Project Drawdown defines electric cars (electric vehicles, EV’s) as: the increased use of battery and plug-in hybrid cars, sport utility vehicles (SUV’s) and light trucks. This solution replaces the use of conventional internal combustion engine (ICE) cars.
Most light duty vehicles in use today rely on liquid fuel for energy storage and propulsion in an internal combustion engine. Electric vehicles (EVs) use a more energy-efficient electric motor, and have high-capacity batteries on board that can be charged from the electric grid. The EV market is still in its infancy, with early adopters driving the high growth seen over the past ten years. Even though EVs are still only a small fraction of vehicle sales and stock, they are expected to grow dramatically over the coming decades, replacing a large share of conventional vehicles and causing a dent in the carbon dioxide emissions from road transportation. For purposes of this work, both battery EVs and plug-in hybrid EVs are included in specified shares. All relevant variables are weighted according to this share.
Total Addressable Market
The total addressable market for electric cars represents the total number of urban and non-urban passenger-kilometers projected by sources such as the International Energy Agency (IEA) and the International Council on Clean Transport (ICCT) to 2050. Current adoption of EVs is taken as 0.47 percent of all passenger cars in the global fleet or 0.18 percent of the total global mobility in passenger-kilometers, derived based on several sources. The total passenger-kilometers of light duty vehicles was averaged from data provided by the IEA, ICCT, and the Institute for Transportation and Development Policy (ITDP) and University of California–Davis (UCD).
Impacts of increased adoption of electric cars from 2020-2050 were generated based on two growth scenarios, which were assessed in comparison to a Reference Scenario where the solution’s market share was fixed at the current levels.
- Scenario 1: Adoption is aligned with the IEA projection for EV stock. 100 percent of EV passenger-kilometers are assumed to be urban only until 2020, after which the nonurban share increases by 5 percent annually until 2026. From 2026 on, the share of urban EV passenger-kilometers remains at 70 percent.
- Scenario 2: IEA projections and historical EV sales are combined to project the total stock of EV cars out to 2050. The urban share of all EV mobility drops from 2021 by 5% per year until 2030 representing more extensive support for nonurban driving and reduced range anxiety.
Emissions estimates are based on the electricity and fuel usage data from a range of sources, with emissions factors calculated based on the guidelines from the Intergovernmental Panel on Climate Change (IPCC) and recent sources for grid emissions factors. Indirect emissions were also included. EV production generates 6 percent higher indirect emissions than ICE vehicles.
First costs for purchasing an EV or ICE vehicle were estimated using recent data from several sources that cover key markets like the US, China, EU and Japan as well as the world as a whole. Costs were weighted by market sales. Purchase costs for the EV were averaged to be US$8,000 (31 percent) higher than the ICE vehicle.
Operating costs included grid electricity for the EV (dependent on the ratio of battery to plug-in hybrid EVs in each scenario), and fuel (for the plug-in hybrid and ICE). Electricity and fuel use were based on several sources including US EIA data. The weighted global average fuel prices were derived from recent IEA estimates, and electricity prices were calculated using data from 51 countries over 10 years. Additionally, operating costs included the maintenance costs for cars and fixed operating costs.
To enable integration and minimize double counting, some inputs were harmonized across solutions for consistency. The additional demand on the electricity grid resulting from the growth of EV usage was accounted for in the integrated total market for electricity. To avoid double-counting emissions benefits, the results presented for EVs do not reflect the increasingly cleaner grid; instead, these additional emissions benefits are accounted for directly in the supply-side energy solutions. Additionally, as EV’s were integrated with the Carpooling solution, increased occupancy of EV’s and ICE’s was assumed over time as the Carpooling solution adoption increased. This changed the energy consumption variables.
EV adoption in the Scenario 1 leads to 858 million EVs on the roads in 2050, compared to only 5.2 million EVs in 2018. This rapid growth in the EV fleet results in the reduction of 11.9 gigatons of carbon dioxide-equivalent greenhouse gas emissions between 2020 and 2050, and US$15.3 trillion in lifetime operating savings. The purchase cost is, however, $4.5 trillion. The Scenario 2 projects that 1.2 billion EVs would join the global fleet by 2050, resulting in 15.7 gigatons of emissions avoided.
EV adoption is beneficial for the climate, and our financial analysis shows that it will also save operating costs for households, although at a higher purchase cost in the Scenario 1. For the other scenario, the operating savings are higher. Consumer education is a key component of EV adoption, in order to relieve concerns about the upfront price premium and the reduced range of EVs compared to ICE cars. As battery technology matures and economies of scale grow, the price of manufacturing high-capacity batteries will decrease, so both the purchase price and range of EVs will become more attractive to consumers. However to get to that point may require greater financial incentives for consumers as well as a focus on the mass market rather than the high-end consumer. There are some potential problems from increased battery production that would have to be managed, for instance sourcing of key metals such as cobalt, copper, and nickel, whose supply chains can have negative environmental and social impacts around the world. Additionally, the disposal of old batteries is an environmental challenge at this point. These issues should be managed alongside the growth of the EV market.
 The grid in general is much less polluting than conventional vehicles, and is growing cleaner annually around the world.
 For more on the Total Addressable Market for the Transport Sector, click the Sector Summary: Transport link below.
 Current adoption is defined as the amount of functional demand supplied by the solution in 2018. This study uses 2014 as the base year.
 For more on Project Drawdown’s growth scenarios, click the Scenarios link below. For information on Transport Sector-specific scenarios, click the Sector Summary: Transport link.
 Based on the 2°C Scenario from the IEA’s Energy Technology Perspectives Report (2016).
 This assumption addresses the perceived “range anxiety” problem of EVs – drivers are often hesitant to use them when they drive long distance (such as between cities), due to the perceived risk of being able to arrive at the destination or a charging station before the battery drains to empty. Battery technology and charging networks are advancing rapidly, however, so the passenger-kilometers are confined to urban environments as described to account for a declining range anxiety over time.
 IEA (2017) Energy Technology Perspectives – 2017, Catalysing Energy Technology Transformations, OECD/IEA, Paris
 IEA & EVI (2019) Global EV outlook 2019 – Scaling-up the transition to Electric Mobility, OECD/IEA, Paris
 That is US$34,000 versus US$26,000.
 Energy Information Administration
 Insurance was the only fixed operating cost accounted for, but this was assumed the same for all vehicle types.
 For more on Project Drawdown’s Transport Sector integration model, click the Sector Summary: Transport link below.
 Common variables across solutions include: vehicle prices, fuel prices, operating costs, etc.; total addressable market, and market data.
 All monetary values are presented in US2014$.
 The net operating savings for the full lifetime of all units installed during 2020-2050.