The feasibility of lasting renewable energy in an age of rapid pollution is a hot-button issue on everyone's minds these days. And not too far behind is the possibility that electric cars constitute a big part of the solution. Since most fossil fuel (oil and natural gas) consumption goes to our preferred mode of transportation (automobiles), especially in the United States, the substitution of electric cars into our daily lives is often claimed as a surefire strategy to combat greenhouse gas emissions.
To that end, the California Energy Commission (CEC) has unveiled a new plan of action -- the construction of over 28 hydrogen fueling stations, costing around $46.6 million, spread throughout the Golden State. Now if hydrogen fuel sounds expensive, that's because it is, and what's more, most electric cars currently don't run on it. (The Nissan-Leaf -- produced by Renault-Nissan (NASDAQ: NSANF) and the best selling electric car to date -- doesn't run on hydrogen fuel cells.) The plan also revealed that just $2.8 million has been allocated to build common charging stations for electric cars, arguably a more effective method of encouraging ownership. These subsidies are a definite step towards building cleaner infrastructure for one of the largest, most populous and progressive states in the country. But the production of these cars and the politics surrounding them complicates existing economic and environmental concerns. As always, the devil lies in the details.
This plan's intended efforts toward sustainability -- though in accordance with Governor Jerry Brown's goal of building zero-emissions infrastructure for over 1 million vehicles by 2020 -- is in serious doubt. (For one, hydrogen fuel cells are not entirely zero-emission, as excess gas is usually produced from the chemical reaction required to produce energy.) Earlier this year, due to a political impasse, $500 million intended to subsidize electric car ownership was eliminated from the state budget. Dean Florez -- ex state senator and member of the California Air Resources Board -- put the situation in his own blithe terms: "I think it's ridiculous to play politics with kids' lungs."
The subsidies that did pass after much negotiation will primarily benefit those at the upper end of the electric car market -- that is, the consumers who can afford hydrogen fueled transportation -- thereby creating a surge of electric cars marketed to a specific class-section: upper crust consumers, predominantly composed of white collar workers.
The few hydrogen fuel-able cars produced by companies such as Toyota (NASDAQ: TM), Mitsubishi (NASDAQ: MMTOF), and General Motors (NASDAQ: GM) cost on average $100,000, a price that outweighs little benefit in the mind of a prospective buyer who commutes long distances between suburbia and downtown. The plan passed by the CEC won't do enough to expand the ownership of electric cars, thereby rendering wholesale change almost toothless.
Compared to gas-powered vehicles across a number of variables, electric cars have much ground to cover in order to be considered serious competition. Tesla (NASDAQ: TSLA) is still in the game, and led by its ever-pioneering CEO Elon Musk, the company may produce a viable and affordable alternative in the near future. But the cheap, easily mass produced, completely electric car -- the saving grace of the planet in the minds of many -- is still a dream yet to be realized.