You are here

Energy Transition: When Will Electrical Mobility Take Over?

Transition énergique : quand l’e-mobilité détrônera les véhicules thermiques
Published on
26 March 2018

2040 could be the year France forbids traditional vehicles in cities. At least, this appears to be the opinion of numerous French and European energy experts as confirmed by the Energy Market Barometer published by Grenoble Ecole de Management. In Germany, several cities have already banned old diesel vehicles. What are the major challenges of electrical mobility?

We speak with Olivier Cateura, an associate professor of strategic and energy management, and the co-author of the Energy Market Barometer*. He shares with us perspectives on French and European energy policies, and in particular, the issues facing electrical mobility.

What's your analysis of French and European energy policy?

On a global scale, energy consumed for living, industry and transportation comes 80% from fossil resources (petrol, gas, coal, nuclear). In France, it represents 84%, which isn't very good. However, our electrical consumption is more "positive" as it's carbon free thanks to nuclear energy production (71.6% in 2017) and renewable energy (18.5% in 2017). In 2015, a law on the energy transition was passed and it opens new perspectives by confirming the government's desire to reduce our nuclear production and increase renewable production.

Currently, the multi-year energy production plan is being debated and it will have an decisive impact on our energy transition. These debates highlight a major effort in terms of national energy policy to organize this transition. Europe is already very advanced in terms of energy policy. Its roadmap is the most ambitious worldwide and anticipates serious advances by 2030 (27% for renewable energy, +27% for energy efficiency and -40% for greenhouse gas emissions).

What are the perspectives on a ban of traditional vehicles by 2040?

Nicolas Hulot, the French Environmental Transition Minister, announced a goal of stopping the French sale of diesel and gas vehicles by 2040. Other countries such as Norway, the Netherlands and the U.K. have similar goals for the next 20 years. In Germany, old diesel vehicles could be banned nationally. However, our overall analysis of the Energy Market Barometer highlights the fact that there still remains a long road ahead if we wish to truly transition from our current model of mobility.

What are the major trends in terms of developing electrical mobility?

Approximately 750,000 electrical vehicles were sold in 2016, of which half were sold in China (according to the global report by the International Energy Agency). This market should continue to grow through 2020 and anywhere from 9 to 20 million electrical vehicles should join our roadways. In 2016, public infrastructures for recharging vehicles also grew by 72%. In France, almost 31,000 electrical vehicles were registered in 2017.

This figure is equivalent to 1.2% of our market, which is far behind the European champion, Norway, where 17% of sales are for electric vehicles. Sales in Germany are lower, but are close to France. To support the sale of electrical vehicles, several European countries have implemented policies to reduce prices. In France, 6,000 euros can be deducted from the price and this can be combined with a 2,500 euro bonus if the new vehicle replaces a diesel vehicle that is more than 16 years old.

What factors explain the major difference in sales in Norway versus France or Germany?

The primary factor is important political support for tax exemptions, deductions and various advantages (e.g., VAT exemption equivalent to 25%, free toll booths, the right to use bus lanes, free parking or charging stations in various cities, etc.). This difference can also be attributed to the fact Norway's actions were launched more than a decade ago with the goal of having a completely carbon free fleet by 2025. While Norway is still a major exporter of oil, its electricity is mostly derived from hydropower.

High prices and low autonomy are some of the major issues slowing down growth of the electrical market in Europe. Could you comment on this?

Experts are rather pessimistic on this point and perceive there to be a number of important challenges that have to be overcome before electrical vehicles can be competitive with traditional cars. The key priority cited by experts is to improve technology in order to reduce prices and increase autonomy. The price tag for electrical vehicles is currently 15 to 25% higher than for traditional vehicles. As production ramps up in the near future, this increased volume should help reduce costs, in particular the cost of batteries. Automobile manufacturers such as Tesla (whose Model 3 sells for 35,000 dollars) and Renault are aiming to produce an electric vehicle (e.g., Renault Kwid) that could sell for 7-8,000 dollars in China by 2019. China is still the leading market for electrical vehicles and electrical scooters are also an important part of the market.

Low autonomy is also a key challenge as most electrical vehicles are limited to 250 kilometers (although this is double for the Tesla Model S). Another factor is the slow installation of charging stations. By the end of 2017, France counted 20,000 charging spots across 7,200 stations. Along the same lines, long charging times are also a barrier (up to 12 hours, although there are a few 30 minute rapid charge stations). While the Ademe as well as several local authorities and energy actors are supporting and investing in charging stations, the current pace could be too slow.

In sum, we need a change of perspective in terms of politics, technology and behavior if we want our energy transition to be successful.

On the same subject

  • Le dilemme des achats responsables à Noël
    Published on 16 December 2019

    Trending: buying an ethical Christmas gift...

    Christmas is a time for giving…” or maybe a time for shopping should we say. How can Christmas shopping and sustainable consumerism join paths?

  • La Chaire Energy for Society « embarque » les citoyens dans la transition énergétique
    Published on 18 November 2019

    The Energy for Society Chair: mobilizing citizens for the energy transition

    With the growing urgency of climate change and its associated challenges, the energy transition has become of essential importance for society. As a result, the Energy for Society Chair at Grenoble Ecole de Management was launched with three...

  • GEM ouvre une filière Innovation for Sustainability Transition
    Published on 08 November 2019

    Societal issues: new track in "Innovation for Sustainability Transition"

    Grenoble Ecole de Management continues its investment for a better society. The School has just launched an "Innovation for Sustainability Transition" track with 28 students on board. The aim is to train future leaders in the transition from...

  • Le Défi de la rentrée 2019 : 700 étudiants rôdés à la controverse
    Published on 21 October 2019

    The 2019 Challenge: 700 students debate the future of society

    How can educational institutions prepare students to be better citizens and future managers? For 700 first year students in the Grande Ecole Program, the 2019 Challenge was a first step towards a greater understanding of current, major societal and...

  • Energie. La régulation des prix décourage la concurrence
    Published on 20 October 2019

    Energy: price regulation discourages competition

    A new European study analyzes the impact of price regulation on competitiveness in the European energy market. After 20 years of moving towards a liberalized energy market, the study notes that many countries report limited motivation by customers...

  • web série de sept épisodes de sept minutes sur sept entreprises aux modèles alternatifs
    Published on 24 September 2019

    Promising model for Corporate Social Responsibility

    Corporate Social Responsibility is more than a side strategy for some companies. Two recent graduates analyzed the impact and success of companies whose alternative models make CSR a fundamental part of their raison d’être.

  • Communautés énergétiques : vraie ou fausse révolution ?
    Published on 24 May 2019

    Energy communities: a real or imagined revolution?

    Energy cooperatives are making headway as new business models for the energy transition. Despite the promise of these citizen initiatives, their future growth and success is still up for grabs.

  • Baromètre du Marché de l’Énergie – Hiver 2018 : blockchain
    Published on 31 January 2019

    Energy market barometer report - Winter 2018

    The Winter 2018 edition of the Grenoble Ecole de Management (GEM) Energy Market Barometer explores the opinion of the French energy experts on the role of blockchain technology for the French energy sector. The experts were also asked about their...

  • Comment les primes influent la vente de produits neufs ou recyclés ?
    Published on 19 June 2018

    Sales Incentives: Balancing New and Remanufactured Goods

    Remanufactured goods can provide companies with higher profit margins. But, it’s essential for companies to implement a strategy that adequately balances the sale of new and remanufactured products.

  • Published on 22 January 2018

    Energy market barometer report - Winter 2017-2018

    This Winter 2017-2018 edition of the Grenoble Ecole de Management (GEM) Energy Market Barometer explores the opinion of French energy experts about the challenges of e-mobility for the electricity sector in France. The experts were also asked where...

  • Published on 23 June 2017

    Energy market barometer report - Summer 2017

    This Summer 2017 edition of the Grenoble Ecole de Management (GEM) Energy Market Barometer explores the opinion of French energy experts on the effects of Brexit on Europe's internal energy market. French experts were also asked about the investment...

  • Circular Economy
    Published on 09 May 2017

    Troccauris: a Business Model for a Circular Economy?

    The circular economy relies on barter and re-using goods. Discover a flourishing example with Troccauris.

  • Pourquoi des entreprises investissent dans la création d’un Mooc ?
    Published on 07 April 2017

    Why Are Companies Investing in MOOCs?

    The New Energy Technologies MOOC provides an innovative portal to promote a culture of renewable energy. In addition, MOOCs enable companies to share expertise and foster collaboration.

    Published on 13 March 2017

    Energy Market Barometer Report: Winter 2016

    This Winter 2016 edition of the Grenoble Ecole de Management Energy Market Barometer explores the opinion of French energy experts about the decentralization of the electricity sector in France. French experts were also asked where the focus of...

  • Published on 09 December 2016

    Research: Renewable Energy, How to Invest While Sharing Costs Fairly?

    Countries are investing billions to foster renewable energy. Yet these investments do not necessarily consider who is footing the bill and whether each household is paying its fair share. This latest research highlights concrete principles that can...

  • Research: Digital Transformation of the Electricity Sector in France and Germany
    Published on 18 October 2016

    Digital Transformation: the Electricity Sector in France and Germany

    Remote meters, mobile apps to control energy consumption, smart grids… It’s time for the energy sector to embrace the digital transformation.

  • Published on 04 February 2016

    Low oil prices cause investment in renewables, biofuels and energy efficiency technologies to decrease

    The current weak price of crude oil is having an adverse impact on the amount of investment in renewables for heat generation, biofuels, and energy efficiency technologies, according to Grenoble École de Management’s Energy Market Barometer Reading.

  • Published on 07 September 2015

    Energy market barometer report: the development of energy prices

    The next Conference of Parties to the United Nations Framework Convention on Climate Change (COP21) will take place in Paris from 30 November to 11 December. The Paris Climate Summit, announced as one of the biggest climate negotiations in history,...

  • Mark Olsthoorn, professor and researcher at Grenoble Ecole de Mangement
    Published on 07 April 2015

    Barriers to Electricity Load Shift in Companies, a Survey-Based Exploration of the End-User Perspective

    Overcoming the barriers to renewable energy systems is a key challenge. In shifting from centralized fossil-fuel energy production to decentralized solar and wind energy production, countries are being forced to act on multiple fronts : flexible...

  • Joachim Schleich, professor and energy markets experts at Grenoble Ecole de Management
    Published on 01 December 2014

    Research: Switching to energy efficient lighting : a bright idea!

    Energy efficiency policies such as the EU ban on incandescent light bulbs (and on halogen ones in the near future) have been the subject of much discussion in the last few years. The majority of the academic community predicted that new emerging...