Cumulative subsidy to break-even year (billion $)d
Cumulative vehicle retail price difference until the break-even year (billion $)e
Number of PHEVs sold to break-even year (millions)
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.
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.
Costs to a vehicle manufacturer for a PHEV-40built in 2010 are likely to be about $14,000 to $18,000more than an equivalent conventional vehicle, includinga $10,000 to $14,000 battery pack. The incremental costof a PHEV-10 would be about $5,500 to $6,300, includinga $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.
PHEV-40s are unlikely to achieve cost-effectivenessbefore 2040 at gasoline prices below $4.00 per gallon, butPHEV-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.
At the Maximum Practical rate, as many as40 million PHEVs could be on the road by 2030, butvarious factors (e.g., high costs of batteries, modestgasoline savings, limited availability of places to plugin, competition from other vehicles, and consumerresistance to plugging in virtually every day) are likelyto keep the number lower. The Maximum Practical rate