“Communism”, said Lenin, “is Soviet power plus the electrification of the whole country.”
It didn’t end well.
And nor, I suspect, will be the administration’s drive to electrify the U.S. auto sector at a pace that displays the same sorts of refusal to accept reality that was once the province of Soviet central planners.
Auto makers also still face a significant risk that consumer demand won’t keep pace with supply. This is Detroit’s Big Three have been lobbying hard for President Biden’s Build Back Better plan. The bill would provide $12,500 tax credits for electric cars made at union auto plants in the U.S. and extend the current $7,500 credit through 2031 for nonunion plants.
Translation: People are unlikely to want electric cars in large enough quantities.
The reasons for that extend beyond EVs’ expense. To be sure, charging with electricity is cheaper than filling up a car with gas (low bar) at the moment, but it takes so long that it’s best to bring a book or two, or even start writing one. That should be fun for long family vacation trips. Some details here.
And when it comes to the expense of EVs, The Wall Street Journal has news:
[E]lectric cars are still on average 35% more expensive than gas-powered ones, and the price disparity is likely to increase as demand for critical minerals grows.
Many of those critical minerals come from our Chinese friends. That may not be too wise. Supply-chain security and all that.
But wait, surely we can mine many of those minerals ourselves.
Potentially, yes, but (via Energy Monitor from late February):
Meanwhile, US President Joe Biden has rolled out an ambitious Build Back Better Act that includes the goal for half of new cars sold in the country in 2030 to be zero emissions. However, the same administration does not seem to be acting to secure a stable supply chain to achieve those goals.
Just last week, the government cancelled the leases of Twin Metals Minnesota to mine for cobalt, nickel and copper. Currently, there is only one operating mine in the US that produces nickel, and even though the country has large reserves of lithium, there is only one big operating lithium mining project, the Silver Peak Mine in Nevada.
The country is in the best of hands.
More from the WSJ:
Most EVs today can’t go more than 250 miles on a charge (and less in cold weather). Drivers worry for good reason that they’ll run out of juice on the road. President Biden hopes to alleviate this so-called range anxiety by subsidizing a nationwide network of charging stations. This won’t solve the problem. Public charging stations are nowhere more ubiquitous than in California’s Bay Area. But a recent study found that less than three-quarters of charging stations worked. In many cases the plugs, screens or payment systems were broken, or connector cables weren’t long enough to reach the car’s port. Imagine if 25% of the nation’s gasoline stations weren’t working and drivers didn’t know until they got out of the car whether they’d be able to fill up.
Much still needs to be worked out before widespread adoption of EVs is feasible. Yet the Biden administration and states like California plan to use fuel-economy and emissions mandates to force auto makers to phase out conventional vehicles. What happens if electric cars don’t sell? Perhaps auto makers would lobby politicians for higher gasoline taxes to boost EV sales, as they are doing in Europe. More likely they’d discount electric cars and raise prices on gasoline-powered ones to compensate. The alternative would be bankruptcy.
Central planning is, it seems, working as well as it always does.
There should be no mandatory phasing-in of EVs, under any circumstances, but to ‘encourage’ their adoption until problems of this type have been worked out is a blend of madness and arrogance all too typical of central planners on the rampage.
But at least we have a reliable electric grid, well-equipped to cope with the extra demand that EVs would put on it.
The Wall Street Journal (also from February):
The U.S. electrical system is becoming less dependable. The problem is likely to get worse before it gets better.
Large, sustained outages have occurred with increasing frequency in the U.S. over the past two decades, according to a Wall Street Journal review of federal data. In 2000, there were fewer than two dozen major disruptions, the data shows. In 2020, the number surpassed 180.
Utility customers on average experienced just over eight hours of power interruptions in 2020, more than double the amount in 2013, when the government began tracking outage lengths. The data doesn’t include 2021, but those numbers are certain to follow the trend after a freak freeze in Texas, a major hurricane in New Orleans, wildfires in California and a heat wave in the Pacific Northwest left millions in the dark for days.
The U.S. power system is faltering just as millions of Americans are becoming more dependent on it—not just to light their homes, but increasingly to work remotely, charge their phones and cars, and cook their food—as more modern conveniences become electrified….
All is well.