1. ECO-MOBILITY
The end of the road for fossil fuels?
The best ideas can
appear in the most
unexpected places

2. ECO-MOBILITY: ThE End Of ThE rOad fOr fOssIL fuELs?
ThE VIEW frOM 2030
If we couldn’t travel by road, our Faith Birol, chief economist of
lives would disintegrate. We the International Energy Agency
couldn’t deliver goods, get to work, believes that, on current trends, oil
see friends, go to events and will peak in 2020. “One day – 2030
entertainments. And road transport or 2040 – oil will run out. We have
depends on oil – more than 99 per to leave oil before oil leaves us,”3 he
cent of vehicles are powered by said.
petrol or diesel.
We had similar fears about energy
One way or another, that’s about to in general in 2005, putting forward
change. the prediction that the UK could
face an energy gap of 16 per cent at
Some people believe that we have
average demand in 2020 and a 31.5
about 50 years of oil left. Others
per cent gap at peak. And that was
think that oil production has peaked
on a conservative analysis4. We have
and we’re already on the fast track
seen no evidence that changes that
to empty. As Saudi Arabia’s then-
prediction.
regent and now king, Abdullah bin
Aziz Al Saud, told his subjects in If this is the case, we need to ask
1998, “The oil boom is over and some hard questions.
will not return... All of us must get
used to a different lifestyle.”1 Sadad
Al Husseini, the former head of
Saudi Aramco’s production and
exploration, held the same view ten
years later. He thinks it likely that
oil production reached its peak in
20062.
1
Peak Oil could trigger meltdown of society,
Energy Watch Group 2007
2
Dave Cohen (October 31, 2007). The
Perfect Storm. ASPO-USA
3
Interview with Faith Birol, www.logica.tv
4
Logica: Mind the Gap: The black hole at the
heart of the UK’s energy supply
3
2

3. sOME BusInEss MOdELs fOr 2030
But not everyone agrees – even
What if in 2030: within the same company. Abdullah
• Oil does run out? Jum’ah, president and CEO of Saudi
Aramco, said in 2008, “We have
• We have to find new ways grossly underestimated mankind’s school
of getting around? ability to find new reserves of
• We need to rebase petroleum, as well as our capacity
transport from oil to other to raise recovery rates and tap
forms of fuel? fields once thought inaccessible or
impossible to produce.”5
A five per cent increase in extraction
from current proven fields would
maintain world oil supplies for
decades. If we managed to improve
extraction techniques by around 30
per cent, we would have another
300 years of oil. Dr Christoph Rühl,
BP’s chief economist, thinks this is
more than possible. “Peak oil has
been predicted for 150 years. It has
never happened.”
But he adds a rider, “[Global
warming] is likely to be more of a
natural limit than all these peak oil
theories combined.”6
So perhaps we need to ask some
different, but equally hard, questions.
5
CEO Offers Positive, Realistic Energy View,
Saudi Aramco News 2010
6
BP: ‘We should see volatility increase’,
updated January 2010
3

4. recycling depot
Glass Cans Card
Faith Birol, the Chief Economist of the OTHER ASPECTS ARE ALSO
What if in 2030: International Energy Agency, who dRiVing thE EV REVOlutiOn
• Oil isn’t the issue but C02 even refuses to buy a car because
As oil supplies in the developed
and other global warming they pollute, points out that nearly
world become scarcer, its countries
gasses are? 95 per cent of growth in oil demand
become more reliant on oil from
comes from transport and that
• We have to change road less stable regions, with the risk that
“business as usual is not an option.
transport to save the supplies will be withheld or prices will
Current policies [continuing to rely on
planet? rocket. The West will therefore push
oil] would lead us to a catastrophic
to develop low carbon technologies
result.”
and to retain control over their
Both the end of oil and the effects production.
of global warming point to the same
There is also a need to protect our
conclusion: we need to move to
auto industry. In the UK alone, the
alternatively powered vehicles that
sector accounts for a value-added
have little or no dependence on oil
share of GDP of more than three
and very low or zero emissions. These
percent, employs 820,000 people
include electric vehicles, hybrids
directly and indirectly and generates
(powered by a mix of fossil fuel and
exports worth £20 billion a year9.
electricity), fuel cell vehicles (for
A move to EVs will safeguard the
example, cars powered by hydrogen)
industry and should boost exports.
and cars using alternative fuels, such
Further employment and growth
as bio-fuels. Together, we refer to
will come from installing new
them as ultra low carbon vehicles.
infrastructure.
In the foreseeable future, electric
vehicles (EVs) are likely to dominate Congestion is another factor – one
the landscape. They are practical which, according to UK government
for short journeys – 80 per cent of estimates, will cost England alone
all UK journeys by distance are by £22 billion a year by 2025. EVs
car, half of all car journeys cover less with intelligent vehicle systems
than three miles and a quarter are that anticipate traffic conditions
less than two miles. Around 20 per would mean that more cars can
cent last for a mile or less7. Electric safely use the roads and traffic flow
vehicles also have an edge because will improve. Intelligent transport
more research and development systems, or Intelligent Mobility as
work has gone into them. the UK government is starting to
call it, will connect private and public
Electric cars will make up 20 per cent
transport to move more people faster
of UK auto sales by 2016 as drivers
– and, again, safely. Overall, there
take advantage of government
should be a reduction in serious
subsidies and lower fuel costs,
road accidents, which currently cost
according to National Grid Plc Chief
Europe two per cent of its GDP10.
Executive Officer Steve holiday8.
7
Department for Transport
8
Taken from article by Kari Lundgren,
Bloomberg: http://www.bloomberg.com/
news/2010-11-30/electric-cars-to-reach-20-of-
u-k-vehicle-sales-by-2016-grid-ceo-says.html.
Electric cars to reach 20% of UK vehicle sales
9
SMMT
10
European Road Assessment Programme
5
4

5. Health will improve, too, because of
the reduction in pollutants, since road
vehicles currently create 46 per cent
of nitrogen oxides (NOx)11.
If climate change is the main reason
for switching to EVs, we will also
have to ensure that the electricity
powering them is not generated from
fossil fuel. Today, fossil fuel power
stations account for another 21 per
cent of NOx12.
Instead, we will need a network of
renewables, such as wind farms,
tidal and wave barrages; solar and
heat exchangers; and nuclear power
stations.
the move to EVs will be part of an
overall, fundamental restructuring
of our economies. As Sir David
King, former UK chief government
scientific adviser and currently
director of the Oxford University
Smith School of Enterprise and the
Environment, puts it, “I think we need
a 21st century renaissance – and by
that I mean a transformation at least
equivalent to the Renaissance or the
Industrial Revolution – if we are going
to manage this in a way that doesn’t
lead to massive breakdowns of our
global economies.”13
11
Foresight Vehicle technology Roadmap
12
Defra
‘Wanted, a 21st Century Renaissance’,
13
Oxford Today volume 22, 2010
5

6. faCTOrs affECTInG ThE fuTurE Of EVs
TaxaTIOn
Already, more than 75 per cent of a THE BUSINESS CONSEqUENCES
What if in 2030: vehicle is recycled at the end of its
• Businesses are under legal
life. Renault, for example, saved €400
• Your car was partly taxed duties both to comply with
million through recycling in 2007
on its recyclability? legislation and to do what is
alone and has now set up a joint
best for their shareholders.
• The tax taken from excise venture with waste specialists SITA
Recyclability taxes will therefore
duty and VAt on fuel falls? to recycle cars14. Renault’s recycling
prompt manufacturers to up
• Fuel taxation was based on rate will rise to around 95 per cent
their recycling rates and clever
driving style? by 2015, partly prompted by EU
design may well enable them
legislation to make manufacturers
to reuse parts and save money.
responsible for car disposal and
But if the penalties for failing to
partly by rising raw material prices.
reach recycling targets are low,
New types of vehicle design, businesses might well take the
manufacture and ownership, view that the cost of compliance
perhaps encouraged by waste exceeds the benefits.
taxes, should lead to almost total
• Road pricing is also likely, as
recycling. Vehicles may be designed
are new taxes on whatever
to be reconfigured for individual
powers fuel cell vehicles. The UK
users as personal needs change
coalition government has already
or to be broken up, with individual
said it will “work towards the
parts reused in new vehicles.
introduction of a new system of
Environmentally damaging practices,
hgV road user charging”15 and
such as paint spraying, will disappear
the Department of Transport has
because of new techniques, such
stated this will be put in place
as embedding colour in body parts.
during the current Parliamentary
Oil lubrication may be replaced by
term. This may well be the
nanotechnology.
precursor to road charging for all
Excise duty and VAt on fuel raises users. Government will probably
upwards of £25 billion a year for try to keep taxes on EVs low to
the UK government. As oil use begin with, to encourage mass
diminishes, so will the tax take. This take-up, then increase taxes once
will certainly have consequences. most drivers are using the new
One is that governments will find vehicles.
ways of making up the difference.
Another is that they could also see
this as an opportunity to change 14
renault.com/environment
public behaviour to make the most of 15
House of Commons Library SN/BT/588 –
diminishing resources. Roads: lorry road user charging
Dentist
7
6

7. • It is certainly possible that
personal carbon allowances will
be in place by 2030. These will
have the effect of penalising
people whose lifestyles involve
above-average carbon use.
Choice will still be important and
we shouldn’t lose sight of the fact
that a vast amount of travel will
still be completed by private car,
therefore emphasising the need
to decarbonise private transport
as well as providing energy-
efficient or even completely
de-carbonised public transport
networks.
• But you can also expect green
behaviour among drivers of petrol
and diesel powered vehicles to
be rewarded, through innovations
such as Logica’s EMO16. EMO
measures a vehicle’s emissions
as it is driven, sending data back
to a collection point. It has been
named by The Economist as
one of ten global green game
changers. Those whose driving
creates minimal emissions could
be rewarded by lower fuel prices,
cheaper vehicle excise duty and
insurance discounts (because
greener drivers tend to have
fewer accidents).
16
Declaration of interest: We invented EMO.
It’s one of our many ventures in intelligent
transport systems. See www.logica.com/emo.
7

8. EnErGY InfrasTruCTurE
Pure EVs and hybrids including THE BUSINESS CONSEqUENCES
What if in 2030: LPG/electric and very low emission/
• The current electricity
electric are being developed in
• different types of alternate infrastructure could not cope
parallel. This will mean developing
fuel vehicles develop at the with EVs – the load would be
parallel infrastructures to support
same time? too great. We will therefore need
them. Hydrogen and other fuel
smart grids that balance local
• We have to invest in cell technologies are still in their
and national supply and demand.
multiple infrastructures? infancy. It will be 15 to 20 years
Micro-generation from solar
before these systems are ready for
panels and other sustainable
mass manufacture. A new fuelling
sources will feed into the local
infrastructure will be needed to
grid to help power EVs. this is
supply fuel cell vehicles.
unlikely to be enough and we
The UK currently has around 9,000 will need to encourage people
petrol stations, many of which could to recharge electric EVs at times
become battery exchange or fast of lowest demand, probably
charge centres. Many may also through pricing. It is also possible
become fuel-cell recharge centres that EVs will power homes during
and LPG providers. Alternatively, high-cost hours and will recharge
petrol station sites could disappear during low-cost hours, which
in the longer term and exchange/ will change business models for
recharge centres could be situated in electricity provision.
entirely new locations.
• An alternative is developing
The UK’s New Automotive Innovation superconductors, to reduce
and Growth Team(NAIGT)17, an cable energy loss, along with
industry-led study into the future of substituting aluminium for
vehicle manufacturing, sees this time- copper cables – but this would be
line for different types of EV: expensive and very disruptive.
• Tens of thousands of charging
points must be installed and,
since it will take hours to
recharge batteries using current
technologies, their location will
be critical. One obvious option
is to site recharging points
outside homes but that won’t
be enough. Car parks at public
transport interchanges could
provide top-up services, as could
parking meters. Who provides
this infrastructure and controls
pricing is a moot point. A Logica
FutureScope survey shows
that 87 per cent of businesses
expect utility companies to be
This implies that there will be a 17
Department for Business, Innovation and
period measured in decades where Skills : http://www.bis.gov.uk/policies/
multiple infrastructures have to be business-sectors/automotive/new-automotive-
supported. innovation-and-growth-team
9
8

9. responsible, 63 per cent expect • There will be techniques that fast-
oil companies to offer recharging feed batteries, with recharges
‘the dog and the toad’
at petrol stations and 58 per measured in minutes rather than
cent expect telecommunications hours, but these will also increase
companies to provide charging local load. It is highly likely that
points, because of their cabling new types of battery will give
and billing experience. EVs a much longer range. An
alternative is swap-out batteries.
• Manufacturers will need to
These will need to be controlled
work with power companies to
and owned by suppliers, or
estimate the optimum number
owners will complain that new
of public recharging points – not
batteries in a new car are being
every parking space will need
replaced by batteries that have
access to power, particularly
been used many times before.
if swap-out batteries are
Battery suppliers will want to
developed.
reuse vehicle batteries once their
• The public sector will address retention capacity falls too low for
how new EV infrastructures will transport but is still good enough
be installed and how EVs will be for energy storage.
promoted. One approach will be
to lead by example, progressively
upgrading public sector vehicle
fleets to EV and persuading
private sector providers of public
transport to move to EVs. Expect
legislation to encourage a faster
migration than some providers
would like.
• Local authorities will work with
the private sector to encourage
EV investment, providing policies
and incentives that encourage
take-up of the new vehicles.
They will not invest much in the
infrastructure itself – that will be
left to the profit-making private
sector. Again, expect legislation
that will ensure it is profitable.
differentially priced road tolls
based on vehicle type may be
one consequence.
• By 2030, all road-based public
transport will use energy-efficient
technologies.
9

10. InTELLIGEnT MOBILITY
It may be counter-intuitive but • The reduction in accidents and
What if in 2030: experts expect no increase in vehicle thefts should result in
traffic congestion and a 50 per lower insurance premiums.
• Congestion ceases to be a
cent increase in journey arrival time Insurance companies and
problem?
accuracy by 203018. This means that health authorities may pressure
• But rising insurance costs not only will pinch points in the travel manufacturers to roll out
are? infrastructure effectively disappear, advanced vehicles with crash
• Pollution, as well as fuel while the number of vehicles on our and congestion avoidance
shortages and CO2, roads increases, but we will also technologies as standard. If
becomes an issue? be able to predict our arrival times you think it unlikely that these
much more accurately. “I got stuck technologies will extend beyond
in traffic,” will no longer be a valid luxury cars, remember that
excuse. air bags and assisted braking
systems were uncommon just
By 2030, emissions should have
a few years ago. Now, they are
been reduced to 20 per cent of
standard.
the level achieved by all engines in
1998. Emissions of gases such as • Expect engines that can run on
NOx and CO2 will be half the current any fuel by 2030. Waste heat will
Euro 4 level for fossil fuel-powered be recovered and will contribute
vehicles. to power. Remaining fossil
fuelled vehicles, meanwhile, will
THE BUSINESS CONSEqUENCES
offer much better fuel economy
• Congestion targets will depend and much lower pollution.
on in-car technology that will Engines will double their power-
allow more vehicles on the road to-weight ratio. The International
– effectively, the driverless car – Energy Agency is aiming for half
and on congestion and road use of all light vehicles to be EVs
charging. by 2050. By then, it is possible
that hydrogen-powered vehicles
• Vehicles will be remotely
will be common, in which case
controlled to meet variable
electrically powered vehicles will
speed limits and there will be a
be an intermediate technology.
significant reduction in accidents
Some experts expect fuel cells
caused by driver tiredness.
to power half of all vehicles by
• Remote controls will also 2030 and biofuelled vehicles to
eliminate vehicle theft. account for 20 per cent of new
registrations.
18
Foresight Vehicle technology Roadmap:
Technology and Research Directions for
Future Road Vehicles
11
10

11. OWnErshIP
Today, the average cost of running a • For companies, timing the move
What if in 2030: petrol or diesel-driven car is around to EVs will be crucial. A first
£22,300 over four years, taking into mover advantage exists in £400
• EVs are much more
account depreciation, fuel and other million of grants. Companies will
expensive in relative terms
costs. The cost of running an electric have to weigh the gains from
than current vehicles?
car is around £32,600 over four a grant against the speed of
• Ownership patterns years. technological change. Currently,
change to reflect the higher the UK has earmarked £100
By 2025 or thereabouts, the
cost of transport? million for sustainable mobility
depreciation cost of a conventional
trials and is installing 11,000
car will still be less than an electric
charging points. People using
car over four years (£14,200 against
EVs will be eligible for grants of
£16,200) but the running costs
up to £5,000 per vehicle. While
for conventional cars will have
those grants will be phased
increased so much that overall,
out, the price of EVs will fall
electric vehicles become cheaper, at
substantially.
£28,300 against £31,300, over four
years19. • There will be a rise in mobility
based web sites that help people
Overall, even running a “cheap”
plan long journeys involving
electric vehicle will be considerably
multiple modes of transport.
more expensive than running a
Again, the public sector will
conventional car in 2010, which will
take the lead but the sites
have an effect on their ownership.
themselves may be integrated
THE BUSINESS CONSEqUENCES into much larger, more useful
social networks that provide
• Leasing could become the
many services beyond person-
standard, with manufacturers
to-person communication.
taking back vehicles for
reprocessing after an agreed
age or mileage. To reduce costs,
vehicles may be jointly leased by
neighbours or be owned by a car
club. Journey sharing, organised
and booked online, is likely to be
commonplace. Vehicles will be
seen less as status symbols and
more as utilitarian ways to get
from A to B.
• Expect new value-added
services, such as in-built
internet, online entertainment
services and automatic location
and booking of charging
points. These developments
will necessitate greater co-
operation between vehicle and
telecommunications companies.
Manufacturers will have to
design in value-added services.
19
Oliver Wyman: E-Mobility 2025
11

12. We hope Views has provided
you with some interesting insight
and perspective into ecomobility.
The opportunities it presents to
organisations are clear, as are the
challenges. This is the start...and
we believe that success will only
be achieved through sharing ideas,
collaboration and innovative ways
of working – some of which we have
covered in the paper.
If you agree, share this paper with
your colleagues and community. If
you disagree, tell us why.
One last thought – imagine your
business model without fossil
fuels – if the well runs dry – will your
business engine keep running – or
will it splutter to a halt?
Logica is a business and technology service company, employing 39,000 people. It provides business consulting,
systems integration and outsourcing to clients around the world, including many of Europe’s largest businesses.
Logica
Logica creates value for clients by successfully integrating people, business and technology. It is committed to long
Tel: +44 (0) 207 637 9111 term collaboration, applying insight to create innovative answers to clients’ business needs.
views.uk@logica.com
Logica is listed on both the London Stock Exchange and Euronext (Amsterdam) (LSE: LOG; Euronext: LOG).
More information is available at www.logica.com
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