Russian experts believe in victory of oil over electric vehicles

The triumph of electric vehicles over internal combustion engines is exaggerated, experts of the fuel and energy sector of Russia believe.

The struggle of world powers with the environmental pollution triggered an electric vehicle revolution, pushing car manufacturers to invest in environmentally-friendly cars. In many cities and countries, it blows fuses if people switch electric kettles on at the same time. Imagine what will happen if everyone puts electric vehicles on charge at nine in the evening, said Head of the fuel and energy analytical center at the Ministry of Energy Pavel Sorokin at an S&P conference. In order for electric vehicles to get mass development, it is required to invest huge amounts of money — it’s not billions of dollars, it’s trillions — in reformatting distribution networks, he added.

Russian experts believe in victory of oil over electric vehicles

The German auto concern Volkswagen plans to invest more than 20 billion euros in the production of environmentally friendly cars in the hope to provide electric versions of their models by 2030 and compete with Tesla, the pioneer in electric vehicles. Daimler announced its plans to invest 10 billion euros in R&D for several models of electric cars by 2025. According to estimates of Managing Director of S&P Mark Schwartz, the share of electric vehicles will amount to 5% in new sales by 2025 and reach 25% by 2040. This forecast is possible, but keep in mind that electric cars are in demand mainly in small countries with a very high standard of living, which is largely based on green energy supporters and followers of fashion, Sorokin said. Vedomosti quoted Sorokin as saying: “100 years ago electric cars have already lost their battle internal combustion engines because it was uncompetitive on a number of parameters”.

Russia produces 10.9 million barrels of oil per day, being among the world’s leaders in oil production, and gets a substantial part of budget revenues from oil exports.  Electricity is currently much cheaper than gasoline, but the cost of gasoline includes a lot of taxes, says Head of Gazprom Neft’s Strategy and Innovation Department Sergey Vakulenko. If suddenly the use of hydrocarbon fuels begins to decline, then all of this tax load will move to electricity and the cost of using electric cars and conventional cars for the consumer will become more comparable, even at zero cost of batteries.

According to Vakulenko’s estimates, there are capacities in the world for the production of batteries for about 500,000 Tesla electric vehicles. There will be capacities for 3 million vehicles by 2020. But the question is how quickly will they develop the production of main battery components for electric vehicles — lithium, cobalt, and graphite which is mainly produced from petroleum coke, said Vakulenko.



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