Finnish Entrepreneur Doubts Social Benefit Of Electric Cars

 

Mika Anttonen is nobody’s fool. The Finn has made himself a billionaire by starting his own energy company, St1, which now operates 1500 gas stations in the Nordic region — about one fifth of the total. He claims to be a big fan of Tesla but questions whether the investments countries like Norway are making in electric cars are a good deal for taxpayers or even beneficial to society.

Mika Anttonen questions policies that promote  electric cars

Anttonen doesn’t have blinders on when it comes to fossil fuels. His company has made significant investments in biofuels and wind energy in the past decade. “I don’t understand why we should be increasing the amount of electric cars. At least we shouldn’t be using any tax money to support it,” he says. “:Tesla is a very cool car, but my guess is that the company will go bankrupt. It has simply promised too much,” Anttonen told Finnish magazine Aamulehti recently.

Anttonen believes most people believe the fuel saved by driving an electric car never gets put to other uses but they are wrong. “The petrol that is saved by using EV’s will be used somewhere else as long as crude oil demand grows,” he says. “Very, very few people truly understand this reality,” which is at the core of all global energy use.

“Let’s take a theoretical case, where tomorrow all the world’s fossil fuel cars are taken out of the road would be replaced by electric cars. The petrol would remain in the hands of the oil distillers…but how is it used? It’s 1000% certain that the fuel will be used somewhere else instead.”

“The growth is driven by growing demand for petrochemicals and jet fuel – the biggest single growth category, according to IEA. If those products grow, then the production of these other fuels will also grow. If the petrol is not being used in a car, it will for sure be used somewhere else. That car fuel would be put in an aggregator, and it would be used to make electricity. And the emissions wouldn’t go down at all!”

Cars that are replaced by electric cars don’t just disappear off the face of the earth, he says. “In Norway, with big EV subventions, the total amount of cars have increased, public transport use has gone down, the EV has been bought as the household’s second or third car. And you’ve gotten it for a cheap price, so it’s a good deal. But what happens to the replaced car? Does it just disappear? No – it could be re-used in another continent altogether.”

Anttonen also raises questions about the source of the electricity used to power electric cars. He thinks the key to renewable energy is storage. “We should focus on finding electricity storage, so that when it’s generated, it’s also stored. In the end game, we have solar, wind and water, but for it to work we need large-scale storage. And that’s completely missing today.”

Actually, it’s not “completely missing.” Tesla is pushing ahead aggressively with grid storage products that presage an emissions free future for electricity generation. Many other companies like Daimler and Sonnen are also deeply involved in energy storage solutions.

He says he is optimistic about the future of energy but thinks people should ask the right questions and focus on clear, concise answers when making business and government policies that affect millions.





“When things are said as they are, many things that are done now get a huge question mark. And that makes decision-makers uncomfortable. Why is this being done if it doesn’t really reduce emissions?” It’s hard to argue with that sort of skeptical and clear eyed inquiry.

Source: Nordic Business Insider





About the Author

I have been a car nut since the days when Rob Walker and Henry N. Manney, III graced the pages of Road & Track. Today, I use my trusty Miata for TSD rallies and occasional track days at Lime Rock and Watkins Glen. If it moves on wheels, I’m interested in it. Please follow me on Google + and Twitter.

  • Michael G

    This Anttonen guy is an idiot. Waste of pixels.

  • BigWu

    That’s just bizarre. If all the world’s fossil fueled cars were taken off the road, replaced by EVs, the price of crude would collapse as would supply as all suppliers with lift costs above the market price would shut down loss-inducing production.

    As the market price fell, the tar sands would close first, then UK, Brazilian, Nigerian and Indonesian offshore, and so on until the remaining demand/supply curve balanced out. New investment would cease and the much smaller market would be supplied by the lowest cost producers Saudi, Iran, Iraq, and Russia.

    Mr. Antonnen also seems to incorrectly believe that cars are durable goods with infinite use horizons. Cars age and are replaced. If all new cars are EVs, as in his own hypothetical, within 15 years nearly all the ICE vehicles will have been retired save for the rarely used collectibles.

    As for exports of used ICEs in a more realisitic example: sure, Norway’s EV switch is likely to result in old ICE vehicles being sold overseas. However, in addition to cleaning up the Norwegian air and making its cities far more livable, these exports will be displacing new build ICE cars and depressing their resale values as well. Global production will thereby be shifted towards EVs and the market will signal buyers outside Norway that buying an ICE is a poor investment.

    • Knut Erik Ballestad

      Except that we relly does not see examples of this export of old ICE’s.
      Who in his right mind would buy cars from one of the highest-priced markets in the world to sell in other countries?

      There is one exemption though (but this has existed since long before EV’s entered the arena. In Norway all cars have to pay a tax on ~$600 when imported, to cover the scrapping costs of the cars. If a car is exported before getting scrapped, this tax is eligible for a return. Therefore old *Toyotas* have for ages been bought and shipped to select african countries when their domestic sales value approaches $600. Then these actors basically get a free car which can cheaply be exported and re-sold in africa.

  • Knut Erik Ballestad

    So, the owner of 1500 *gas* stations doubts “Social Benefit” Of Electric Cars 🙂
    – whatever that means, why would we want to listen to the ‘analysis’ of someone who is tied to the mast of the sinking oil pirate ship 🙂

    • bioburner

      Yup I’m sure the income from those 1500 gas stations has no influence on his thought process or beliefs. As more EVs get on the streets he will be forced to lower gas prices to compete with the other stations. He gonna lose a load of money.

  • kvleeuwen

    Ouch, that guy is misinformed and fails to think for himself.
    One example:
    “That car fuel would be put in an aggregator, and it would be used to make electricity. And the emissions wouldn’t go down at all!”
    Besides the fact that distillers can infuence the fractions that result from crude oil, even if all petrol and diesel would be converted to electricity it would result in lower emissions – NOx, particulate and COx. A direct result of stricter emissions control in electricity plants and the higher efficiency of EVs.
    “In the end game, we have solar, wind and water, but for it to work we need large-scale storage. And that’s completely missing today.”
    Um, no. This Fin does not know about Norway?
    Continent-sized HVDC grids? (NorNed, BritNed, Baltic Cable, Kontek…)
    The endgame is one of statistics and large area averages. And a little bit of (local-ish) storage.

    • Knut Erik Ballestad

      “This Fin does not know about Norway?”
      – Oh yes, he does know about Norway, he actually owns one of the top gas station chains in Norway.

      • kvleeuwen

        OK, so the current amount of pumped hydro is ‘completely missing’…
        So he is not misinformed, but ignorant and/or spreading FUD.
        He should stick with talking about gas stations.

  • PeteDisqus321

    I don’t think we need any more proof that wisdom/intelligence is a prerequisite to being a billionaire.

    He seems to think he’s the first person to realize that ground transport is not the only sector that needs decarbonizing.

    • Epicurus

      Yet Americans worship people like this because they think having great wealth is the result of wisdom and intelligence, Now they have elected a con man simply because he has made a fortune.

  • partyzant

    Well, we can’t expect anything else to say from fossil fuel magnat…

  • Steve Hanley

    I had hoped for some lively discussion when I chose to publish this piece and that has certainly worked out as planned!

    While Anttonen’s arguments may appear extreme, especially to people who are regular Gas2 readers, it is important to be skeptical of any and all government policies designed to influence human behavior.

    Later today, Donald Trump is expected to do everything in his power — whether he can actually do that is a matter of some debate — to undo the CAFE fuel economy ratings that the automakers find so distasteful.

    Personally, I find everything The Donald does disturbing, but if someone suggests the US needs to have an adult conversation about whether CAFE is the best and most efficient way to promote the use of low pollution private transportation, I would say that is a discussion worth having.

    The same can be said for EV incentives. Is CARB’s plan to mandate a certain percentage of electric cars wise? China has tried something very similar and is not dialing that strategy back. If you can’t successfully dictate government policies in China, where can you do it?

    There are signs of headwinds ahead for electric cars. Many states are allowing incentive programs to lapse. Many others are adding annual fees to make up for the amount of revenue they lose from not collecting enough gas tax revenue to fix their roads and bridges.

    As green car advocates, we need to make certain that we are backing policies that are wise and effective, not those that are merely expedient.

    Cost is the big issue. Renewable energy is surging worldwide because it costs less than electricity from burning fossil fuels or nuclear. But no one can mandate the selling price of an electric automobile. Until costs come down, most people will elect to buy less expensive conventional cars. It’s human nature. How to get the cost down is the discussion we should be having.

    Perhaps taking the money spent on incentives and putting it to work in battery research programs would be better for society. See the recent story on John Goodenough and his recent work on solid state batteries.

    I don’t have the answers, but I believe we should have a robust discussion among intelligent people in order to find them, and that includes listening to people with contrary or unpopular ideas.

    Sadly, all we are likely to get from the current maladministration is platitudes designed to appease powerful corporate interests with little to no regard for the health of people or the planet.

    • bioburner

      Renewable energy is surging worldwide because it costs less . 100% true. Coal going down. Nuclear not far behind. Once the people of this world realize that solar/wind is cheaper there will be more converts. IMHO natural gas and oil will feel that same sting soon. Sad to say things happen in this country because of money and not because its the right or wrong thing to do.
      Battery tech is being researched by many many universities, scientists and even car companies. Just a matter or time until somebody designs and builds better cheaper batteries. Get the cost down move more EVs.
      As you suggest CAFE regs. are needed to drive the sales of fuel efficient cars. Some people have a problem with a car company selling their EVs at a horrible loss just so they can sell their gas swilling trucks and SUVs. I’m ok with that because the total emissions are reduced. yes it would be great to get the sales volume of pickups and SUV down . American consumers are not going to change their car buying habits unless the government forces them ha encourages them. Tax breaks come to mind. But sadly you are correct the current occupant of the oval office seems more interested in making money than doing the right thing.

  • trackdaze

    Sounds like the guy is about to write a book titled.

    “How to create a successfull million dolllar business from an unsuccessful billion dollar one”

  • Jem Thomas

    If there is a market demand for all the “excess” fuel that will result from the introduction of electric cars then not having the electric cars would result in even more fuel being required for the ICE cars and therefore even more Oil being extracted. So electric cars are reducing the demand for Oil especially as the mix of electricity production changes to more renewables.

    It is not the number of vehicles available to users that matter but the number of journeys those vehicles perform. As the percentage of electric vehicle journeys increase the demand for Oil will fall irrespective of the number of SUVs, F150s etc standing idle in the driveway. Or is there some mystical Norse god that drives more than one car at once, like Benhur, that I have missed.

  • What’s needed here is the exhaust from just one ICE piped into this guy’s office.