Since their introduction to consumers in 1997, hybrid-electric vehicles have rapidly turned the auto industry on its head and caused no end of consternation to the oil and gas sector. Hybrids have also quickly captured the attention of consumers; by May 2011, more than two million Americans had reportedly bought a hybrid vehicle, the majority gladly paying a premium to 'do their bit' for carbon reduction.
Certainly, in the battle to reduce a city's carbon footprint, hybrid cars help. So, too, will the introduction of more efficient and durable hybrid designs that - over the next few years - will start to deliver new models with even greater electric range and lower (but not zero) carbon emissions.
Unhook the pump
But it will be the development and consumerisation of their still-emerging cousin, the all-electric vehicle, that will have a far greater impact in the world. Indeed, driven by consumer demand, high energy prices and supportive government policy, the all-electric vehicle sector has already been reenergized.
In part, this is because many of the more stubborn challenges that plagued all-electric vehicles in the past have started to seem solvable. Designs are under development for cars that can travel 300 miles on a single charge (effectively curing all but the most intrepid drivers of 'range anxiety'), creative ideas for the development of a network of 'top up' and 'swap out' stations are being proposed, the cost of the batteries themselves are starting to fall - even while their energy density rises.
The wide-spread adoption of carbon-free personal transport will no doubt be a cause for celebration, but it will also bring about a range of new challenges and significant opportunities that will forever alter the relationship between governments and their car-addicted citizens.
Can the power grid keep up?
Let's start with the most obvious: even with higher energy density, electric vehicle batteries will require massive amounts of power. But, as North Americans learned in 2003 and many in the developing world are reminded every day, the world's current power generation capacity and distribution networks are often old, neglected or inefficient. They were designed, in truth, for a different era. To be sure, the strain of hooking millions of power-hungry cars onto the network will be too much for the current system in most cities. Worse, many existing generating facilities (again, particularly in the developing world) are overly reliant on dirty fossil fuels which, in effect, means that consumers are doing little more than 'downloading' their carbon use to the power generator.
In this, energy regulators and governments will need to take decisive steps to develop a set of policies and regulations that support a long-term and sustainable approach to power generation and distribution capacity. For state-owned power outfits, this means a concerted effort to design, construct and maintain new and - when possible, low-carbon - sources of power. Deregulated markets will need to focus on not only creating the right incentives and risk-sharing agreements to drive investment in this area, but will also need to demonstrate a long-term commitment to the industry.
This goes for low-carbon energy' sources too: while the economics of low-carbon power are not currently strong enough to totally usurp cheap coal and omnipresent oil, recent developments point to an imminent reduction in cost for some technologies which will change the economics of power generation completely.
The end of the road for gas tax
The introduction of hybrid vehicles has also signaled a need for new thinking about how taxes are calculated and levied. Many governments rely on gas taxes, paid at the pump, to support their budgets for the development and maintenance of roads, bridges and public transit systems and - in many cases - to bolster other parts of national expenditure. But all-electric cars will effectively eliminate this revenue stream without a commiserate reduction in service use. Indeed, it would be easy to argue that - stripped of a reliance on expensive gasoline - consumers might be more inclined to take to the roads for a pleasure trip, thereby increasing demand for roads and road maintenance.
These are just some of the complex issues that governments - at all levels - will need to solve if they hope to decarbonize urban personal transport.
And herein may lie the crux: the innovation of electric vehicle developers may soon overtake the capability of government to effectively support the new models.
Planning for the future
The urgency for government cannot be over-emphasized. In just a matter of a few years, power grids will already be feeling the strain and tax revenues will already be diminished. Leaders around the world need to start thinking seriously about developing a sustainable, long-term and integrated plan that can mitigate the risks and identify the opportunities in the move towards low-carbon and no-carbon personal transport.
In itself, this will require some new ways of thinking within most government corridors. For one, the traditional rivalry and competition between government departments will need to be overcome. The changes underfoot require the active participation and buy-in from multiple government departments (transport, infrastructure, energy, urban planning, treasury - to name but a few) who will need to work in harmony to accomplish the huge task at hand.
Regional and global integration and cooperation will also be important. Competing (and often subsidized) national standards vying for global domination is a counterintuitive proposition and will only serve to dampen adoption and increase costs to consumers. Governments will need to work together in order to develop a global consensus around standards and ensure that the global divide does not deepen; VHS vs. BetaMax is not a story to be repeated for automotives. The formation of a multi-lateral institution or forum to support this dialogue would help, but the lack of one should not hinder progress.
A steep climb ahead
Possibly the most important change that government may face, however, will be in their capacity to facilitate and catalyze change. In truth, massive, disruptive and sudden change has not traditionally been the forte of government bureaucrats and regulators.
But this is exactly the kind of change that will happen in some countries; where it does, it cannot be left to market forces and Darwinian expectations that only operate well on longer, slower timescales. It will require government to create impactful policies and regulations, and instill a culture of active change to achieve the scale of transformation that the introduction of all-electric cars will soon demand.
There should be no doubt that hybrid and all-electric cars will bring unprecedented change to the future urban landscape. The hope now is that governments can keep up.