It is not the impact of the much vaunted electric cars from manufacturers such as Tesla that should be concerning the oil industry, rather China and it bus fleet are much more of a worry.
By the end of this year, a cumulative 270,000 barrels a day of diesel demand will have been displaced by electric buses, most of it in China, according to a report published by BloombergNEF.
That is more than three times the displacement by all the world’s passenger electric vehicles, a market where Tesla has a share of about 12 per cent..
Despite rapid growth, the impact on the oil market from electric vehicles remains relatively small.
Collectively, buses and electric vehicles account for about three per cent of oil demand growth since 2011, and 0.3 per cent of current global consumption, according to BloombergNEF figures and data from the International Energy Agency (IEA).
Buses matter more because of their size and constant use.
For every 1000 electric buses on the road, 500 barrels of diesel are displaced each day, BloombergNEF estimates.
By comparison, 1000 battery electric vehicles remove just 15 barrels of oil demand.
Still, the EV market’s impact on oil consumption is only going to grow.
By 2040, electric vehicles could displace much as 6.4 million barrels a day of demand, while fuel efficiency improvements will erase another 7.5 million barrels a day, according to BloombergNEF’s 2018 long-term EV outlook.
Its latest forecast shows sales of electric vehicles (EVs) increasing from a record 1.1 million worldwide in 2017, to 11 million in 2025 and then surging to 30 million in 2030 as they become cheaper to make than internal combustion engine (ICE) cars.
China will lead this transition, with sales accounting for almost 50 per cent of the global EV market in 2025.,” BloombergNEF said.
BmoombergNEF’s 2018 outlook said the advance of e-buses will be even more rapid than for electric cars.
BloombergNEF’s analysis showed electric buses in almost all charging configurations having a lower total cost of ownership than conventional municipal buses by 2019.
“There are already over 300,000 e-buses on the road in China, and electric models are on track to dominate the global market by the late 2020s”, it added.
