How blockchain can move electric car use into the fast lane
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Although the electric vehicle (EV) industry is significantly reducing carbon emissions globally, it is still in an adoption battle against motor vehicles due to a lack of availability and functional EV infrastructure. With the global climate crisis well under way, more consumers’ attention has been redirected towards a cleaner, greener focus. Consumers are beginning to see the value of steering away from gasoline and diesel-powered vehicles and toward battery-powered vehicles that use renewable energy.
A recent report from the International Energy Agency cites electric vehicles as key to decarbonising road transport, a sector that accounts for 16% of global emissions. While electric vehicles may be the sustainable alternative, the industry is not without its challenges, nor has it surpassed consumer interest in the original motor vehicle—yet, that is. Industry-wide challenges inhibit development and must be resolved before we can expect to see widespread use of EVs. But blockchain technology could be the new secret ingredient to solving these growing pains and positioning the electric vehicle as the best mode of transportation.
Electric cars’ current challenges
Like any new industry with initial challenges to overcome, the EV industry is no exception. The World Economic Forum found that the high initial cost of an electric vehicle, limited access to charging infrastructure and limited range are some of the main barriers preventing drivers from switching to electric cars.. Another speed bump facing EV adoption is charging infrastructure that lacks the foundation necessary for widespread use. These charging issues include the rising cost of charging, rural areas’ lack of infrastructure, and universal fast charging which is still up for debate. These obstacles can be seen on a global scale and threaten to slow progress towards widespread adoption.
Climate change is advancing at a rapid rate, and the lack of funding allocated to the EV space is only exacerbating this. Increased investment in infrastructure as well as lower entry costs for passengers wishing to switch from low-cost internal combustion engine (ICE) vehicles to zero-emission vehicles (ZEV) are essential for continued use. The increased demand for sustainable transportation suggests a bright future for the EV industry, but these obstacles must be addressed on a global scale before this can become a reality.
The negative impact of fossil fuel powered vehicles is clearly global, but the EV industry needs to be inclusive of all nations and backgrounds to see emission rates lowered worldwide. This can be achieved through significant investment in charging infrastructure as well as opening up financial access for drivers, especially in rural areas, which will create incentives for individuals to switch – and blockchain is integral to this.
Leverage blockchain to solve problems
Blockchain technology is built to promote inclusion, making it a good candidate for solutions in the electric car market. Innovative solutions are essential to address the lack of trust that exists between electric car owners and charging providers, the need for more infrastructure and the high initial costs and existing range of electric cars. With the decentralized composition of the technology, blockchain has the potential to solve these challenges.
The lack of trust that exists between electric car owners and charging providers can be solved through secure and transparent payment processing, made possible by smart contracts. The smart contract ensures that users are not overcharged and correspondingly that charging providers receive payment quickly. This adds an unprecedented layer of accountability.
The need for more charging infrastructure is a bigger problem that prevents widespread use, especially in developing countries and rural areas. There are high costs associated with the installation process and managing the consistent maintenance required to operate a functional charging network. Building these charging stations on the blockchain will streamline processes such as automated payments through the use of smart contracts, while providing a larger and more efficient charging network for electric cars. Users can then charge their electric cars and experience a seamless payment process. By increasing the number of charging stations in rural and urban areas, the “range anxiety” of EV users will be reduced, increasing the confidence of those who are curious and on the fence about switching.
The high initial costs were another prominent problem in the market. The introduction of the sharing economy to the electric car industry shows another innovative solution blockchain has to offer. The sharing economy functions as a platform that allows individuals to access products in collaboration. Users will share resources such as the vehicle itself and its respective services. This provides an alternative to traditional ownership, meaning users can choose to share their vehicle or rent it out to others. The sharing economy can be made possible through input mechanisms that open doors for those who cannot afford to buy a tuk-tuk independently. It provides an opportunity for users worldwide to take a stake in the future of EV adoption on the blockchain.
Look forward to
Something must be done for our planet to fully recover from the consequences of the climate crisis. Although considerable efforts have been made to promote accessible sustainable travel for all, it is important that developing countries are not excluded from this effort. For example, recent research from InsideEVs reports that more than 2.6 million new passenger plug-in electric cars were registered in Europe, while in countries such as Brazil, India and Indonesia, fewer than 0.5% of car sales are electric.
It is clear that we must increase sales of electric vehicles internationally and prioritize the development of developing countries to see global use of the electric car, and to further reduce carbon emissions across the globe. Blockchain offers a unique solution to make this possible and includes all nations regardless of economic eligibility and availability.
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