Australia’s lawmakers copped it from Tesla chairwoman Robyn Denholm during her speech to the Apec 2021 CEO summit, while our Government received a bucketload of praise – perhaps not surprising given the recent surge in Tesla sales in New Zealand with the new electric vehicle subsidy.
Speaking to the Apec CEO Summit’s online audience from her native Australia, Denholm also called for Apec governments to accelerate the adoption of EVs by co-investing in mines and refining facilities for key elements lithium and nickel (more on which below).
- Record September for NZ new vehicle sales – and 1 in 5 is electric
- Evnex, a Christchurch startup that solves a major EV charging issue, raises millions from Movac, Tindall
She also called on power companies to more aggressively adopt so-called “big battery” arrays to help with the transition from coal-fired stations (again, more on which shortly).
“Today there are about 1.5 billion cars globally and 16 million are electric, about 1 per cent,” the Tesla chairwoman said.
“It takes nearly 20 years to turn over the global vehicle fleet with about 60 to 70 million new vehicles sold each year.
“The math is pretty simple: to fully decarbonise transport by 2050, we have to stop selling combustion engine vehicles by around 2030 In most places.
“The number one thing that I urge all countries in the Apec region to do is to strengthen emission standards. This fundamentally changes the economics of CO2 pollution and gives the industry throughout the supply chain of EVs confidence to invest knowing that the market is headed towards EVs.”
Denholm said while some state governments were making progress, Australia’s weak response at a federal level made it Exhibit A for her argument.
“Let me give you some evidence behind how emission standards changed the pace of EV adoption,” she said.
“Here in Australia, EV uptake is slower than comparable countries at less than 1 per cent of new vehicle sales last year – because there are no meaningful national vehicle or emission standards.”
By contrast, “Our host nation New Zealand is a great example of leadership. EV sales have rocketed up from about 3 per cent to 12 per cent of new light-vehicle sales in just a few months since the New Zealand Government introduced a world-class Clean Car Discount scheme earlier this year,” Denholm said.
“In fact, the average fleet emissions of new vehicles in New Zealand is down 15 per cent In just one quarter, and the Clean Car Standard before your Parliament at the moment will give Aotearoa one of the cleanest, safest vehicle fleets in the world, and that is decisive leadership.”
The Government’s Clean Car Standard – which has drawn a backlash from some in rural areas, and some car importers who say it goes too far, too fast – would require most new and used imported passenger vehicles to met a 145 grams per kilometre travelled CO2 emissions standard by 2023, dropping to 63.3g/km by 2027, with financial penalties for cars that don’t meet the target.
In June, the average emissions of imported cars was 173g/km.
EV critics will see an element of cupboard love. After the Clean Car Discount was introduced in July, offering a subsidy of up to $8625 for a new electric vehicle, EV sales have surged. In September – a month when a stunning one in five NZ new car sales involved an electric model – Tesla’s Model 3 (1066 units) outsold Toyota’s Hilux (648).
The spurt in EV sales was partly the result of months of pent-up demand as electric vehicle buyers waited for the Clean Car Discount to kick in, and it’s yet to be seen if it will be sustained. But the sale of 3505 EVs in September was still eye-popping.
Denholm’s company is banking on steadily increasing EV sales worldwide.
The Tesla chairwoman told Apec her company will sell 20 million cars by 2030 (it sold around 500,000 last year).
And most big carmakers have said they stop selling pure ice (internal combustion engine) cars by 2030.
23-fold increase in lithium-ion production required
But there are two issues with the ramp-up: Producers of key materials for EVs are already struggling to keep up with current production levels (Jaguar had to temporarily suspend production of its I-Pace because of a lithium battery shortage) and power girds in that are already popping at the seams in many countries.
Lithium is also in demand for smartphone, battery and solar power storage batteries – not to mention new gadgets like e-scooters.
“To meet the world’s COP decarbonisation targets, lithium-ion cell production will have to grow by 23 times from its current level by 2035,” Denholm said.
That implies an annual growth rate of 37 per cent – and the key to hitting that pace is governments backing mining firms, the Tesla chairwoman said.
“Apec countries are clearly key to this. Chile and Australia together supply most of the world’s lithium today, Indonesia, the Philippines and Russia lead on nickel to name just two metals of dozens that go into every [EV battery] cell.”
Call on Apec govts to back mining, refining
“In Apec, we have some of the best most innovative manufacturers in the world. But a production line can only move at the speed of its slowest component. And a new nickel or lithium mine and processing facility can take billions of dollars and up to a decade to ramp production.
“These are huge investments that require very patient and strategic capital. That’s why countries whose governments are willing to lead the way by planning and co-investing with businesses are ahead on this front.”
Such a surge in lithium production could give some green advocates to take fright. Lithium extraction is invasive, and lithium batteries can be problematic to dispose of at the end of their life.
While Denholm praised Chile, the Financial Times recently reported that the South American country’s lithium extraction from underground brine reservoirs – which accounts for around a quarter of the world’s supply – has also been the subject of legal action from environmentalists who said the energy-intensive mining caused underground water depletion and soil contamination, among other issues.
The hard-rock lithium mining in Australia causes fewer side effects, but does leave scars on the landscape.
Denholm said the mining and refining industries also have to decarbonise, and technologies for cleaner lithium extraction are being developed by various companies.
One is the Taupō-based company Geo40, which is developing a process for extracting lithium from geothermal brine. Geo40, which partners with Contact Energy for access to geothermal fluid recently raised $7.5m to develop its technology in a round led by local private equity company Pacific Channel, which in turn partners with the Crown-backed NZ Growth Capital Partners (NZGCP).
While a laggard on EV incentives, Australia did earn dibs from Denholm for its adoption of so-called “big battery” arrays, which store power from solar panel or wind farms – which can then be deployed at times of low sun or wind. For the likes of coal-fired plants, a big battery can help offset demand at peak times. Denholm said big battery arrays could also serve as a key tool in the transition away from coal.
She specifically-namechecked the Victorian Big Battery project now under way which, yes, is a Tesla project, but also added that “more than 40 big batteries being deployed or planned across Australia and many more across the APAC region”.
Tesla won the tender to supply batteries for the Victorian Big Battery in February. Once completed the 300 megawatt Big Battery, funded by a A$160m grant from the Australian Federal Government’s Clean Energy Finance Corporation (which has $A10b in funding overall), features 212 Tesla Megapack batteries, each weighing 13 tonnes. Production was halted in July after two of the Megapacks caught fire during testing, resulting in a toxic smoke warning for local residents during the three-day blaze. Construction resumed in September.
Big battery projects are aimed at increasing the percentage of power that comes from renewable sources – but at the same time, increasing EV adoption and other decarbonisation measures will increase demand for electricity.
Vector CEO Simon Mackenzie – whose company is involved in a trial that controls the timing of EV charging between 200 Auckland households – recently noted that “You might have one household worth of energy on a property and by virtue of putting an EV charger in your home – and not a fast charger or a supercharger, it’s just a pretty standard type of charger – that’s like adding two more households’ worth of energy on your existing load.”
A 2020 report by national grid operator Transpower said around 40 new, grid-scale, generation and batteries projects will be required by 2035 as the number of EVs on our roads increases from around 30,000 today to around 1.5m over the next 15 years.
Transpower has budgeted $50m per year from 2030, rising to $300m per year by 2050 for power infrastructure expansion – which it says will be offset, in national terms, by savings from reduced petrol purchasing.
Denholm also said home solar installations would play a key role in meeting increased power demand, too.
She said future technologies would allow homes with solar power panels and home solar batteries to combine as virtual power plants (VPPs).
“VPPs ensure that your home is protected by the most efficient source and can also act together like a big battery to support the grid when it’s most needed. Add an electric vehicle that you can charge for free off the sun – which I do – and it is a no-brainer. “
While sunlight is free, the solar panels to capture it and the batteries to store it are not. Stokes Valley man Tim Philips told the Herald his Tesla solar battery setup cost $26,000.
And since the round of partial privatisation, power companies have chopped back the amount they’re willing to pay solar homeowners to sell surplus power back to the grid.
But one way or another, renewable power will have to increase dramatically as EVs climb from their 1 per cent market share today to perhaps account for almost half the vehicles on roads by 2035.
Apec countries could give markets certainty and direction by setting clear and ambitious timelines for technology transition. This included strong vehicle emission standards, not just for 2050 but importantly for the next 5-10 years, Denholm said.
“Globally we can only transition to reliable, cost-effective renewables as fast as we can build energy storage. We can only reduce vehicle pollution as fast we can build electric vehicles. That is the race.
“The International Energy Agency estimates that around a third of the world’s electricity will be generated by renewables this year,” Denholm said.
“We also need that to be 100 per cent within 25 years. That’s a production challenge unlike anything humanity has managed before.”
Below: Tesla chairwoman Robyn Denholm prepared to take the high road at Apec, CEO Elon Musk got into another personal spat on Twitter this week, this time with US Senator Ron Wyden. The Democrat has proposed a tax on unrealised capital gains.
Source: Read Full Article