The EV Revolution – Driven by Autonomous Vehicles, the Sharing Economy and Policy

The summer driving season is upon us. Today, the conversation centers around gas prices, miles driven and how many cars will be on the road. More than 1 million vehicles traveled at least 50 miles from the metro DC region on Memorial Day weekend, according to AAA.

Imagine an alternative headline: Shared mobility means fewer cars on the roads this Memorial Day weekend. It sounds apocryphal, right? As electric vehicles (EVs) attract more owners, the sharing economy becomes ubiquitous – at least in urban environments – and autonomous vehicles (AVs) move onto the roads, it’s possible. Daniel Sperling writes in Three Revolutions about the convergence of EVs, automation and shared mobility and the trio’s ability to transform urban transportation.

“In the dream scenario where driverless cars are pooled and electrified, vehicle use would drop by 60 percent compared to business as usual, greenhouse gas emissions would drop by 80 percent, and overall costs of vehicles, fuel use, and infrastructure would drop by more than 40 percent – representing a savings of $5 trillion annually,” writes Sperling.

Will that be our reality by 2040? Policy makers will need to solve a myriad of problems ranging from how to replace the gas tax that currently funds infrastructure to revising insurance and liability requirements.

While those debates are waged, global automakers and self-driving auto pioneers Waymo and Uber are taking action. Global auto manufacturers, for example, have invested $90 billion to advance the EV revolution and meet government regulations, according to a Reuters analysis.

U.S. fuel economy standards require automakers to reduce fleet emissions, and EVs are one strategy to do so. China has set a new standard for automakers to produce more zero- and low-emission vehicles (EVs and plug-in hybrids), also known as New Energy Vehicles (NEV). This quota is 10 percent in 2019. NEVs should comprise 20 percent of auto sales by 2025. Coupled with declining battery costs and improved performance, policy is putting more EVs on the roads. By 2040 more than 50 percent of new cars in China and 49.3 percent of new cars in the United States will be electric, according to the Bloomberg New Energy Finance’s EV Outlook released in May.

Autonomous vehicles are also a key driver to EV adoption. AVs for ride-sharing services, such as those being piloted by Uber, Waymo, Ford and Chevrolet, are used more intensively than an owner-operated car. EVs are easier for computers to drive, and “it will be easier, cheaper and safer to recharge an unmanned car than to gas one up,” reports USA Today.

“AVs have the promise to reduce the number of cars on the road, improve safety and expand accessibility – making our communities healthier and smarter – if we take steps now to manage AV deployment,” said Kelley Coyner, co-founder Mobilitye3 and former director of the Northern Virginia Transportation Commission. “AVs can help electric drive reach its tipping point to greater adoption.”

The combination of policy incentives and technology advancements have created a solid foundation for growth in the electric vehicle market. New and innovative policies as well as a shift in traveler’s expectations will further spur adoption of EVs and the synergies with AVs and the sharing economy.

This article originally appeared The Current, WCEE Newsletter, Q2 2018.