TABLE S.2 PHEV Transition Times and Costs

Penetration Rate:

PHEV-40

PHEV-40

PHEV-40 High Oila

PHEV-10

30/70% PHEV-40/10 Mix

Maximum Practical

Maximum Practical

Maximum Practical

Maximum Practical

Maximum Practical

Probable

Technical Progress:

Optimistic

DOE Goalb

Optimistic

Optimistic

Optimistic

Probable

Break-even year c (annual cash flow = 0)

2040

2024

2025

2028

2032

2034

Cumulative subsidy to break-even year (billion $)d

408

24

41

33

94

47

Cumulative vehicle retail price difference until the break-even year (billion $)e

1,639

82

174

51

363

Number of PHEVs sold to break-even year (millions)

132

10

13

24

48

20

aAssumes oil costs twice that in the base case, or $160/bbl in 2020, giving results similar to meeting DOE’s cost goals.

bAssumes DOE technology cost goal ($300/kWh) for the PHEV-40 is met by 2020, showing the importance of technology breakthroughs as discussed in Chapter 2 and Appendix F. Reducing costs this rapidly would significantly reduce subsidies and advance the break-even year relative to the Optimistic Technical Progress cases.

cYear when annual buydown subsidies equal fuel cost savings for fleet.

dDoes not include infrastructure costs for home rewiring, distribution system upgrades, and public charging stations which might average over $1000 per vehicle.

eCost of PHEVs minus the cost of Reference Case cars.

FIGURE S.4 Gasoline consumption for scenarios that combine conventional vehicle efficiency, PHEVs, biofuels, and HFCVs.

FIGURE S.4 Gasoline consumption for scenarios that combine conventional vehicle efficiency, PHEVs, biofuels, and HFCVs.

undergone expected degradation over time. Costs are expected to decline by about 35 percent by 2020 but more slowly thereafter. Projections of future battery pack costs are uncertain, as they depend on the rate of improvements in battery technology and manufacturing techniques, potential breakthroughs in new technology, possible relaxation of battery protection parameters as experience is gained, and the level of production, among other factors. Further research is needed to reduce costs and achieve breakthroughs in battery technology.

  1. Costs to a vehicle manufacturer for a PHEV-40 built in 2010 are likely to be about $14,000 to $18,000 more than an equivalent conventional vehicle, including a $10,000 to $14,000 battery pack. The incremental cost of a PHEV-10 would be about $5,500 to $6,300, including a $2,500 to $3,300 battery pack. In addition, some homes will require electrical system upgrades, which might cost more than $1,000. In comparison, the incremental cost of an HEV might be $3,000.

  2. PHEV-40s are unlikely to achieve cost-effectiveness before 2040 at gasoline prices below $4.00 per gallon, but PHEV-10s may get there before 2030. PHEVs will recoup some of their incremental cost, because a mile driven on electricity will be cheaper than a mile on gasoline, but it is likely to be several decades before lifetime fuel savings start to balance the higher first cost of the vehicles. Subsidies of tens to hundreds of billions of dollars will be needed for the transition to cost-effectiveness. Higher oil prices or rapid reductions in battery costs could reduce the time and subsidies required to attain cost-effectiveness.

  3. At the Maximum Practical rate, as many as 40 million PHEVs could be on the road by 2030, but various factors (e.g., high costs of batteries, modest gasoline savings, limited availability of places to plug in, competition from other vehicles, and consumer resistance to plugging in virtually every day) are likely to keep the number lower. The Maximum Practical rate



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