Additional Author: Dan Degagne
Electric vehicles (EV) have been available for some time, but adoption has always been too low to attract significant investment and displace the internal combustion engines (ICE) in a meaningful way. This time is different, though, as EVs are in the process of displacing a significant portion of the traditional ICE vehicle market, which presents interesting opportunities for Bechtel. There are several reasons why we think this time is different, and the intent of this post is to lay out a brief summary of our views of the EV market, the infrastructure needed to support that market, and the opportunities for Bechtel in this space. Finally, we’ll talk about what we’re doing to address the lack of EV charging infrastructure in North America.
The Shift to Electric Vehicles is Happening Now
The auto industry has come a long way since the first mass-market battery EVs were released in the mid-2000s. In the past few years we’ve seen a significant increase in public interest and adoption of EVs due in large part to new and exciting models from automakers and increasing concern over the negative effects of carbon emissions, of which internal combustion engines are a contributor.
Automakers around the world have been investing heavily in the development of new mass-market EV models. In the U.S., General Motors, Ford and Fiat-Chrysler have announced plans to launch more than 40 new EV models in the next five years. In Europe, several automakers have gone so far as to announce their entire vehicle lineup will soon be available in EV varieties. Globally, more than $300 billion is being invested in the development of EVs, according to an analysis by Reuters of 29 large global automakers. Many automakers are committing to a future with electric vehicles, and many have essentially staked their business on it. So, while there may not be an abundance of choice for electric vehicle models today, within a few years that will change dramatically.
With so many EV models coming to market, EVs are expected to displace a significant portion of the traditional ICE market. Estimates vary, but by 2030, it’s anticipated that between 20 to 30 percent of vehicles on the road will be electric, from a current share of around 1 percent.
In short, there will be a wave of EVs hitting the market in just a few years and that market will see significant growth. But to support the growth of the EV market, significant investment in charging infrastructure is needed.
EVs Need Infrastructure
While automakers are investing heavily in the development of EV models, without adequate charging infrastructure to recharge those vehicles, consumers will be reluctant to purchase them. In fact, the lack of EV charging stations is often cited as a key hurdle for consumers who are thinking about making the switch from an ICE to an EV.
Around the world, particularly in Europe and China, big investments are being made and policies are being implemented to address the lack of EV infrastructure. North America, however, is generally lagging on the EV infrastructure front. The International Council on Clean Transportation recently reported 88 of the top 100 U.S. metropolitan areas have less than half of the total charging infrastructure needed to support the EVs expected to be on the road by 2025.
If we want to be ready for the future of electric vehicles in the next three to five years, we need to think big and build the critical charging infrastructure in North America at large scale.
Bechtel and GM Collaboration
As you may have seen in recent news reports, like CNN and ENR, Bechtel and General Motors are collaborating to build a large-scale Direct Current (DC) fast-charging network in North America. At Bechtel, we believe EV charging presents a compelling opportunity for our company as it combines three of our traditional markets – power, transportation, and communications infrastructure – and is representative of what defines us: building important large-scale projects.
Our goal is to build a large-scale charging network across North America so that ‘range anxiety’—worry about an inability to find a charging station—is no longer an impediment to purchasing an EV. We believe in a clean future and think this is one of many important steps in that direction.
As we work through the development of this exciting opportunity, we’ll do our best to provide updates on our progress. For more information on our collaboration with GM and some more insight into our thinking, click here and here.