All-electric vehicles (EVs) have yet to hit the road, but the technology exists and interest is high in a number of countries. Compared to conventional gasoline cars, EVs have a number of advantages. In particular they are likely to improve air quality – and consequently human health – in cities, by moving emissions from the city centre to the power station, where they are more easily controlled. What's more, they have the potential to achieve significant reductions in greenhouse gas emissions, by using a low-carbon electricity source, such as wind turbines, solar panels, or hydroelectric or nuclear power.

The latest technology means that EVs should perform as well as gasoline-powered cars. So what is holding us back? Right now, money is the major hurdle.

Following on from a study that compared gasoline-fuelled vehicles with plug-in hybrid electric vehicles (PHEVs), Derek Lemoine and Daniel Kammen, from the University of California, Berkeley, US, have extended their analysis to include EVs. Taking California as their case study they analysed what impact each kind of vehicle would have on the electricity grid and calculated how much the battery would need to cost in order to break even. In addition they looked at policies and measures that could help EVs to become cost-effective.

One potential problem for EVs is that they could increase strain on the electricity grid. Lemoine and Kammen modelled a worst case scenario of 0.3  million people driving their EV to work in California and fully charging the vehicles on arrival. In this case they found that the EVs could increase peak demand slightly, particularly on summer afternoons, when air-conditioning is on full power. However, this isn't an un-surmountable barrier. "There are many ways to avoid these problems, ranging from electricity price signals, to devices on the cars themselves, to smart charging networks run by centralised operators," Lemoine told environmentalresearchweb. Furthermore, they argue that the scenario is overly pessimistic, because it is unlikely that everyone would arrive at work with their batteries completely depleted.

The biggest hurdle for EVs appears to be the cost of the battery. Even with expensive gasoline ($4 per gallon) and cheap electricity ($0.05/kWh), a 4 miles/kWh EV battery would need to cost less than $200/kWh before the EV would pay for itself entirely in fuel savings compared to a gasoline-fuelled vehicle. In this instance PHEVs are in a better position, with battery prices needing to fall below $700/kWh to break even with gasoline cars.

Currently batteries are estimated to cost anything between $1000/kWh and $200/kWh. However, the cost of batteries is likely to fall with greater production and fuel prices may rise as oil becomes scarcer, meaning that EVs are likely to become closer to break-even as time passes.

Meanwhile, a form of carbon taxing is likely to make EVs even more financially attractive. "A price on carbon, of course, tilts the equation more towards a pure EV than a PHEV, and both look superior to even high-mileage gasoline cars," said Kammen.

What's more, there are ways to make EVs more economically attractive to consumers. Better Place is considering signing up vehicle owners to pricing plans. If these plans include tiered rates and keep battery ownership with the company, Lemoine and Kammen argue that EVs could make financial sense for large numbers of people.

Changing our infrastructure to support electric vehicles is a big challenge, but from an environmental point of view the advantages of adopting EVs soon outweigh the difficulties. "Electrified transportation may be crucial to the transition to a low-carbon future because it becomes cleaner as the grid becomes cleaner. Introducing EVs soon can begin the slow process of adopting the vehicles that could enable achievement of long-term greenhouse gas targets," write Lemoine and Kammen.