:53.160 align:middle line:84% and ExxonMobil, had all increased 00:09:53.160 --> 00:09:56.095 align:middle line:84% their electric vehicle sales forecasts. 00:09:56.095 --> 00:09:57.720 align:middle line:84% Of course, Bloomberg New Energy Finance 00:09:57.720 --> 00:10:00.440 align:middle line:84% has been perhaps the most aggressive forecast, 00:10:00.440 --> 00:10:02.190 align:middle line:84% or most aggressive forecast for the number 00:10:02.190 --> 00:10:03.120 align:middle line:90% of electric vehicles. 00:10:03.120 --> 00:10:06.570 align:middle line:84% But you can see between 2016 and 2017, 00:10:06.570 --> 00:10:11.640 align:middle line:84% both OPEC and ExxonMobil, two entities that probably are not 00:10:11.640 --> 00:10:13.800 align:middle line:84% welcoming the adoption of electric vehicles, 00:10:13.800 --> 00:10:17.690 align:middle line:84% also increased their sales forecasts. 00:10:17.690 --> 00:10:20.910 align:middle line:84% If we look more recently at Bloomberg New Energy Finance's 00:10:20.910 --> 00:10:23.460 align:middle line:84% electric vehicle outlook in 2022, 00:10:23.460 --> 00:10:25.410 align:middle line:84% you can see that it further increased 00:10:25.410 --> 00:10:28.380 align:middle line:84% their economic transition scenario, or their estimates 00:10:28.380 --> 00:10:32.440 align:middle line:84% of the global long-term passenger EV fleet by market. 00:10:32.440 --> 00:10:34.470 align:middle line:84% And you can see that their estimates are now up 00:10:34.470 --> 00:10:38.800 align:middle line:84% to around $700 billion electric vehicles, when a few years ago, 00:10:38.800 --> 00:10:40.630 align:middle line:90% they were at $500 million. 00:10:40.630 --> 00:10:43.170 align:middle line:84% And if you look at their forecasts of what 00:10:43.170 --> 00:10:45.990 align:middle line:84% the global passenger vehicle fleet by drivetrain 00:10:45.990 --> 00:10:48.670 align:middle line:84% will look like on the right-hand side, 00:10:48.670 --> 00:10:50.990 align:middle line:84% they show that internal combustion engines, 00:10:50.990 --> 00:10:55.810 align:middle line:84% this gray block, will decrease-- will increase slowly to 2020 00:10:55.810 --> 00:10:59.650 align:middle line:84% or so, and then start decreasing pretty much around now. 00:10:59.650 --> 00:11:02.890 align:middle line:84% They show that hybrid vehicles will increase, 00:11:02.890 --> 00:11:09.340 align:middle line:84% but be a relatively small share of our future drivetrain fleet. 00:11:09.340 --> 00:11:13.570 align:middle line:84% Battery plug-in hybrids, and fuel cell vehicles, barely. 00:11:13.570 --> 00:11:14.800 align:middle line:90% You can see them here. 00:11:14.800 --> 00:11:17.560 align:middle line:84% But the majority of vehicle growth 00:11:17.560 --> 00:11:19.300 align:middle line:90% will be in battery electric. 00:11:19.300 --> 00:11:23.020 align:middle line:84% Until by 2040, there will be as many battery electric vehicles 00:11:23.020 --> 00:11:26.710 align:middle line:84% as there are combustion engine vehicles. 00:11:26.710 --> 00:11:29.770 align:middle line:84% And this, of course, depends on Bloomberg New Energy Finance's 00:11:29.770 --> 00:11:33.970 align:middle line:84% forecast and some of their modeling. 00:11:33.970 --> 00:11:35.800 align:middle line:84% But it's also worth pointing out, 00:11:35.800 --> 00:11:39.850 align:middle line:84% and I like to point this out every year since 2016 or 2017, 00:11:39.850 --> 00:11:43.180 align:middle line:84% that electric vehicles are still very new technologies. 00:11:43.180 --> 00:11:46.570 align:middle line:84% They're still very new products in a consumer marketplace. 00:11:46.570 --> 00:11:48.040 align:middle line:84% The Bolt electric vehicle was one 00:11:48.040 --> 00:11:51.130 align:middle line:84% of the first low-cost electric vehicles that was long-range. 00:11:51.130 --> 00:11:53.830 align:middle line:90% It was only introduced in 2016. 00:11:53.830 --> 00:11:56.080 align:middle line:84% They beat Tesla to the market by one year, 00:11:56.080 --> 00:11:58.300 align:middle line:84% when Tesla introduced their first, I think, 00:11:58.300 --> 00:12:04.890 align:middle line:84% sub-$35,000 or sub-$40,000 model, the Model 3, in 2017. 00:12:04.890 --> 00:12:06.750 align:middle line:84% It is worth pointing out most automakers 00:12:06.750 --> 00:12:10.390 align:middle line:84% have yet to introduce electric vehicle models, 00:12:10.390 --> 00:12:13.210 align:middle line:84% even though if you look at Car and Driver Magazine, 00:12:13.210 --> 00:12:15.670 align:middle line:84% you'll see that 50 or 100 new electric vehicle 00:12:15.670 --> 00:12:18.490 align:middle line:84% models are expected to come out in the next few years. 00:12:18.490 --> 00:12:21.100 align:middle line:84% But it's worth looking at how quickly electric vehicle 00:12:21.100 --> 00:12:24.080 align:middle line:84% sales are growing as a share of new cars. 00:12:24.080 --> 00:12:26.785 align:middle line:84% If we compare the first half of 2021 numbers 00:12:26.785 --> 00:12:30.670 align:middle line:84% to the first half of 2022 numbers, globally, 00:12:30.670 --> 00:12:33.100 align:middle line:84% electric vehicles went, from last year to this year, 00:12:33.100 --> 00:12:36.910 align:middle line:84% from 4% to 5% of new car sales to 12%. 00:12:36.910 --> 00:12:42.790 align:middle line:84% In Germany, they went slightly up, from 12% to almost 14%. 00:12:42.790 --> 00:12:46.240 align:middle line:84% In China, they went from 12% to 20% of new car sales. 00:12:46.240 --> 00:12:50.470 align:middle line:84% In the US, they almost doubled, from 3.6% to 6.2%, 00:12:50.470 --> 00:12:53.710 align:middle line:84% despite declines in the sales of other vehicles 00:12:53.710 --> 00:12:57.520 align:middle line:84% probably due to price inflation and rises and vehicle 00:12:57.520 --> 00:12:58.360 align:middle line:90% shortages. 00:12:58.360 --> 00:13:01.450 align:middle line:84% But despite all these problems, electric vehicles 00:13:01.450 --> 00:13:05.690 align:middle line:84% have increased their market share of new car sales. 00:13:05.690 --> 00:13:08.230 align:middle line:84% So this is what we'll start by analyzing 00:13:08.230 --> 00:13:10.570 align:middle line:90% private vehicles, a.k.a. 00:13:10.570 --> 00:13:12.880 align:middle line:84% personal transport, and understand them 00:13:12.880 --> 00:13:14.920 align:middle line:84% in terms of their energy consumption 00:13:14.920 --> 00:13:18.160 align:middle line:84% in terms of energy per person, per kilometer, 00:13:18.160 --> 00:13:19.900 align:middle line:90% or per 100 kilometers. 00:13:19.900 --> 00:13:23.860 align:middle line:84% So this is a figure from MacKay 20.23. 00:13:23.860 --> 00:13:26.050 align:middle line:84% The vertical axis is the energy consumption 00:13:26.050 --> 00:13:27.910 align:middle line:90% per person per distance. 00:13:27.910 --> 00:13:30.370 align:middle line:84% And the horizontal axis is the speed 00:13:30.370 --> 00:13:32.217 align:middle line:90% in terms of kilometers per hour. 00:13:32.217 --> 00:13:33.800 align:middle line:84% And you can see if we were to compare, 00:13:33.800 --> 00:13:38.170 align:middle line:84% let's say, two of the waterborne transportation modes, 00:13:38.170 --> 00:13:41.920 align:middle line:84% the Vancouver SeaBus, a SeaBus that I've ridden quite a bit, 00:13:41.920 --> 00:13:44.170 align:middle line:90% is compared to a catamaran. 00:13:44.170 --> 00:13:46.840 align:middle line:84% And you can see that the energy consumption of the catamaran 00:13:46.840 --> 00:13:49.750 align:middle line:84% is actually higher, though the speed is higher. 00:13:49.750 --> 00:13:52.900 align:middle line:84% I assume that this is a motorized 00:13:52.900 --> 00:13:56.950 align:middle line:84% or fueled catamaran rather than a sailing catamaran. 00:13:56.950 --> 00:13:59.650 align:middle line:84% And you can see that the energy consumption for the SeaBus 00:13:59.650 --> 00:14:01.420 align:middle line:84% is relatively lower, because it's 00:14:01.420 --> 00:14:03.250 align:middle line:90% lower on the vertical axis. 00:14:03.250 --> 00:14:06.580 align:middle line:84% Of course, it could be because the SeaBus has a limited range 00:14:06.580 --> 00:14:09.762 align:middle line:84% and moves about 400 people at a time. 00:14:09.762 --> 00:14:13.010 align:middle line:84% Now, if we look in terms of the airborne modes 00:14:13.010 --> 00:14:16.250 align:middle line:84% of transportation, you can see that a turboprop plane has 00:14:16.250 --> 00:14:20.870 align:middle line:84% much lower fuel consumption than a Boeing 747, 00:14:20.870 --> 00:14:23.360 align:middle line:90% even if the Boeing 747 is full. 00:14:23.360 --> 00:14:26.390 align:middle line:84% And, of course, lower than a Boeing 747 00:14:26.390 --> 00:14:29.408 align:middle line:84% if the Boeing 747 is not entirely full. 00:14:29.408 --> 00:14:31.700 align:middle line:84% Of course, the most useful part of this graph, I think, 00:14:31.700 --> 00:14:34.910 align:middle line:84% is comparing the different modes of transportation. 00:14:34.910 --> 00:14:36.380 align:middle line:90% For example, whether or not-- 00:14:36.380 --> 00:14:38.180 align:middle line:84% what the energy consumption of a car 00:14:38.180 --> 00:14:40.520 align:middle line:90% is versus public transportation. 00:14:40.520 --> 00:14:43.970 align:middle line:84% So if you look at a car that is full, 00:14:43.970 --> 00:14:48.110 align:middle line:84% it has roughly about 20 kilowatt hours 00:14:48.110 --> 00:14:50.960 align:middle line:90% per 100 kilometers per person. 00:14:50.960 --> 00:14:54.890 align:middle line:84% The underground system looks like it's about, I'd say, 15 00:14:54.890 --> 00:15:00.390 align:middle line:84% or 16 kilowatt hours per 100 kilometers per person. 00:15:00.390 --> 00:15:02.570 align:middle line:84% Of course, if the underground train is full, 00:15:02.570 --> 00:15:06.170 align:middle line:84% that drives it very low, to about 4 kilowatt hours 00:15:06.170 --> 00:15:09.980 align:middle line:90% per person per 100 kilometers. 00:15:09.980 --> 00:15:12.770 align:middle line:84% And, of course, walking and cycling is still lower, 00:15:12.770 --> 00:15:14.220 align:middle line:90% but the speeds are lower. 00:15:14.220 --> 00:15:17.480 align:middle line:84% And so you can start to see this trade-off between the speeds 00:15:17.480 --> 00:15:20.840 align:middle line:84% we would like to attain either for short distances, 00:15:20.840 --> 00:15:23.840 align:middle line:84% in terms of walking or cycling, or long distances, 00:15:23.840 --> 00:15:25.730 align:middle line:90% like high-speed trains. 00:15:25.730 --> 00:15:28.880 align:middle line:84% And, of course, you can see why, in many cases, 00:15:28.880 --> 00:15:31.160 align:middle line:84% high-speed trains are out-competing 00:15:31.160 --> 00:15:32.720 align:middle line:90% short-haul aviation. 00:15:32.720 --> 00:15:36.080 align:middle line:84% In North America, we tend to use turboprop planes 00:15:36.080 --> 00:15:40.670 align:middle line:84% for short-haul aviation instead of large jets like a Boeing 00:15:40.670 --> 00:15:42.080 align:middle line:90% 747. 00:15:42.080 --> 00:15:44.060 align:middle line:84% But also, if you look at-- compare that 00:15:44.060 --> 00:15:46.940 align:middle line:84% to an electric high-speed train, the electric high-speed train 00:15:46.940 --> 00:15:49.700 align:middle line:84% has much lower energy consumption 00:15:49.700 --> 00:15:51.320 align:middle line:90% than a turboprop plane. 00:15:51.320 --> 00:15:53.690 align:middle line:84% This is essentially why China building 00:15:53.690 --> 00:15:57.920 align:middle line:84% a large high-speed rail network has apparently 00:15:57.920 --> 00:16:01.700 align:middle line:84% wiped out the entire short-haul aviation market. 00:16:01.700 --> 00:16:05.390 align:middle line:84% Of course, you can make do with things like a bus 00:16:05.390 --> 00:16:08.870 align:middle line:84% or a coach that is full, also has much lower energy 00:16:08.870 --> 00:16:11.330 align:middle line:84% consumption than individual cars. 00:16:11.330 --> 00:16:14.690 align:middle line:84% But you can see that trains can largely outcompete-- 00:16:14.690 --> 00:16:17.300 align:middle line:84% trains, electric trains, or high-speed trains 00:16:17.300 --> 00:16:19.730 align:middle line:84% can outcompete buses quite easily. 00:16:19.730 --> 00:16:22.910 align:middle line:84% Of course, they have a larger upfront cost in terms of land, 00:16:22.910 --> 00:16:25.310 align:middle line:84% and building the rails and the electrical grid 00:16:25.310 --> 00:16:28.340 align:middle line:84% required to support those trains. 00:16:28.340 --> 00:16:30.470 align:middle line:84% So if we use graphs like this, you 00:16:30.470 --> 00:16:33.080 align:middle line:84% can compare not only the energy consumption, 00:16:33.080 --> 00:16:35.250 align:middle line:84% but the speed that we would like, 00:16:35.250 --> 00:16:38.100 align:middle line:90% in terms of to achieve mobility. 00:16:38.100 --> 00:16:41.190 align:middle line:84% And so here's a-- kind of a bit of a teaser 00:16:41.190 --> 00:16:42.840 align:middle line:90% that I put in the problem set. 00:16:42.840 --> 00:16:44.640 align:middle line:84% Let's ask a simple policy question. 00:16:44.640 --> 00:16:48.990 align:middle line:84% Which vehicles should we focus on making more efficient? 00:16:48.990 --> 00:16:51.460 align:middle line:84% In terms of policy, we want to target our policies well. 00:16:51.460 --> 00:16:54.870 align:middle line:84% We want to spend our time as government officials having 00:16:54.870 --> 00:16:57.480 align:middle line:84% the most impact for the time we spend. 00:16:57.480 --> 00:17:01.050 align:middle line:84% So should we make SUVs slightly less gross, 00:17:01.050 --> 00:17:04.589 align:middle line:84% maybe increasing their average 11 miles per gallon 00:17:04.589 --> 00:17:07.380 align:middle line:84% to a whopping 13 miles per gallon? 00:17:07.380 --> 00:17:09.900 align:middle line:84% Or should we make passenger cars super-efficient? 00:17:09.900 --> 00:17:13.589 align:middle line:84% Let's say going from the fleet average for passenger cars, 00:17:13.589 --> 00:17:16.319 align:middle line:84% from 29 miles per gallon, maybe changing them 00:17:16.319 --> 00:17:19.900 align:middle line:84% to hybrid drivetrains that get 49 miles per gallon. 00:17:19.900 --> 00:17:23.430 align:middle line:84% So if we use some of the calculations we learned 00:17:23.430 --> 00:17:27.630 align:middle line:84% in MacKay chapters 3 and 20, you can 00:17:27.630 --> 00:17:29.100 align:middle line:90% see that actually going from-- 00:17:29.100 --> 00:17:33.720 align:middle line:84% if we flip this over, in terms of 11 miles per gallon, 00:17:33.720 --> 00:17:39.820 align:middle line:84% that has roughly 0.091 gallons to go per mile. 00:17:39.820 --> 00:17:42.240 align:middle line:84% And if we flip over 13 miles per gallon, 00:17:42.240 --> 00:17:47.150 align:middle line:84% that basically implies that 0.077 gallons per mile. 00:17:47.150 --> 00:17:49.530 align:middle line:84% And so this is the point from the MacKay reading. 00:17:49.530 --> 00:17:52.270 align:middle line:84% We want to look less at miles per gallon, which 00:17:52.270 --> 00:17:53.880 align:middle line:84% is an indication of how many miles 00:17:53.880 --> 00:17:56.550 align:middle line:84% you can go in a given amount of fuel, 00:17:56.550 --> 00:17:58.830 align:middle line:84% and instead look at how much energy are we spending 00:17:58.830 --> 00:18:00.330 align:middle line:90% to go a certain distance. 00:18:00.330 --> 00:18:03.720 align:middle line:84% This emphasizes the service we want to get, which is mobility. 00:18:03.720 --> 00:18:06.330 align:middle line:84% So we take this number, flip it over, 00:18:06.330 --> 00:18:09.930 align:middle line:84% and we measure how much energy we need to go a certain mile. 00:18:09.930 --> 00:18:16.560 align:middle line:84% And so if we go from a gross SUV from 0.91 gallons per mile 00:18:16.560 --> 00:18:21.360 align:middle line:84% and make it more efficient, we go to 0.77 gallons per mile. 00:18:21.360 --> 00:18:24.820 align:middle line:84% If we do the same thing for passenger cars, 00:18:24.820 --> 00:18:30.750 align:middle line:84% we go from 29 miles per gallon to 0.34 gallons per mile. 00:18:30.750 --> 00:18:36.060 align:middle line:84% And we go from 49 miles per gallon to 0.20 gallons per 00:18:36.060 --> 00:18:36.870 align:middle line:90% mile. 00:18:36.870 --> 00:18:38.670 align:middle line:84% But this is a bit of a brainteaser, 00:18:38.670 --> 00:18:40.092 align:middle line:90% or I guess a trick question. 00:18:40.092 --> 00:18:42.300 align:middle line:84% Because the difference between both pairs of vehicles 00:18:42.300 --> 00:18:43.270 align:middle line:90% is the same. 00:18:43.270 --> 00:18:49.130 align:middle line:84% We're actually going-- improving them by 0.14 gallons per mile. 00:18:49.130 --> 00:18:51.680 align:middle line:84% This is just a kind of trick question 00:18:51.680 --> 00:18:54.350 align:middle line:84% I want to use to illustrate a point about consumers' 00:18:54.350 --> 00:18:57.600 align:middle line:84% perceptions versus misperceptions of energy costs. 00:18:57.600 --> 00:19:00.200 align:middle line:84% This is a paper by Hunt Alcott in the American Economic 00:19:00.200 --> 00:19:01.070 align:middle line:90% Review. 00:19:01.070 --> 00:19:05.150 align:middle line:84% And what this is called is the "MPG illusion," 00:19:05.150 --> 00:19:07.040 align:middle line:84% in which most people think intuitively 00:19:07.040 --> 00:19:11.030 align:middle line:84% that automobile fuel costs scale linearly in miles per gallon. 00:19:11.030 --> 00:19:14.180 align:middle line:84% When, in fact, what we care about is the amount of energy 00:19:14.180 --> 00:19:17.540 align:middle line:84% we spend on service, which is going-- 00:19:17.540 --> 00:19:20.030 align:middle line:84% how many gallons of gasoline do we need to go per mile, 00:19:20.030 --> 00:19:23.570 align:middle line:84% or how much fuel do we need to go per mile of service. 00:19:23.570 --> 00:19:25.400 align:middle line:84% And so this is just the indication 00:19:25.400 --> 00:19:29.510 align:middle line:84% that this is a systemic bias or a systemic misperception 00:19:29.510 --> 00:19:33.270 align:middle line:84% that people have about energy costs. 00:19:33.270 --> 00:19:35.630 align:middle line:84% So let's focus on the powertrain options 00:19:35.630 --> 00:19:38.870 align:middle line:84% we have to achieve the service we want, which is mobility. 00:19:38.870 --> 00:19:40.555 align:middle line:90% Internal combustion engines. 00:19:40.555 --> 00:19:41.930 align:middle line:84% This essentially is where we burn 00:19:41.930 --> 00:19:44.480 align:middle line:90% fossil fuels to move the car. 00:19:44.480 --> 00:19:47.580 align:middle line:84% We have hybrid drivetrain, which have been around for, 00:19:47.580 --> 00:19:49.760 align:middle line:84% I think, almost 15 or 20 years now, 00:19:49.760 --> 00:19:52.190 align:middle line:84% where fossil fuels move the car, but we 00:19:52.190 --> 00:19:55.370 align:middle line:84% integrate a small battery to store the power from braking 00:19:55.370 --> 00:19:56.420 align:middle line:90% to move the car. 00:19:56.420 --> 00:19:58.190 align:middle line:84% This is the well-known Prius that's 00:19:58.190 --> 00:20:00.740 align:middle line:90% been around for many years. 00:20:00.740 --> 00:20:06.120 align:middle line:84% We have plug-in hybrid electric vehicles, or PHEVs for short, 00:20:06.120 --> 00:20:08.570 align:middle line:84% where we have a larger battery that moves the car up 00:20:08.570 --> 00:20:10.040 align:middle line:90% to 20 or 40 miles. 00:20:10.040 --> 00:20:12.020 align:middle line:84% And then we have a fossil fuel engine still 00:20:12.020 --> 00:20:14.750 align:middle line:84% in the car that's used to extend the range of the battery, 00:20:14.750 --> 00:20:16.550 align:middle line:84% and you can charge the battery off gas 00:20:16.550 --> 00:20:19.370 align:middle line:90% if you run out of electricity. 00:20:19.370 --> 00:20:22.550 align:middle line:84% And, of course, we have fully battery electric vehicles 00:20:22.550 --> 00:20:26.943 align:middle line:84% where the battery moves the car 200 or 400 miles. 00:20:26.943 --> 00:20:28.610 align:middle line:84% These electric vehicles have drastically 00:20:28.610 --> 00:20:30.950 align:middle line:84% less maintenance because an electric motor is easier 00:20:30.950 --> 00:20:32.975 align:middle line:84% to maintain than an internal combustion engine, 00:20:32.975 --> 00:20:35.570 align:middle line:84% and they're less mechanically complex. 00:20:35.570 --> 00:20:39.530 align:middle line:84% But they also, as we saw in the readings from the Miotti et al. 00:20:39.530 --> 00:20:43.280 align:middle line:84% paper or the Kidner article, Kidner chapter, 00:20:43.280 --> 00:20:45.740 align:middle line:84% the cost of electric vehicles largely 00:20:45.740 --> 00:20:47.510 align:middle line:90% depends on battery costs. 00:20:47.510 --> 00:20:51.890 align:middle line:84% Almost 35% or 40%, I think, of the entire cost of the vehicle 00:20:51.890 --> 00:20:53.430 align:middle line:90% is simply the battery. 00:20:53.430 --> 00:20:56.000 align:middle line:84% This is also why Tesla has built a gigafactory 00:20:56.000 --> 00:21:00.530 align:middle line:84% to churn out batteries at lower cost at higher volumes. 00:21:00.530 --> 00:21:04.000 align:middle line:84% Tesla believes, and I think they're being proven correctly, 00:21:04.000 --> 00:21:06.590 align:middle line:84% being proven right, that if they produce batteries 00:21:06.590 --> 00:21:08.768 align:middle line:84% at very large volumes, they'll learn about how 00:21:08.768 --> 00:21:10.310 align:middle line:84% to make the batteries more efficient, 00:21:10.310 --> 00:21:11.870 align:middle line:84% they'll produce a lot more batteries 00:21:11.870 --> 00:21:13.880 align:middle line:84% and drive the cost per unit down. 00:21:13.880 --> 00:21:15.650 align:middle line:84% Therefore, that will lower the cost 00:21:15.650 --> 00:21:17.780 align:middle line:84% of the cars they're selling, because most 00:21:17.780 --> 00:21:20.840 align:middle line:84% of the cost of the car is the cost of the battery. 00:21:20.840 --> 00:21:24.620 align:middle line:84% Or much of the cost of car is the cost of the battery. 00:21:24.620 --> 00:21:27.590 align:middle line:84% Just to show you what these different powertrain 00:21:27.590 --> 00:21:31.460 align:middle line:84% options look like, this is a diagram from the Kidner chapter 00:21:31.460 --> 00:21:33.540 align:middle line:84% that I assigned and referenced at the beginning 00:21:33.540 --> 00:21:34.620 align:middle line:90% of this lecture. 00:21:34.620 --> 00:21:37.100 align:middle line:84% You can see a battery electric vehicle 00:21:37.100 --> 00:21:38.930 align:middle line:90% has a fairly simple drivetrain. 00:21:38.930 --> 00:21:40.445 align:middle line:84% It has a charger going to a battery, 00:21:40.445 --> 00:21:42.487 align:middle line:84% going to a power converter, to an electric motor, 00:21:42.487 --> 00:21:44.090 align:middle line:90% to the transmission. 00:21:44.090 --> 00:21:49.370 align:middle line:84% A series electric vehicle has not only a battery, a power 00:21:49.370 --> 00:21:52.400 align:middle line:84% converter, you can generate power 00:21:52.400 --> 00:21:54.350 align:middle line:84% from the fuel tank, the internal combustion, 00:21:54.350 --> 00:21:56.960 align:middle line:84% and convert power into the electric motor, which 00:21:56.960 --> 00:21:58.880 align:middle line:90% goes to the transmission. 00:21:58.880 --> 00:22:01.250 align:middle line:84% A series plug-in hybrid electric vehicle 00:22:01.250 --> 00:22:04.670 align:middle line:84% has the ability to plug into the wall, power 00:22:04.670 --> 00:22:06.380 align:middle line:84% the battery, power the converter. 00:22:06.380 --> 00:22:09.020 align:middle line:84% Or you can also put gas into a fuel tank that 00:22:09.020 --> 00:22:10.940 align:middle line:84% drives an internal combustion engine that 00:22:10.940 --> 00:22:12.980 align:middle line:84% runs a generator that creates electricity, then 00:22:12.980 --> 00:22:14.660 align:middle line:90% goes into your transmission. 00:22:14.660 --> 00:22:17.240 align:middle line:84% And then you have a fuel cell electric vehicle, 00:22:17.240 --> 00:22:18.950 align:middle line:84% where the fuel cell, essentially, 00:22:18.950 --> 00:22:21.750 align:middle line:84% is another way of storing electricity. 00:22:21.750 --> 00:22:26.060 align:middle line:84% Whether from gasoline, or from natural gas, or hydrogen. 00:22:26.060 --> 00:22:27.555 align:middle line:90% There's a fuel cell stack. 00:22:27.555 --> 00:22:29.930 align:middle line:84% The fuel cell stack can be used to run a generator, which 00:22:29.930 --> 00:22:31.340 align:middle line:90% creates electricity. 00:22:31.340 --> 00:22:33.410 align:middle line:84% The battery can also be charged from outside 00:22:33.410 --> 00:22:35.870 align:middle line:84% of the vehicle, which all drive the transmission, again. 00:22:35.870 --> 00:22:38.120 align:middle line:84% So this is to say that there's many different possible 00:22:38.120 --> 00:22:41.600 align:middle line:84% drivetrains for the kind of mobility services 00:22:41.600 --> 00:22:44.510 align:middle line:90% you want in passenger vehicles. 00:22:44.510 --> 00:22:47.750 align:middle line:84% Just to do a few simple calculations to illustrate 00:22:47.750 --> 00:22:50.630 align:middle line:84% the amount of energy we need per service 00:22:50.630 --> 00:22:53.150 align:middle line:90% or per distance we want to go. 00:22:53.150 --> 00:22:55.460 align:middle line:84% For an internal combustion engine that gets-- 00:22:55.460 --> 00:22:58.560 align:middle line:84% an SUV that gets, let's say, 22 miles per gallon, 00:22:58.560 --> 00:23:01.370 align:middle line:84% that's kind of generous for most SUVs, to be honest, 00:23:01.370 --> 00:23:04.310 align:middle line:84% we have the energy density of the fuel, which 00:23:04.310 --> 00:23:07.940 align:middle line:90% is 10 kilowatt hours per liter. 00:23:07.940 --> 00:23:10.640 align:middle line:90% That's the figure from MacKay. 00:23:10.640 --> 00:23:15.770 align:middle line:84% We multiply times the inverse of gallons per 22 miles. 00:23:15.770 --> 00:23:17.860 align:middle line:90% We convert liters to gallon. 00:23:17.860 --> 00:23:19.490 align:middle line:90% We convert miles to kilometers. 00:23:19.490 --> 00:23:21.210 align:middle line:90% And we multiply times 100. 00:23:21.210 --> 00:23:25.290 align:middle line:84% So we get 100 kilowatt hours per 100 kilometers. 00:23:25.290 --> 00:23:27.546 align:middle line:84% This is simply dimensional analysis. 00:23:27.546 --> 00:23:30.590 align:middle line:84% So you can cross out liters top to bottom. 00:23:30.590 --> 00:23:32.870 align:middle line:90% Cross out gallons top to bottom. 00:23:32.870 --> 00:23:34.850 align:middle line:90% Cross out miles top to bottom. 00:23:34.850 --> 00:23:36.710 align:middle line:84% I just want to show you how to convert 00:23:36.710 --> 00:23:40.010 align:middle line:84% some of these metric or SI units to imperial numbers 00:23:40.010 --> 00:23:41.900 align:middle line:84% that we might be more familiar with. 00:23:41.900 --> 00:23:45.470 align:middle line:84% Imperial, or US system of measurement. 00:23:45.470 --> 00:23:48.710 align:middle line:84% If we take the same calculation for a Toyota Prius, which 00:23:48.710 --> 00:23:53.990 align:middle line:84% is a hybrid vehicle, we put in the energy density per volume 00:23:53.990 --> 00:23:55.850 align:middle line:90% of the gasoline that goes in. 00:23:55.850 --> 00:23:58.218 align:middle line:84% But as we know, Priuses are drastically 00:23:58.218 --> 00:24:00.260 align:middle line:84% more efficient because they have a hybrid battery 00:24:00.260 --> 00:24:02.660 align:middle line:84% to help them store energy from braking. 00:24:02.660 --> 00:24:04.700 align:middle line:84% So you take the 10 kilowatt hours 00:24:04.700 --> 00:24:08.160 align:middle line:84% per liter divided by 56 miles per gallon. 00:24:08.160 --> 00:24:12.860 align:middle line:84% So this 56 decreases the energy consumption by a factor of 2. 00:24:12.860 --> 00:24:14.880 align:middle line:84% All the other factors are the same. 00:24:14.880 --> 00:24:17.600 align:middle line:84% And you can see that we get to 43 kilowatt hours 00:24:17.600 --> 00:24:21.320 align:middle line:84% per 100 kilometers traveled for our Prius. 00:24:21.320 --> 00:24:25.520 align:middle line:84% And, of course, EVs according to MacKay's research assumption 00:24:25.520 --> 00:24:30.260 align:middle line:84% in 2009, get about 100 kilometers for every 15 00:24:30.260 --> 00:24:34.320 align:middle line:84% or 20 kilowatt hours of energy going in. 00:24:34.320 --> 00:24:38.600 align:middle line:84% So if you want to do a simple summary of what this means, 00:24:38.600 --> 00:24:40.407 align:middle line:84% you can see that there's multiples 00:24:40.407 --> 00:24:41.990 align:middle line:84% between these different vehicle types. 00:24:41.990 --> 00:24:44.600 align:middle line:84% You can see that the difference between SUV 00:24:44.600 --> 00:24:48.800 align:middle line:84% versus an electric vehicle is 5 to 7 times more efficient, 00:24:48.800 --> 00:24:50.090 align:middle line:90% an electric vehicle. 00:24:50.090 --> 00:24:52.490 align:middle line:84% Even between a hybrid vehicle and an electric vehicle, 00:24:52.490 --> 00:24:55.200 align:middle line:84% it's 2 to 3 times more efficient. 00:24:55.200 --> 00:24:57.300 align:middle line:84% So this is our argument for electrification. 00:24:57.300 --> 00:25:00.020 align:middle line:84% This is why electric vehicles are so efficient 00:25:00.020 --> 00:25:03.260 align:middle line:84% and why we're trying to pursue electric vehicles. 00:25:03.260 --> 00:25:06.470 align:middle line:84% If we look at the Miotti et al paper, in figure 1, 00:25:06.470 --> 00:25:08.900 align:middle line:84% you can see that basically every single battery 00:25:08.900 --> 00:25:14.450 align:middle line:84% electric vehicle, symbolized here in the yellow envelope, 00:25:14.450 --> 00:25:16.670 align:middle line:84% is lower energy consumption than pretty 00:25:16.670 --> 00:25:19.410 align:middle line:90% much every hybrid vehicle. 00:25:19.410 --> 00:25:23.030 align:middle line:84% Lower, sorry, vehicle and fuel lifecycle greenhouse gas 00:25:23.030 --> 00:25:24.740 align:middle line:84% emissions, which are very closely 00:25:24.740 --> 00:25:27.120 align:middle line:84% associated with how much energy they consume. 00:25:27.120 --> 00:25:29.450 align:middle line:84% And you can see that there's envelopes stretching 00:25:29.450 --> 00:25:31.430 align:middle line:84% along the horizontal axis, because we 00:25:31.430 --> 00:25:34.830 align:middle line:84% know that some of these cars are more expensive than others. 00:25:34.830 --> 00:25:38.210 align:middle line:84% An electric Chevrolet Spark is much cheaper, 00:25:38.210 --> 00:25:40.640 align:middle line:84% in terms of vehicle, fuel, and maintenance costs, 00:25:40.640 --> 00:25:44.600 align:middle line:84% than a Tesla Model S. Of course, the Tesla Model 00:25:44.600 --> 00:25:48.440 align:middle line:84% S is more expensive, but has much lower lifecycle greenhouse 00:25:48.440 --> 00:25:51.890 align:middle line:84% gas emissions than pretty much all the fuel or hybrid vehicles 00:25:51.890 --> 00:25:54.330 align:middle line:90% out here. 00:25:54.330 --> 00:25:58.400 align:middle line:84% You also might notice that all of the gasoline combustion 00:25:58.400 --> 00:26:00.560 align:middle line:84% engine vehicles here at the black dots 00:26:00.560 --> 00:26:05.060 align:middle line:84% do not meet our 2030 targets for the Paris Climate Agreement. 00:26:05.060 --> 00:26:09.140 align:middle line:84% Some of our hybrid vehicles do get under the 2030 target, 00:26:09.140 --> 00:26:12.260 align:middle line:84% and pretty much all battery electric vehicles 00:26:12.260 --> 00:26:16.070 align:middle line:84% meet our 2030 targets, but do not meet our 2040 targets. 00:26:16.070 --> 00:26:19.080 align:middle line:84% In fact, if you look at all the vehicles on this chart, 00:26:19.080 --> 00:26:22.860 align:middle line:84% there are no vehicles that meet our 2040 or 2050 targets. 00:26:22.860 --> 00:26:25.220 align:middle line:84% We still have some time before those years. 00:26:25.220 --> 00:26:28.370 align:middle line:84% We have 18 years until 2040, so we can still 00:26:28.370 --> 00:26:30.200 align:middle line:84% develop new vehicles that hopefully 00:26:30.200 --> 00:26:31.670 align:middle line:90% meet those requirements. 00:26:31.670 --> 00:26:34.370 align:middle line:84% But right now, it's worth saying that none of our vehicles today 00:26:34.370 --> 00:26:38.630 align:middle line:84% that are commercially available meet our 2040 or 2050 Paris 00:26:38.630 --> 00:26:40.100 align:middle line:90% Climate Agreement targets. 00:26:40.100 --> 00:26:44.150 align:middle line:84% That is also-- those are capital assets 00:26:44.150 --> 00:26:47.630 align:middle line:84% that individual consumers and countries will 00:26:47.630 --> 00:26:50.940 align:middle line:84% have to invest in so that we can meet our Paris Climate 00:26:50.940 --> 00:26:53.200 align:middle line:90% Agreement targets. 00:26:53.200 --> 00:26:54.980 align:middle line:84% If you look at all the ways that we 00:26:54.980 --> 00:26:59.150 align:middle line:84% can try to improve our existing powertrain or drivetrain 00:26:59.150 --> 00:27:03.590 align:middle line:84% technologies, on the graph here, figure 4 from the Miotti et al. 00:27:03.590 --> 00:27:05.720 align:middle line:84% paper, you can look the average emissions 00:27:05.720 --> 00:27:12.140 align:middle line:84% based on 2014 models in terms of grams of CO2 per kilometer. 00:27:12.140 --> 00:27:14.780 align:middle line:84% And you can see all the different vertical bars 00:27:14.780 --> 00:27:19.010 align:middle line:84% represent different drivetrain or powertrain technologies. 00:27:19.010 --> 00:27:22.100 align:middle line:84% And what we can do-- what this graph tells 00:27:22.100 --> 00:27:24.320 align:middle line:84% us is that if we do a series of things 00:27:24.320 --> 00:27:26.900 align:middle line:84% to try to improve each technology, 00:27:26.900 --> 00:27:29.310 align:middle line:84% how far can we push these technologies. 00:27:29.310 --> 00:27:33.830 align:middle line:84% So we could try to start with the sales-weighted average 00:27:33.830 --> 00:27:35.210 align:middle line:90% of 2014 models. 00:27:35.210 --> 00:27:37.160 align:middle line:84% These are new cars or basic trims. 00:27:37.160 --> 00:27:38.960 align:middle line:84% We can, for each of these technologies, 00:27:38.960 --> 00:27:42.680 align:middle line:90% try to downsize to compact cars. 00:27:42.680 --> 00:27:45.140 align:middle line:84% In the electric-using technologies 00:27:45.140 --> 00:27:47.390 align:middle line:84% like electric vehicles or plug-in hybrids, 00:27:47.390 --> 00:27:50.960 align:middle line:84% we can increase the amount of low-carbon electricity 00:27:50.960 --> 00:27:53.690 align:middle line:84% available, we can make the maximum efficiency 00:27:53.690 --> 00:27:54.590 align:middle line:90% improvements. 00:27:54.590 --> 00:27:57.477 align:middle line:84% And in some cases, we could try to use best-case biofuels. 00:27:57.477 --> 00:27:59.810 align:middle line:84% And, of course, the best case for all these technologies 00:27:59.810 --> 00:28:01.560 align:middle line:84% is we do all of the above things. 00:28:01.560 --> 00:28:04.100 align:middle line:84% And you can see that there's fundamental limitations 00:28:04.100 --> 00:28:06.260 align:middle line:84% to different powertrain technologies. 00:28:06.260 --> 00:28:11.930 align:middle line:84% For internal combustion vehicles, internal combustion 00:28:11.930 --> 00:28:16.220 align:middle line:84% vehicles that use gasoline, we can only 00:28:16.220 --> 00:28:17.710 align:middle line:84% get better than our 2030 targets, 00:28:17.710 --> 00:28:20.630 align:middle line:84% but we can't get to our 2040 targets. 00:28:20.630 --> 00:28:22.520 align:middle line:84% For internal combustion engine vehicles 00:28:22.520 --> 00:28:28.040 align:middle line:84% that use E85, that's ethanol fuel, 50% ethanol fuel, 00:28:28.040 --> 00:28:31.760 align:middle line:84% I think, you can see that we can barely meet our 2040 tar-- 00:28:31.760 --> 00:28:33.830 align:middle line:90% 2030 targets. 00:28:33.830 --> 00:28:35.510 align:middle line:90% Sorry, 2040 targets. 00:28:35.510 --> 00:28:37.910 align:middle line:84% But we can't meet our 2050 targets. 00:28:37.910 --> 00:28:40.280 align:middle line:84% It is possible that internal combustion engine vehicles, 00:28:40.280 --> 00:28:44.030 align:middle line:84% such as diesel, to get below our 2050 targets 00:28:44.030 --> 00:28:46.700 align:middle line:90% if we pull out all the stops. 00:28:46.700 --> 00:28:50.300 align:middle line:84% Of course, that ignores the fact that diesel has severe air 00:28:50.300 --> 00:28:52.460 align:middle line:84% pollution impacts also, something 00:28:52.460 --> 00:28:54.810 align:middle line:90% seen in many European cities. 00:28:54.810 --> 00:28:58.790 align:middle line:84% The reason why we see, let's say, a lot of old statues 00:28:58.790 --> 00:29:02.675 align:middle line:84% degraded, or their features are starting to be worn away 00:29:02.675 --> 00:29:04.580 align:middle line:90% is from diesel fumes. 00:29:04.580 --> 00:29:07.460 align:middle line:84% They also have severe health impacts. 00:29:07.460 --> 00:29:09.260 align:middle line:84% If you look at hybrid electric vehicles 00:29:09.260 --> 00:29:12.360 align:middle line:84% and plug-in hybrid electric vehicles, they are much better, 00:29:12.360 --> 00:29:17.390 align:middle line:84% but barely get to within range of our 2040 targets. 00:29:17.390 --> 00:29:18.980 align:middle line:84% The only technology here that can 00:29:18.980 --> 00:29:22.700 align:middle line:84% exceed our 2050 targets are battery electric vehicles 00:29:22.700 --> 00:29:26.240 align:middle line:84% or fuel cell vehicles where the vehicle-- 00:29:26.240 --> 00:29:30.950 align:middle line:84% where the energy is from electrolysis, where-- 00:29:30.950 --> 00:29:35.120 align:middle line:84% in other words, we use renewable resources to create hydrogen. 00:29:35.120 --> 00:29:38.750 align:middle line:84% And the hydrogen used is used to power fuel cell vehicles. 00:29:38.750 --> 00:29:40.790 align:middle line:84% Fuel cell vehicles are a technology 00:29:40.790 --> 00:29:43.820 align:middle line:84% that's being tested in the Toyota Mirai, 00:29:43.820 --> 00:29:48.230 align:middle line:84% in pilot sales of the Mirai in places like California. 00:29:48.230 --> 00:29:50.765 align:middle line:84% They have not been terribly popular yet, 00:29:50.765 --> 00:29:52.640 align:middle line:84% and there's a real question if they will ever 00:29:52.640 --> 00:29:54.980 align:middle line:84% become as popular as battery electric vehicles, which 00:29:54.980 --> 00:29:57.050 align:middle line:84% are taking off very quickly, as I showed you 00:29:57.050 --> 00:29:59.360 align:middle line:90% on previous slides. 00:29:59.360 --> 00:30:01.433 align:middle line:84% So here's the fundamental question. 00:30:01.433 --> 00:30:03.100 align:middle line:84% If we're looking at MacKay's book, which 00:30:03.100 --> 00:30:05.920 align:middle line:84% was written in 2009, let's ask ourselves, 00:30:05.920 --> 00:30:08.980 align:middle line:84% have electric vehicles changed since MacKay's book? 00:30:08.980 --> 00:30:11.200 align:middle line:84% And we can figure this out by looking 00:30:11.200 --> 00:30:13.930 align:middle line:84% at a fairly simple set of numbers that you can look up 00:30:13.930 --> 00:30:16.420 align:middle line:84% from any manufacturer, or Car and Driver Magazine, 00:30:16.420 --> 00:30:18.730 align:middle line:84% or Consumer Reports, what have you. 00:30:18.730 --> 00:30:22.060 align:middle line:84% Let's look at MacKay's assumptions in 2009. 00:30:22.060 --> 00:30:26.290 align:middle line:84% He assumes that we have about 15 kilowatt hours of energy 00:30:26.290 --> 00:30:28.400 align:middle line:84% to get about 100 kilometers of range. 00:30:28.400 --> 00:30:29.260 align:middle line:90% That's his estimate. 00:30:29.260 --> 00:30:32.350 align:middle line:84% About 15 kilowatt hours per 100 kilometers. 00:30:32.350 --> 00:30:34.390 align:middle line:84% His conservative estimate is a higher amount 00:30:34.390 --> 00:30:36.010 align:middle line:90% of energy per 100 kilometers. 00:30:36.010 --> 00:30:39.085 align:middle line:84% 20 kilowatt hours per 100 kilometers. 00:30:39.085 --> 00:30:40.960 align:middle line:84% Now let's compare this to the Tesla Roadster, 00:30:40.960 --> 00:30:43.510 align:middle line:90% which is first sold in 2008. 00:30:43.510 --> 00:30:47.080 align:middle line:84% It got about-- has about a capacity of 53 00:30:47.080 --> 00:30:49.840 align:middle line:90% kilowatt hours in its battery. 00:30:49.840 --> 00:30:51.730 align:middle line:84% This is one of the small roadsters 00:30:51.730 --> 00:30:54.910 align:middle line:84% that Tesla first built. It had a fairly limited range 00:30:54.910 --> 00:30:58.510 align:middle line:90% of 220 miles, or 354 kilometers. 00:30:58.510 --> 00:31:01.000 align:middle line:84% And that means it calculates almost exactly 00:31:01.000 --> 00:31:05.140 align:middle line:84% to MacKay's estimate in 2009, about 15 kilowatt hours per 100 00:31:05.140 --> 00:31:07.610 align:middle line:90% kilometers. 00:31:07.610 --> 00:31:09.800 align:middle line:84% Of course, MacKay's numbers were based 00:31:09.800 --> 00:31:12.740 align:middle line:84% on just a few electric vehicles available at the time. 00:31:12.740 --> 00:31:14.450 align:middle line:84% Very famously, the Tesla Roadster 00:31:14.450 --> 00:31:16.610 align:middle line:90% was relatively expensive. 00:31:16.610 --> 00:31:20.150 align:middle line:84% Elon Musk was very clear about using high-cost, 00:31:20.150 --> 00:31:23.720 align:middle line:84% almost bespoke-built electric vehicles to subsidize 00:31:23.720 --> 00:31:24.830 align:middle line:90% building-- 00:31:24.830 --> 00:31:28.240 align:middle line:84% manufacturing of more electric vehicles. 00:31:28.240 --> 00:31:30.670 align:middle line:84% So that is exactly what Tesla did. 00:31:30.670 --> 00:31:34.870 align:middle line:84% They built the Tesla S, which is a much larger passenger 00:31:34.870 --> 00:31:35.410 align:middle line:90% vehicle. 00:31:35.410 --> 00:31:39.340 align:middle line:84% The Tesla X, which was their SUV version. 00:31:39.340 --> 00:31:43.540 align:middle line:84% They had much higher capacities, or much larger batteries. 00:31:43.540 --> 00:31:45.460 align:middle line:90% They had increased ranges. 00:31:45.460 --> 00:31:47.980 align:middle line:84% But you can see that actually, of all things, 00:31:47.980 --> 00:31:52.180 align:middle line:84% they go more towards MacKay's conservative estimate 00:31:52.180 --> 00:31:53.380 align:middle line:90% for vehicles. 00:31:53.380 --> 00:31:56.320 align:middle line:84% Because they had much larger form factors and much larger 00:31:56.320 --> 00:31:58.480 align:middle line:84% weight, they actually required more energy 00:31:58.480 --> 00:32:00.350 align:middle line:84% to go the same amount of distance. 00:32:00.350 --> 00:32:02.230 align:middle line:84% And you can see their costs were very high. 00:32:02.230 --> 00:32:06.490 align:middle line:84% $80,000 for a Tesla S, $83,000, I think, 00:32:06.490 --> 00:32:08.770 align:middle line:90% for the base model, the Tesla X. 00:32:08.770 --> 00:32:11.740 align:middle line:84% And you can start to calculate their energy per distance 00:32:11.740 --> 00:32:12.850 align:middle line:90% per cost. 00:32:12.850 --> 00:32:15.910 align:middle line:84% This is just to show you how you can take very simple numbers 00:32:15.910 --> 00:32:18.610 align:middle line:84% and start to calculate a basic metric to compare 00:32:18.610 --> 00:32:19.990 align:middle line:90% different models. 00:32:19.990 --> 00:32:22.870 align:middle line:84% Of course, the Chevy Bolt, the GM model 00:32:22.870 --> 00:32:25.930 align:middle line:84% that I mentioned that was introduced in 2016, 00:32:25.930 --> 00:32:28.240 align:middle line:90% had a smaller battery pack. 00:32:28.240 --> 00:32:30.880 align:middle line:84% It had a lower range, but started 00:32:30.880 --> 00:32:35.340 align:middle line:84% to get closer, again, to the estimate from MacKay in 2009. 00:32:35.340 --> 00:32:37.900 align:middle line:84% 16 kilowatt hours per 100 kilometers. 00:32:37.900 --> 00:32:40.360 align:middle line:84% But the drastic change from the Teslas 00:32:40.360 --> 00:32:44.500 align:middle line:84% was that they only charge $37,000 for the initial model, 00:32:44.500 --> 00:32:49.180 align:middle line:84% driving the energy per distance per cost way down. 00:32:49.180 --> 00:32:53.490 align:middle line:84% And if you look at the Tesla 3, which was introduced in 2017, 00:32:53.490 --> 00:32:56.310 align:middle line:84% you can see that they have comparable battery 00:32:56.310 --> 00:32:59.760 align:middle line:84% packs for both the standard and the long-range versions. 00:32:59.760 --> 00:33:05.220 align:middle line:84% They have slightly longer ranges because they've-- 00:33:05.220 --> 00:33:07.260 align:middle line:84% comparable ranges to the Tesla Roadster 00:33:07.260 --> 00:33:09.900 align:middle line:84% or the long-range model, which has a larger battery pack. 00:33:09.900 --> 00:33:11.430 align:middle line:84% But you can see that, fundamentally, 00:33:11.430 --> 00:33:14.340 align:middle line:84% the amount of energy used per distance has not changed. 00:33:14.340 --> 00:33:17.160 align:middle line:84% Again, what they're doing is competing in terms of price 00:33:17.160 --> 00:33:19.620 align:middle line:84% now, because we're trying to reach the broader 00:33:19.620 --> 00:33:23.010 align:middle line:84% part of the market that can afford $40,000 cars rather 00:33:23.010 --> 00:33:24.570 align:middle line:90% than $80,000 cars. 00:33:24.570 --> 00:33:28.080 align:middle line:84% And you can see that the Tesla basically comes in roughly 00:33:28.080 --> 00:33:30.240 align:middle line:84% in the same ballpark as the Chevy Bolt. 00:33:30.240 --> 00:33:31.740 align:middle line:90% They are directly competing. 00:33:31.740 --> 00:33:34.650 align:middle line:84% The Tesla long-range is more expensive, simply 00:33:34.650 --> 00:33:36.450 align:middle line:84% because you're paying for that range, 00:33:36.450 --> 00:33:38.910 align:middle line:84% even if the fundamental technology, in terms 00:33:38.910 --> 00:33:41.958 align:middle line:84% of energy per distance, is not more efficient. 00:33:41.958 --> 00:33:43.500 align:middle line:84% And, of course, what we're seeing now 00:33:43.500 --> 00:33:46.740 align:middle line:84% is manufacturers like Hyundai and Kia, 00:33:46.740 --> 00:33:49.470 align:middle line:84% large Korean automakers, starting to crowd 00:33:49.470 --> 00:33:50.760 align:middle line:90% into the same market. 00:33:50.760 --> 00:33:53.430 align:middle line:84% You can see that they've almost standardized their models 00:33:53.430 --> 00:33:56.400 align:middle line:84% on a 64 kilowatt-hour hour battery pack. 00:33:56.400 --> 00:33:58.890 align:middle line:84% They're starting to get larger longer ranges 00:33:58.890 --> 00:34:01.200 align:middle line:84% with the same sized battery pack because battery 00:34:01.200 --> 00:34:02.790 align:middle line:90% technologies have advanced. 00:34:02.790 --> 00:34:04.950 align:middle line:84% But fundamentally, the efficiency of these vehicles 00:34:04.950 --> 00:34:06.000 align:middle line:90% hasn't changed that much. 00:34:06.000 --> 00:34:11.040 align:middle line:84% It's 17, 14, 16 kilowatt hours per 100 kilometer. 00:34:11.040 --> 00:34:14.040 align:middle line:84% What's fundamentally changed is the cost of these vehicles. 00:34:14.040 --> 00:34:17.130 align:middle line:84% These vehicles are all meant to be sold around $40,000. 00:34:17.130 --> 00:34:20.610 align:middle line:84% And you can see in terms of the energy times cost divided 00:34:20.610 --> 00:34:23.520 align:middle line:84% by distance, you can see that their cost is going down, 00:34:23.520 --> 00:34:26.150 align:middle line:90% driving this metric lower. 00:34:26.150 --> 00:34:28.850 align:middle line:84% This is where most competition is occurring. 00:34:28.850 --> 00:34:30.889 align:middle line:84% But my point is, the fundamental technology 00:34:30.889 --> 00:34:33.020 align:middle line:84% under battery electric vehicles has not 00:34:33.020 --> 00:34:36.949 align:middle line:84% changed that much over the last 12 or 13 years, simply 00:34:36.949 --> 00:34:38.547 align:middle line:90% because they're pretty simple. 00:34:38.547 --> 00:34:39.380 align:middle line:90% They have a battery. 00:34:39.380 --> 00:34:41.179 align:middle line:90% They have an electric motor. 00:34:41.179 --> 00:34:43.429 align:middle line:84% Depending on how many luxury items 00:34:43.429 --> 00:34:45.290 align:middle line:84% or how big the form factor is, that 00:34:45.290 --> 00:34:46.940 align:middle line:90% might affect the efficiency. 00:34:46.940 --> 00:34:49.219 align:middle line:84% But the fundamental technology is fairly simple. 00:34:49.219 --> 00:34:53.239 align:middle line:84% A battery, based mostly on lithium ion cells, 00:34:53.239 --> 00:34:54.710 align:middle line:90% driving an electric motor. 00:34:54.710 --> 00:34:56.540 align:middle line:84% Some cars might have all-wheel drive 00:34:56.540 --> 00:34:58.070 align:middle line:90% with multiple electric motors. 00:34:58.070 --> 00:35:00.710 align:middle line:84% They're all roughly the same efficiency. 00:35:00.710 --> 00:35:04.070 align:middle line:84% But the cost is going down as we adopt more electric vehicles 00:35:04.070 --> 00:35:07.610 align:middle line:84% and as more manufacturers compete in the market. 00:35:07.610 --> 00:35:09.383 align:middle line:84% So one question you might have is, 00:35:09.383 --> 00:35:11.050 align:middle line:84% what about the carbon of the electricity 00:35:11.050 --> 00:35:13.520 align:middle line:84% that's going to the electric vehicle itself? 00:35:13.520 --> 00:35:15.070 align:middle line:90% And this is worth pointing out. 00:35:15.070 --> 00:35:18.063 align:middle line:84% It's a question that MacKay answers in his book. 00:35:18.063 --> 00:35:20.230 align:middle line:84% His question is, you've shown that electric cars are 00:35:20.230 --> 00:35:22.180 align:middle line:84% more energy efficient than fossil cars. 00:35:22.180 --> 00:35:23.770 align:middle line:84% But are they better if our objective 00:35:23.770 --> 00:35:26.950 align:middle line:84% is to reduce the CO2 emissions, and the electricity is still 00:35:26.950 --> 00:35:29.650 align:middle line:84% generated by fossil fuel power stations? 00:35:29.650 --> 00:35:31.450 align:middle line:84% Using McKay's reasoning, again, I 00:35:31.450 --> 00:35:32.950 align:middle line:84% encourage you to go back to the book 00:35:32.950 --> 00:35:35.110 align:middle line:84% if you haven't read this part, this 00:35:35.110 --> 00:35:37.300 align:middle line:84% is a quite easy calculation to do. 00:35:37.300 --> 00:35:39.370 align:middle line:84% Assume the electric vehicle's energy cost 00:35:39.370 --> 00:35:42.790 align:middle line:84% is 20 kilowatt hours of electricity per 100 kilometers. 00:35:42.790 --> 00:35:45.160 align:middle line:84% That's his conservative estimate. 00:35:45.160 --> 00:35:47.080 align:middle line:84% If the grid electricity has a carbon footprint 00:35:47.080 --> 00:35:51.100 align:middle line:84% of 500 grams of CO2 per kilowatt hour of electricity, 00:35:51.100 --> 00:35:52.930 align:middle line:84% then the effective emissions of this car 00:35:52.930 --> 00:35:55.720 align:middle line:84% are 100 grams CO2 per kilometer, which 00:35:55.720 --> 00:35:58.690 align:middle line:84% is as good as the best fossil cars in 2009. 00:35:58.690 --> 00:36:01.000 align:middle line:84% Fossil cars have unfortunately not gotten 00:36:01.000 --> 00:36:02.710 align:middle line:90% that much better since 2009. 00:36:02.710 --> 00:36:06.700 align:middle line:84% So MacKay could conclude in 2009 that electric cars are already 00:36:06.700 --> 00:36:10.810 align:middle line:84% a good idea, even before we green our electricity supply. 00:36:10.810 --> 00:36:12.550 align:middle line:84% If we look at more recent calculations 00:36:12.550 --> 00:36:15.520 align:middle line:84% from the Union of Concerned Scientists, 00:36:15.520 --> 00:36:18.940 align:middle line:84% they do a miles per gallon calculation equivalent 00:36:18.940 --> 00:36:22.270 align:middle line:84% comparing what the grid energy is, 00:36:22.270 --> 00:36:25.750 align:middle line:84% and what the emissions are of the grid energy as a gas 00:36:25.750 --> 00:36:27.530 align:middle line:90% mile per gallon equivalent. 00:36:27.530 --> 00:36:29.290 align:middle line:84% This is why if you buy a new car, 00:36:29.290 --> 00:36:33.610 align:middle line:84% you'll see PGE, or the miles per gallon equivalent 00:36:33.610 --> 00:36:35.055 align:middle line:90% for electric cars. 00:36:35.055 --> 00:36:36.430 align:middle line:84% But if you calculate it backwards 00:36:36.430 --> 00:36:39.340 align:middle line:84% and show what the gasoline miles per gallon equivalent 00:36:39.340 --> 00:36:41.290 align:middle line:84% is of the grid electricity, you'll 00:36:41.290 --> 00:36:44.470 align:middle line:84% see that places like California or the Northwest, 00:36:44.470 --> 00:36:46.930 align:middle line:84% that have relatively low greenhouse gas 00:36:46.930 --> 00:36:48.490 align:middle line:84% emissions in the electricity mix, 00:36:48.490 --> 00:36:50.710 align:middle line:84% have amazingly high miles per gallon 00:36:50.710 --> 00:36:52.270 align:middle line:90% in miles per gallon of gasoline. 00:36:52.270 --> 00:36:55.150 align:middle line:84% In other words, grid electricity in California 00:36:55.150 --> 00:36:56.290 align:middle line:90% is relatively clean. 00:36:56.290 --> 00:36:59.500 align:middle line:84% That's the equivalent, in terms of greenhouse gas emissions, 00:36:59.500 --> 00:37:02.330 align:middle line:90% of getting 134 miles per gallon. 00:37:02.330 --> 00:37:04.480 align:middle line:84% So you can basically completely outcompete, 00:37:04.480 --> 00:37:08.680 align:middle line:84% by a factor of 4, any fossil fuel cars. 00:37:08.680 --> 00:37:10.425 align:middle line:90% Here in New England, we have-- 00:37:10.425 --> 00:37:13.360 align:middle line:84% in upstate New York, because of hydropower, they 00:37:13.360 --> 00:37:15.010 align:middle line:90% have amazingly clean energy. 00:37:15.010 --> 00:37:19.330 align:middle line:84% 255 miles per gallon gasoline equivalent. 00:37:19.330 --> 00:37:21.520 align:middle line:84% Here in New England, we have a 122 miles 00:37:21.520 --> 00:37:22.750 align:middle line:90% per gallon equivalent. 00:37:22.750 --> 00:37:25.840 align:middle line:84% But the key thing is, even in places like the Midwest, that 00:37:25.840 --> 00:37:29.500 align:middle line:84% relies heavily on relatively dirty sources of electricity 00:37:29.500 --> 00:37:31.810 align:middle line:84% like coal-fired power plants, you 00:37:31.810 --> 00:37:33.610 align:middle line:84% can see that most places in the Midwest 00:37:33.610 --> 00:37:35.852 align:middle line:84% get about 60 miles per gallon equivalent. 00:37:35.852 --> 00:37:37.810 align:middle line:84% In other words, if you get an electric vehicle, 00:37:37.810 --> 00:37:40.708 align:middle line:84% you're getting the equivalent of 60 miles per gallon electricity 00:37:40.708 --> 00:37:42.250 align:middle line:84% in terms of greenhouse gas emissions. 00:37:42.250 --> 00:37:45.700 align:middle line:84% Only two places in the US, looks like Minnesota 00:37:45.700 --> 00:37:49.720 align:middle line:84% and parts of the Midwest, get relatively low greenhouse gas 00:37:49.720 --> 00:37:51.490 align:middle line:90% efficiencies from electricity. 00:37:51.490 --> 00:37:54.170 align:middle line:84% 41 miles per gallon, 43 miles per gallon. 00:37:54.170 --> 00:37:56.950 align:middle line:84% That's lower than you could get with a comparable hybrid 00:37:56.950 --> 00:38:00.400 align:middle line:84% in those places if you simply powered a hybrid from gasoline. 00:38:00.400 --> 00:38:02.530 align:middle line:90% But most cars are not hybrids. 00:38:02.530 --> 00:38:05.620 align:middle line:84% And the average US efficiency, it's something 00:38:05.620 --> 00:38:08.570 align:middle line:90% like 20, 25 miles per gallon. 00:38:08.570 --> 00:38:11.560 align:middle line:84% So even in these places, electric vehicles 00:38:11.560 --> 00:38:16.330 align:middle line:84% outcompete your fossil fuel car, if not your typical hybrid. 00:38:16.330 --> 00:38:18.470 align:middle line:84% The average for all US electric vehicles 00:38:18.470 --> 00:38:21.630 align:middle line:84% is around 93 miles per gallon equivalent. 00:38:21.630 --> 00:38:27.420 align:middle line:84% So this is to say that in almost all cases from a-- on a just 00:38:27.420 --> 00:38:31.110 align:middle line:84% fuel basis, we have much lower greenhouse gas emissions 00:38:31.110 --> 00:38:33.030 align:middle line:90% from electric vehicles. 00:38:33.030 --> 00:38:36.840 align:middle line:84% The Miotti paper counted the vehicle and the fuel lifetime 00:38:36.840 --> 00:38:37.830 align:middle line:90% carbon emissions. 00:38:37.830 --> 00:38:39.810 align:middle line:84% And in all cases there, you also saw 00:38:39.810 --> 00:38:42.720 align:middle line:84% electric vehicles were lower emissions than hybrid vehicles 00:38:42.720 --> 00:38:45.000 align:middle line:90% or gasoline vehicles. 00:38:45.000 --> 00:38:46.980 align:middle line:84% So this brings me to an article that I 00:38:46.980 --> 00:38:48.673 align:middle line:84% wish I'd included in the syllabus, 00:38:48.673 --> 00:38:51.090 align:middle line:84% but didn't have time to because it only came out last week 00:38:51.090 --> 00:38:52.260 align:middle line:90% or so. 00:38:52.260 --> 00:38:54.120 align:middle line:84% It actually came from Outside magazine. 00:38:54.120 --> 00:38:57.540 align:middle line:84% And the headline is "Why You Should Buy an E-bike Instead 00:38:57.540 --> 00:38:58.890 align:middle line:90% of an Electric Vehicle." 00:38:58.890 --> 00:39:00.780 align:middle line:90% I have an electric bicycle. 00:39:00.780 --> 00:39:01.320 align:middle line:90% I love it. 00:39:01.320 --> 00:39:03.240 align:middle line:84% So I guess I'm encouraging you to read 00:39:03.240 --> 00:39:05.020 align:middle line:90% this article for that reason. 00:39:05.020 --> 00:39:06.780 align:middle line:84% But also because the article is actually 00:39:06.780 --> 00:39:09.600 align:middle line:84% full of calculations for what the cost of ownership 00:39:09.600 --> 00:39:11.430 align:middle line:90% is for an electric vehicle. 00:39:11.430 --> 00:39:13.230 align:middle line:84% For a lot of people who are considering 00:39:13.230 --> 00:39:15.720 align:middle line:84% replacing their current fossil fuel cars, 00:39:15.720 --> 00:39:18.480 align:middle line:84% the author, Jill Lindsay, argues that it's much better 00:39:18.480 --> 00:39:21.420 align:middle line:84% to actually add an e-bike to your household 00:39:21.420 --> 00:39:23.370 align:middle line:84% rather than replacing your current car. 00:39:23.370 --> 00:39:25.200 align:middle line:84% You might keep your fossil fuel car. 00:39:25.200 --> 00:39:26.850 align:middle line:84% But if you try an e-bike, you might 00:39:26.850 --> 00:39:29.910 align:middle line:84% like it so much that you simply leave the car in the garage 00:39:29.910 --> 00:39:32.460 align:middle line:84% and only preserve it for long distance camping trips 00:39:32.460 --> 00:39:35.400 align:middle line:84% occasionally, like the typical reader of an Outside magazine 00:39:35.400 --> 00:39:36.090 align:middle line:90% might go on. 00:39:36.090 --> 00:39:38.490 align:middle line:84% I would also argue to you that electric bikes have 00:39:38.490 --> 00:39:40.920 align:middle line:84% a lot of advantages over electric cars 00:39:40.920 --> 00:39:42.480 align:middle line:90% or internal combustion cars. 00:39:42.480 --> 00:39:45.450 align:middle line:84% For example, I do a lot of errands on my electric bike. 00:39:45.450 --> 00:39:46.500 align:middle line:90% I never have to park it. 00:39:46.500 --> 00:39:50.220 align:middle line:84% I just pull up in front of a store or library, 00:39:50.220 --> 00:39:54.060 align:middle line:84% and I knock out six errands in my relatively dense suburb 00:39:54.060 --> 00:39:55.090 align:middle line:90% in under an hour. 00:39:55.090 --> 00:39:58.320 align:middle line:84% So I can just cruise around, avoid traffic, avoid parking. 00:39:58.320 --> 00:40:01.590 align:middle line:84% That time savings is worth a lot for me as a-- 00:40:01.590 --> 00:40:03.422 align:middle line:90% to buy an e-bike. 00:40:03.422 --> 00:40:05.130 align:middle line:84% And so this brings me to the idea of two- 00:40:05.130 --> 00:40:06.840 align:middle line:90% and three-wheeled vehicles. 00:40:06.840 --> 00:40:08.340 align:middle line:84% If you don't know what this is, this 00:40:08.340 --> 00:40:10.920 align:middle line:84% is a tuk tuk, a three-wheeled vehicle. 00:40:10.920 --> 00:40:13.242 align:middle line:84% Also called a "rickshaw" sometimes. 00:40:13.242 --> 00:40:14.950 align:middle line:84% And you can see, in this particular case, 00:40:14.950 --> 00:40:17.260 align:middle line:84% it looks basically like a motorcycle up front. 00:40:17.260 --> 00:40:19.470 align:middle line:84% It's got a cargo bed here in back 00:40:19.470 --> 00:40:22.740 align:middle line:84% where it looks like maybe five or six people could ride 00:40:22.740 --> 00:40:24.690 align:middle line:90% or cargo could be carried. 00:40:24.690 --> 00:40:27.960 align:middle line:84% If you've ever been to various countries 00:40:27.960 --> 00:40:31.590 align:middle line:84% in the developing world like India, or Thailand, 00:40:31.590 --> 00:40:35.550 align:middle line:84% or sub-Saharan Africa, or parts of Latin America, 00:40:35.550 --> 00:40:38.520 align:middle line:84% you'll see a lot of these two- and three-wheeled vehicles. 00:40:38.520 --> 00:40:41.790 align:middle line:84% They're called "tuk tuks" in Southeast Asia. 00:40:41.790 --> 00:40:45.150 align:middle line:84% Here's a picture of a traffic jam in Nigeria. 00:40:45.150 --> 00:40:48.240 align:middle line:84% You can see that these are the prevalent form of vehicles. 00:40:48.240 --> 00:40:51.270 align:middle line:84% You can see this relatively low-density pickup 00:40:51.270 --> 00:40:53.880 align:middle line:90% truck in this traffic jam. 00:40:53.880 --> 00:40:56.550 align:middle line:84% You can see one car going the opposite direction 00:40:56.550 --> 00:40:57.810 align:middle line:90% in this traffic jam. 00:40:57.810 --> 00:41:00.508 align:middle line:84% But the vast majority of vehicles are tuk tuks. 00:41:00.508 --> 00:41:02.550 align:middle line:84% And the reason why this is important-- we go back 00:41:02.550 --> 00:41:07.072 align:middle line:84% to the Bloomberg New Energy electric vehicle outlook again. 00:41:07.072 --> 00:41:10.300 align:middle line:84% And you can see that two- and three-wheeled vehicles 00:41:10.300 --> 00:41:11.710 align:middle line:90% and municipal buses-- 00:41:11.710 --> 00:41:15.580 align:middle line:84% this is their actual breakdown of road transport segment 00:41:15.580 --> 00:41:17.710 align:middle line:90% progress towards net zero. 00:41:17.710 --> 00:41:19.540 align:middle line:84% From what they've forecasted, you 00:41:19.540 --> 00:41:21.460 align:middle line:84% can see that two- and three-wheeled vehicles 00:41:21.460 --> 00:41:23.830 align:middle line:84% and municipal buses are actually almost 00:41:23.830 --> 00:41:27.940 align:middle line:84% on-track to have a net zero scenario, 100% zero 00:41:27.940 --> 00:41:30.670 align:middle line:90% electric vehicle share, by 2050. 00:41:30.670 --> 00:41:34.150 align:middle line:84% You can see that 74% of two-wheelers 00:41:34.150 --> 00:41:35.890 align:middle line:90% will be zero-emission vehicles. 00:41:35.890 --> 00:41:39.320 align:middle line:84% 94% of three-wheelers will be electric vehicles. 00:41:39.320 --> 00:41:42.940 align:middle line:84% And essentially, with 1.1 billion of these vehicles 00:41:42.940 --> 00:41:47.270 align:middle line:84% already on the road, 3.8 million municipal buses on the road, 00:41:47.270 --> 00:41:50.410 align:middle line:84% we are almost on track to hit our net zero scenarios. 00:41:50.410 --> 00:41:53.530 align:middle line:84% Where we need to do more work is in terms of passenger vehicles 00:41:53.530 --> 00:41:55.990 align:middle line:84% and light commercial vehicles, the kind of vehicles 00:41:55.990 --> 00:41:58.750 align:middle line:84% that Americans typically tend to drive. 00:41:58.750 --> 00:42:01.030 align:middle line:84% And we need to make a lot of effort 00:42:01.030 --> 00:42:03.910 align:middle line:84% in terms of getting to net zero emissions 00:42:03.910 --> 00:42:06.910 align:middle line:84% from medium and heavy commercial vehicles. 00:42:06.910 --> 00:42:10.300 align:middle line:84% As we know from planning cities, if we 00:42:10.300 --> 00:42:12.940 align:middle line:84% want to have more two- and three-wheeled vehicles 00:42:12.940 --> 00:42:16.360 align:middle line:84% in developed countries like the US, or low-density countries 00:42:16.360 --> 00:42:20.140 align:middle line:84% like the US, we need to improve our biking infrastructure, 00:42:20.140 --> 00:42:22.510 align:middle line:84% or infrastructure in terms of allowing these two- 00:42:22.510 --> 00:42:24.730 align:middle line:90% and three-wheeled vehicles. 00:42:24.730 --> 00:42:30.310 align:middle line:84% Municipal buses are already a cost-effective alternative 00:42:30.310 --> 00:42:33.910 align:middle line:84% for transportation, relatively convenient to charge, 00:42:33.910 --> 00:42:36.520 align:middle line:84% because they go on the same route every day. 00:42:36.520 --> 00:42:40.275 align:middle line:84% But we know that buses already still cost more upfront. 00:42:40.275 --> 00:42:42.400 align:middle line:84% And so we're going to need incentives to get people 00:42:42.400 --> 00:42:45.820 align:middle line:84% over the upfront cost, even if their lifetime is 00:42:45.820 --> 00:42:49.180 align:middle line:84% comparable in terms of fuel cost. 00:42:49.180 --> 00:42:51.760 align:middle line:84% And so this brings me to this headline which you probably 00:42:51.760 --> 00:42:54.790 align:middle line:84% saw a few weeks ago, what to know about California's ban 00:42:54.790 --> 00:42:56.740 align:middle line:90% on new gasoline-powered cars. 00:42:56.740 --> 00:43:00.100 align:middle line:84% By 2035, California shoppers looking for new vehicles 00:43:00.100 --> 00:43:02.750 align:middle line:84% will have to buy electric vehicles. 00:43:02.750 --> 00:43:05.360 align:middle line:84% There won't be a ban on the internal combustion engine 00:43:05.360 --> 00:43:07.470 align:middle line:84% vehicles that already exist in California. 00:43:07.470 --> 00:43:09.852 align:middle line:84% But if you're a shopper buying a new car or a licensing 00:43:09.852 --> 00:43:11.750 align:middle line:84% a new vehicle in California, you're 00:43:11.750 --> 00:43:14.840 align:middle line:84% probably going to have to license an electric car if it's 00:43:14.840 --> 00:43:16.080 align:middle line:90% a new vehicle. 00:43:16.080 --> 00:43:17.700 align:middle line:90% Now, why is this important? 00:43:17.700 --> 00:43:19.400 align:middle line:84% What I want to talk about is some 00:43:19.400 --> 00:43:23.510 align:middle line:84% of the policies that could be used to basically shape 00:43:23.510 --> 00:43:25.910 align:middle line:84% the international auto market, how California 00:43:25.910 --> 00:43:27.510 align:middle line:90% has played a key role. 00:43:27.510 --> 00:43:30.410 align:middle line:84% And I'd also like to tell the story about Mary Nichols. 00:43:30.410 --> 00:43:37.130 align:middle line:84% Mary Nichols is a 28-year-old Yale Law graduate. 00:43:37.130 --> 00:43:40.910 align:middle line:84% She successfully helps to sue the EPA for not enforcing 00:43:40.910 --> 00:43:43.010 align:middle line:90% the Clean Air Act in 1970. 00:43:43.010 --> 00:43:45.860 align:middle line:84% And this is building on efforts in the State of California 00:43:45.860 --> 00:43:48.950 align:middle line:84% to intervene in local air pollution issues that 00:43:48.950 --> 00:43:51.440 align:middle line:84% led to the design of air quality management 00:43:51.440 --> 00:43:54.110 align:middle line:84% districts and the California Air Resources Board 00:43:54.110 --> 00:43:57.660 align:middle line:84% before the US Clean Air Act was passed in 1970. 00:43:57.660 --> 00:44:02.000 align:middle line:84% So from these efforts, both from the State of California, 00:44:02.000 --> 00:44:04.280 align:middle line:84% and from these efforts by environmental groups to sue 00:44:04.280 --> 00:44:06.980 align:middle line:84% the EPA for not enforcing the Clean Air Act which was passed 00:44:06.980 --> 00:44:12.020 align:middle line:84% by Congress in 1970, they essentially pushed 00:44:12.020 --> 00:44:14.330 align:middle line:90% California's-- 00:44:14.330 --> 00:44:18.050 align:middle line:84% California's regulations for vehicles and air pollution 00:44:18.050 --> 00:44:21.440 align:middle line:84% are essentially grandfathered into the Clean Air Act. 00:44:21.440 --> 00:44:24.320 align:middle line:84% Mary Nichols joins the California Air Resources 00:44:24.320 --> 00:44:27.750 align:middle line:84% Board in 1975, becomes the chairman in 1979. 00:44:27.750 --> 00:44:29.720 align:middle line:84% And this is a picture of Mary Nichols 00:44:29.720 --> 00:44:31.640 align:middle line:84% more recently in the last decade. 00:44:31.640 --> 00:44:35.420 align:middle line:84% She goes on to work at Bill Clinton's EPA in 1993, 00:44:35.420 --> 00:44:37.700 align:middle line:84% works on sulfur dioxide and acid rain. 00:44:37.700 --> 00:44:40.790 align:middle line:84% She works on the first national limit for fine particulates, 00:44:40.790 --> 00:44:44.270 align:middle line:84% and then rejoined the California Air Resources Board in 2003 00:44:44.270 --> 00:44:46.820 align:middle line:84% under Governor Arnold Schwarzenegger and Governor 00:44:46.820 --> 00:44:47.750 align:middle line:90% Jerry Brown. 00:44:47.750 --> 00:44:50.180 align:middle line:84% And this is to say that California always 00:44:50.180 --> 00:44:55.850 align:middle line:84% had a focus on air pollution before national efforts. 00:44:55.850 --> 00:44:58.010 align:middle line:84% Mary Nichols is-- I just like to use 00:44:58.010 --> 00:45:01.460 align:middle line:84% as an example of a young, successful university 00:45:01.460 --> 00:45:03.870 align:middle line:84% graduate, like many of you will be, 00:45:03.870 --> 00:45:06.890 align:middle line:84% and how she gets involved in air pollution issues, 00:45:06.890 --> 00:45:09.530 align:middle line:84% and how California's regulations, which 00:45:09.530 --> 00:45:12.350 align:middle line:84% preceded the Clean Air Act, enable California 00:45:12.350 --> 00:45:15.470 align:middle line:84% to pass successively more aggressive air pollution 00:45:15.470 --> 00:45:18.670 align:middle line:90% legislation or regulations. 00:45:18.670 --> 00:45:20.740 align:middle line:84% And so to bring us back to how can 00:45:20.740 --> 00:45:24.580 align:middle line:84% you use these standards, the California Air Resources Board 00:45:24.580 --> 00:45:27.970 align:middle line:84% standards, or zero emission vehicle mandates. 00:45:27.970 --> 00:45:31.210 align:middle line:84% How do you force large national international automakers 00:45:31.210 --> 00:45:33.250 align:middle line:90% to conform to your regulations? 00:45:33.250 --> 00:45:38.200 align:middle line:84% Well, California is a large part of the US vehicle market. 00:45:38.200 --> 00:45:41.360 align:middle line:84% They decided the goal was going to be 00:45:41.360 --> 00:45:44.720 align:middle line:84% 22% of zero emission vehicles in 2025, 00:45:44.720 --> 00:45:46.483 align:middle line:90% just a few years from now. 00:45:46.483 --> 00:45:47.900 align:middle line:84% And what they do quite effectively 00:45:47.900 --> 00:45:49.460 align:middle line:90% is join with other states. 00:45:49.460 --> 00:45:51.140 align:middle line:84% They basically, essentially, form 00:45:51.140 --> 00:45:54.335 align:middle line:84% a collision of zero emission vehicle states. 00:45:54.335 --> 00:45:56.850 align:middle line:84% This is California plus 13 states, 00:45:56.850 --> 00:45:57.980 align:middle line:90% including Massachusetts. 00:45:57.980 --> 00:46:01.550 align:middle line:84% That adds about 800,000 vehicles. 00:46:01.550 --> 00:46:03.025 align:middle line:90% Of course, at this-- 00:46:03.025 --> 00:46:04.400 align:middle line:84% when the Trump administration try 00:46:04.400 --> 00:46:07.940 align:middle line:84% to roll back emission standards that California and these 13 00:46:07.940 --> 00:46:11.420 align:middle line:84% states had basically passed, 23 states actually 00:46:11.420 --> 00:46:16.700 align:middle line:84% sued to stop the rollbacks of these EPA standards 00:46:16.700 --> 00:46:18.800 align:middle line:90% in the fall of 2019. 00:46:18.800 --> 00:46:21.950 align:middle line:84% Even more states sued to stop the rollbacks. 00:46:21.950 --> 00:46:24.980 align:middle line:84% Because once one large state like California 00:46:24.980 --> 00:46:27.710 align:middle line:84% has passed certain regulations, automakers 00:46:27.710 --> 00:46:29.630 align:middle line:84% want to supply vehicles that state. 00:46:29.630 --> 00:46:31.760 align:middle line:84% Once California joined the 13 other states, 00:46:31.760 --> 00:46:35.160 align:middle line:84% that's a large fraction of the total auto sales in the United 00:46:35.160 --> 00:46:39.500 align:middle line:84% States, which is itself a large auto-consuming country. 00:46:39.500 --> 00:46:43.400 align:middle line:84% And 23 states sued to stop these rollbacks in fall of 2019 00:46:43.400 --> 00:46:47.330 align:middle line:84% because states and automakers both liked having 00:46:47.330 --> 00:46:48.650 align:middle line:90% some regulatory certainty. 00:46:48.650 --> 00:46:50.390 align:middle line:84% And the industry and these states 00:46:50.390 --> 00:46:53.150 align:middle line:84% had already agreed on what these zero emission mandates 00:46:53.150 --> 00:46:55.920 align:middle line:90% or standards would be. 00:46:55.920 --> 00:47:00.530 align:middle line:84% And one of the aspects of these zero emission standards 00:47:00.530 --> 00:47:03.650 align:middle line:84% or mandates from California is that manufacturers 00:47:03.650 --> 00:47:05.750 align:middle line:90% have to make enough vehicles. 00:47:05.750 --> 00:47:10.740 align:middle line:84% 15.4% of all sales are in California, 00:47:10.740 --> 00:47:14.480 align:middle line:84% and so this is essentially getting entities 00:47:14.480 --> 00:47:17.750 align:middle line:84% like Volkswagen, or Hyundai, or Kia. 00:47:17.750 --> 00:47:20.090 align:middle line:84% If they want to sell vehicles in California, 00:47:20.090 --> 00:47:24.020 align:middle line:84% they have to conform to California's standards. 00:47:24.020 --> 00:47:26.660 align:middle line:84% And so some of the analysis that California Air Resources 00:47:26.660 --> 00:47:29.450 align:middle line:84% Board does is that this is going to add about $1,900 00:47:29.450 --> 00:47:30.860 align:middle line:90% to the cost of a new vehicle. 00:47:30.860 --> 00:47:33.230 align:middle line:84% But this efficiency or these fuel standards 00:47:33.230 --> 00:47:35.580 align:middle line:84% will pay for themselves in about three years. 00:47:35.580 --> 00:47:38.270 align:middle line:84% We get a 47% reduction in greenhouse gas emissions 00:47:38.270 --> 00:47:41.750 align:middle line:84% compared to today, and a 75% reduction in air pollution 00:47:41.750 --> 00:47:43.870 align:middle line:90% compared to today. 00:47:43.870 --> 00:47:48.050 align:middle line:84% I think one point worth noticing is that people in California 00:47:48.050 --> 00:47:49.730 align:middle line:84% care about greenhouse gas emissions. 00:47:49.730 --> 00:47:51.680 align:middle line:84% But these standards or these mandates 00:47:51.680 --> 00:47:54.440 align:middle line:84% started with local air pollution and smog. 00:47:54.440 --> 00:47:56.030 align:middle line:84% When I was growing up, Los Angeles 00:47:56.030 --> 00:47:58.100 align:middle line:84% was known as a quite smoggy place. 00:47:58.100 --> 00:48:01.910 align:middle line:84% Air pollution has vastly improved in California, 00:48:01.910 --> 00:48:03.950 align:middle line:84% leading to much better health outcomes, 00:48:03.950 --> 00:48:06.320 align:middle line:84% and leading to these arguments that not only is it 00:48:06.320 --> 00:48:08.600 align:middle line:84% cost efficient, it's also efficient in terms 00:48:08.600 --> 00:48:12.740 align:middle line:84% of what we spend on health care or chronic pulmonary heart 00:48:12.740 --> 00:48:14.900 align:middle line:90% disease or asthma. 00:48:14.900 --> 00:48:18.920 align:middle line:84% And so California has led to successively more-- 00:48:18.920 --> 00:48:22.580 align:middle line:84% has passed successfully more stringent standards 00:48:22.580 --> 00:48:23.690 align:middle line:90% and regulations. 00:48:23.690 --> 00:48:27.320 align:middle line:84% As I said 2035, the goal is 100% of new vehicles 00:48:27.320 --> 00:48:29.780 align:middle line:84% will be sold as zero emission vehicles. 00:48:29.780 --> 00:48:32.450 align:middle line:84% There will also be greater use of low-carbon fuels being 00:48:32.450 --> 00:48:36.020 align:middle line:84% promoted, such as hydrogen, such as fuel cell vehicles. 00:48:36.020 --> 00:48:38.273 align:middle line:84% By 2050, they'll be trying to phase 00:48:38.273 --> 00:48:40.190 align:middle line:84% out all their internal combustion engine cars. 00:48:40.190 --> 00:48:44.990 align:middle line:84% So you will be able to drive old gas cars still. 00:48:44.990 --> 00:48:48.710 align:middle line:84% So currently, we have almost 100% of all cars in California 00:48:48.710 --> 00:48:49.880 align:middle line:90% run on gas. 00:48:49.880 --> 00:48:53.960 align:middle line:84% Their target by 2050 is to have about 53% run on fuel cells, 00:48:53.960 --> 00:48:56.542 align:middle line:84% because fuel cells and hydrogen are even more 00:48:56.542 --> 00:48:58.250 align:middle line:84% efficient than battery electric vehicles, 00:48:58.250 --> 00:49:00.350 align:middle line:90% or prospectively more efficient. 00:49:00.350 --> 00:49:02.960 align:middle line:84% Only 17% of cars in 2050 will still 00:49:02.960 --> 00:49:05.300 align:middle line:84% be running on battery electric vehicles. 00:49:05.300 --> 00:49:10.280 align:middle line:84% 9.7% will be plug-in, and 21% will still be using gasoline. 00:49:10.280 --> 00:49:12.150 align:middle line:90% That's their target in 2050. 00:49:12.150 --> 00:49:15.650 align:middle line:84% But what you can see is also a very deliberate, clear 00:49:15.650 --> 00:49:18.800 align:middle line:84% regulatory roadmap for automakers to follow. 00:49:18.800 --> 00:49:20.600 align:middle line:84% The reason why a lot of automakers 00:49:20.600 --> 00:49:23.270 align:middle line:84% want to keep these standards is because they've already 00:49:23.270 --> 00:49:25.040 align:middle line:84% developed their technology pathways, 00:49:25.040 --> 00:49:27.740 align:middle line:84% or they've already designed their products for the future 00:49:27.740 --> 00:49:28.837 align:middle line:90% to meet these standards. 00:49:28.837 --> 00:49:30.920 align:middle line:84% They don't want to see these standards fluctuating 00:49:30.920 --> 00:49:33.470 align:middle line:84% every four years depending on the occupant of the White 00:49:33.470 --> 00:49:35.547 align:middle line:90% House. 00:49:35.547 --> 00:49:37.630 align:middle line:84% And so let's talk a little bit about the Inflation 00:49:37.630 --> 00:49:38.410 align:middle line:90% Reduction Act. 00:49:38.410 --> 00:49:41.950 align:middle line:84% I just assigned these Hawkins and M. J. Bradley articles 00:49:41.950 --> 00:49:44.830 align:middle line:84% to highlight some of the policy design of how 00:49:44.830 --> 00:49:48.550 align:middle line:84% the federal government is going to try to incentivize people 00:49:48.550 --> 00:49:51.610 align:middle line:84% to buy electric vehicles by getting over the higher upfront 00:49:51.610 --> 00:49:54.700 align:middle line:84% cost, even if the future fuel cost is lower. 00:49:54.700 --> 00:49:56.810 align:middle line:84% They've extended incentives for manufacturers 00:49:56.810 --> 00:49:58.600 align:middle line:90% over 200,000 vehicles. 00:49:58.600 --> 00:50:01.270 align:middle line:84% The California Air Resources Board 00:50:01.270 --> 00:50:04.088 align:middle line:84% was taking away incentives over 200,000 vehicles, 00:50:04.088 --> 00:50:06.130 align:middle line:84% because the idea was that incentives would simply 00:50:06.130 --> 00:50:08.530 align:middle line:84% get manufacturers to start building electric vehicles, 00:50:08.530 --> 00:50:10.450 align:middle line:84% and they wouldn't need additional incentives. 00:50:10.450 --> 00:50:13.900 align:middle line:84% Of course, three manufacturers passed over the 200,000 vehicle 00:50:13.900 --> 00:50:17.470 align:middle line:84% limit, GM, Tesla, and Toyota, and so they no longer 00:50:17.470 --> 00:50:19.870 align:middle line:84% got incentives, meaning their cars were no longer cost 00:50:19.870 --> 00:50:22.450 align:middle line:84% competitive based on tax incentives, 00:50:22.450 --> 00:50:23.860 align:middle line:84% even though the idea is that they 00:50:23.860 --> 00:50:25.720 align:middle line:84% start making enough vehicles that they 00:50:25.720 --> 00:50:29.770 align:middle line:84% can learn enough and get to enough economies of scale 00:50:29.770 --> 00:50:32.470 align:middle line:84% that they compete without tax incentives. 00:50:32.470 --> 00:50:34.360 align:middle line:84% One difference in the Inflation Reduction Act 00:50:34.360 --> 00:50:36.520 align:middle line:84% is that it gives point of sale tax rebates 00:50:36.520 --> 00:50:40.090 align:middle line:84% for EVs to overcome those higher upfront costs. 00:50:40.090 --> 00:50:41.740 align:middle line:84% The point of sale tax rebate means 00:50:41.740 --> 00:50:44.020 align:middle line:84% that the consumer immediately sees 00:50:44.020 --> 00:50:46.450 align:middle line:84% the lower cost of the vehicle, rather than 00:50:46.450 --> 00:50:50.560 align:middle line:84% waiting for a tax return credit when they file their taxes. 00:50:50.560 --> 00:50:54.130 align:middle line:84% The Inflation Reduction Act also adds a first-time tax rebate 00:50:54.130 --> 00:50:56.920 align:middle line:84% for used electric vehicles, I think $4,000, 00:50:56.920 --> 00:50:59.440 align:middle line:84% to create a secondary market for electric vehicles 00:50:59.440 --> 00:51:01.630 align:middle line:84% to encourage people to buy electric vehicles, 00:51:01.630 --> 00:51:04.690 align:middle line:84% knowing that the subsequent person buying the vehicle 00:51:04.690 --> 00:51:09.070 align:middle line:84% from them will be subsidized so that it maintains resale value. 00:51:09.070 --> 00:51:12.010 align:middle line:84% Funny thing is, if you look for a used electric vehicle, 00:51:12.010 --> 00:51:14.350 align:middle line:84% you'll quite often see electric vehicles that 00:51:14.350 --> 00:51:17.770 align:middle line:84% are actually relatively high in price as used vehicles. 00:51:17.770 --> 00:51:22.120 align:middle line:84% But because the first owner got a tax incentive, 00:51:22.120 --> 00:51:24.940 align:middle line:84% the subsequent owner, even with a low-mileage vehicle, 00:51:24.940 --> 00:51:27.080 align:middle line:84% will pay much more than for a new vehicle. 00:51:27.080 --> 00:51:29.920 align:middle line:84% So this first-time tax rebate for used EVs 00:51:29.920 --> 00:51:33.430 align:middle line:84% is meant to overcome this problem of the one-time tax 00:51:33.430 --> 00:51:35.380 align:middle line:90% rebate for the first owner. 00:51:35.380 --> 00:51:38.440 align:middle line:84% And, of course, the part the Hawkins article focuses 00:51:38.440 --> 00:51:41.020 align:middle line:84% on the most is that there's new domestic manufacturing 00:51:41.020 --> 00:51:42.790 align:middle line:84% requirements for vehicles and batteries, 00:51:42.790 --> 00:51:44.620 align:middle line:84% meaning that for the next couple of years. 00:51:44.620 --> 00:51:47.162 align:middle line:84% it actually may be relatively hard to buy an electric vehicle 00:51:47.162 --> 00:51:48.900 align:middle line:90% because of supply chain issues. 00:51:48.900 --> 00:51:50.650 align:middle line:84% But simply, because most electric vehicles 00:51:50.650 --> 00:51:52.480 align:middle line:90% aren't manufactured in the US. 00:51:52.480 --> 00:51:54.010 align:middle line:84% The idea is we're going to increase 00:51:54.010 --> 00:51:55.900 align:middle line:84% the manufacturing in the US, and we're 00:51:55.900 --> 00:51:59.560 align:middle line:84% giving people incentives to manufacture vehicles 00:51:59.560 --> 00:52:00.610 align:middle line:90% and batteries in the US. 00:52:00.610 --> 00:52:04.000 align:middle line:84% And that's what's going to get incentives going down the road. 00:52:04.000 --> 00:52:06.700 align:middle line:84% There's probably more aspects of the Inflation Reduction Act, 00:52:06.700 --> 00:52:08.410 align:middle line:84% but I want to focus on the implications 00:52:08.410 --> 00:52:10.520 align:middle line:84% for your personal transportation, 00:52:10.520 --> 00:52:12.937 align:middle line:84% especially if you're in the market for an electric vehicle 00:52:12.937 --> 00:52:14.780 align:middle line:90% in the near future. 00:52:14.780 --> 00:52:16.580 align:middle line:84% So that concludes our lecture today. 00:52:16.580 --> 00:52:18.820 align:middle line:84% I'll see you in class for the next lecture. 00:52:18.820 --> 00:52:21.030 align:middle line:90% Have a great day. 00:52:21.030 --> 00:52:37.000 align:middle line:90%