Electric Vehicles Begin To Bite Into Oil Demand

Projections have suggested that the advent of electric vehicles will have a dramatic impact on oil demand and now its starting to show.

With China adding the equivalent of London’s bus fleet every 5 weeks, that’s 279,000 barrels of oil a day removed from demand.

The latest report from Bloomberg New Energy shows that economics are driving the change, with the total cost of ownership of electric buses far outperforming the alternatives. The report says a 110kWh battery e-bus coupled with the most expensive wireless charging reaches parity with a diesel bus on total cost of ownership at around 60,000 km traveled per year (37,000 miles). This means that a bus with the smallest battery, even when coupled with the most expensive charging option, would be cheaper to run in a medium-sized city, where buses travel on average 170km/day (106 miles).

Today large cities with high annual bus mileages therefore choose from a number of electric options, all cheaper than diesel and CNG buses. The BNEF report says, ‘Even the most expensive electric bus at 80,000km per year has a TCO of $0.92/km, just at par with diesel buses. Compared to a CNG bus, it is around $0.11/km cheaper in terms of the TCO. This indicates that in a megacity, where buses travel at least 220km/day, using even the most expensive 350kWh e-bus instead of a CNG bus could bring around $130,000 in operational cost savings over the 15-year lifetime of a bus.

For every 1,000 battery-powered buses on the road, about 500 barrels a day of diesel fuel will be displaced from the market, according to BNEF calculations. In 2018, the volume of oil-based fuel demand that buses remove from the market may rise 37 % to 279,000 barrels a day, or approximately the equivalent of the oil consumption of Greece. By 2040, this number could rise as high as 8 million barrels per day (bpd).

Read more: Forbes

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