Comment by dust42
11 hours ago
BloombergNEF has over the years proven to have pretty solid forecasts. The current one about NEVs [1] has a few interesting points. Adoption of EVs is slowing down in the US due to policy changes but going to explode in countries like Vietnam because they are cheeper to buy an run. It is not BMWs and Mercs but Chinese brands.
In Europe and the US the Chinese EVs are kept outside with the help of tariffs but that is just closing the eyes to avoid facing the inevitability. Battery technology, production and raw materials is all China.
Last not least Europe is driving up KWh costs by an ideologically driven push for renewables which also doesn't help.
[1] https://about.bnef.com/insights/clean-transport/electric-veh...
> an ideologically driven push for renewables
Renewables (especially wind) are now just about the cheapest way to generate electricity, and new battery technologies do much to help with their intermittency, so where’s the problem?
(Plus, the ‘ideology’ in question would seem to be: it’s bad to fry the planet, and also bad to run even a small risk of radioactively contaminating one’s landmass, and IMHO neither of these positions deserves to be called an ideology).
>> an ideologically driven push for renewables
> Renewables (especially wind) are now just about the cheapest way to generate electricity, and new battery technologies do much to help with their intermittency, so where’s the problem?
The basics of economics are:
Yet you know all this as you are a professor of economics in the UK. So how comes that the UK has the highest industry KWh prices in Europe? There must be an absolutely fantastic opportunity to make money and investors should be like vultures grabbing new projects for renewables.
Just the other day I read news that in Germany perfectly well functioning wind turbines are being turned down because they have reached the end of the phase of guaranteed KWh prices. So are the owners crazy and throwing money away? No, they simply do the business calculations and if the math doesn't play out, they simply remove them and build new ones with new subsidies.
The latest auction from the German gov for a new field in the baltic sea didn't even find one bidder.
China is doing lots of renewables but they calculate it down to the penny.
So yes, as you say "Renewables (especially wind) are now just about the cheapest way to generate electricity". To generate yes. But you need lots of CAPEX to store it and to distribute it. And you can not work with a 95%ile. You need 100% in any developed economy.
Despite marginal cost pricing it not interesting for investors without subsidies.
Old wind turbines might be perfectly fine but they are also no longer competitive with modern replacements. Usually it does make sense to replace them with more modern alternatives. Subsidies have gotten very low because carbon credits are now a much more important way for renewables to boost their income (most negative prices reflect that).
Offshore wind is facing the challenge that it is more expensive than onshore wind and also that solar is having a day with ever decreasing prices. Governments are trying hard to minimize the cost of the energy transition, offshore is primarily hurting because of this.
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>There must be an absolutely fantastic opportunity to make money and investors should be like vultures grabbing new projects for renewables.
They are. While the marginal price is being set (most of the time) by expensive gas renewables projects are making money hand over fist.
Also, to add to the “ideology”: it is bad to rely on other countries for fossil or uranium fuels.
Frying the planet is bad. That said i don't see the reliance argument for uranium. There's a variety of existing sources on the planet and some we stopped mining. It's proportionally a super small financial element of the energy production process unlike with fossil fuels. So in the case of let's say Putin's Russia you can avoid using their or let's say Kazakhstan's fuel and if you don't but don't take it's gas directly or via intermediaries like armenia then Russia still ends up in the financial shitter because their income from Rosatom/uranium one/... doesn't even compare.
It's almost inviting anti renewables arguments based on things like aluminium mostly being produced in china and russia or based on where the vast majority of panels are produced, etc.
>Renewables (especially wind) are now just about the cheapest way to generate electricity
Only if you don't include the huge cost of storage for when it isn't windy.
Include it and it's still cheaper than, say, nuclear.
Also ... even when storage is included, you still gain freedom from opex spending for fuel (that is, lining oily pockets). Once there, renewables are "pure payoff".
Chiming in as Australian with no context on European situation. AFAICT the key drivers of cost inflation are to do with reconfiguring the electric grid to transfer power efficiently and reliably from plants that produce renewable energy. However, the grid is set up to do so from non-renewable sources. And you want to do it while smoothly operating the network. This is extremely hard. Doing so quickly therefore elevates prices. That’s the rationale I could imagine being the case in EU markets.
It's not that simple. For example, in the The Netherlands, the use of electricity was stable for a long time. Mostly because all kinds of equipment (light bulbs, etc) got more efficient.
Grid operators predicted that with the energy transition, demand would rise, but politics wanted to keep prices low and limited investments.
So now, there is a big problem in the entire country connecting companies or new residential areas to the grid independent of how electricity is generated.
At the same time, the government is extremely forward looking and builds massive interconnection points on the North-Sea. Not a bad idea in the long run, but in the short run it does make electricity from wind on sea more expensive.
That said, the biggest hit to EU countries is that cheap natural gas disappeared. Coal is not cheap and extremely polluting. Natural gas was cheap for a while. Until it wasn't.
The European situation is a bit more complicated. It was very well known for a long time that Russia is a ticking time bomb in our backyard yet we made ourselves nearly dependent on their energy supplies and now combined with the push for renewables (which in my opinion is the right thing to do) we have a crisis. Now there are also lot of countries in the EU with different priorities, so while in theory we could build long-range HVDC connections across borders, it is very hard to do.
more like "it's bad to fry the planet so we will destroy our economy for 0.001% impact while the real impacters continue to advance and leave us in the dust"
It's not just Vietnam. It's almost any country anywhere in the world that is seeing healthy growth in EVs. Especially the ones that barely have a road network or a petrol distribution network.
This is an effect that is still underappreciated in western markets but developing markets embracing renewables and EVs means they are enabling some serious economic growth. They are eliminating chunks of fossil fuel imports from their balance sheet while enabling economic activity in areas that have poor grid coverage and limited access to fuel.
Pakistan is a good example. They have a very under developed grid. Solar and battery storage are enabling the locals to work around that and they have installed a lot of that in recent years. This is enabling local businesses that previously had very poor access to reliably power to now have reliable power and grow. The Pakistan government is also putting in place incentives to stimulate EV imports.
Ethiopia is going a lot further and has actually banned ICE car imports last year. They want to reduce the amount of fossil fuel imports on their balance sheets.
So you buy a battery for your tiny grid island and pay a little more so that you can also use for a drive? Or perhaps not even more, because the standalone battery is less mass market item.
Truly an interesting change, considering how much of the ICE market used to be hand-me-downs from more industrialized countries. I guess proximity to those is now a hindrance to the renewable revolution, because places with less access to hand-me-downs have a market (and mindset!) for low-priced new cars that never existed in places flooded with second hand cars? Will the upmarket-first kind of BEV ever work in that way?
> Ethiopia is going a lot further and has actually banned ICE car imports last year. They want to reduce the amount of fossil fuel imports on their balance sheets.
My understanding is that they are more concerned about oil shipping as they are landlocked and the situation in the gulf of aden is less than ideal.
Electricity costs in the UK (which I believe is still in Europe) are cheaper now than they've ever been if you have the right tariff and that's all due to renewables. Granted, that's primarily at night, but for EVs that's perfect.
One can get a tariff at <7p/kWh for 6 hours in the night. That's cheaper than gas (actual gas, not gasoline).
If that’s Octopus Intelligent Go, then it will also give you the 7p rate outside the normal nighttime slot if the car is charging and their algo calculates they can do it.
Renewables definitely help and I think the UK is doing quite well there but it's a little disingenuous to not even mention the price cap that the government has imposed!
What's the price cap got to do with it? You can get tariffs that are very cheap and outside of the price cap: https://www.goodenergy.co.uk/wp-content/uploads/2025/11/Good...
> an ideologically driven push for renewables
It is not an ideological push, but one driven by the necessity to fight climate change.
Maybe it is ideology to emphasize renewables over nuclear. But all over the world the energy transition seems to involve primarily renewables and only maybe a dash of nuclear.
For many years (20+?) Vietnam has had huge import tariffs on US/German/etc cars. It varies by origin country and engine displacement, but it's around 75% to 175%. Some trade agreements with other Asian countries result in much more reasonable tariffs for Asian brands, but some rich Vietnamese people have bought BMW or Merc with 150%+ tariff/tax. (I found it a bit mind-blowing.) So, it's pretty obvious why Asian made EVs are expected to "explode" in popularity over there. (I'm pretty sure the trend is already well underway, I know a retired guy there who replaced a Merc with a hybrid Mitsubishi (?) last year.)
Your reliable BloombergNEF says that onshore wind became the cheapest source of unsubsidized new electricity in Germany and UK in 2015, a decade ago.
Coincidentally that's roughly when the UK government banned the building of onshore wind across England, which was only recently revrsed.
Now that sounds like an Ideologically driven attempt to raise electricity prices.
The European tarriffs on Chinese EVs typically amount to 20%, which doesn't keep them out but does somewhat slow their adoption.
Would we price out cheap Vietnamese EVs (say) in the same way?
The US would just ban them with some regulation like we do with most foreign competitors