Toyota Motor Corporation (ADR) (TM): Is Tesla Motors Inc (TSLA)’s Model S Bad for the Environment?

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If electric vehicles have a reputation for anything, it’s that they’re better for the environment than their gas counterparts and they’ll save you money on gas. However, while it’s true that EVs are generally better for the environment than say, a truck, when you factor in variables like a battery’s carbon debt, and what goes into charging that battery, the “better for the environment” part goes right out the window. That’s especially true for Tesla Motors Inc (NASDAQ:TSLA)‘ Model S — and it’s a reality that may come back to bite it.

Photo: Tesla Motors, via Wikimedia Commons.

Sorry, not polar-bear friendly

According to Climate Central, when cars are manufactured, gas-powered vehicles are initially better for the environment than EVs, because when the battery that powers EVs is manufactured, it creates a 10,000- to 40,000-pound carbon debt, which can be overcome only by charging the car on green energy and driving it for tens to hundreds of thousands of miles.

Complicating the matter is that different states generate power from different energy sources. For example, West Virginia gets a majority of its electricity generation from coal, while Vermont relies on nuclear, Idaho uses hydropower, and Rhode Island consumes natural gas. As a result, EVs’ CO2 emissions vary depending on what energy source charges their batteries. And for the first 50,000 miles of an EV’s life, when it comes to CO2 emissions, in 39 states it’s actually better to drive a gas-powered hybrid, such as Toyota Motor Corporation (ADR) (NYSE:TM)‘s Prius, than it is to drive the least-polluting EV.

For luxury sedans, the numbers escalate. In 46 states, it’s better for the climate to drive one of Toyota Motor Corporation (ADR) (NYSE:TM)’s Lexus ES hybrids for the first 100,000 miles than it is to drive Tesla Motors Inc (NASDAQ:TSLA)’s Model S.

In fact, of all the EVs available, the Model S is the least climate-friendly EV, and it’s worse than all but two hybrids when it comes to CO2 emissions and 100,000 miles of driving. And before you blame coal, keep in mind that only 13 states get a majority of their electricity generation from coal.

The reality of CO2 lifecycle emissions

Taking into account that each state generates electricity from different sources, Climate Central combined vehicle manufacturing emissions with an average mix of electricity to evaluate the lifecycle emissions of every EV and hybrid available, for its report “A Roadmap to Climate-Friendly Cars: 2013.” The study found that hybrids — like the Prius — have lower overall CO2 emissions than all-electric vehicles. In fact, the Prius and Prius Plug-In ranked first in every state as the most CO2-friendly. The Prius hybrid’s pounds per CO2 equivalent per mile is 0.67, and the Prius Plug-In’s is 0.64, based on 100,000 miles of driving.

That’s in comparison with the 60 kilowatt-hour Tesla Motors Inc (NASDAQ:TSLA) Model S, whose pounds per CO2 equivalent per mile is 1.14; and the 85 kWh Tesla S, which comes in at 1.34, also based on 100,000 miles of driving.

Why this should matter

When driving emissions are calculated without manufacturing emissions, many EVs are better for the climate in states that rely on green energy. However, when manufacturing emissions are included — and they must be to factor in overall climate impact — EVs are not as environmentally friendly as some would have you believe. As Climate Central states: “In many states the rapid substitution of coal with natural gas and the adoption of substantial amounts of wind power have measurably decarbonized the grid from 2010 to 2012. These changes have shifted the balance of carbon emissions in favor of recharging electrics vs. burning gasoline in high-mileage hybrids like the Prius, if car manufacturing emissions are excluded. (Emphasis mine.)

In other words, even when EVs are powered by green energy, they’re not necessarily the most climate-friendly option — and that’s in large part because of the battery.

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