Autonomous vehicles – the pace of adoption, transition and their effect on the energy sector

By Sam Stephens


A week rarely passes these days without some mention of driverless cars in the press or the media, and the pace of coverage has accelerated over the last two years, particularly since Google started sharing more about their successes (or otherwise) in the field. If a benchmark is needed, Gartner’s recent assessment of Autonomous Vehicles on their ‘Hype Cycle’ confirmed what many cynics would suspect, that the technology has just passed the, “peak of inflated expectations”.

While this analysis seems fair, there is a much broader conversation to be had, and some key fundamentals that are becoming apparent. It is becoming clear that Autonomous Vehicles represent a real game changer for society, and the question is not ‘if’ they will become commonplace, but ‘when’. Predictions of this vary wildly, from techno-optimists declaring that they are five years away, while more measured assessments predicting that we’ll be well into the 2030s and 40s before Autonomous Vehicles have an impact on the masses. Sifting through these predictions in itself is a minefield, with optimistic views typically touted by those with most to gain, and vice versa.

Another fundamental is that viewing driverless technology alone is missing the bigger picture in the transportation space. Two further technical trends are emerging, as was discussed in ERP’s Energy Options for Transport report earlier this year, notably toward electrification of vehicles and the increased connectivity of vehicles, particularly through on demand services such as Uber and Lyft. Electric, Connected Autonomous Vehicles (ECAVs as I could refer to them) represent a synergistic combination of technologies – each will reinforce and strengthen the capability and business case for the others. In the transportation sector we are seeing this conversation move to one about a business model focussed on providing ‘mobility’ above all else.

Once we accept that the technology will provide overarching benefits to society, the next step is to identify how we can accelerate this transition to reduce our impact on the environment and improve quality of life, particularly in our rapidly growing cities. In this respect the Energy sector is a key stakeholder; ECAVs will have a dual impact both on demand for liquid fuels and electricity.

Some high level analysis of these impacts has been undertaken by the likes of Bloomberg – predicting that Electric Vehicles alone could displace 2 million barrels of oil consumption per day by 2023, with or without advances in autonomy. Then there are the challenges with not only the supply of energy in absolute terms required for electrification – recent European Environment Agency forecasts indicate that EVs will require almost 14% of total electricity demand by 2050 if 80% market penetration is reached – but also when and where the power is required. But the uncertainties with any analysis are currently vast, and the trifecta of autonomy, connectivity and electrification presents a potential ‘black swan’ event. Infrastructure investment will be required somewhere in the system and the pace of adoption will depend upon how each constituent part of the ECAV proposition is developed. For example with regards to electrification, consideration needs to be given to the learning rates associated with battery storage, but also rapidly reducing costs of variable renewable sources of generation such as wind and solar that would benefit from a vast pool of dynamic storage.

To complicate things further, technologies will continue to combine in ways that will surprise us, for example what if Vehicle Integrated PV can provide enough power from sitting in a car park all day to power your daily commute? And with the removal of the driver, will Heavy Goods Vehicles that currently deliver goods from A to B via C, morph into a fleet of many more Light or Medium Goods Vehicles that cut out the middleman?

The key challenge we face now is understanding whether the new technology will work around existing infrastructure and regulation, or whether its pace of adoption will be inhibited by them. If clarity can be gained on this matter, we as a society will be better placed to identify the ‘low regrets’ investment and policies for our energy system. These are topics that ERP members will look to address in 2017, through collaboration with a diverse range of energy sector stakeholders to provide a reasoned and independent view, underpinned by industry, government and academic insight.

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