John Raine: EV or Not EV, That is the Question - Let's Be Smart About Transport Energy

Energy as Society’s Economic Enabler

Oil prices escalated as a result of the US-Iran war and have boosted electric vehicle (EV) sales. Once prices at the fuel pump restabilise nearer pre-war levels, should more buyers still be going electric? 

A previous post [1] on New Zealand’s electricity generation system discussed why solar and wind power cannot practically or economically make up more than a small proportion of the total system capacity. It also looked at Election 2026 political party energy policies and found Labour, the Greens, and to some extent National, out of touch with the realities of a resilient energy system.

Like stationary electric power generation, transport requires low-cost, high-density energy. This article (abridged from a Substack post [2]) looks at future vehicle fuels and does a reality check on political party Election 2026  policies on transport modes.   

The availability of cheap hydrocarbon fuels (petrol and diesel) has underpinned the domination of ICE transport vehicles worldwide and has been a critical economic enabler throughout the 20^th and 21^st century, whether for transporting people, goods and services, or providing power for industry. 

Payload Efficiency, Energy Intensity and Why Electric Aircraft Won’t Go Far

Payload efficiencies differ across road transport modes. Typical payload fraction (payload/gross weight) figures vary from air freight transport (~25%) at the low end through passenger EVs (~25%), ICE passenger vehicles (~30%), loaded city buses or trucks (~40%) to freight trains (~60%) and container ships (~70%). 

And because Avtur jet fuel makes up typically 40% of the loaded weight of a long-haul passenger aircraft, this cannot be replaced by batteries whose energy density is less than 2% of that of hydrocarbon fuel. Batteries make up so much of the weight of an electric aircraft that those built to date are small, have a tiny payload, and have a limited range.

Energy Intensity, EI = (journey energy consumed, MJ)/(payload x distance travelled)

Clearly, a low EI is good. Typical values show EI is lowest for oceangoing freight shipping (~0.1 MJ/tonne-km), higher for rail freight (~0.3 MJ/tonne-km electric, ~0.5 MJ/tonne-km diesel), higher still for road freight (~1.1 MJ/tonne-km electric, ~2.2 MJ/tonne-km diesel), and very much the highest for air freight (~10 MJ/tonne-km). 

EI figures for passenger transport modes are shown below [various sources including references 3 and 4]:

Mode                                                  Typical Energy Intensity (EI)

      (MJ/passenger km)

Short haul air (economy)                            1.5 - 3.0 

Long haul air (economy)                             1.0 - 1.5 

Passenger car (ICE)                                   1.8 - 3.0* 

Passenger car (EV)                                    0.6 - 1.0* 

City bus (well loaded)                                 0.4 - 1.1 

Electric rail (metro / intercity)                     0.2 - 0.4 

(*Depends on occupancy)

The foregoing figures do not reflect the embodied energy used in manufacturing the vehicle, which is 40 – 80% higher for EVs.  These figures show that:

·        Sea, rail and road freight are much more energy-efficient than air freight.

·        Mass surface transport is more payload and energy-efficient than personal vehicles, whose ICE energy intensity is similar to that of short haul aircraft.

·        Electric aircraft will never have a significant role with any foreseeable battery technology.

·        Electric trains, except for short city commuter routes, are only viable if they have a live-rail or overhead-line mains power feed.  

·        Intercontinental shipping requires the ongoing use of heavy fuel oil for payload efficiency. Likewise, diesel is also dictated for long haul road freight, although EV freight vehicles are now available with a loaded range of ~300km. 

·        Electric road vehicles convert a higher ~80% of battery energy to useful work at the wheels than the 20 - 30% of fuel energy converted by an ICE-powered vehicle.  But the energy density of a modern EV lithium-ion battery is less than 2% of that of petrol and diesel (44 – 45 MJ/kg). So, EVs end up much heavier (i.e. have poorer payload efficiency) than the equivalent fossil fuel-powered vehicle. For example, at 2,495 kg, an EQC400 Mercedes Benz is over 500kg heavier than a GLC300 or GLC 43. This is just dead mass to be lugged around using battery energy.

Despite periodic media excitement, hydrogen is not currently economically viable as a road transport fuel and is unlikely to be. This is addressed briefly in Reference 2.

Electric Vehicle Economics and the Future of Fossil Fuels

China continues to flood the world with EVs, ironically built using energy from imported coal (e.g. from Australia), and competes on both price and quality with Tesla and European brands. However, the EV market remains subdued - 0.8% growth and  5% of all vehicles on the road in 2025.

EV whole-of-life economics have been the subject of multiple analyses such as the comprehensive modelling of Baek et al [5]. These authors indicate that passenger EV’s should become lower on manufacturing cost than ICE vehicles around 2030-2035, and on total cost of ownership by 2040-2050, possibly earlier depending on a number of variables. 

Averages are difficult because the  economics vary across different vehicle classes, but an AI-assisted summary indicates that:

·    Current EVs can become more cost‑effective than ICE vehicles after about 5 - 7 years’ ownership, but only with home charging and government-offered purchasing incentives. Without those, the crossover point may be much later or never reached, such as in unsubsidised markets where the user is primarily using costly public battery charging stations.

·    The limited availability of public charging stations has put off some buyers. However, the big kickers are the

-      Fall in travel range with battery degradation, often substantial after 5 - 7 years. 

-      Multi-thousand-dollar cost for a battery replacement (and lithium-ion battery recycling is very expensive and not yet widely profitable). 

-      Ongoing rapid pace of development of EV technology causing fast depreciation of existing models. 

These can all be major disincentives and make EV total cost of ownership (TCO) expensive.  Five-year depreciation of high-end models like the Audi e-tron and Jaguar I-PACE can be around 60%, but a 2020 Tesla Model 3 comes up worst at 77%. It is telling that Porsche is discontinuing their flagship Taycan EV and focusing back on ICE and hybrid vehicles.

·    Quiet electric buses are being favoured by city transport authorities. They are comparable with or cheaper than diesel buses on a whole life cost per kilometre basis provided they travel more than 60,000 km per year, electricity is less than 40 NZ cents per kWh, and batteries last at least 8 years.   Meeting these criteria can be challenging. 

The Earth’s population may plateau and even start to fall in the next 100 years, but lifting living standards in developing countries will increase fossil fuel use and pressure on natural resources.  The exaggeration of the role of anthropogenic carbon dioxide (CO₂)  emissions in global warming has been discussed previously [6, 7, 8], and there is no harm in using fossil fuels prudently in the medium term. These fuels will eventually become scarce because they are regenerated in the Earth’s crust only over geological timescales.  Biofuels are very costly and will ultimately be reserved for essential uses, e.g. in aircraft. We should expect more electrified transport over time.

EVs need a breakthrough battery technology that has higher energy density and longer life than lithium-ion batteries, but EV batteries will remain far lower on energy density than a tank of petrol or diesel. New battery technology also needs to avoid degrading social and environmental ore-mining conditions such as those for lithium in South America and Africa.  

Meantime, the ICE will be further refined, with vehicles optimised for more fuel-efficiency and lower weight, and incentives to buy smaller vehicles where practical. Critically, with EV technology is still advancing quite rapidly, a smaller world fleet in the near term would penalise fewer owners through rapid depreciation. So, don’t rush everyone into EVs or ban the internal combustion engine by 2035, but make a more gradual transition to when the TCO for EVs falls below that for ICE vehicles. 

Common Sense Versus Political Party Transport Electrification Policies

A quick look at Party policies on electrification of transport:

ACT Party: Market-driven EV adoption and no EV subsidies; repeal of the Zero Carbon Act; support for oil and gas exploration, gas and energy security; removal of regulatory barriers.

NZ First: Nothing EV‑specific but scepticism on rapid EV mandates; support for regional transport, maintaining fossil‑fuel vehicle options;  opposition to policies penalising rural drivers (such as ute tax); major investment in oil and gas exploration.

National Party: Acceleration of EV uptake through a nationwide charging network; installation of 10,000 public EV chargers by 2030 funded by a co-investment model with some zero-interest loans; removal of regulatory barriers; no subsidies for EV purchases; removal of resource consents for EV chargers. 

Labour Party: Opposition to fossil fuel expansion, e.g. through oil and gas exploration; support for EV uptake via purchase subsidies, e.g. clean car discount; reinstatement of ban on new oil and gas exploration. 

Green Party: Rapid electrification of transport; strong anti‑fossil‑fuel stance; major investment in public transport (aim for free travel); electrification of freight and public bus fleet; subsidised “scrap-and-replace” programme to get low-income households into EVs. 

Every government expenditure or subsidy on electrification of transport is funded by the taxpayer. The milder transport electrification policies of ACT and NZ First are the most economically favourable to the consumer when raising productivity is a key priority. National’s is closer to the taxpayer-penalising policies of Labour and the Greens.  

Labour and, especially, the Greens are unrealistic in their much more costly aims for rapid electrification of the vehicle fleet and opposition to ongoing use of fossil fuels. Their strong EV policy position also ignores consequential extra pressure on the electricity grid which added solar and wind power cannot meet [1]. 

Consider these policy positions alongside the increasing evidence that, on a warming planet, CO₂ - vital to life on Earth - is not causing a climate crisis. EVs are still problematic on whole-of-life cost and environmental impact from raw materials mining. A gradual transition towards a more electrified vehicle fleet will have the least negative medium-term economic impact and makes sense while EV technology continues to evolve.

Energy policy is likely not top of mind for many voters, but we need a government after November 2026 that understands that sound energy policy must be driven primarily by economic considerations not climate change ideology.

************************************************************

John Raine is an Emeritus Professor of Mechanical Engineering and a former researcher in alternative and renewable energy systems. He previously worked in the UK engine and vehicle test plant industry.

References:

1.    John Raine, “The Electricity System: Energy Realism versus Policy Greenwash.” Brash and Mitchell, 5^thAugust 2026. https://www.brashandmitchell.com/post/john-raine-the-electricity-system-energy-realism-versus-policy-greenwash

2.    John Raine, “EV or Not EV, That is the Question”, Substack 14^th August 2026 https://johnraine31350.substack.com/publish/posts/detail/211177843

3.    IEA, “Energy intensity of passenger transport modes, 2018”  https://www.iea.org/data-and-statistics/charts/energy-intensity-of-passenger-transport-modes-2018

4.    Stacy C. Davis and Robert G. BoundyTransportation Energy Data Handbook edition 40. Oakridge National Laboratory, June 2022 ORNL/TM-2022/2376 https://tedb.ornl.gov/wp-content/uploads/2022/03/TEDB_Ed_40.pdf    

5.    KwangHoon Baek, Xinyi Wu, Yan Zhou, Ram Vijayagopal, Namdoo Kim, Amgad Elgowainy. “Total cost of ownership of vehicle electrification and fuel switching options for light-duty and heavy-duty vehicles” Science Direct,  eTransportation 27 (2026) 100512. Version of Record 3 December 2025.

6.    Richard Lindzen and William Happer, “Physics Demonstrates that Increasing Greenhouse Gases Cannot Cause Dangerous Warming, Extreme Weather or any Harm”, CO₂ Coalition, 7^th June 2025. https://co2coalition.org/wp-content/uploads/2025/06/Lindzen-Happer-GHGs-and-Fossil-Fuels-Climate-Physics-2025-06-07.pdf

7.    John Christy, Judith Curry, Steven Koonin, Ross McKitrick, Roy Spencer, “A Critical Review of Impacts of Greenhouse Gas Emissions on the U.S. Climate”, Report of the Climate Working Group to U.S. Energy Secretary Christopher Wright, USA Department of Energy, July 23, 2025

8.    William Happer, Steven E. Koonin, Richard S. Lindzen, Tutorial Submission on Global Warming and Climate Change to United States District Court Northern District of California San Francisco Division, Case No. C 17-06011 WHA, Case No. C 17-06012 WHA. Hearing Date: March 21, 2018.