SAN FRANCISCO – As a mature, cost-effective technology, electric vehicles (EVs) are an important part of the solution to global warming emissions.
In combination with clean electricity, they offer a route to climate-neutral land transport. And luckily, electricity is getting cleaner every year due to the rapidly falling costs of solar and wind energy.
Global sales of electric cars boomed last year, rising to 13% of all new vehicles sold, up from 8.6% in 2021. Much of this growth came from China, where electric vehicle sales will double by 2022 to 6.9 million (26% of all new car sales), and showed no signs of stopping. China’s Association of Automobile Manufacturers predicts electric vehicle sales in the country to grow 35% to nine million by 2023 (33% of total new vehicle sales).
But even this growth rate will not be enough to meet China’s or the world’s climate commitments.
To bring transport emissions in line with scientific goals for a safe climate, China’s leaders will have to step up the pace even further.
According to the International Council for Clean Transportation, a key element in China’s success so far has been the New Energy Vehicle Sales Standard (NEV), a little-known policy that sets sales targets for domestic automakers.
These targets will increase over time, enabling flexible compliance through carbon credit trading. If a manufacturer sells more than the industry average, it receives NEV credits that can be sold to a manufacturer that sells less.
Since the policy went into effect in 2019, the benchmark has increased from 10% of all sales that year to 18% in 2023.
But with sales already far exceeding that threshold last year, China’s Ministry of Industry and Information Technology can and should set future targets much higher.
In particular, Chinese transportation officials should plan for an NEV standard that will reach 75% of all sales by 2030.
Combined with other viable, high-ambition measures for heavy-duty vehicles, this would reduce car emissions by 70% below 2020 levels by 2050.
In contrast, vehicle emissions are predicted to rise by 63% by the middle of this century without additional action.
The Chinese authorities have no good reason to hold back. After all, getting more clean cars on the road could also save tens of thousands of lives each year by reducing air pollution.
Ambitious NEV standards are also essential to align China’s transportation industry with its broader commitment to net-zero emissions.
The International Energy Agency’s models show that global adoption of electric vehicles needs to exceed 60% of all cars by 2030 to reach net-zero emissions globally by 2050.
In practice, this means that the largest, most sophisticated car markets should outperform the global average, as many other countries will not have the resources to make such a rapid transition.
A Chinese decision to increase the NEV standard to 75% by 2030 would therefore have major consequences.
A faster transition is both feasible and affordable. Many EV options are already available in key markets and new ones are steadily being added to manufacturers’ product lines.
Growing investments show that automakers are serious about accelerating the shift to EVs. Prices will continue to fall due to improvements in battery technology and economies of scale.
EVs in China are already cheaper than internal combustion engine cars over the life of the vehicle (taking into account the fuel and maintenance savings that EVs offer).
These developments have pushed electric vehicle sales in China and 18 other countries, including the United States, past a tipping point.
Major markets have entered a phase of mass adoption of electric vehicles in which preferences will change surprisingly quickly.
Still, it would be a mistake to leave matters to the invisible hand of the market. Without policy changes, the transition will be slower than necessary given the lifespan of a typical car and the decades of investment that have gone into fossil fuel infrastructure.
While some 25 million new passenger cars are sold annually in China, there are already more than 200 million vehicles on the road, and most will be on the road for years to come.
To overcome this inertia, ambitious NEV sales standards must be embedded in a broader package of strategic EV policies.
For example, scaling up the mass acceptance of electric vehicles requires measures to stimulate and coordinate investments in charging infrastructure.
And to reap the full benefits of electric cars for the climate and public health, increased deployment of electric vehicles must be accompanied by an accelerated transition to clean electricity.
The remarkable growth in EV sales in recent years holds promise for the global fight against climate change. But transport officials must continue to act quickly to adapt policies to global needs.
While too little ambition entails unsustainable climate damage, a rapid transition is essential for a safe climate and cleaner air. There is no time for delay. China’s leaders need to fully depress the accelerator.
Chris Busch is Director of Transportation and Senior Economist at Energy Innovation.
Copyright: Project Syndicate, 2023.www.project-syndicate.org