Electric vehicles: A win for Detroit and EE

By Reid Smith

At this week’s Detroit Auto Show, electric vehicles are on top. Two of the year’s highest-rated cars are electric. The plug-in hybrid electric Chevy Volt was awarded this year’s “Car of the Year,” just beating out the all-electric Nissan LEAF.

But regardless of which car wins, the message is clear: electric cars are generating a lot of excitement.

It’s not just the auto industry that will benefit. The EV industry offers growth to other industries as well, including the energy efficiency sector.

Utilities win because a growing electric auto fleet means more use of electricity to replace gasoline. GM sold between 250 and 350 Chevy Volts in December and Nissan has sold fewer than 10 LEAF sedans in the past two weeks, which means utilities need to begin thinking about how they will manage growing demand as more EVs hit the market. One way utilities can manage additional load is through energy efficiency programs, special energy pricing rates, and demand response.

Both GM and Nissan are selling their electric vehicles in selected test markets. The utilities in these test markets have been preparing energy management strategies and are now starting to collect the first real electric vehicle energy data. “Our role is to do everything we can to make EV’s successful,” said Chris Chen, market development manager for San Diego Gas and Electric, a test market for the Nissan LEAF. http://www.intelligentutility.com/resource/demand-webcast/electric-vehicles-tale-three-cities

The new data will tell utilities when consumers are charging their electric cars and how much their use will affect the grid. Because less energy is generally used at night, the existing electric infrastructure and power load can accommodate the extra energy required from electric vehicles, at least for a few years, if customers charge at night as expected. Utilities plan to encourage customers to charge their cars at night and to manage energy use to maximize the current grid’s potential.

One utility, San Diego Gas and Electric, is trying out three rate-incentive pricing schemes in different areas of its service territory. “We are trying to see if lower off-peak rates will encourage different charging patterns,” said Chen.

Another utility, DTE Energy in Michigan, is educating consumers about energy use and time-of-day rates through special energy workshops and sessions for businesses, partners, and consumers, said Jeff LeBrun, principal marketing analyst at DTE Energy. Michigan is also the headquarters to several battery manufacturers, which are growing along with the electric vehicle industry. LG Chem, one Michigan battery company, is the chosen manufacturer for both the Chevy Volt and Ford’s electric Focus, set to be released later in 2011.

Utilities such as San Diego Gas and Electric are also looking at demand response programs designed specifically for electric vehicles. As more and more vehicle charging stations are installed, demand response programs can help manage surging energy loads and peak loads. It’s likely the demand response market will develop with the electric car market.

But how fast will the electric market grow? Will your next car likely be electric?

Right now, utilities project that electric vehicles will develop slowly because car companies are limiting the number of units sold and are gradually ramping up production. A slow-growing industry is good for utilities, which have time to test different electric vehicle adoption and energy management strategies. Limited expansion is good as long as consumer demand continues. About 50,000 people are on waiting lists for electric vehicles.

Consumers will adopt electric vehicles as long as utilities make the transition to ownership a positive experience. In many ways the success of the electric vehicle industry ultimately depends on the utility’s ability to manage energy and promote energy efficiency, thus being able to provide electric vehicle owners with the proper energy infrastructure and simplicity that they demand.

Visit Reid Smith at www.realenergywriters.com and pick up his free weekly newsletter and podcast.

Retire the clunker?

By Elisa Wood

January 15, 2009

What would it take to convince you to get rid of your gas-guzzling old clunker? Would $5,500 do?

Some members of Congress think this is the magic figure. Under a bill introduced in the House and Senate today, Uncle Sam would give you a credit of up to $5,500 to scrap your old car. You could spend the credit on a new, fuel efficient vehicle or mass transportation.

The proposal makes a lot of sense and has won support from the American Council for an Energy-Efficient Economy.

Why the incentive? Because the rush for hybrids and other fuel-efficient autos is largely an upper- income trend. Nearly half of the nation’s $100,000/year-plus earners own cars that are less than four years old. But only about a quarter of the $40,000-$45,000 set have such young vehicles, says an ACEEE whitepaper. http://aceee.org/transportation/Crusher%20white%20paper%20fin.pdf.

The credit would bring middle-income families into the market to buy new and cleaner cars. Greater sales of these cars should reduce the cost of their advanced technologies.

Equally important, the credit helps fill a hole in the Corporate Average Fuel Economy standard passed in 2007. The CAFÉ standard requires a 40% improvement in fuel economy for new vehicles by 2020. Nice idea, but not enough people buy new cars for the standard to significantly lower our oil use. In fact, about 70% of today’s auto purchases involve used vehicles.

Called the Accelerated Retirement of Inefficient Vehicles Retirement Act of 2009 (ARIVA), the bill would apply to used cars that get less than 18 miles/gallon and would be in effect from 2009 to 2012. ACEEE estimates consumers would retire 575,000 vehicles annually and save 46,000 barrels per day of oil by 2013.

I think I’d take the deal. But will Congress and the Obama administration? Stay tuned.

Visit Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets podcast and newsletter.

Next, the Air Car?

By Reid Smith

September 11, 008

Vehicles account for 26% of the nation's carbon dioxide emissions, and 51% of the average household's daily CO2 output (http://www.fueleconomy.gov/feg/climate.shtml), according to the U.S. Environmental Protection Agency. So, clearly fuel economy is critical to reduce greenhouse gas emissions.

Big car manufacturers, like GM, Ford and Toyota, have seen a dramatic drop in recent sales. In response, they are beginning to make smaller, more fuel-efficient, vehicles, as well as step up research on new fuels. GM announced development of the battery-powered Chevy Volt, set to be released in 2010. This is a much needed move in the right direction.

However, we need more revolutionary change. The solution, it seems, will come from companies that are reaching far outside traditional lines of thought and coming up with truly innovative ways to fuel our cars. One such company, Motor Development International (MDI) (www.mdi.lu) of France, has developed a vehicle that can run almost exclusively on compressed air, and therefore only emits air. MDI, which is headed by Guy Negre, founded the company in the 1990s in pursuit of a new environmentally friendly engine that was also cost competitive.

The car runs on compressed air at speeds up to 35 mph. Then conventional fuels kick in – fossil fuels or biofuels. These cars could be particularly effective in reducing city pollution, since we tend to drive slower on urban roads.

One tank of compressed air lasts up to 93 miles before it needs to be filled. The tank can be plugged into a standard electrical outlet and filled in about four hours. It is also possible to refill the tank much more quickly – in as little as three minutes using a high-pressured air pump.

How does the car work? The air tank is made of ultra-light carbon fiber and holds 52 gallons of air. From the tank, air is forced through an injector to the engine, where it expands and pushes down on pistons that turn the crank shaft, which propels the car.

Although the air car needs to be as light as possible for maximum efficiency, these cars are not necessarily small, and several models are already under development. A two-seater, the OneCat is one option. A three-seater, the MiniCat is another option. A six-seat sedan, the CityCat; and a compact truck. The company plans to introduce a six-seat, four-door family-size version to the U.S. market in 2010 according to Popular Mechanics http://www.popularmechanics.com/automotive/new_cars/4251491.html?series=19. This model is expected to achieve over 100 mpg and over 90 mph, emit little or no CO2, offer plenty of space for luggage, meet all safety requirements, and cost no more than an average economy to mid-size vehicle.

Tata motors (www.tatamotors.com), India's largest car manufacturer and leading company for automotive R&D has already signed a contract with MDI, and cars hit the streets there at the end of August. The deal provides MDI with a significant capital infusion to further the technology and get it ready for the mainstream public.

The air car is just one example of innovative, affordable, and environmentally clean cars being developed all around the world. The next decade will bring monumental changes to the auto industry as priorities in car design shift and consumers demand change. Cars ten years from now will be very different from those we drive today. What remains to be seen is whether the US cornerstone car companies will adapt to these changing technologies or if foreign innovators will drive off with the market.

Visit energy writer Reid Smith at www.realenergywriters.com and subscribe to his free EE Markets newsletter and podcast.