Getting more traction will require consumers to accept higher upfront costs for vehicles in exchange for total-cost-of-ownership benefits down the road. McKinsey's report says that cost parity with comparable internal combustion engine vehicles will be achieved in Europe by 2025 and in the U.S. by 2030.
"A lot of people recognize that if they invest more in a good pair of shoes, it's going to last a little bit longer," Hannon said. "If you're going to hold on to your vehicle long enough, the payback is clear."
Batteries make up a substantial amount of an EV's cost. Even as costs for the raw materials needed to make batteries rise in the short term, the downward trend of overall EV prices will continue for a while before leveling out in the next decade, Hannon foresees.
Efforts to establish domestic supply chains for those materials and make battery breakthroughs that improve storage and efficiency are ongoing. This month, the U.S. Department of Energy made $3.1 billion in funding available to support commercial battery facilities and development of supply chains.
The White House has set a goal of ensuring that ZEVs account for half of all new-vehicle sales by 2030. That is barely enough time to thwart the more grim scenarios outlined by the climate change panel, McKinsey concluded.
"If we wait 10 years or 15 years to start thinking about this and start acting in earnest, it's too late," Hannon said. "Then it becomes incredibly bumpy and incredibly difficult and problematic.
"But if we have precision and clarity as far as where we need to go as an industry already today, then there's hope we'll ... go down that path."