America: Why Electric Cars?

No invention in the 20th century has been more influential upon Americans than the automobile. Today, cars still act as super-dynamo for the U.S., accelerating its development, prompting productivity, and raising the standard of living. After centuries’ of development, however, the wheels brought not only prosperity, but also troubles: they seem to weigh heavier and heavier under a huge consumption of oil — and it’s becoming unbearable.

Take the year 2008 as an example. The oil consumed by the Department of Transportation (DOT) accounted for two-thirds of America’s total, with carbon emissions comprising 31 percent of the American annual amount. Spending on oil and America’s reliance on foreign resources became Americans’ top concern after the oil crisis in the 1970s. Wars, pollution, terrorism and now the oil spill in the Gulf of Mexico are all closely associated with oil. Centuries’ glory is about to evaporate and the future of cars tagged “Made in the USA” is in the mist.

Yet, however misty the future seems, a faint way out lies in front of the Americans. They can replace oil with electricity, turning gas-powered cars into electric vehicles. The U.S. legislature passed a greenhouse gas emission reduction regulation and two electric vehicle acts within a month. Apparently, the American government and Congress finally see eye-to-eye on developing electric cars.

We often see the American government and Congress give each other tit-for-tat. Democrats and Republicans react like water and fire in policy making, as in health care reform, but at least in the issue of promoting electric cars, they are standing in the same line this time. On May 7, the Environmental Protection Agency (EPA) and DOT jointly announced the Light Vehicle Greenhouse Gas Emission Standard and a new fuel efficiency standard, putting strict limits on the development of the traditional gas-powered automobile. Soon after, on May 25, four congressmen, Democrats and Republicans, presented an electric vehicle act draft, advocating the development of electric cars for widespread use. On May 27, three senators of both parties proposed a draft with the same name. The government and Congress have made allies with the goal of promoting electric cars and discarding fuel cars. At least we can draw the conclusion from the above that the Americans have reached an agreement on developing electric cars, the sooner the better.

Once the actions take effect, the results will be obvious. In the Electric Vehicle Act there is a 20-year goal aiming to widen the market for electric cars to 100 million by 2030, which means saving 1 billion barrels of oil and reducing 300 million tons of annual carbon emissions.

From the details of the Act, we can see from all the subsidies and tax reductions that consumers are the main targets. This will obviously better encourage consumers to choose electric cars, hence raising their competitiveness. At the same time, the Act says that the government should provide favored loans to electric car producers and the government should give electric cars preference when choosing official vehicles. Moreover, in the regulations presented by DOT and EPA, all the limits are targeted at auto manufacturers, hence putting the pressure of emission reduction and industry transformation directly on the producers.

All in all, the U.S. government and Congress passing regulations and acts promoting electric cars with small intervals will, on one hand, realize the limitation of the development of gas-powered cars and prompt transformation to the electric cars by setting up new emission standards. On the other hand, this will boost the development of the electric car industry. The direction of the American car industry, which is currently comprised of gas-powered cars becoming more energy-efficient to reduce carbon emissions through upgrading motors and reducing car weight, is gradually withdrawing from the market due to mixed signals from the government. Electric car makers, however, will work on improving their cost-to-price ratio This will increase their competitiveness with the help of the government and, in the end, they ca take over the market with zero carbon emissions and low cost. The policy makers think that such a transformation will not only lower overall carbon emissions and cut the reliance on the foreign oil, but also provide new jobs and boost the economic growth.