Can the current energy crisis kill the electric car?

€1000 per MWh. This is the incredible record achieved three days ago on the wholesale electricity market in France. A year ago this MWh was trading at €85, representing a spectacular increase of 1000%. Thus, after months of staggering increases in the price of a barrel of oil, Europe and its partners are facing an even more serious energy crisis, which is causing panic among governments. In the UK, where regulated electricity prices have already increased by 80% for households in the country, strikes and demonstrations are increasing in the country. In France, Prime Minister Elizabeth Borne is preparing emergency measures to limit the damage as much as possible. A new unit to replace the current tariff shield, funded to the tune of 20 billion euros, is due to arrive before the end of the year to regulate gas and electricity prices.

“We owe this unprecedented increase in the price of electricity to the particularity of our current European system”explains Nicolas Meilhan, Senior Advisor at and energy expert. “The wholesale price of electricity is not defined by the average price of our production plant, but by the last plant in the network. However, this last plant in the network is a gas-fired plant. And since the price of gas has recently been multiplied by 20 (to €320 per MWh), things explode.”.

So what are the immediate consequences for the French? “Fortunately in France, the regulated cost of electricity, the blue EDF tariff, currently set at less than 15 euro cents per kWh off-peak, protects the consumer, although it could soon be reassessed upwards in contained proportions. . Those, who had chosen to go through unregulated private suppliers, on the other hand, are already getting bills of 40 øre per kWh. I also advise everyone to quickly return to regulated electricity to avoid this kind of surprise.”explains Nicolas Meilhan.

What influence does the electric car have?

In recent years, the low cost of using the electric car has obviously been one of the biggest advantages of this technology. Despite a purchase price that is generally higher than that of a similar thermal vehicle, the low price of a fully electric battery allows you to navigate after a few years of use. A few months ago, at the height of the Ukrainian crisis, when a barrel of oil flirted with 130 dollars and a liter of gasoline cost more than 2€, it even looked like the ideal solution to drive an electric car. And now ? “Without protective measures, the electricity bill to recharge the batteries in his car would be multiplied by 4 or 5. It is therefore impossible to keep this technology attractive in the eyes of the customer. All the more so given that this increase in the price of electricity will also affect the construction costs. In short, everything will depend on the intensity of the protective measures that control the price of our electricity in France. But sooner or later we will pay the real price in taxes”.

The prospect of filling up at home, the cost of which would be multiplied by 4, would no doubt have something to deter the average customer. And let’s not even talk about the price increase of fast charging on networks like Ionity’s: “I imagine that these networks will be subsidized to avoid finding prices that are too deterrent”says Nicolas Meilhan.

And how long will this unprecedented crisis last? “The current crisis is worse than the oil shocks because they concern oil as well as electricity and gas. But we have no alternative to this last energy in Europe at the moment. Gas enables our entire industry to function. Without Russian gas, we have no other solution. That is why I believe we have no choice but to return to negotiate with Russia to unblock the situation. It is about securing our industries and our entire economy. Either way, with such energy prices we will mechanically end up destroying demand. »

So you thought we’d never see worse than a full tank of unleaded at €2 a pop. liters?

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