New York, New York – China could lead the race to roll out electric vehicles (EVs) and will deploy new transportation technologies more quickly than the U.S., according to a report by global consulting firm Accenture. Still, the U.S. could lead a global biotechnology-based agricultural revolution that will generate a greater range of biofuel breakthroughs, the study said.
The report concludes that China’s state-backed focus on EVs, its domestic supplies of lithium and current battery production capability will give it a competitive advantage over the U.S. in electric vehicles, while the American market-led approach will result in a more gradual development of new technologies. However, the U.S. will be better placed to create new innovations across many platforms, such as advanced combustion engines, electric and advanced biofuels, that can be integrated into the existing fuel supply infrastructure.
The reduction in gasoline demand in the U.S. could be up to 22 billion gallons per year by 2030, if vehicle miles travelled remained roughly the same as today, cutting crude oil imports by one billion barrels a year. This would be a 34 per cent reduction from the 3.3 billion barrels imported in 2009. China, which imports over half its petroleum demand, could reduce its crude oil imports by 676 million barrels per year by 2020, a drop of 21 per cent from today.
The rise of new fuels will have a negative effect on the U.S. refining industry, as increased fuel efficiency standards and the blending of biofuels could replace more than 30 per cent of gasoline and diesel demand. This would affect U.S. refineries currently configured to maximize gasoline production, and favour those refineries that can more easily adjust their product mix. China will have no losers, the report said, because even though it intends alternative energy to make up 30 per cent of transport fuels by 2020, car ownership is expected to almost triple between now and then, creating growth for the biofuel, EV and oil industries.
“The U.S. already has a competitive advantage in agriculture and conditions that make it the home of completely new technologies, but China’s policy decisiveness will allow it to scale specific new transport technologies more rapidly,” said Melissa Stark, global lead of the clean energy practice at Accenture. “However, these respective strengths will not guarantee long-term competitiveness, and policy makers and investors in both countries will need to put in place major structural changes to ensure their industries adapt and can compete globally.”