Randall Field, Executive Director, Mobility of the Future study and Mobility Systems Center
Joanna Moody, Research Program Manager, Mobility Systems Center
The idea is that to really decarbonize the transportation sector, you have to simultaneously decarbonize the electricity production and distribution and the energy sector. A lot of this is driven by the fact that we’re expecting to see huge population growth and growth in the middle class in cities around the world.
Randall Field: I’m Randy Field, I’m an energy researcher at the MIT Energy Initiative. I’m also the executive director for the Mobility of the Future study.
Joanna Moody: I’m Joanna Moody, I’m the research program manager for the Mobility Systems Center here at the MIT Energy Initiative and a coordinating author of the Mobility of the Future study.
So, Randy, you and I both worked on the Mobility of the Future study, which focused on how personal travel is going to evolve from now to 2050. Can you tell us a little bit more about the motivation behind that study?
RF: Because of the changes that are occurring in our transportation systems, there’s a great deal of interest from many stakeholders to understand how the transportation systems will evolve over the next 30 years. Many questions that affect both the growth of the number of people who need to travel, as well as the demand for energy, as well as what are the implications for pollution and climate change? Because every time we use a gallon of gasoline, we’re putting more pounds of CO2 into the atmosphere. Everybody wants to know, what do we do in our transportation system, in our energy systems, to avoid some of these consequences? We took this project on as a way of discerning that by working with interested stakeholders and working across the MIT campus with people from different disciplines, from mechanical engineers and civil engineers, urban studies, as well as business school economists and chemical engineers.
JM: I also know that this study was undertaken as part of MIT’s Plan for Action on Climate Change. The study itself covered many topics and we’re here today to talk about the findings and its implications for how people are going to move. One of the really interesting topics within this study is looking at different types of vehicles and people’s preferences and how these different types of vehicles are going to evolve into the future. Today, a majority of the vehicles on the road are internal combustion engine vehicles or they’re powered by gasoline, diesel, or other biofuels. But there are a lot of alternative fuel vehicles that are emerging on the market, whether they’re powered by electricity or powered by hydrogen. Could you tell us a little bit more about why we’re not seeing more of these vehicles on the road today?
RF: The number one reason is cost. These alternative fuel vehicles, whether it be a battery electric vehicle or hydrogen-powered fuel cell vehicle, those vehicles cost more money than what you would buy today if you were buying a gasoline-powered vehicle. We looked at not only the cost today, but more importantly, what does cost look like in the future? Because with any new technology, as you work out the kinks and you work out large manufacturing facilities, you can make the price of those vehicle technologies reduce in the future. We examined future prices based on analysis of learning curves, as we call it, to understand how greater volume could reduce those costs.
We also looked at how people make decisions and how the economics would influence their decision making. Part of this is that we recognize that these vehicle types will tend to be more expensive for many years to come. But the beauty of some of these vehicles, such as the electric vehicle, is that because the cost of the electricity is less than what you’d pay for gasoline, and because the vehicle cost in terms of maintenance is less than that for an internal combustion engine vehicle, because as we know, the battery vehicles have fewer moving parts. That means it has much less opportunity for wear and replacement and there’s no oil changes. There are many ways in which the cost of maintenance as well as the cost of fuels is reduced by having these alternative fuel vehicles.
Therefore, what we did in our analysis is to look at both the upfront purchase cost but also the costs that are incurred by the operator—the owner of those vehicles—over the course of years to have a very balanced view of the total cost of ownership. We compare those total cost of ownerships across different types of vehicles to understand where they stand today, and more importantly, where would those relative total cost of ownerships stand in the years ahead as we look at future cost reductions of the vehicles as well as future prices of fuels, future prices of electricity.
What we found is that in the United States, it’s very likely that the total cost of ownership of a battery electric vehicle will be equal, or roughly equal, to that of an internal combustion engine vehicle running on gasoline. At that point, the economics appear to be equal. Joanna, I was hoping you’d tell us about the other factors that come into play. Because we recognize it even when two cars may have the same cost, that by itself doesn’t necessarily mean that people will make those purchases.
JM: There’s a lot of debate in the field about whether total cost of ownership is really reflective of the decision making that an individual goes through when they’re purchasing a vehicle. For a lot of people, the upfront cost of alternative fuel vehicles is a huge barrier even if they could recoup those costs or save money as they operate those vehicles into the future. Not everyone is going to have that same sort of calculation when they’re going to the dealership to buy their vehicle. In addition to that, even if these vehicles cost the same, they have other differences in terms of how you use them.
One of the real concerns for battery electric vehicles is the issue of range anxiety or this idea that I may run out of energy before I get where I need to go. If there’s not a convenient place for me to top up or recharge, then maybe I would be stranded. That fear is really holding back some consumers from purchasing these vehicles. That’s particularly true when we look at how people are charging their vehicles today. Eighty percent of battery electric vehicle charging in the United States is done at home. Most people rely on the charge overnight at their home and then they don’t look to charge very much during the day. They only take these vehicles for trips where they know that they can get to and from their destination and back.
Now, if you want to look at a larger market for these vehicles, they need to be able to serve longer distance trips. In order to do that there needs to be some more robust provision of publicly available recharging infrastructure. That’s also going to be important for unlocking markets of individuals who don’t have access to a garage or a private parking space, whether they’re homeowners or even renters, that don’t have the ability to charge at home.
RF: Another interesting dimension is we talk about being able to charge at home in the United States. There are other parts of the world where people don’t have the ability to have electricity in their homes at all. That makes it an interesting longer term question of, how do we not only electrify our vehicles but also simultaneously electrify the world in places where, due to various constraints of the grid and wealth and income, some people are currently cut off from electricity? We know that some parts of the world use diesel to make electricity because they have that dilemma of not having ready access to electricity.
JM: Absolutely. I think that the global perspective is something that’s hugely important and was a big part of the Mobility of the Future study. One of the research teams employed a global economic model to look at how the passenger vehicle fleet and which types of vehicles are adopted by individuals is going to change as we move forward to 2050. Could you tell us a little bit more about some of the global and economically-driven findings from this analysis?
RF: Using that model that looks at all parts of the world and all sectors of the economy. What we found is that under the more aggressive climate mitigation strategies, we found that the amount of electrification of vehicles over the next 30 years brings us to approximately 50% of all vehicles—light-duty vehicles in the world—will be battery electric vehicles or plug in hybrid electric vehicles. That’s a substantial uptake from where we are today, which is less than 1% of electric vehicles in the world. We’re going to see a large transition under the scenarios. Even when we’re looking at this case of what we refer to as a reference situation where there is no Paris Agreement and there are no efforts to get to 2°C, even under that situation, based purely on economics, we would still have a fairly strong uptake of electric vehicles of roughly 33% of the global vehicle fleet in the year 2050.
We already have set off this trend towards electrification due to various policies that are driven by both European, Chinese, U.S., and other country’s efforts to reduce their dependence upon petroleum based fuels and to clean up their cities by having vehicles that have lower emissions, both of pollutants as well as CO2.
JM: I think that point about local pollution as another driver for the adoption of electric vehicles is really important. Particularly when we look at rapidly urbanizing and motorizing cities in emerging markets. Because a lot of these cities are looking at huge air pollution, public health issues, and that’s really a driver of electric vehicle adoption much more than potentially the climate change or the greenhouse gas emission concerns.
At the same time, what those vehicles are doing is maybe shifting the pollution from the exhaust pipe or the tailpipe of those vehicles out to the energy plant that’s producing the energy that then charges those vehicles. The idea is, if I’m driving an electric vehicle in the city, having an impact on global climate change, if that vehicle is powered from a coal plant, or from burning of other types of fossil fuels. Can you talk a little bit more about what it means to really reduce or decarbonize transportation when you move towards electrification?
RF: Joanna, you’re exactly right. If you were to make all of your electricity by burning coal and driving a power plant that way and then using that to power your battery electric vehicle, then you are worse off than if you were simply using a gasoline-powered vehicle.
Therefore, in our analysis, we looked at the entire lifecycle of the fuels, the vehicle of manufacturing, including the batteries, and understood on an apples-to-apples comparison how these different vehicle types compared. There’s certainly no doubt about it that today, the emissions by having a battery electric vehicle in an area like Massachusetts, using our local electricity, is better than having a gasoline-powered vehicle. Even though those emissions are not zero by any means. Because as you said, it’s not simply what comes out of the tailpipe, but how do you make that energy?
As we look to the future, the question is, how do we modify our vehicle selection to being vehicles of alternative fuel vehicles like battery electric or perhaps fuel cell vehicles? How do we simultaneously decarbonize the generation of power by making the power plants more efficient, introducing more renewable energy types, having carbon capture at the power plants? All of these things combined together can drive down the level of carbon intensity of our electricity substantially. Our economic model looked at that and examined what level of decarbonization could occur across the world in different countries recognizing that different countries have different constraints and different current starting points in terms of their availability of coal, their economics, their availability of natural gas, their availability of wind and solar.
We considered all of those factors in assessing how much decarbonization would happen in different parts of the world under different scenarios. What we see is that the level of decarbonization of the electric grid would actually be greater than the level of decarbonization of the transportation system, partly because there are currently more options for decarbonizing electricity. It’s less expensive to decarbonize electricity. But the answer is we do both and we do both on different trajectories in order to get to the overall objective of reduced carbon emissions globally.
JM: Right. The idea is that to really decarbonize the transportation sector, you have to simultaneously decarbonize the electricity production and distribution and the energy sector. One of the things that you said really reminds me that an important context here is that the transportation sector is a significant but not overwhelming part of global greenhouse gas emissions. But if you only look at the current contributions, you’re really missing part of the equation, which is that it’s one of the fastest growing contributors to global greenhouse gas emissions. A lot of this is driven by the fact that we’re expecting to see huge population growth and growth in the middle class in cities around the world. As people reach an ability to afford a car, you’re seeing a huge projection for car ownership and car use demand in countries around the world. This is particularly true in China, in India, in Brazil, and in other places.
One of the things that we looked at in our study is what are some of the drivers in addition to just this income growth that might lead to this rapid motorization and increased demand for transportation and the implications for that on our climate and how people are going to be moving day-to-day.
RF: That touches on a very important aspect of, if we look across the globe, how do different people’s preferences, how will that affect their desire to own a car and to use a car in the future? Because as we, as we know, if you can’t afford to buy a car, that’s not really an option. But as you become wealthier and wealthier, then your ability to afford a car has to be weighed against what other things you want to do. In our study we examined attitudes across 51 countries by doing a survey with more than 42,000 people. I know one of the areas that you looked at, Joanna, was the question of car pride and how to measure that as well as what would be the potential consequences of that. Could you tell us more about that?
JM: Sure. We define car pride as how people attribute their social status and personal image to owning and using a car. We looked at how individuals’ car pride impacts their decision to own a car and to use a car. In our survey, we first found that among established economies and car markets, the U.S. has the highest car pride. If you drive around Detroit and you look at all of the car manufacturing history in the United States, this is maybe not surprising to you. But we also looked at countries where there’s still a lot of growth to be expected in car ownership and car use. We actually found that in these less mature car markets and these emerging economies, we find even higher car pride. That might mean that these sort of symbolic attachments to the car could be additional drivers of this demand for transportation going forward. We know that as you put more cars on the road, depending on what types of cars those are, you may be talking about more greenhouse gas emissions, more air pollution. Regardless of what type of vehicle it is, it means more traffic for people trying to get where they need to go.
RF: As we talk about how people need to travel in their daily lives, the urban setting is a very important context. In an urban setting, you typically have more than one choice for how you get from point A to point B. We recognize there are different types of cities. A commonly asked question was, how will ride hailing apps—such as Uber and Lyft—how will that change future modes, future choices about how we travel in cities? How much of a revolution will that be? Likewise, as we introduce things such as autonomous vehicles that might create a robo-taxi with a lower cost, how might that affect people’s choices of transportation? What would be the consequences on congestion and vehicle miles traveled and energy consumption in places like cities?
JM: The urban component is really important as we look to projections into the future. Because it’s not just that populations and incomes are going to rise, but they’re going to increasingly concentrate in cities. What some of our researchers, as part of this study, have done is simulate what it would mean for individuals’ travel choices in cities, if you were to introduce a very low-cost, door-to-door mobility service such as a robo-taxi. Really, the idea is this would be similar to the Uber and Lyft that you might be used to today but at a much lower cost because you’ve removed the cost of a driver.
What they found is that introducing those services without additional restrictions or regulations is really just going to put additional vehicles on the road. It’s going to increase congestion and it’s going to increase vehicle miles traveled. But if you can leverage the existing public transport networks in some of these cities and integrate these new robo-taxi services as first/last mile connection, so they take you to a transit station or from a transit station. If you can really create a system where they’re integrated, then you can expand people’s mobility and options without some of these negative consequences like congestion and increased travel time and vehicle miles traveled.
RF: There’s a lot in our study that we’ve just completed. I would like to also let you know that this study generated a report. That report is available online at energy.mit.edu/insightsintofuturemobility. I hope you find it interesting reading. I’d also like to thank Joanna Moody for joining me today for this discussion.
JM: Thanks for having me, Randy.