Electric cars - subsidise the consumer or producer?

We can expect a battery of articles in the days and weeks ahead on government incentives to grow the UK electric car market. Gordon Brown is reported as favouring a sizeable subsidy for consumers to purchase electric vehicles - according to the FT, buyers of electric cars will be offered discounts of more than £2,000 – paid for by the state – under plans by Gordon Brown to make Britain a leading centre for manufacturing “greener” vehicles.

This raises an interesting economic debate. If the government is seriously committed to a car industry that is beyond petroleum, should it direct its limited resources to subsidising the manufacturing of electric vehicles (to bring their price down) or give it directly to consumers to lower their own private cost? And will a subsidy have much effect anyway given the almost total absence of accessible recharging points across the country? G-Wiz electric cars at present cost between £7,995 and £15,795 and the top of the range Tesla sports car sells for just under £80,000.

But only 179 electric cars were registered in the UK last year out of a total of 2.12 million.

London Mayor Boris Johnson has announced plans for 25,000 recharging stations in the capital as part of a strategy of having 100,000 electric cars within a few years. And this article from the Wall Street Journal looks at an interesting joint venture between Nissan and the Chinese government

What of the environmental consequences of a switch towards battery-powered vehicles? Mike Rutherford is sceptical…..

“These cars do not and cannot run without emissions. True, there are no fumes from their exhaust pipes, because they don’t have any. But where do you think the energy comes from to charge those colossal battery packs? Certainly not from their owners’ solar panels or wind turbines. No, it is nuclear or coal-fired power stations that provide the essential fuel for electric cars, which usually need to be plugged into the mains for many hours in order to recharge. That means countless tons of CO2 being pumped into the atmosphere: not to mention the additional ecological damage done to the environment after two or three years, when the battery banks lose their juice and have to be disposed of.”

More here

Expect this story to run and run ....unless the batteries conk out