Posts Tagged ‘electric vehicles’

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How green is your EV?

April 18, 2012

Lynne Kiesling

On Monday the Union of Concerned Scientists released an analysis estimating the MPG equivalence of electric vehicles. The point of the analysis is this: taking as given an objective of greenhouse gas emission reduction, how do electric vehicles compare to internal combustion vehicles in that dimension? To do such an analysis requires comparing the GHG emissions across the two types of engines, taking into account that the electricity generation fuel mix varies across the country. Here’s how they did that:

Most drivers are familiar with the concept of miles per gallon (mpg), the number of miles a car can travel on a gallon of gasoline. The greater the mpg, the less fuel burned and the lower your global warming emissions. But how can such consumption be figured for electric vehicles, which don’t use gasoline? One way is by determining how many miles per gallon a gasoline-powered vehicle would need to achieve in order to match the global warming emissions of an EV.

The first step in this process is to evaluate the global warming emissions that would result at the power plant from charging a vehicle with a specific amount of electricity. Then we convert this estimate into a gasoline mile-per-gallon equivalent—designated mpgghg, where ghg stands for greenhouse gases. If an electric vehicle has an  mpgghg value equal to the mpg of a gasoline-powered vehicle, both vehicles will emit the same amounts of global warming pollutants for every mile they travel.

For example, if you were to charge a typical midsize electric vehicle using electricity generated by coal-fired power plants, that vehicle would have an  mpgghg of 30. In other words, the global warming emissions from driving that electric vehicle would be equivalent to the emissions from operating a gasoline vehicle with 30 mpg fuel economy over the same distance (Table 1.1).3 Under this equivalency, the cleaner an electricity
generation source, the higher the mpgghg . When charging an EV from resources such as wind or solar, the mpg equivalent is in the hundreds (or thousands) because these resources produce very little global warming emissions when generating electricity.

This map, from a New York Times feature on the report, summarizes the results:

The results reflect the regional variety in electricity generation fuel mix — hydro power in the Pacific Northwest increases the mpgghg there, as does the predominance of nuclear around Chicago. The results suggest that even in the coal-intensive Midwest and plains states, electric vehicles using coal-generated electricity outperform the standard 4-door 27 MPG sedan in the greenhouse gas dimension.

I found this analysis useful and informative. Frankly, I often take UCS analyses with a grain of salt, because they are an advocacy group and generally start their analyses with presumptions of catastrophic global warming that directs their conclusions, while I think it’s more scientific to make assumptions that weaken your conclusion so that you don’t bias your analysis toward your desired conclusion. This analysis, while still a piece of advocacy, presents the calculations and mpgghg comparisons in a more dispassionate fashion that I found informative. The New York Times also had an article on Sunday summarizing the report.

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Cheap natural gas undermining solar dreams

January 5, 2012

Michael Giberson

NPR reports from Pennsylvania how low natural gas prices have helped put the damper on some solar power dreams:

Barbara Scott had 21 solar panels installed last March on her house in Media, Pa. Scott’s family was the first in the community, and she was prepared to evangelize, “We can have open houses and write newsletter articles and promote the idea of solar,” she said. But that was before the economics changed.

With government rebates and tax incentives, Scott says, her family spent $21,000 to install the system. She figured it would take eight years to recoup that investment.

But that eight year (private) payback period turned out to be too optimistic. First, too many other Pennsylvanians also invested in solar, which caused the price of solar power credits to drop sharply.  Scott figures the change added seven more years to the payback period. Second, the price of electric power is lower than it would have been because of low natural gas prices. Scott adds another two years to the payback period for that effect.

With a new total of a seventeen-year payback period, Scott observed: ”We’re up to 17 years, which is, essentially, the life of the system. And we haven’t even considered what happens if the system breaks or what it’s going to cost to take the system off the roof and dispose of it. “

As noted, this is a private payback estimate, it only reflects the homeowners expenses and net electric bill reductions. Omitted from the calculation are the taxpayer- or ratepayer-funded subsidies (likely large) and external benefits of the system (likely modest but could be significant). Furthermore, these sort of casual payback calculations frequently omit consideration of opportunity costs (i.e. the time value of money or foregone interest income.)

But isn’t it sort of interesting that the story builds around the effects of low natural gas prices as a culprit even though the effect is relatively modest compared to the much larger solar credit price effect resulting from too many other Pennsylvanians getting into the subsidized solar game?

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Rainy days, but not Sundays, will get them down

August 25, 2010

Michael Giberson

From the “Things that make you go Hmmmm” file, note things take an interesting turn in paragraph 4:

W2 Energy, Inc. is pleased to announce that it has become a research affiliate of the Arizona Research Institute for Solar Energy (AzRISE).

AzRISE (www.azrise.org) is a global institute at the University of Arizona in Tucson whose mission is to transform science into large and small-scale solar energy solutions that are demonstrable and can transform individual lives.

W2 Energy will be shipping one of the Solar Bug solar-electric vehicles to AzRISE. AzRISE will test the Solar Bug and provide 3rd party certification of its operation and efficiency.

In addition to testing the Solar Bug, AzRISE, in collaboration with musicians and composers at the University of Arizona, will be performing musical pieces that promote solar energy. Several of the musicians will drive the Solar Bug to schools and community centers and will perform their music using power from the Solar Bug’s on-board batteries. The musicians will plug in their instruments, amplifiers and microphones into the Solar Bug’s 110 volt outlet.

“What a great real world example of the beauty and efficacy of solar power,” says Joe Simmons, the Director of AzRISE. “We will play our songs about solar energy using solar energy.”

According to a previous W2 Energy press release, a Solar Bug “can carry two passengers and a small amount of cargo” and will “travel up to 10 miles a day on solar power alone.”

Sure, I can imagine that musicians can plug their instruments and equipment into the Solar Bug’s outlet and play for the kiddos, but will the musicians actually be able to load all of their gear into a Solar Bug AND drive to a school or community center AND play a plugged-in concert AND pack up and get home again, all on solar power? Or will these shows be staged with the help of a lot of petroleum-fueled vehicles behind the scenes?

I’m guessing that when the solar concerts wrap up and the last musicians reach home again, a complete accounting would reveal the performers and sponsors were unable to resist the beauty and efficiency of gasoline as a transportation fuel.

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Chevy Volt and the definition of price gouging

August 9, 2010

Michael Giberson

The upcoming highly publicized, somewhat politicized release of the Chevy Volt is attracting some unfavorable attention because of the significant dealer markup that at least some Chevrolet dealers are seeking. Edmunds AutoObserver reports being asked for $20,000 for the dealer in addition to the MSRP of $41,000. Around automotive blogs, the phrase “price gouging” is being tossed around a lot (see plugincars.com, GM-Volt.com, worldcarfans.com, egmCarTech.com, and plugincars.com again).

The $20,000 markup appears to be the highest reported, but in an online survey 25 percent of respondents reported seeing markups of $10,000 or more.  At USA Today‘s DriveOn blog, Fred Meier opines “U.S. taxpayers are kicking in a $7,500 tax credit and California is giving buyers another $5,000 to encourage electric car sales. That’s a waste of money if this dealer is right and folks will give him an extra $20K to be first on their block to have a Volt.”  Fully justifying a conclusion that “that’s a waste of money” would require some sophisticated policy analysis, of course, but at first glance the case in favor of the conclusion seems pretty strong.

But, as long time readers know, I’m somewhat more interested in the use of the term “price gouging,” having worried about the meaning, economics and policy application of the term frequently here in the past. (See prior “price gouging” posts here: http://knowledgeproblem.com/?s=price+gouging+giberson.) I’m concerned both with the meaning of the phrase in everyday English and with application of the term in economics, policy and law. (NOTE: The rest of this post is rather pedantic and academic and overly concerned with slight differences in classification and meaning, so it won’t be to everyone’s taste. Proceed, as always, at your own risk.)

Previously I’ve described “price gouging” as involving three elements in its central or prototypical usage: a price increase judged as unfair, an emergency or desperate situation, and a good or service of particular use or value in mitigating the consequences of the emergency.  As also noted, frequently consumers and editorialists fling the term “price gouging” any time they don’t like a price.  See the prior KP posts for examples.  Now I think both parts of this description can be improved.

Notice in the Chevy Volt case, there isn’t a price increase per se. The product hasn’t yet been sold at any price. And while the manufacturer has announced a “suggested retail price” (MSRP), it is well known that actual retail prices for automobiles may be substantially higher or lower than the MSRP.  The “price gouging” term is also invoked in other cases without price increases, but simply when prices for a product are higher in some stores than they are in other stores.  So rather than assert price gouging requires “a price increase judged as unfair,” I’ll assert that price gouging requires “a price judged as unfairly high.”

This isn’t any simpler than before. To judge a price as unfairly high implicitly invokes a further three element breakdown: the price under consideration, a reference price relied upon by the consumer in coming to the conclusion that the price under consideration is too high, and then the negative moral reaction that causes the consumer to evaluate the price under consideration as unfair. The analytical value of this reformulation is in allowing specific attention to the choice of reference prices and to the judgment of unfairness.

The Chevy Volt case also does not involve an emergency or desperate situation, and therefore not a good or service useful in mitigating the desperate situation. Similarly, price gouging is alleged for HDMI cables sold at seemingly high prices along with High Definition TVs, another example lacking an emergency condition. Still, it seems to me there is some useful structure to the concept even in this casual usage.  While there isn’t an emergency, there is a certain urgency involved.  If you want to be the first on your block to drive a Volt, obviously you need to get your Volt before one of your neighbors gets one.  If you’ve committed to buying the HDTV, you must have an HDMI cable to hook it up to your video receiver. I think this urgency aspect makes “price gouging” seem like the appropriate term in these more casual usages.

To be clear, I think an emergency or desperate situation is part of the definition of a prototypical case of price gouging. If you want a good example of price gouging, you need the desperate situation. It is common for legal definitions of price gouging to require an emergency condition.  It is just that it is also possible to properly use the English phrase “price gouging” in cases that lack a desperate situation. Even in casual usage however, not anything goes. For the term “price gouging” to be appropriately applied, you still need a price judged as unfairly high and you need some sort of difficulty or urgency or other constraint on the consumer, however attenuated such constraint may be.

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Electric vehicle recharging: Is the energy too cheap to meter?

June 24, 2010

Michael Giberson

Competitive retail power company NRG plans to offer an “all you can eat” electric vehicle recharging plan in Houston early next year, expanding the offer to the Dallas area a little later.  Likely too few electric vehicles will show up in Houston in the next year or so to make much of a dent in the retail power market, but in general electric vehicles should tend to recharge off-peak, improving the retailers power factor, and possibly tending to reduce average power costs a little.  I assume they’ve done the analysis and understand what they are doing.

Perhaps it is a tool to attract high-income consumers to NRG’s retail power unit – Reliant Energy – for home electric service? Seems a little crazy to me, but that is one of the great things about the competitive Texas retail power system: retailers can do crazy things, and no public utility commission has to approve, and no captive ratepayer can be stuck with the bill.  Competition works in mysterious ways.

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The vast electrical sponge provided by V2G technology

April 1, 2010

Michael Giberson

In the realm of more-enthusiasm-but-no-more-analysis for vehicle-to-grid (V2G) technology, Fereidoon Shioshansi at the EU Energy Policy Blog asks, “Will V2G Evolve Into A Great Electrical Sponge?“  He asks the question, and it is an excellent question to ask, but he doesn’t answer it.

Instead we get a little taste of claims made by researchers based on a pilot project – “the extra costs of making an EV battery V2G compatible could be as little as $1,500 while the potential reward may be as high as $3,000 per annum through a ‘load-balancing contract’ with a grid operator” – and follow those claims with the usual rather unconstrained imagination of exciting possibilities.

Actually, Shioshansi is better than many commentators on V2G because he at least realizes that there is more than just an electrical cord necessary to connect an the electric car and the vast power grid in need of load balancing services:

Additionally, the owner must reach an agreement with the grid operator – most likely through an aggregator and/or intermediary – to provide a reasonable revenue stream for the car owner while offering tangible storage and balancing service to the grid operator. These are formidable but not insurmountable challenges.

“Not insurmountable” is technically correct, but a casual stroll through history offers some perspective.  It took a literal act of Congress to get much third party access to the transmission grid (namely, the Energy Policy Act of 1992), and then it was several years before final rules governing third party access were issued by FERC.  It typically takes a supportive state law or regulation for local distribution companies to become very interested in helping consumers attached distributed energy sources to the local grid, and while energy policy folks have been talking about these issues for decades most places don’t have much in the way of effective state policies supporting distributed energy resources.  The physical proof-of-concept type issues are being solved, thanks in large part to the efforts of talented researchers at the University of Delaware and elsewhere, but the associated contractual/policy/institutional issues are far from being resolved.

In order to manage the safety and reliable operations of the grid, grid operators like to have some control over devices connected to the grid. V2G asks us to imagine a world in which consumers are attaching to the grid at times and points of convenience to the consumer, and then have the grid operator pay the consumer for some limited access to the battery capabilities of the electric vehicle for the uncertain amount of time the vehicle remains connected.  And advocates of these ideas ask us to believe, simultaneously, that electric vehicles with V2G technology will be available in large enough numbers to make it worth the trouble of someone to overcome all of these challenges, and yet not available in large enough numbers to overwhelm the electric system’s demand for load balancing service.

I haven’t done the analysis, but I can state with fairly high confidence that the demand for load balancing service is not perfectly elastic at the $5 – $10 day rates obtained by the three test cars in the University of Delaware/PJM pilot project.

So while Shioshansi asks a great question, his conclusion is an appropriately tempered “V2G technology may prove to be a welcomed blessing.” (Emphasis added.)  Hedging claims is probably wise in this space.

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Vehicle-to-grid income and analysis

February 22, 2010

Michael Giberson

If you are already a rock star and can’t imagine doing anything else, then “money for nothing and your chicks for free” may be a reasonable characterization of your situation.  On the other hand, if you’re a teenage boy picking up a guitar and hoping to attain wealth and women, you should consider the start-up costs involved.  Some discussions of “vehicle-to-grid” (V2G) revenue potential seem a bit like the “money for nothing and your chicks for free” kind of analysis.

Consider the Financial Times article, “Grids to Harness Power of Electric Cars,” a story that builds on recent V2G presentations at the American Association for the Advancement of Science meetings in San Diego.

The first experimental V2G system has just gone live at the University of Delaware, where three electric cars are connected to the grid whenever they are not being driven. “They are making five to ten dollars a day just by being plugged in,” said Kenneth Huber, technology manager for the PJM grid, which covers the mid-Atlantic states.

The two-way connection not only pulls in power to recharge the battery but also sends electricity back to the grid. V2G vehicles work like an electrical sponge, absorbing excess energy when demand for power is low, and returning some to the grid when demand is high, said Willett Kempton, project leader at the University of Delaware.

…  Prof Kempton says his project suggests that an investment in V2G technology could pay off very fast for an electric car owner. Once the technology is commercialised, the additional costs of fitting a V2G-enabled battery and charging system would be about $1,500 – and the owner could make $3,000 a year through a load-balancing contract with the grid.

V2G is economically viable because electric car owners are buying batteries anyway, so it makes sense to use them for communal energy storage. It would be much more costly for electric grids to install stationary battery banks or other storage systems dedicated to load balancing.

It is dangerous to leap to conclusions based on a newspaper summary of research, but the characterization above suggests that a few assumptions may be key.  The assumption that “electric car owners are buying batteries anyway” may mean that the V2G analysis treats the battery as a free resource, and so compares V2G revenue estimates just to the incremental costs of V2G capability and operations.

I suppose it is a perfectly reasonable assumption for anyone who is going to buy an electric car anyway, and then is considering adding V2G capability. If, on the other hand, the intention is to advocate V2G revenue possibilities as an inducement to buy the electric car in the first place, a more inclusive analysis seems reasonable.

(For more on Dire Straits, “Money for nothing”: YouTube, Songfacts.)

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EVs need to avoid charging during peak hours? Nonsense!

February 17, 2010

Michael Giberson

From time to time you see reports of electric utility executives or analysts worried about a forthcoming avalanche of electric vehicles (EVs) that will, just maybe, overwhelm utility distribution systems. What happens if everyone comes home from work and plugs in at the same time?  What happens if drivers want to recharge on-peak rather than off-peak?  I’m omitting links because I’m reacting to the general attitude and not a specific analysis, but a recent sample comment was the stern declaration: “EVs need to avoid charging during peak hours.”

Nonsense.

When car batteries become sufficiently advanced that lots of people actually buy and drive an electric car, then electric-utility scale batteries will also be more advanced.  It is, or at least can be, the same technology.  Utility applications actually have more choices, the batteries don’t have to be lightweight, so improvements in battery technology are likely to become widespread within the power industry before they become widespread in vehicle applications.

The supply side of the industry will readily handle the changes in load presented by growth of the electric vehicle market.

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National Research Council says benefits from plug-in hybrid vehicles decades away

December 17, 2009

Michael Giberson

The National Research Council has issued a study examining the costs and benefits of plug-in hybrid electric vehicles and concluding that it will likely be decades before such vehicles yield benefits to overcome their higher initial costs.  From the press release:

Costs of plug-in hybrid electric cars are high — largely due to their lithium-ion batteries — and unlikely to drastically decrease in the near future, says a new report from the National Research Council.  Costs to manufacture plug-in hybrid electric vehicles in 2010 are estimated to be as much as $18,000 more than for an equivalent conventional vehicle.  Although a mile driven on electricity is cheaper than one driven on gasoline, it will likely take several decades before the upfront costs decline enough to be offset by lifetime fuel savings.  Subsidies in the tens to hundreds of billions of dollars over that period will be needed if plug-ins are to achieve rapid penetration of the U.S. automotive market.  Even with these efforts, plug-in hybrid electric vehicles are not expected to significantly impact oil consumption or carbon emissions before 2030.

John Petersen, writing at Alt Energy Stocks, sums up the point for investors who have jumped into the field: “grid-enabled vehicles, or GEVs, are nowhere near ready for prime time and investors that buy into the GEV hype can look forward to decades of pain and suffering.”  Petersen follows up with additional commentary on electric vehicle issues.

It doesn’t appear that the NRC report examines possible “Vehicle to Grid” (V2G) services and associated revenue, which are sometimes explored in this kind of analysis, but that is probably a good thing.  You might recall the USPS report “Electrification of Delivery Vehicles” assumed that the examined all-electric vehicles would yield nearly $200 per month from V2G (and still the project only made sense of the USPS if taxpayers chipped in to the tune of $15,500 per vehicle).  The NRC report is on the safer ground, I think.  As I’ve said here before, projections of significant V2G revenues are unlikely to pan out.

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U.S. government becoming clean energy venture capitalist

December 14, 2009

Michael Giberson

The Wall Street Journal summarizes the news that you already know: the U.S. Department of Energy has become one of the biggest financial forces in the clean energy innovations business.

The DOE hopes to lend or give out more than $40 billion to businesses working on “clean technology,” everything from electric cars and novel batteries to wind turbines and solar panels. In the first nine months of 2009, the DOE doled out $13 billion in loans and grants to such firms. By contrast, venture-capital firms — which have long been the chief funders of fledgling tech firms, taking equity stakes in the start-ups that will pay off if they go public — poured just $2.68 billion into the sector in that time, according to data tracker Cleantech Group.

My gut reaction to this news: it can’t be good.

Of course my gut reaction here my be no more a reliable guide to action than Leon Kass’s repugnace or Michael Sandel’s outrage. Is there data or history available that could calm my troubled nerves? I’m not in principle opposed to government funding for basic or even applied research, but I believe we are well beyond those limits. Here is part of the problem created:

“The existence of an 800-pound gorilla putting massive capital behind select start-ups is sucking the air away from the rest of the venture-capital ecosystem,” said Darryl Siry, former head of marketing at Tesla Motors Inc., a San Carlos, Calif., company that got a $365 million DOE loan in June to build high-end electric cars. “Being anointed by DOE has become everything for companies looking to move ahead.”

The result is that developments in applied clean energy research become focused around the ideas of a handful of people involved in the US DOE’s “deal teams.”

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