Electric Cars Must Pay Higher Taxes To Build Power Plants, Says Power-Plant Builder

By Antony Ingram

Antony Ingram

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With the increase in coverage that electric cars are enjoying in both the motoring and the mainstream press, you might be forgiven for thinking that the future is bright for EV lovers worldwide.

The U.K. newspaper The Telegraph might have you believe otherwise, though.

According to a recent article, a study reveals that a fuel tax of 10p a mile (15 cents) would have to be added to the cost of electricity to cover the extra demand that an increase in electic cars would place on the UK's National Grid.

The study, released by analysists Saturn Energy, also claims that electricity for recharging vehicles should cost the same as petrol. The average price of gas in the UK at the moment is £1.18 per liter, or almost $7 per gallon. This massive price hike would be "to deter those motorists who are shifting to electric cars to try to save money on driving".

The extra revenue generated, up to $2.5 billion a year, could pay for one new nuclear power plant, two gas-fired power stations or up to 10,000 new wind turbines per year.

Saturn Energy's managing director, John McShane, argues that "The running costs of an electric car, if you can afford one, looks attractive. Two pence per mile compared with say 12p for a conventional car."

"But putting a million on the road," McShane continues, "will mean having to build new power stations to keep them charged when we’re already concerned about power shortages."

McShane also adds that, while he agrees heavy taxes would cut the incentives for people buying electric cars, “we can’t cut emissions without making sure that we can keep the lights on in our homes and businesses.”

While few studies appear to exist on the impact of electric vehicles on the U.K. electricity grid, that topic was extensively studied for the U.S. by the Electric Power Research Industry and the National Resources Defense Council.

Their joint report, issued in 2008, concluded that a steady rollout of plug-in vehicles would have very little effect on grid capacity. One plug-in vehicle has the same grid load as four plasma TVs, and their steady spread has hardly caused calls for new and punitive taxes.

It may or may not come as a surprise that Saturn Energy deals largely in commercial gas and electricity, and wouldn't stand to make much profit from an increase in electric car usage.

A contract to produce more power stations, however, could be very much in their corporate interest.

[Telegraph]