China and U.S. Will Lead the Next-Gen Electric Vehicle Race

by | Aug 5, 2010

The world’s largest automotive markets, U.S. and China, are also the greatest consumers of energy. China consumed the equivalent of 2.3 billion tons of oil in 2009, according to the International Energy Agency (IEA), and is expected to demand the equivalent of 2.8 billion tons of oil by 2015. While China consumes roughly half the amount of oil as the U.S., it uses more than three times as much coal.

The growth of China’s energy demand is far more remarkable than the fact that, almost overnight, China overtook the U.S. as the world’s greatest energy consumer. On a per capita basis, the U.S. consumes five times as much energy as China, but the projected growth rate of Chinese demand for energy and its sheer scale signal that the global energy market is on the precipice of a revolution. The similarities in energy consumption do not stop there as both countries have experienced some of the most catastrophic oil events in recent history. 400,000 gallons of oil have spread off the coast of Dalian, China. Stateside, the Gulf of Mexico is experiencing what 94 million to 184 million gallons of oil feels like and just last week, a state of emergency was declared in Michigan as more than 800,000 gallons of oil were released into the Kalamazoo River. The outlooks for the clean-ups remain hopeful although it illustrates the similarities between energy-hungry giants like China and the U.S. and college binge drinkers: there are very few societal consequences for overindulgence.

There is a silver lining though. Both nations will lead in the future of electric vehicles (EV). Last week Nissan’s electric rival, GM, announced it will launch the Chevy Volt and Enterprise Rent-A-Car confirmed 500 Nissan LEAFs on order (both will be available by year’s end). Other companies have followed suit; Ford, Volkswagen, CODA, Toyota, BMW, and Honda announced that they will be releasing EVs within the next couple of years in the U.S. In comparison, the first-mover-advantage will be experienced by GM (partnered with SAIC Motor Corp.), Nissan, CODA, Geely, Chery, and BYD that will capture the largest EV marketshare in China. Even U.S. consumer electronics retailer Best Buy will enter the EV game by not only supplementing parking lots with chargers, but also selling products such as ECOtality’s Blink charger and outfitting its group of IT troubleshooters (Geek Squad) with a vehicle fleet of Mitsubishi I-MiEVs. Also don’t forget about the exotic segment of the EV industry, mainstays Tesla and Fisker already have attractive vehicles in the pipeline, with entrants such as Porsche and Audi set to get their brake shoes wet in the electric pool as well.

Just months away from plugging into the U.S. and China mainstream, the automotive blue chips are already executing dialog on the next generation of auto that will allow consumers to preserve the environment while selling energy back to the power grid. What is this next-gen auto that will put money back in the pockets of the consumer? V2G, vehicle-to-grid technology is the “Smart Grid” solution for the automobile sector by allowing vehicles to connect, communicate, and sell demand services to the grid. In the ZigBee Alliance sponsored V2G Report by Zpryme from 2015 to 2020, the China V2G vehicle market value is projected to grow from $0.4 billion to $6.5 billion, while from 2015 to 2020, the US V2G vehicle market value is projected to grow from $1.1 billion to $8.1 billion. Globally the global V2G vehicle market value from 2015 to 2020 is projected to grow from $3.2 billion to $26.6 billion, respectively.

It appears the greatest threat to the preservation of our earth isn’t oil spills or carbon emissions but the limits of the mind. Christine Hertzog, CEO of Smart Grid Library, has said that, “once upon a time, people had to learn how to manage an internal combustion engine (ICE) car instead of a horse,” and explains how the success of EVs is contingent on consumer education. EV users are not far from earning money by selling back electricity to the grid at peak times, and companies should present this information effectively to provide incentives for early adopters who want financial compensation for going electric.

The oil spills in the U.S. and China are a reminder that history will continue to repeat itself until consumers understand the value of the alternative, vehicle-to-grid. With U.S. President Barack Obama calling for one million plug-in electric vehicles on the roads by 2015 and experts predicting close to a million EVs in China by 2015, V2G will soon enough find its position in the passing lane for the Smart Grid and automotive ecosystem.

Janelle Downing is a senior researcher at Zpryme. To learn more about the ZigBee Alliance sponsored V2G Report by Zpryme visit

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