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  • Nick Sargent

Thinking points of an economics student regarding the EV laws

Updated: Sep 23, 2023

Amid the controversial push by California to ban the sale of new electric cars by 2035, a lot of speculation has begun to encompass the topic. Before I get into the topic, I would like to start off by saying that I am not an expert within the industry, I am an economics student at CU Denver, who owns a couple companies in the automotive industry. That said, here is my perspective and opinions regarding this move. This document is regarding a law which California has recently passed that will, in theory, ban the sale of new gasoline powered vehicles by 2035. Making it, I believe, the first government in the world to attempt to entirely switch to electric and other zero emission vehicles. Why we need to make the transition from combustion engines I understand why California would attempt to make a push like this, there are a lot of people in california. With a high population, comes a higher dependency on transportation, energy, and a higher contribution of smog and pollution. This isn't exclusive to just California, for example, China and India, countries with massive populations, have a massive smog issue. Then there's the increasingly important issue of our planet completely running out of nonrenewable resources, such as oil. Finally, the biggest motive to get away from oil dependency, and inherently, the internal combustion engine, is a matter of strategic interest. Meaning that the dependency of oil to keep americas economy alive, is nothing short of daunting to comprehend. Any oil producing country outside of americas control, can leverage its oil supply against americas economy and ultimately government. The less gas we need in our daily lives, the less control these other countries have on us. There is genuine security in lowering our need to import oil from other counteries. Whether it be due to the simple lack of oil reserves on the planet, or other factors like war and government interest, oil will eventually run out. So yes, there is a legitimate need for a move towards electric and renewable powered vehicles. But there are a lot of issues that I believe will need to be addressed over the course of this transition towards electric vehicles. Environmental impact The first issue is the impact on the environment. When looking at the environmental impact of the vehicle itself, yes, electric vehicles don't pollute the environment. Whereas gas and diesel vehicles do. The focus then shifts to the source of the energy, a gas vehicle gets its energy from the gasoline, and when driving along, it causes the pollution. But an electric vehicle needs to get power from somewhere, and most likely, that power came from a power plant. Unless that plant is a nuclear energy plant, it is burning coal to make the electricity that charges electric vehicles. Rule of thumb is that, to produce one kilowatt hour of electricity, a coal plant pollutes 2 LBS of Co2, and a gas plant pollutes 330 grams. a 2020 Tesla model 3 standard range, will get about .25 KWH per mile. Meaning that the vehicle pollutes around 2LBS of Co2 for every 3.84 miles or 236.24 grams for every mile. For further comparison, a gas vehicle pollutes around 411 grams of Co2 per mile. Which ultimately still pollutes the environment. just a side note, a tree can absorb 4 Lbs of Co2 per month. Further, the lead acid used in the batteries of most electric vehicles, is extremely toxic stuff, you know... Battery acid! There will come a time when we need to dispose of old, depleted batteries, where will we put this lead acid? Much like disposal of nuclear waste, I believe we don't understand the full extent just yet. Traditional Road Trips The next issue is the modern idea of long haul road trips, where you will need to recharge atleast once in between your final destination. This is one of the big reasons I consider gasoline vehicles to be so hard to transition from. A gasoline vehicle simply needs to be refilled before you carry on your way, whereas an electric vehicle will require something around 20 minutes of recharging, at best, before it has enough charge to get to the next recharge station. Bringing these recharge times down will be an important task before the public will be ready to transition. Redefining the idea of a car manufacturer and how they make money Electric and other renewable powered vehicles are notoriously cheap to maintain, they have features such as regenerative braking which enables them to slow down as if you are on the brakes without actually using the brakes. That and electric vehicles don't need oil changes, coolant changes or really anything else. It is an extremely attractive trait of electric vehicles. But there is an issue with this minimal need for maintenance, most car manufacturers make money from their parts and service departments. New car sales only account for a profit margin of about %15 of the vehicle MSRP. leaving the rest of a manufacturer's profit and yearly revenue to be made up in the upkeep of their vehicles. This significant chunk of lost revenue and profit is something that will need to be found elsewhere. And I don't think they have found an alternative to maintenance and service revenue just yet. You might ask about tesla, this is why tesla has gone into the tech segment and offer self driving cars, their tech endeavors help fund the company much more than their car sales currently do. Cost of EV ownership With every positive, there is a negative, no pun intended, I'm referring to the cost of replacing a battery. Electric car batteries currently last around 15 to 20 years before the vehicle essentially becomes a paperweight. Leaving the owner with a choice, to replace the battery, which takes up a considerable chunk of the entire cost of the vehicle, or to replace the entire vehicle. This shortened usable lifetime of vehicles will likely take a toll on the used car industry. The strain of recharging This is going to be a random example but hear me out, water towers are important to a town because of the imbalance of water use during the day as compared to the night. During peak usage times (sun up), pumps would not be able to keep up with demand on their own, resulting in a pressure loss and other problems to the town's water system. So they use water towers to deliver enough water to keep up with demand during peak times, and during the other times of day (like sun down time) they use the pumps to replenish the water tower for the next day of the water usage cycle. Most of our sources of renewable energy such as solar power and wind turbines rely on one thing. The heat from the sun. For those who are confused, wind is influenced by the conventional forces from the sun. Meaning that, just like the water tower example, there will be certain times of peak energy production, mostly in the sun up part of the day. Electric cars are not usually plugged in through the day, as everyone is out using the cars. Just like a phone, people will typically charge their electric cars overnight. Causing an ever increasing draw of power to recharge the EV’s overnight, as more people switch to electric. This is in part a problem solved by the tesla power wall. It is a house sized electric battery, or “water tower” in my example, to help reduce the strain on the power grid when charging overnight, alongside most other EV’s in a town. But a less expensive solution to an EV owner must come to market before the masses will be more accepting of the idea to switch. Misc. Points When a gasoline vehicle is crashed, let's say rolled, you would hope that the car does not explode. Because well, gas is combustible. Now, in an electric vehicle, the same crash as the gas vehicle, you're going to be worried about getting electrocuted and/or covered in battery acid. There will need to be a solution to these issues. Electric vehicles also don't usually come with transmissions, meaning that in any application of torque and or raw power, a diesel will, for now, likely still remain superior in regards to towing capacity. This is an extremely important measure when concerning the United States economy as the United States relies on trucks to keep its internal economy moving. My opinions During this research, I participated in sema 2022, where I met the patent holder for a device which actually turns combustion engines into truly zero emission engines. This connection has revived my optimism for the future of the combustion engine. I believe that with time, combustion engines will become cleaner and less harmful to the environment. We may even see alternative fuels, but I personally don't think the combustion engine will completely disappear. Other impacts Outside of cars, I truly believe the modern world will never be able to completely remove gas from the economy. This is due to the core medium of transporting global product, aka imports and exports. This is an extremely vital piece to the global innovation and day to day life, im referring to container ships. they will likely always need to be gas powered, well, unless we utilize the nuclear reactor designs that the U.S. navy fleet has started to utilize. The aviation industry uses turbo props and turbo fan engines, these engines are the fastest and highest power options that the industry offers, however they are also more like rockets in a sense, meaning that you need a constant burn, a constant explosion in order for them to work. this can only be provided by combustable fuels and the modern high speed aircraft will never be able to operate off of a non combustable fuel.


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