The disappearance of ICE, no .... not that kind of ICE

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What happens with the internal combustion engine (ICE) goes away?


My postage sized yard was due for a haircut this weekend, so I stepped into the garage to get my lawnmower. I thought ... nuts; I forgot to get gas, and it has been a while since I have changed the oil.  Oh, wait .... I have an electric lawn mower with an 82 volt battery.  Just press the button and go.  Gas in the garage is gone forever.

Take a look at the graph below (courtesy Bloomberg, https://about.bnef.com/blog/behind-scenes-take-lithium-ion-battery-prices/):



It does not take a genius to figure out what will happen.  Batteries are getting cheaper and more powerful every year.  It’s an inexorable form of Moore’s law.  
Making no assumptions about the environmental goodness of human beings, we can assume that if two things provide the same service and one is cheaper, we’ll go low cost.  Some implications:
  • Within 5-7 years no more ICE powered cars will be manufactured.  The low cost option will be electric.  
  • Most other ICE based equipment—bulldozers, backup generators, small to medium ships, lawn trimmers, and aircraft will convert to battery power.
  • The number of car repair shops will decrease because electric cars require less maintenance than their gasoline equivalents. 
  • Oil prices may drop to where extraction from difficult environments, such as oil sands, becomes uneconomic.  
  • At some price point, home or community power storage becomes practical, reducing the economy’s overall exposure to blackouts.  Distributed power generation is reliable.
  • The used car (ICE based) market will crash.  Want a $90K+ Lexus LX570 cheap? Just wait a few years.  
  • Car insurance companies will need to find replacement income.  Electric cars plus artificial intelligence based safety systems will reduce accidents. That translates to lower premiums for businesses and consumers.   
  • Assuming self driving cars and trucks penetrate the market, paid driver jobs will decrease.  Long-haul trucks on less complex routes (such as western highways) will be the first to automate.    
  • We will build no new power plants.  Much of the existing capacity is required solely to meet peak demand, such as mid-day during the summer.  With cheap and massive electric storage facilities, we can easily manage the peaks.  
You can think of many other consequences of cheap storage combined with electric motors.  A century after Henry Ford we have still horses.  And a century after ICE, we’ll still have cool sports cars with the traditional deep-throated growl.  Both will be in climate controlled buildings, to be brought out for recreation and nostalgia.  No horses or ICE machines allowed on interstates.    





  

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