What Will Propel Our Cars and Trucks?

  • United States
  • 08/23/2017
  • Duane Morris LLP & Affiliates. © 1998-2017 Duane Morris LLP. Duane Morris is registered service mark

By Seth v.d.H. Cooley

Over the past several weeks, the following items have all hit the news:

a) The Trump administration is “encouraging more coal mining on lands owned by the federal government” as “part of an aggressive push to… invigorate the struggling American coal industry.” New York Times, August 6, 2017

b) A South Carolina utility, SCANA, “announced to its investors that it is abandoning the construction of two nuclear power plants in the Palmetto State, citing rising costs that would push the total for the two facilities to over $20 billion. The abundance of cheap natural gas from American sources – thanks to the wonders of fracking – has altered the financial calculus and rendered new nuclear… economically nonviable. The announcement leaves the Vogtle power plant in Georgia as the only new nuclear facility currently still under construction in the United States. SCANA, via its subsidiary South Carolina Electric & Gas, has already sunk about $5 billion into the V.C. Summer nuclear facility in South Carolina, and its customers may be completely on the hook for those expenditures regardless of the fact that construction will never be completed and not one electron will be created from the venture.” CleanTechnica, August 4, 2017

c) “The U.K. said it would ban the sale of cars powered by traditional internal-combustion engines by 2040, joining other European regulators in a bold push toward populating roads with electric cars that remain unpopular in the mass market. The initiative… follows a similar move by France and efforts by several European cities from Munich to Madrid to ban or restrict diesel engines.” Wall Street Journal, July 26, 2017

d) “All new cars launched by Volvo from 2019 onwards will be partially or completely battery-powered, in what the company called a ‘historic end’ to building models that only have an internal combustion engine.” The Guardian, July 5, 2017

With nearly one quarter of the energy use in the United States being consumed by cars, trucks, light trucks and motorcycles, the growing prospect (if not triggered process) of a substantial shift from petroleum (gasoline and diesel) to electricity as the energy source for propulsion of our nation’s vehicles necessarily means that significantly more electricity will need to be generated (even after accounting for increases in vehicle energy efficiency associated with electric propulsion) to power the nation’s vehicle fleet. On economic considerations alone, the SCANA experience does not bode well for utility scale nuclear plants filling the void. Even with the Trump administration’s support of the coal industry, it does not seem likely that new coal-fired power plants will be selected as the answer. As of August 2017, the race would seem to be one between natural gas and renewables, with plenty of room for both.