The Electric Vehicle Report: How to Get Americans to Pay a Few Dollars to Plug into Electric Power

The Electric Vehicle Report: How to Get Americans to Pay a Few Dollars to Plug into Electric Power

Majority of voters favor gasoline-car phaseout. But all-electric goal faces tough opposition.

The most significant factor shaping the electric vehicle (EV) adoption challenge is not the state of the U.S. economy, or the political climate, but the cost of charging. EV sales will fall short of 20 percent of the market by 2030, according to a McKinsey Global Institute (MGI) report, because the transition from gasoline-fueled vehicles is stalled by a fundamental economic problem: how to get Americans to pay a few dollars to plug into electric power to take the charge out of their fuel bills.

“We’re finding that it is the cost of charging that is a major constraint to EV adoption,” says Michael Goggin, president and chief technology officer of ChargePoint, a Silicon Valley company that sells EV charging kits and accessories to consumers.

MGI estimates that charging stations will need to be expanded from 4.5 million today to 9.5 million by 2030 to meet the demand for the cars now being sold. Charging stations also generate business for electric utilities and public agencies.

“It’s a pretty big problem,” says MGI senior analyst Mike Oleske. “The economics are very difficult, and it’s a question of finding enough places to deploy the chargers, as well as all the infrastructure costs and maintenance that will be required, and then making sure government and utilities have the necessary access.”

At least a few states are trying to solve the charging problem. The electric vehicle and plug-in-hybrid market will grow by 25 percent to 27 percent annually between 2012 and 2030 as battery technology advances, according to an industry report by MGI. For now, however, states are struggling to persuade people to pay exorbitant fees to drive their vehicles in public on electricity generated by wind turbines, solar panels, geothermal or other renewable energy sources.

The U.S. Public Interest Research Group report, released ahead of the U.S. Conference of Mayors annual meeting July 12-14, examines a range of possible solutions to the EV charging problem and weighs the costs against the benefits.

The report acknowledges that the current state of charging-station deployment is “not ideal.” As some people consider adopting charging-station-free electric vehicles, MGI estimates that more than half of those would prefer to not pay

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