January 10, 2018 – Research that undergraduate Aditya Pande (SFS’17) conducted with a Georgetown adjunct professor projects that 90 percent of cars on the road in developed countries could be electric by about 2040.
The resulting working paper by IMF senior economist Reda Cherif, Pande and Faud Hasanov, a School of Foreign Service adjunct professor and IMF senior economist, also projected that 40 percent of cars could be electric in that year under a slow-adoption model.
The Financial Times and National Geographic, as well as newspapers in Russia and Sweden, have featured the research in their publications.
Oil, the New Coal
“I am incredibly grateful to Drs. Hasanov and Cherif for this once-in-a-lifetime opportunity, for sticking with me when progress was slow and a final paper seemed far off,” says Pande, an international economics major from Florence, South Carolina.
The IMF working paper, called “Riding the Energy Transition: Oil Beyond 2040,” found that under the fast-adoption model, global oil demand would decrease dramatically and oil prices could converge to the level of coal prices, about $15 per barrel in 2015 prices, by the early 2040s.
“In this possible future, oil could become the new coal,” the paper states.
The research began after Pande met with Hasanov to discuss a possible career in economics.
“One day in office hours, Professor Hasanov suggested that he and a colleague of his had an idea about using historical data on the transition from coal power to oil in the early 20th century to model what a renewables transition would look like, and asked if I wanted to help,” Pande explains. “Naturally, I said yes.”
After performing an initial literature review surrounding energy transitions and the rise of oil consumption, the research team focused on the emergence of electric cars.
The work continued before and after Pande’s year abroad at the London School of Economics (LSE).
“LSE was incredibly academically stimulating,” Pande says, “particularly given that many of my professors were, in addition to doing cutting-edge research, advising governments on the policy issues that we were talking about in class.”
By the end of Pande’s junior year in May 2017, the team had published its findings.
“The essential concept is that energy and technological transitions follow some patterns that are similar over time,” Pande explains. “Hence, we can use the growth rates of early automobiles … to forecast the penetration of electric cars today and prospects for oil demand.”
Pande says his International Finance course with Hasanov, as well as his time at LSE, were “particularly influential” in helping him realize just how important economic ideas are in policymaking.
“I wanted to contribute to this debate, and doing research with Drs. Hasanov and Cherif is a great first step toward this goal,” he says.
When Pande graduates in May, he plans to pursue a Ph.D. in economics.
“I chose the SFS for two reasons,” he says. “The first was its core curriculum – the emphasis on developing a holistic worldview appealed to my interests in not only economics but history, philosophy, and politics. Its location in Washington, D.C., was naturally the second, although I never imagined an experience like this.”