Electric Vehicles and the impact in the overall effect in Renault’s Carbon Footprint

Electric and Hybrid vehicles are the next step for Automakers to reduce their carbon footprint, be included in the changing scenario of urban mobility and utilities and still push new technologies to the consumer to sustain margins. Renault is pushing this revolution in Europe together with its strategic partner Nissan by launching multiple Electric Vehicles models.

In recent years, Automakers have understood that customers have shown increasing levels of awareness about the carbon footprints related to vehicles production and utilization. Because of that, since 2007, with the launch of the Toyota Prius (the first hybrid vehicle in history), they have decided to invest in technologies to reduce carbon emissions from vehicles. Renault, a French automaker understood this trend in 2008 and started developing a new product line of Electric Vehicles to serve the European market as signals that electrification was the future became more and more evident: penetration of “electrified vehicles”, such as start-stop systems and full-hybrid systems such as the Toyota Prius, are expected to continue increase over the next few years. Start-Stop systems are expected to achieve 60% penetration by 2020, Hybrid vehicles already represent over 10% market share in the US market[1].

More so, Automakers have in past years invested heavily in alternative fueling technologies such as full electrification. Adoption of Electric Vehicles has been accelerating in the last few years all over the world, a movement lead by Renault-Nissan, but also followed by other automakers in developed economies. In the UK, EVs already represent over 1% of the overall market, with registrations doubling from 2014 to 2015, and already showing a 9% increase in 2016[2]. In the US, 115,262 new Plug-in Electric Vehicles were registered in 2015 and 118,882 in 2014.[3]. In the past year, most of the Global Car Manufacturing Companies have reinstated their commitment to PEVs. Tesla has released the Model 3 and its plan to make affordable EVs. In the US, Ford is expected to spend $4.5 Billion to add 13 PEV models to its lineup by 2020[4]. In Europe, Renault-Nissan together have already built 340,000 PEV vehicles since 2010[5]. China has set a target of 5 million PEV vehicles by 2023.

Renault-Nissan have since the inception released a number of new car models to achieve those impressive results: Nissan Leaf was the first to get to the market, with exceptional performance and marketing campaigns tightly associated with the Olympics in Rio; Renault has released the Zoé, Twizy, the Kangoo EV and the Fluence EV, appealing to all segments of the market.

Type of energy storage is one aspect that might potentially affect the carbon footprint of this electric revolution. Currently, the EV market is highly concentrated in Battery-powered EVs, such as Renault-Nissan models, while only 3 models of Fuel-Cell EVs (Toyota Mirai, Hyundai ix35 and Honda Clarity), with a special attention to recent Toyota focus on FCEVs[6] to distance itself from competition. But FCEV models are expected to jump to 17 in the next 11 years[7]. This technology presents a challenge because one of the major challenges for EV deployment is the Lithium-Ion battery decommission, that at some instances might surpass the lifetime carbon footprint of using a regular Internal Combustion Engine vehicle.To counter, that Tesla has unveiled what it calls Closed Loop Battery Recycling Program[9]. Mercedes-Benz has emphasized its batteries as having a second-life application at stationary environments (such as our homes)[10]. Renault has also followed by working in alliance with Samsung in Korea to develop better battery Li-Ion cells in order to continue to be competitive in this search for better emissions.

Also, as electric vehicles are deployed and start to impact the electrical grid, there is a discussion that emerges about the role of consumers in the energy distribution as they become potential energy storage units. Renault has worked closely with the Smart Cities/Smart grid initiatives withIN EDF, the French utilities company, in order to relevant impact in the current grid, especially in neighborhoods where EV adoption is likely to be high. If charged during peak hours, EVs are much more likely to rely on electricity generated from fossil-fuel power plants, which would increase its CO2 footprint as well as require new investments in local distribution grid[11].

All this scenario, although challenging, presents the possibilities for Automakers to take a relevant role in making their part in Climate Change.

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[1] IHS Automotive Practice

[2] Society of Motor Manufacturers and Traders (SMMT) August 2016 Report

[3] 2015 Electric Vehicle Market Summary and Barriers, Electric Vehicle Transportation Center, Florida Solar Energy Center

[4] Ford Media Center – https://media.ford.com/content/fordmedia/fna/us/en/news/2015/12/10/ford-investing-4-5-billion-in-electrified-vehicle-solutions.html

[5] Nissan Newsroom – https://newsroom.nissan-global.com/releases/renault-nissan-alliance-delivers-annual-synergy-target-one-full-year-ahead-of-schedule

[6] Toyota Mirai website – https://ssl.toyota.com/mirai/fuel.html

[7] IHS Automotive – http://press.ihs.com/press-release/automotive/global-hydrogen-fuel-cell-electric-vehicle-market-buoyed-oems-will-launch-1

[8] Michelin press release – Copy available http://www.autoblog.com/2008/12/01/michelin-partners-with-chinese-firm-to-create-active-wheel-syste/

[9] https://www.tesla.com/blog/teslas-closed-loop-battery-recycling-program?redirect=no

[10] https://www.mercedes-benz.com/en/mercedes-benz/next/e-mobility/the-second-lives-of-lithium-ion-batteries/

[11] NRECA “Managing the Financial and Grid Impacts of Plug-in Electric Vehicles” – http://www.nreca.coop/wp-content/uploads/sites/4/2015/06/managing_the_financial_and_grid_impacts_of_plugin_electric_vehicles.pdf


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Student comments on Electric Vehicles and the impact in the overall effect in Renault’s Carbon Footprint

  1. Awesome post! This is particularly interesting as transportation is disrupted by many avenues, and I constantly wonder how consumers will change their behaviors with new modes of transportation. For example, some of the ride sharing companies will say their mission is to get less cars on the road, leading to a positive impact on climate change from lower emissions. Other companies like Tesla will say the electric car is what will stall climate change in the future. While others may believe something like biogas is ultimately the solution to all of this. When consumers have so many choices, I am always interested to understand how adoption here will play out. It’ll likely be some combination of all the above, but from a company’s perspective, they’ll likely have to make some interesting tradeoffs as well when going to market. I like what Renault is doing, which is ultimately taking a stance. I believe that it is what will resonate with consumers as you had noted, but with industries where disruptive technologies can rise, what would happen when / if another major disruptor comes to market?

    Thanks for the thought provoking piece!!

  2. Marcelo,

    In most countries the energy production priority scheme is

    1/ Alternative energy – most countries have established rules that alternative energy has absolute priority
    2/ Nuclear energy – nuclear installations are safest when they operate at full capacity, have a low variable cost and are therefore second priority
    3/ Thermal energy – Thermal energy is the plug to make supply meet demand

    As such, one could argue that incremental (with the focus on incremental) energy use always comes from thermal energy. What’s the difference between fuel being burnt in your car versus fuel being burnt in a thermal power plant?

  3. Fossil fuel power plants are still much more efficient than internal combustion engines. And adoption of EVs will boost the infrastructure needed for delivering renewable electricity to drivers. In 10 years it will be very feasible for US families to charge their own car with solar energy generated on premise.

  4. Love the post, Marcelo.

    I think the analysis is spot on, especially your concerns about how EVs charged during periods of peak demand will only “offset” the energy consumption to the power plants, which (for now) still are burning fossil fuels for the most part. However, I would hypothesize that most EVs will be charged overnight and therefore will not align with periods of peak demand, in general. Interestingly enough, as people start to implement more home solar applications, this could cause a serious problem! Charging your car overnight could be detrimental when your home is generating most of it’s power through solar. Regardless, it still would be a great step in the right direction.

    With respect to the battery issue and the sustainability (and recyclability) of Lithium Ion technology, do you think the EV manufacturers are focusing in the right areas? It seems to be that the battery tech will be of most value to propel the industry forward (both for the EV itself and for home and commercial applications). That is Tesla’s theory, anyway. Also, curious to see what you think of my post which is more of a deep dive on just Tesla and their challenges in the industry.

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