Page 62 - Apmor 2018

oil insight

Are Combustion Engines

Reaching Peak Demand? By Peter Tertzakian

the assumptions needed the choice between a Model T Ford and a
to project the future. And horse-and-buggy.
more importantly question To be honest, I’m getting a little tired of all
the assumptions behind the the horse-and-buggy analogies. You may be
assumptions. familiar with the narratives I’m talking about.
Why Do We Need To Ban Imagine a photo of a New York street in the
The Internal Combustion early 1900s, jammed with horses and buggies,
Engine? clippety-clopping through manure. Click: The
Why are countries like next photo, less than 10 years later, is the same
Norway, UK, France, India street jammed with Ford Model Ts and early
and China announcing plans Chevrolets. Like a Where’s Waldo game, we are
to ban ICE vehicles? then challenged to find the lone horse.
Of course, there is the
Peter Tertzakian pressing matter of arresting
green-house gas (GHG) On the surface, it’s a compelling
emissions from a billion analogy. Everyone understands the
magine if we woke up tomorrow and read
the headline, “GLOBAL PACT: ALL COUNTRIES tail pipes. So, one reason is to accelerate the parallel: Ford clobbered the horse
IAGREE TO BAN THE SALE OF INTERNAL development of the nascent EV industry. industry, therefore Tesla and the
COMBUSTION ENGINES.” But the other reason says much about emerging EV industry will easily put
consumer decision-making. In the absence
And then imagine that we wake up in 2040 and pistons into a museum. Then the
learn that every country actually kept to their of government regulation, would a car buyer impact ripples upstream and puts
choose an entrenched mode of transport
promise. In 23 years all new vehicle sales— everyone operating a pump-jack
everywhere—would be electrically-powered. (the ICE vehicle), or a radical new mode (even
assuming that future EVs achieve lower costs)? out of business too.
I call this scenario “GB40” – a global ban on
the sales of internal combustion engine (ICE) For fun, let’s go back in time and think about
vehicles by the year I get it. Yet there is
2040. something bothersome
For reference, Electric vehicle here: Nobody banned
the GB40 market the horse-and-buggy
penetration of electric back in the early 1900s.
vehicles (EVs) would If EVs are expected to be
exceed the projections so compelling, why do
of even the most we need to ban the ICE?
aggressive analyst Like tossing a slide rule,
forecasts today. aggressive substitution
Yet, GB40 is an should just happen.
interesting thought What The Ford Replaced
experiment. I always
like to think about the A century ago people
future at the margins readily bought Ford’s
of realism and work my miracle product
analysis up or down without government
from there. Stress- intervention. To
testing extremes, understand why sales
like a universal ban, were so rapid, I went to
helps to understand my personal collection

62 | AFRICAN POWER Mining & Oil Review Vol 21, Issue 20, 2017