The Breakdown: Electric Vehicles

What is an electric vehicle?

The term “electric vehicle” (EV) refers to a group of vehicle technologies, all of which are either partially or fully powered by an electric motor. Modern EVs fall into two main categories: battery electric vehicles (BEVs)—also known as all-electric vehicles—which are powered exclusively by electricity and must be recharged by plugging the vehicle into an outlet or other charging equipment; and plug-in hybrid electric vehicles (PHEVs), which have a gasoline or diesel engine that can partially power the vehicle and recharge the battery. 

The ability to travel significant distances on batteries alone and recharge from the electric grid distinguishes BEVs and PHEVs from the older, rudimentary type of “hybrid electric” vehicles, which use small self-charging electric motors in tandem with a gasoline engine to improve gas mileage and performance but typically cover only short distances under electric power alone.

Today, EVs are available in a variety of shapes and sizes ranging from familiar passenger cars and pick-up trucks to buses and heavy-duty vehicles. Automakers continue to expand the number and variety of EV models on the market.

Why are electric vehicles important for sustainability and achieving climate goals?

EVs offer environmental benefits by reducing the amount of harmful pollutants emitted compared to conventional fossil fuel-powered vehicles. BEVs—as well as PHEVs running in all-electric mode—produce zero so-called “tailpipe” emissions, avoiding the air pollutants and greenhouse gasses directly exhausted by the operation of gasoline- or diesel-powered engines. Although some greenhouse gas emissions may still be produced during the manufacture of EVs and the generation of electricity, research shows that, in the U.S., swapping a fossil-fuel powered car or truck for an EV results in a roughly 60–70% net reduction in climate pollution over the lifetime of the vehicle.

Transportation is the leading source of greenhouse gas emissions in the United States, accounting for more than a quarter of national emissions. The vast majority of these emissions come from passenger vehicles and medium- and heavy-duty trucks, making the transition to EVs a necessary step to avoid the worst effects of climate change. Reducing vehicle emissions also improves local air quality and creates immediate health benefits for communities, especially those situated near high-traffic roadways.

What are some of the major barriers to realizing the benefits of transportation electrification?

There are a few commonly cited barriers to widespread EV adoption: cost, driving range, and charging availability. 

Although average prices are expected to come down, EVs today are generally more expensive to purchase than similar conventional vehicles. However, the difference in upfront costs can often be offset by government incentives and fuel savings over the life of the vehicle. A growing used electric car market may also help to make EVs affordable for more consumers. 

Another barrier that prospective consumers frequently contend with is “range anxiety,” the fear of running out of battery power mid-trip without being able to find a convenient place to recharge. This barrier is largely psychological, though, since more than 90% of daily trips are well within the range of current EVs. Still, increasing range on newer models, building out charging infrastructure networks, and getting EVs into the hands of more drivers may alleviate this worry over time. 

How are policy developments affecting EVs today? What does the future look like? 

Federal and state policies continue to provide support for the maturing EV market. At the federal level, the Infrastructure Investment and Jobs Act of 2021—the latest comprehensive federal transportation funding authorization—provides $7.5 billion to build out a national network of public charging stations, and the recently passed Inflation Reduction Act extends EV tax credits and establishes billions of dollars in grant money that could be used for transportation electrification. 

At the state level, air quality standards and looming climate goals are leading to strong policies in favor of EV adoption. In California, the Advanced Clean Cars Program requires automakers to produce an increasing number of zero-emission vehicles (ZEVs), including BEVs and PHEVs. So far, another fifteen states have also adopted California’s ZEV regulation. Additionally, many states offer their own financial incentives to promote EVs and charging infrastructure.

Over the coming years, these policies may play less of a role as consumer demand grows. New sales of fully electric vehicles have surged over recent years—surpassing 5% U.S. market share for the first time in 2022. If this trend continues, one in four new car sales nationwide could be all-electric by the second half of this decade.

An accelerated rate of EV adoption may be critical to achieving climate targets and limiting the worst effects of climate change. In fact, experts suggest that 90% of cars on U.S. roads may need to be electric by 2050 in order to be consistent with the Paris Agreement’s goal of limiting global warming to 2℃. However, this alone will not be sufficient; even with widespread EV adoption, it will continue to be important to pursue policies that reduce the amount that Americans drive, including improving access to alternative modes of transportation.