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Luc Vallée is chief strategist of Laurentian Bank Securities and former chief economist of Canada Economic Development. Jean Michaud is managing director at CoreCommodity Management.

Earlier this month, Volvo announced that, starting in 2019, it will only sell electric or hybrid cars. The next day, France said that it will ban diesel and gasoline engines in 2040; Britain has since announced that it will follow suit. Combustion-engine cars thus seem to be driving toward extinction much sooner than anyone expected. Are they really?

Before celebrating the death of the combustion-engine, crude oil and greenhouse gas (GHG) emissions, consider the following. There were about one billion cars and light trucks in circulation globally in 2016; roughly 0.1 per cent were electric. Electric cars sales will pick up, but still less than 10 per cent of new cars sold by 2025 will be electric. While the number of cars sold each year exceeds 80 million, the total car fleet increases by about 40 million annually. Over the next 8 years, this would bring their number to 60 million, or 4.5 per cent.

True, these electric cars could save one million barrels of oil a day (mb/d), but global oil consumption would still increase from 97 today to 106 mb/d. Not only will combustion-engine cars remain dominant for decades but oil will still be used to run planes, trucks, trains, tractors, buses and to make asphalt, plastic and cosmetics, among other things.

Globe editorial: Why subsidies for electric cars are a bad idea for Canada

What about GHG emissions? The ultimate goal of the electric car is to reduce harmful emissions; otherwise, electric cars are a waste – they cost more and may create a graveyard of dirty batteries hard to dispose of. Yet, aside from the battery issues, the reduction of harmful emissions from the adoption of the electric car may be decades away. As we are decommissioning coal-fired power plants in the Western Hemisphere and trying to limit their expansion in developing countries, most electric cars put on the road will be running on coal for the indefinite future. To understand why, ask yourself how the electricity needed to power these electric cars will be produced.

In most countries today, the energy mix used to produce the electric power needed to run an electric car from point A to point B already generates less CO2 than a similarly operated gasoline car. The problem is that our ability to replace coal by other cleaner sources of energy being limited in time and space forces us to rely on coal for marginal demand.

This means that, in most locations, any marginal quantity of electricity used by an electric car (that would not otherwise be consumed) is generated by a coal power plant. In other words, the electric car adds to the electricity demand relative to what it would have been without them. This directly increases the demand for coal or slows down the decommissioning of coal-fired power plants and hence swells the amount of emissions in the atmosphere. In Canada, the electricity generating energy mix is much better than in most countries. However, at the margin, coal is still needed.

In Quebec, where there are electricity surpluses, an argument can be made that electric cars could truly run on hydro and thus truly be "green." Yet, a counterargument can also be made: If Hydro-Québec was exporting its clean electricity to its neighbouring U.S. states, its surpluses would go away. Consuming more hydroelectricity in Quebec to power electric cars would force our American neighbours to source their energy from more GHG intensive sources. In the end, in an integrated North American energy market, any electric car will ultimately run on coal as long as coal remains part of the electricity generating pool.

The bottom line here is that before promoting a transition to electric cars, policy makers and the public should consider the whole energy ecosystem before such policy is implemented. A partial analysis can create the illusion that we can reduce GHG emissions by driving electric cars, but it would be a costly mistake; and, once the policy is adopted, turning back the clock to reverse the damage might be difficult. Ask the Ontario government about its experiment with solar energy. In spite of massive investment, solar still only produces 0.01 per cent of Ontario's energy.

Does that mean that we should be discouraging the development of the electric car? No, but we should limit its widespread adoption until we have eliminated coal-fired powerhouses.

In the meantime, rather than subsidizing the electric car, we should invest our resources in carbon capture and storage technologies, in developing better batteries as well as further improving the efficiency of the combustion engine. Today, making 99 per cent of cars on the road more energy efficient is probably a more climate-friendly strategy than blindly relying on a vision of an electric car that so far does not deliver on its promises of reducing GHG.

Investing in carbon capture and storage technologies is particularly important if it turns out that we can never really get rid of coal completely. Capturing the carbon produced by the remaining coal-fired power plants would greatly enhance our ability to deploy a truly clean electric car and thereby achieve our climate objectives. Today, these technologies might still be a pipe dream but innovations in this field are progressing fast and may bear fruit even before those promised by the development of better batteries. It is certainly worth keeping a close watch.