For Brigid Niall and her daughter Queenie it was quite a road trip. Not because of the route they took on their weekend drive – around their inner-Melbourne suburb, through Melbourne’s CBD and up to East Brunswick in the inner-north – but for the reaction they received from other motorists and onlookers.

Niall was at the wheel of her brand new car, a BMW i3 electric vehicle (EV), and the “futuristic” car was acting like a magnet for eyes.

“We went right up Collins Street (in Melbourne’s CBD) and we went past a tram and the people on the tram were all looking at us. We looked up and they were all pointing,” she says.

The car acted, she says, as a powerful drawcard to people who wanted to talk. “I have never had people come up to me and ask me about a car before. It was extraordinary how many people came up.”

Three years later Niall is at the wheel of her EV as she speaks. And it seems that in Australia at least, plenty of people are still looking on at EVs, and perhaps waiting for a catalyst to buy, rather than getting behind the wheel.

EV sales make up a greater share of new vehicle sales in places like Denmark and New Zealand than in Australia, according to motoring groups. Sales and registrations of EVs in Australia are rising, but from a low base.

While we might be slower adopters than some, Australian mining companies seem very well placed to benefit from the global rise of EVs due to the international competition for lithium, which in turn might produce some successful (electric) battery barons.

Lithium is a key ingredient in lithium ion batteries used in EV batteries and there are many ASX-listed lithium companies. Australian lithium companies are already mining, exploring and contributing to international electrification.

Quiet power

Niall’s small but powerful EV surges forward as she presses the accelerator, but despite the sharp response there’s barely any noise. What you hear is mainly road noise as the wheels turn on the bitumen and the sound of air rushing past. The car is so quiet that you can hear the noise of a pen moving across paper.

“I’m not an eco-warrior or anything, but I love the environmental qualities it has, from its production to its being on the road,” she says.

“And it still feels a bit futuristic, there’s something a bit Jetsons about it,” she says.

Figures obtained by Fairfax Media show that Niall drives one of about 1100 fully electric passenger vehicles registered in Victoria at the end of 2017.

The number of electric passenger vehicles registered in NSW was 1416 at the end of 2017, quadruple that of four years ago. In Queensland the number of registered EVs stood at 600 at the end of 2017, virtually double the number one year earlier.

The global penetration of EVs was in the spotlight this week, with a Bloomberg New Energy Finance report predicting worldwide EV sales would surge to 11 million in 2025, and “30 million in 2030 as they become cheaper to make than internal combustion engine (ICE) cars”. The report predicts China will lead the way, accounting for almost 50 per cent of the global EV market in 2025.

Ford will launch 50 new vehicles in China by 2025, including 15 electrified vehicles, as it looks to rev up sales growth in the market.

While the number of EVs on Australian roads is a tiny fraction of the nation’s vehicle fleet, there are about 80,000 hybrids registered in NSW, Victoria and Queensland. The number of hybrids registered in NSW jumped 75 per cent to 28,960 over the four years to the end of 2017.

National car sales figures provide an interesting snapshot of Australia’s EV story. The Victorian Automobile Chamber of Commerce says 1.19 million new cars were sold in Australia in 2017, with 1124 recorded as EVs.

This number excludes sales of Teslas, but the VACC estimates “around 1060” Tesla EVs were sold in 2016.

Allowing an estimate for the number of Teslas sold, the VACC estimates that the EV share of new car sales in Australia could be about 0.18 per cent. This compares to an EV new vehicle market share in Denmark of 0.4 per cent.

The VACC says 11,209 hybrids were sold in 2017, which was 7.7 per cent down on the prior year.

Win for Lithium

The increased penetration of EVs, particularly overseas, has been good news for Australian lithium companies.

And investors in lithium companies who got in early have seen healthy gains (at least on paper) as the share price of companies like Kidman Resources and Pilbara Minerals rode the fast lane.

Kidman’s share price has gone up more than four-fold over the past year, while Pilbara’s is sitting at more than double its value of one year ago, even after easing since January.

Kidman, which has one of the biggest lithium projects in the world at Mount Holland in Western Australia, recently announced it had struck a new supply agreement with Tesla, the world’s best known EV maker.

Kidman has signed a three year fixed-price agreement to supply Tesla with lithium hydroxide, a key ingredient in the manufacture of lithium ion batteries used in EVs.

Pilbara Minerals, meanwhile, struck a comprehensive deal with Chinese car maker Great Wall last year.

Great Wall bought a 3.5 per cent share in Pilbara for $28 million. Great Wall will also receive 75,000 tonnes of Pilbara’s spodumene concentrate over a five year term, with options to extend.

Pilbara chief executive Ken Brinsden says the scale of the opportunity for Australian lithium companies is “huge”.

“The whole market’s just going through a really fundamental change . . . most people would say that the market’s going to have to grow something like five-to-10 times over the coming decade. And that’s a really material change in any resources market.

“So as a result people are scrambling. It’s exploration, a combination of mine development, mine investment is really taking off,” he says.

It’s also worth noting that the international demand for lithium is driven by more than EVs.

Electric bikes, drones, robotics, electronic carts in hospitals even, are using lithium ion batteries, Brinsden says.

“Lithium ion batteries are now the preferred energy source because they’re so light and they’re so powerful. That’s the technology that’s allowed the plug to be pulled basically. You no longer need a plug for the sort of energy that these batteries can generate,” he says.

Brakes on

Australia has the lithium, but has it got the subsidies and incentives to support the take-up of EVs?

Key bodies representing motorists in NSW (NRMA) and Victoria (RACV) both support electric cars and want more done to get EV onto our roads.

The NRMA is funding an ambitious network of 41 fast-charging stations across NSW and the ACT which, it says, will be free to members and cover more than 95 per cent of its members’ road trips.

“We’re actually starting from regional towns and communities, working backwards to the city, because our commitment is to regional Australia as well,” NRMA chief executive Rohan Lund says.

“We’re a big group, we feel very strongly about the benefits of electric (vehicles)…we’ve got the capacity to actually do something so we decided to invest,” he says.

The first charging station stands in front of NRMA’s Sydney corporate office. The commissioning of the next two, in the Hunter Valley and at Jindabyne, is imminent.

“We’re creating a catalyst to remove range anxiety, so that’s one less barrier to people getting EVs in this country,” Lund says.

“The penetration of electric vehicles in this country is embarrassingly low. New Zealand is already seeing about five-fold the share of the new car market, that we see here,” he says.

Decision-makers across the ditch have taken a range of steps to encourage EVs, including the establishment of a network of 75 charging stations. It has a goal of reaching about 64,000 EVs on the nation’s roads by the end of 2021, and has reduced annual vehicle levies for EVs.

“Australia is a big country and we love our road trips. And the perception of electric vehicles is that you can only get 200 kilometres before you’ve got to recharge…And the way to solve the range anxiety is to see infrastructure when you drive around,” Lund says.

According to the RACV, motorists will soon get more choice among EVs, with nine new models to be released in Australia over the next 18 months.

“Five are estimated to be priced at $60,000 or less,” says the RACV’s Simon Mikedes.

“RACV research also indicates that 45 per cent of our members would consider buying an EV because of low running costs,” he says.

“Electric vehicles (EV) have a place in future transport systems alongside traditional fuel-based vehicles but one of the biggest issues for EVs is that there is a lack of federal and state government incentives and subsidies to encourage their use.

“Prices are not subsidised and there aren’t any incentives to install home or public charging stations.”

In Victoria 80 per cent of daily car trips are less than 50 kilometres, making EVs “an ideal option for city and urban drivers”, he says.

VACC executive director Geoff Gwilym has an interesting analogy for how he thinks EVs will be adopted.

“The way we use cars isn’t homogenous. It’s not like an apple. It’s like the rings of an onion. Which means that people in inner-metropolitan Melbourne, for example, will probably be large adopters of electric cars. And as you go out to the suburbs, the use of electric cars will be less. And mainly because the further you go out, the further people are needing to drive,” he says.

Regional reluctance

Gwilym also believes there will be limited EV penetration in rural Australia because of a lack of supporting infrastructure and it will take a lot longer for motorists to give up petrol or diesel cars.

In a recent submission to Infrastructure Victoria the VACC warned that the uptake of EVs was expected to disrupt key sectors of the automotive industry.

“Electric vehicles typically have around 17 moving parts or less, as opposed to around 2,000 moving parts in an ICE vehicle. This will have negative implications for the motor vehicle parts retailing, automotive repair and maintenance and car retailing/wholesaling sectors,” it says.

The report made forecasts about the economic impact of both a low, and high uptake.

“The low EV uptake scenario assumes an EV uptake rate of one per cent of new passenger car and SUV sales in 2021, rising to 10 per cent by 2030,” the submission says.

The report says the economic and industry impact from a “low EV uptake” would include a decline of 1,064 automotive businesses in Victoria by 2030, as well as “an estimated decline of 3,222 people employed in Victoria’s automotive industry by 2030”.

The size of the impact on jobs and businesses would be even greater under a “high” EV uptake, it says.

The report also highlights an interesting consequence of a mass uptake of EVs in Australia, including “diminishing fuel excise revenues over time” as well as “the possibility of new taxes and charges on road users to balance the decline in fuel excise revenues”.

The VACC recommended that the state government initiate a study of the impact of EVs on the energy network, called for the development of an “End of life policy for EVs and their batteries”, and urged the government to provide EV “policy clarity”.

But perhaps it’s most notable recommendation was the one that argued against financial incentives to encourage the purchase of EVs. “Government policies aimed at providing price support and other financial incentives to encourage EV purchases by consumers are viewed to be unsustainable and can distort the EV market,” it said.

Ahead of the curve

“Early adopter” Paul Kirkpatrick owns one of the 30,740 hybrid vehicles registered in Victoria, having bought a Mitsubishi Outlander petrol hybrid electric vehicle in 2014.

It has a two litre, four cylinder internal combustion engine, and two 60 kilowatt electric motors. One electric motor is for the front wheels, the other for the rear wheels.

He also has 15 solar panels on top of his house and garage, and a Tesla battery in his workshop to store the energy generated above.

“I’m just a committed sort of solar, renewable person from way back…I’ve always had my eye on cars of the future,” he says.

Most of his driving in his “SUV in hybrid clothes” is around Bendigo, the goldfields city about two hours’ drive from Melbourne.

“If I drive it from Melbourne to Bendigo, and Bendigo to Melbourne, I’m probably using around about half petrol and half electricity, because of the re-generative braking and charging of the car,” he says.

“If you’ve got the battery fully charged and the tank filled up you’d have a combined range of 600 kilometres, so there’s no impediment,” he says.

“I think it does give you a feel-good factor. You’re doing something for the environment, you’re generating your own power…it’s the shape of the future. But it’s nice to be living the future a bit earlier,” he says.

Extracted from Brisbane Times