The graph on the link below shows that gasoline sales in the U.S. may already have reached an inflection point.

U.S. Gasoline Sales

Automobiles have about a 12-year average life. The graph below projects that almost all car sales in 2030 will be electric. Therefore, in 2030 the rate of decline in gasoline consumption should be about 8% per year. Some of my liberal arts friends might calculate that in the twenty years from 2030 to 2050 the total decline would be 160 percent.

Projected electric vehicle sales

By the time 2050 rolls around, there might not be enough carbon dioxide in the atmosphere to continue to stave off the start of the ice age, which was predicted to start in 1970.

Automobile companies that rely on the ability to design and manufacture internal combustion engines will face considerable hardship. Petroleum extraction enterprises and countries will need to be the low-cost producer in order to avoid rapid enfeeblement.

Stefan Jovanovich writes:

No one has seriously suggested that distillates can be replaced as the primary fuel for the engines for airplanes, ships, helicopters, farm and construction equipment, large tonnage trucks and railroads. Even the small motors used in chainsaws have had a hard time going electric; Stihl's latest model is a fuel-injected engine, not the battery-powered one they introduced several years ago. The wonderful success of electric motor devices is purchased by their not having to endure the nastiness of the world outside nightly indoor storage and recharging. Their usefulness is unquestionable; their ability to do everything that distillate-powered engines can do is a hope, not a near likelihood.

My favorite Listista enjoys reminding me that I took the pair trade of long coal, short BitCoin back when both Commodities we're priced under $100. (No, I didn't actually do the trade, but if my investing had matched my opinions, that would have been the bet.)So, all churlishness from me about the new energy world needs to be discounted to close to infinity. But, these numbers come from a churl whose calculations Martin Armstrong has chosen to publish this morning.

Current annual gasoline energy consumption by Canadian and American cars converted to electricity, using 30 miles per day as average driving distance and 70 kWh/mile as average electrical car "mileage" rating

Canada 4 Trillion kWh
U.S. 190 Trillion kWh
Present annual electricity generation
Canada .7 Trillion kWh
U.S. 17 Trillion kWh

George DeVaux writes: 

Hi Stefan,

I am always delighted to exchange thoughts with you and always with a smile on my face.

I guess the conclusion from your presentation is that the very large number makes the prospect a near impossibility.

So let me try to develop the cost of a "gallon of electric."

On gasoline, a car might get 25 miles on a gallon that costs $2.50. Searching for electric car "mileage", I get 25 to 30 KWh per 100 miles. For 25 miles, this works out to about 7 KWh (Decimal point error in your calculation?). At retail of $0.12 per KWh, the "gallon of electric" costs $0.84. I think that Carder would agree that the manufacturing cost for electric is about $0.03 per KWh. Clearly, there is more than enough margin to pay for the construction of the necessary capacity.

I will leave it to Carder to calculate how many acres of Palm Springs, California will be covered and how many windmills will shroud Martha's Vineyard, Nantucket and Block Island (NIMBY factor). I will also leave it to Carder to monitor the time-of-day consumption of electric in California to determine the impact of vehicle charging on required generation capacity additions.

We can also have a discussion about fission power (various versions) and fusion power (various versions).

One of my conclusions about the electric car phenomenon imposing an inflection point on petroleum usage - At some point in the future, the usage of electricity by electric cars will increase the need for (and the profitability of) the manufacture of carbon free electricity (solar, wind, nuclear). Retrofitting older facilities for improved operation may be a very profitable investment. 





Speak your mind

2 Comments so far

  1. Gregory Rehmke on November 3, 2019 11:13 am

    Also, in California, gasoline will become a significant source of electricity, including for charging electric cars. Across the Bay Area, residents and companies have purchased gas-powered generators. Wikipedia puts electric car sales at 2.1% in 2018, Edison Electric put sales at 1.5% for first quarter of 2019. By 2030, will electric car sales reach 5% or 10% of U.S. market? Of course this depends on the roll out of charging stations and advances in batteries plus capacities of electric SUVs and pickups (”light truck” category at 69%, cars at 31% in 2018). My 2016 Jetta gets 40 mpg on freeway and for 1.4 liter 4 cyl. is pretty fast (thanks to turbocharger). It’s great that electric cars keep improving, but gas cars keep improving too. With so many ways to absorb CO2 from atmosphere, and energy efficiency improvements (esp. natural gas power) steadily reducing U.S. CO2 emissions, plus U.S. emissions a steadily shrinking percent of global CO2 emissions, why continue state and federal subsidies for electric cars, and wind and solar electric power generation? (And I’m all for ending fossil fuel subsidies too, but they seem harder to identify, apart from tax write-offs.)

  2. none on November 7, 2019 11:04 am

    The Russell 2000 Index (RUT), have a vast majority of stocks that trade lower volume, or lower value-traded stocks.

    Today 1,000 stocks trade less than $5-6 million in value during the day.

    That is over half, and almost half of those - 500 stocks - traded less than $1-2 million during the day.

    But, though ‘indexing’ portfolio’s move now ‘hundreds of billions’ which are linked to stocks like this.

    The S&P 500 is the same the index contains the world’s largest stocks, but still, 250 stocks about 1/2 of the index total trade under $150 million a day.

    There are now 70 times more stock market indices than listed stocks in the world.

    There are nearly 3.3 million stock market indices around the world, according to new research from the Index Industry Association (IIA).


Resources & Links