2
Nature and Structure of the U.S. Advanced Battery Consortium

The three biggest domestic automakers, Chrysler, Ford, and GM, established the USABC in early 1991 to accelerate the development of batteries for EVs. Because EVs could help reduce mobile-source air pollution and allow electric utility companies to use their excess capacity during off-peak hours, EPRI, along with several individual utility companies, agreed to participate in the consortium in mid-1991. EPRI had funded the development of batteries independently for more than 15 years. Responding to a legislative mandate to pursue the benefits of EVs,1 DOE agreed to cooperate with the consortium in late 1991. The relationship between DOE and the three automotive manufacturers is governed by a cooperative agreement that requires DOE to be actively and substantially involved in the management of the consortium (DOE, 1991).

The USABC is one of about a dozen partnerships among Chrysler, Ford, and GM, who have joined forces under the U.S. Council for Automotive Research (USCAR) to research and develop precompetitive automotive technologies. The USABC is one of the largest ventures under the USCAR agreement and is the only USCAR consortium that currently receives significant federal funding (Thorpe, 1997).

1  

 The legislative mandate is contained in the Electric and Hybrid Vehicle Research, Development, and Demonstration Act of 1976. The Energy Policy Act of 1992 (EPACT) reaffirmed this mandate and authorized the secretary of energy to enter into cooperative agreements with industry to develop advanced batteries for EVs.



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--> 2 Nature and Structure of the U.S. Advanced Battery Consortium The three biggest domestic automakers, Chrysler, Ford, and GM, established the USABC in early 1991 to accelerate the development of batteries for EVs. Because EVs could help reduce mobile-source air pollution and allow electric utility companies to use their excess capacity during off-peak hours, EPRI, along with several individual utility companies, agreed to participate in the consortium in mid-1991. EPRI had funded the development of batteries independently for more than 15 years. Responding to a legislative mandate to pursue the benefits of EVs,1 DOE agreed to cooperate with the consortium in late 1991. The relationship between DOE and the three automotive manufacturers is governed by a cooperative agreement that requires DOE to be actively and substantially involved in the management of the consortium (DOE, 1991). The USABC is one of about a dozen partnerships among Chrysler, Ford, and GM, who have joined forces under the U.S. Council for Automotive Research (USCAR) to research and develop precompetitive automotive technologies. The USABC is one of the largest ventures under the USCAR agreement and is the only USCAR consortium that currently receives significant federal funding (Thorpe, 1997). 1    The legislative mandate is contained in the Electric and Hybrid Vehicle Research, Development, and Demonstration Act of 1976. The Energy Policy Act of 1992 (EPACT) reaffirmed this mandate and authorized the secretary of energy to enter into cooperative agreements with industry to develop advanced batteries for EVs.

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--> Funding Total funding for Phase I of USABC was originally planned to be $262 million, 50 percent of which was to be provided by DOE and 50 percent by industry (i.e., the three automotive companies, battery developers, and the utility industry [GAO, 1995]). In fact, the total spent during Phase I was approximately $189 million (Heitner, 1998; Thorpe, 1997). The shortfall was partly attributable to the USABC's decision to terminate some projects early because of their lack of progress toward meeting objectives. In addition, some projects were delayed because of the logistics of setting up the consortium and the time required to establish operating principles and procedures. DOE and industry contributed equally to Phase I funding, as originally planned. Under the cooperative agreement with DOE, the three USABC automotive partners were responsible for the entire nongovernmental half of the budget. (Cost-sharing provisions in the USABC contracts provide for funding from outside the three automotive companies.) The participation agreement between EPRI and the USABC ensures contributions from the utility industry. Battery developers also contributed on a negotiated basis. Representatives of the USABC told the committee that when the Phase I contracts were negotiated, the consortium hoped that between 30 and 50 percent of the costs would be paid by battery developers (Thorpe, 1997). Detailed information on the financial contributions of the automakers and EPRI is proprietary. However, the committee noted that the financial contribution from Chrysler, Ford, and GM, which is leveraged not only by DOE, but also by other industry participants in the USABC, is significantly less than the financial contribution of the federal government. Some of the unspent DOE funding for Phase I is being carried forward to Phase II. The total budget for Phase II is anticipated to be $106 million, which will again be split between government and industry, with DOE providing 45 percent and industry 55 percent. Total DOE funding for R&D on EV batteries for fiscal years (FYs) 1990 through 1998 is shown in Table 2-1. In FYs 1990, 1991, and 1992, when DOE's Office of Energy Efficiency and Renewable Energy was reorganized and the USABC were formed, DOE began to phase out its existing development programs on advanced batteries, which were replaced by the USABC projects. DOE also reduced its long-term high-risk work under the Exploratory Technology Research (ETR) program, which seeks to identify new rechargeable battery systems with higher performance and lower life-cycle cost than those of current systems and to provide critical supporting and materials research for batteries under development by the USABC. The overall goal of the ETR program is to develop electrochemical power sources suitable for use in electric and hybrid vehicles.

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--> TABLE 2-1 DOE Funding for Advanced Battery Research (millions of dollars), FYs 1990 to 1998 FY DOE Development Programs and Supporting Work Exploratory Technology Research Program USABC Cooperative Programs (Phase)b 1990 7.1 5.6 — 1991 4.1 4.6 6.4 (I) 1992 0.5 2.6 21.0 (I) 1993 2.5a 3.9 21.9 (I) 1994 0.3 3.3 26.9 (I) 1995 0.2 2.1 22.2 (I) 1996 0.4 1.9 15.0 (II) 1997 0.0 2.4 13.0 (II) 1998 (planned) 0.3 3.5 12.2 (II) a Funding for the development of an air battery that was not part of the USABC program. b These funds include expenditures for CRADAs with several of the national laboratories of about $32 million (GAO, 1995). Work included development and testing for Ni/MH, sodium-sulfur, lithium-iron disulfide, and lithium-polymer battery technologies. As far as the committee is aware, little, if any, of these funds was used to support new science for possible application to advanced battery systems. Source: Sutula, 1997. Management The USABC is governed by a partners' committee of senior executives from Chrysler, Ford, and GM; the partners' committee sets USABC policy. A management committee made up of managers from Chrysler, Ford, and GM makes business decisions, selects contractors, and determines funding, in concert with representatives of DOE and EPRI. The posts of chair, treasurer, external affairs officer, and secretary are rotated annually among Chrysler, Ford, and GM. In Phase I, representatives of EPRI were nonvoting members of the management committee. In Phase II, however, EPRI has a voting member. Another EPRI representative managed the GM/Ovonic project. A DOE representative contributes to business decisions, participating in the selection of contractors and the determination of funding for projects. All decisions are based on a consensus management process. The responsibility for executing technical programs is vested in the technical advisory committee (TAC), which includes the program managers for each USABC-funded battery technology, as well as technical representatives of the three automakers, EPRI, the electric utilities, the national laboratories, and DOE managers. The USABC business manager, a representative of CARB, and the

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--> Figure 2-1 USABC management structure. Source: Thorpe, 1997. program managers from DOE serve on the TAC. TAC program managers are supported by program teams, or work groups, for each technology; members of the teams are drawn from the TAC (see Figure 2-1). These teams evaluate proposals, negotiate contracts, and manage USABC technical programs with battery companies and developers. The fields of expertise of team members include vehicle integration, manufacturing, problem solving, testing, diagnostic analysis, and basic chemistry. The TAC also manages relationships with DOE's national laboratories that conduct USABC-funded research and testing. The function of USABC program managers is similar to the function of program managers in industry and governmental agencies responsible for programs that involve many internal and external components. The USABC program managers, who are selected for their technical knowledge and management skills, are all employees of the three automakers or EPRI and its participating utilities. Most of them have been trained in management by their respective companies, and the USABC provides some additional program management training. One program manager is assigned to lead each USABC battery development project. Historically, program managers have been assigned to one battery development program at a time, although recently one individual managed both a high-power battery contract and an EV battery contract that involved the same battery company. Overlapping responsibilities are permitted only if there are no conflicts of proprietary information. Program managers typically review projects every two to four weeks, accompanied by experts from the TAC, when necessary. Quarterly in-depth reviews are conducted by the entire work group, including the

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--> DOE manager. These reviews involve visits to the developers that last a day or a day-and-a-half. The work group assesses the status of all tasks, goals, and objectives of the program, does an in-depth review of issues, and discusses future directions. Changes in the timing or objective of an individual task are based on a consensus of the work group. Higher level peer reviews and critical reviews performed by members of the TAC are used for reporting the project status and issues to the management committee, which makes decisions about future activities. Most peer reviews involve all members of the TAC, including the managers from DOE, except when program managers may not be allowed to review proprietary information from competing programs. The program manager for the GM/Ovonic Ni/MH (nickel metal hydride) program, for example, does not have access to proprietary information relating to the SAFT Ni/MH program, and vice versa. These reviews, called critical reviews, are similar to peer reviews but are conducted by an appropriate subgroup of the TAC. Role of the U.S. Department of Energy DOE's Office of Transportation Technologies (OTT), through the OAAT (Office of Advanced Automotive Technologies), provides management, contributes technical input, and oversees the USABC's battery development projects, as defined in a cooperative agreement between DOE and the USABC. Other DOE headquarters staff deal with legal and contractual issues pertaining to the consortium. DOE's Chicago Operations Office and various other offices are also involved in supporting DOE activities with the USABC. Within OTT, support is provided by the Office of Technology Utilization Field Operations Program, which tests and evaluates vehicles with advanced batteries as they become available. Most of the R&D on advanced batteries has been conducted under competitive contracts awarded by the USABC to various organizations. However, some projects are carried out through CRADAs with five of DOE's national laboratories. For example, CRADAs were established with some of the national laboratories to develop test procedures, conduct independent tests and evaluations of batteries developed in the USABC program, and pursue R&D in each of the six battery programs. In addition, long-term, high-risk/high-payoff exploratory work is being conducted directly by DOE under OAAT's ETR program. Coordinating the activities of the USABC and federal advanced battery programs requires high-level programmatic direction, major program reviews, workshops, meetings, and symposia with experts on topics related to advanced EV batteries. Interagency coordination of DOE and the Defense Advanced Projects Research Agency projects is based on a memorandum of understanding. The government-sponsored Interagency Advanced Power Group is responsible for coordinating other projects and programs.

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--> Infrastructure Issues Achieving a significant market penetration for EVs will require that a number of infrastructure needs, as well as environment, health and safety issues, be addressed. For example, standards for recharging vehicles, the availability of materials, and recycling of batteries are important infrastructure areas. While the USABC has been focused on battery development, a number of other groups have been working on broader issues. An Infrastructure Working Council was established in the early 1990s by EPRI, major electric utilities, and the automakers and is supported by DOE. DOE has also sponsored other activities to encourage the creation of the needed infrastructure for EVs. DOE assigned programmatic responsibility for environmental, health, and safety issues associated with advanced batteries, including recycling, to the National Renewable Energy Laboratory, which has conducted assessments of the advanced batteries under development by the USABC. The National Renewable Energy Laboratory has led the Advanced Battery Readiness ad hoc Working Group, which provides a forum for information for technology developers, the USABC, and regulatory agencies.