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145 This appendix focuses on EVs that can be partially or fully powered by batteries charged from an off-board source of electricity (e.g., grid power). Two possible configurations are considered: BEVs and PHEVs. BEVs only operate on electricity. Once the batteries of a BEV are drained, the vehicle can no longer be driven until its batteries have been recharged. The Nissan Leaf, Chevy Spark, Tesla Model S, Honda Fit EV, and others fall in the BEV category. PHEVs include both batteries and (as currently configured) a gasoline-powered ICE. The batteries provide sufficient storage to allow for a limited range of travel in all-electric mode. As the battery charge becomes depleted, the vehicle can rely on power generated through the combustion of gasoline for additional range. With the ability to rely on fuel combustion as needed, the battery pack provided with a PHEV does not need to be as large as that for a BEV. The Chevy Volt, Toyota Plug-In Prius, Ford C-Max Energi, and Honda Accord Plug-In are examples of the PHEV category. HEVs not capable of being plugged in, such as the Honda Insight and the original Toyota Prius, are not included in this appendix but rather are discussed with other advanced tech- nologies for conventional vehicle technologies in Appendix A. The logic for this division is that with HEVs, all of the vehicleâs power ultimately originates with the combustion of petro- leum. The capabilities enabled by hybrid technology, such as regenerative braking and automatic engine shutoff, can thus be viewed as strategies for recycling and making more efficient use of the petroleum power. In contrast, BEVs and PHEVs receive some or all of their power from off-board sources of electricity, creating a distinct set of challenges and opportunities. There are several potentially compelling motivations for seeking a transition from conventional vehicles to BEVs or EVs: â¢ Energy security. Most of the nationâs electric power is generated from domestic sources of energy. Displacing a significant volume of gasoline and diesel with electricity would thus foster greater energy independence and security. â¢ Greenhouse gas reductions. Electric energy can be gener- ated from renewable, low-carbon sources such as solar and wind power. A shift to EVs and PHEVs, combined with an effort to increase the share of low-carbon electricity on the grid, could therefore help reduce the nationâs emissions of greenhouse gases. â¢ Improved air quality. Because BEVs and PHEVs running in battery-only mode do not emit air pollutants, a shift to EVs could be helpful in meeting EPAâs urban air quality requirements. While the combustion of coal and natural gas to produce electricity does create air pollutants, power plants are often located away from population centers and can be equipped or retrofitted with pollution control devices as needed, making the resulting emissions less problematic for human health. Here again, a major shift to renewable energy would reduce air pollution at these point sources as well. â¢ Reduced cost of driving. Due to the efficiency through which electricity can be stored in a battery and then discharged to propel a vehicle, the per-mile cost of driving on electric power is a small fraction of the cost of driving on gasoline or diesel. Provided that battery improvements reduce the considerable premium currently required for the purchase of BEVs and PHEVs, a shift to EVs could also allow for more affordable total costs of ownership. Based on such potential benefits, the major auto manu- facturers have been exploring EV technology for some time. In the early 1990s, in an effort aimed at improving air quality, CARB adopted new vehicle emission regulations that included a ZEV mandate. The ZEV regulations required large auto manufacturers to offer ZEVs for sale by 1998, with the share of sales growing from 2% in 1998 to 10% by 2002. In response to this mandate, all of the major auto companies began to design and test EVs. Ultimately, though, only GM with its EV-1 A p p e n d i x d Electric and Plug-In Hybrid Vehicles
146 and Honda with its EV Plus produced dedicated BEV models; other companies developed BEV conversions of conventional vehicle models, such as the Ford Ranger EV and Toyota RAV4 EV. Additionally, most of the auto manufacturers only offered their EV models through leasing programs; only Toyota made its product, the RAV4 EV, available for sale. As documented in the movie Who Killed the Electric Car, Californiaâs first attempt to promote the commercialization of electric vehicles through its ZEV program was not successful. Only 4,000 BEVs were sold or leased in California between 1996 and 2002, representing about 0.01% of statewide light- duty vehicle sales during that period. This failure can be attributed to several factors, including high technology costs, concerns about the reliability and safety of batteries, and sustained low gasoline prices in the 1990s. In response to a subsequent lawsuit filed against California by the three major U.S. auto manufacturers, the ZEV mandate was suspended by CARB in 2002. Shortly thereafter, most manufacturers began to terminate lease agreements and then repossessed and destroyed the vehicles. Only Toyota RAV4 EVsâwhich had been available for sale rather than for leaseâavoided this fate. This was followed by a relatively brief interlude during which the worldâs major automobile manufacturers showed less interest in electric vehicles. For most of the past decade, the only BEVs available for sale or lease were neighborhood electric vehicles (NEVs) with a maximum speed of 25 mph and high-end, luxury automobiles developed by start-up companies such as Tesla. In the last few years, however, there has been renewed interest in the development and marketing of EVs. This is due, in part, to CARBâs decision in 2008 to reinstitute the ZEV mandate, which will take effect beginning in model year 2015. Additionally, technology advances over the past decade have enabled manufacturers to make further progress on some of the earlier EV challenges. In 2010, GM released a commercial PHEV, the Volt, with an advertised all-electric range of 35 miles. Next, in 2011 Nissan delivered its BEV hatchback, the Leaf, with an advertised range of about 75 miles between recharges, and Toyota has now released a PHEV version of its popular Prius model. Other firms that have released BEV or PHEV models, or are planning to do so in the near future, are BMW, Chevrolet, Fiat, Ford, Honda, Mitsubishi, and Smart. Because of the potential benefits of transitioning to electric vehicles, a number of state and federal initiatives to promote the development and adoption of electric vehicles have been recently enacted as well. For example, as part of the American Recovery and Reinvestment Act of 2009, a tax credit of up to $7,500 has been established for the purchase of electric vehicles. The DOE has already invested more than $5 billion in research, development, and manufacturing of batteries and other components of electric vehicles and charging infra- structure (DOE 2010). D.1 Production, Distribution, and Refueling Electricity to charge BEVs and PHEVs can be obtained via the existing power grid. Assuming relatively limited pene- tration of electric vehicles, it should be possible to accom- modate the additional load with existing infrastructure. To support widespread adoption, however, grid transmission and distribution infrastructure upgrades could be required. Additionally, the current mix of electric generation capacity in the United States still relies to a large extent on coal and natural gas plants. To fully reap the potential air quality and greenhouse gas emission reduction benefits, a transition to EVs would need to be accompanied by a major shift to lower- carbon sources of electricity. Finally, while most EV owners would be expected to rely on at-home charging stations for their main source of electricity, the relatively limited driving range of most BEVs, as currently configured, suggests the need for a broader network of publicly accessible charging stations, and considerably faster recharge times, to accommodate a significant level of market penetration of BEVs as the primary household vehicle. D.1.1 Current Electric Generation In assessing the potential for transitioning to EVs, it is useful to consider the ability of the U.S. power grid to handle the addi- tional load created by charging (Kintner-Meyer, Schneider, and Platt 2007; Shao, Pipattanasomporn, and Rahman 2009; NPC 2012; NRC 2013). From the perspective of aggregate power generation, an assessment by Kintner-Meyer, Schneider, and Platt (2007) suggests that existing U.S. capacity provides suf- ficient slack (i.e., excess capacity during the nighttime hours) to power roughly 70% of the nationâs light-duty fleet through the use BEVs or PHEVs. NPCâs more recent estimate is that existing capacity could accommodate electrifying half of the current vehicle fleet if vehicles were charged at night (NPC 2012). Both of these estimates demonstrate the deep availability of excess nighttime capacity and the importance of charging during off-peak hours to accommodate large-scale adoption of electrified transportation. NRC (2013) projects that elec- tricity demand from the grid to power electric vehicles will rise to about 286 terawatt hours (TWhs) by 2050, or 7% of the projected total electricity usage, well within the historic growth of the grid. As discussed in later sections, however, other chal- lenges related to distribution and recharging exist. The U.S. electrical power system is complex, consisting of generating plants, high-voltage transmission lines, local dis- tribution facilities, and communications networks that must interact to provide stable and reliable electricity to customers under varying load conditions. The flow of electricity within the system is controlled by dispatch centers that buy and sell
147 electricity based on agreements with interconnected utilities and other power providers. The system is divided into three major networksâthe Eastern, Western, and Texas Interconnected Systemsâwithin which the dispatchers and utilities operate (EIA, undated). As of 2012, according to EIA (2013b), net U.S. electric power- sector generation totaled around 3,900 TWhs. This included 38.5% from coal, 29.2% from natural gas, 19.7% from nuclear, 7.0% from conventional hydroelectric power, 4.8% from other renewable sources (biomass, geothermal, wind, and solar), and 1.0% from oil. Note that the mix of electricity sources varies greatly across states and regions. California, for example, has a less carbon-intensive electric grid than the U.S. average, with almost 29% of total net generation coming from renewable sources inclusive of conventional hydropower (EIA 2012a). Figure D.1 illustrates the growth in electric production for the United States as a whole, by source, over the past 40 years. One of the challenges of managing the electric grid is that the demand for energy exhibits considerable variation by time of day, day of week, and season. In theory, this could be addressed by storing excess electricity generated during off-peak hours for subsequent use during peak periods. In practice, how- ever, electricity storage options such as batteries and flywheels have remained costly, while opportunities for pumped stor- age (pumping water uphill during off-peak periods and then releasing it over turbines to generate hydropower during peak periods) are geographically limited. Accordingly, the approach for matching supply to demand has been to run certain power plants on a continuous basis to meet base demand and then to bring on additional capacity as demand rises (EERE 2002). In planning for base demand, utilities are interested in plants that provide the lowest generating costs when operated at nearly full capacity year round. This usually involves coal- fired plants, nuclear plants, and conventional hydropower plants. Coal and nuclear plants in particular are expensive to shut down and start up again and as such are best adapted to relatively continuous use. As demand rises above base loads, utilities next bring intermediate or mid-merit plants on line. These are often combined-cycle natural gas plants that are relatively easy to cycle up and down and also provide reasonably low-cost generation. Finally, as demand reaches its highest levels, utilities must bring on still more plants. Often referred to as âpeakers,â these may be operated just a few hundred hours each year. This operational profile favors lower construction costs (since there will be fewer hours of revenue-generating operation to recoup the capital investment) and also requires the ability to easily cycle. Based on these factors, utilities often select less costly (but also less efficient) combustion turbines fired by natural gas or oil for peak power (EERE 2002). D.1.2 Cleaner Sources of Electricity The extent to which some of the potential benefits of EVs can be realized will depend on the sources of energy used to power the grid. One of the main objectives behind the effort to develop EVs in the 1990s, as embodied in CARBâs ZEV mandate, was to improve air quality, especially in urban areas. While the generation of electricity at power plants typically releases air pollutants, such plants are often located far from 0 1,000 2,000 3,000 4,000 5,000 1980 1990 2000 2010 El ec tr ic ity N et G en er a on (T W hs ) Other Non-Hydro Renewables Hydroelectric Nuclear Natural Gas Petroleum Coal (Top to boÂom in the figure.) Source: EIA (2013b, Table 8.2b). Figure D.1. Growth in U.S. electric generation by source.
148 turbine components (NRC 2010). Offshore wind power is comparatively less developed, with some deployment in Europe but relatively little in the United States, but promises poten- tial access to substantial wind resources. As an added benefit, offshore wind power can be located close to major popula- tion and load centers along the coast (Kempton et al. 2007). Continued development of offshore turbines is expected to help reduce capital as well as operations and maintenance costs (NRC 2010). Hydro and wave power. There are two categories of hydro- electric power: conventional and emerging hydrokinetic. Conventional hydroelectric power (e.g., hydroelectric dams) is inexpensive and offers comparatively low greenhouse gas emissions on a life-cycle basis (mainly from the production and transportation of concrete and steel as well as construction activities when first building the dam). While opportunities for large new hydroelectric dams in the United States are limited (NRC 2010), there may be options for smaller-scale conven- tional hydroelectric projects if local environmental concerns can be managed (INL 2006). Unconventional hydroelectric technologies to harness energy from waves, tides, currents, and rivers are still emerging but could be deployed, assuming considerable technological advances, on a large scale by the 2035 time frame (NRC 2010). Geothermal power. Geothermal or hydrothermal power- generation technologies rely on naturally occurring reservoirs of steam, hot water, or hot rocks in the earthâs crust to gener- ate electricity. Utility-scale technologies convert heat into steam to run a turbine in much the same way that fossil fuels are used to generate electricity (NRC 2010, Crane et al. 2011). Conventional hydrothermal plants make use of hot water and steam trapped in permeable rocks at depths of up to 3 kilometers. These resources produce stable and inexpensive electricity with low life-cycle GHG emissions, but they are geographically concentrated in the western United States and limited in quantity. An emerging technology not yet deployed is enhanced (or engineered) geothermal systems (EGS), which use hot rocks at depths between 3 and 10 kilometers. The aggregate energy potential for EGS is much greater than that for traditional hydrothermal, and the resource is more geo- graphically dispersed. Before this potential can be realized, though, further research and innovation will be needed in the areas of deep thermal drilling, managing the resource, and avoiding the triggering of seismic activity (NRC 2010, Crane et al. 2011). Biomass power. Biomass can be produced and harvested with the aim of generating electricity, but biomass has com- peting uses as well, such as for liquid fuels and food and animal feed. Some biomass waste and residues, however, are best suited for power generation; recent estimates suggest that using such biomass resources for electricity could supply 10% to 20% of the nationâs power demand. If the country were to increase urban areas. The act of driving an EV, on the other hand, pro- duces no additional emissions, and a significant amount of all driving (particularly the shorter trips that could be accom- modated by electric vehicles with limited range) occurs in urban areas. Therefore, even if much of the power on the grid is generated from coal, a significant shift from conventional vehicles to EVs could result in air quality improvements in many urban areas. Still, air pollution in rural settings is not harmless, and there are some coal-fired power plants located close to cities. Adopting a cleaner mix of power generation could therefore lead to even greater air quality benefits. More recently, the potential of EV technology to help mitigate climate change has received increasing attention. Unlike with local air pollutants, greenhouse gases create the same effects on climate regardless of where they are emitted. For this reason, the potential climate benefits of transitioning to EVs depend entirely on the mix of sources used to gen- erate grid electricity. In short, the prospect of shifting from conventional vehicles to EVs creates additional incentive to increase reliance on electricity sources that produce little or no emissions, including wind, solar, hydrokinetic, geothermal, biomass, and nuclear. In the remainder of this section, current and future prospects for such alternatives are briefly considered. Solar power. Solar energy represents a vast potential source of clean, renewable power; harvesting solar energy on just a quarter of a percent of the nationâs land area would provide enough electricity to meet current U.S. consumption (NRC 2010). There are two main methods for converting solar radiation to electricity: photovoltaic (PV) panels and concentrating solar power (CSP) that uses focused solar energy to drive a steam-turbine generator. While the cost of these technologies has declined in recent years, solar power is still more expensive than other sources of electricity. Additionally, solar generation is inconsistentâvarying by latitude, time of year, and meteorological conditionsâand unavailable at night. Any effort to significantly increase the share of solar energy on the grid would thus likely require large-scale deployment of storage capacity (batteries, flywheels, etc.) to help balance temporal variations in the supply and demand for electricity. In short, the cost of solar power technologies, including both generating modules and balance of system costs, will need to decline substantially over the next several decades to overcome current economic and technical barriers (NRC 2010). Wind power. Wind is another potentially significant source of clean and renewable energy, with estimates suggesting that wind resources in the United States could produce several times the amount of electricity consumed by the nation (NRC 2010, Crane et al. 2011). As with solar power, however, wind power is intermittent and thus creates load-balancing challenges. Onshore wind power is viewed as relatively mature, though there may be opportunities for further cost reductions with more deployment experience and improvements in wind
149 such as in underground geologic formations. By capturing and storing the CO2, CCS can avoid upwards of 90% of CO2 emissions. There are several promising pathways for CCS, but a significant amount of technological and policy develop- ment is required before these systems will be economical and deployable at scale. DOE is currently funding a program to demonstrate the technical viability of alternative approaches to CO2 capture from existing and planned power plants (NETL 2013). To date, however, no full-scale commercial power plants with CCS have been deployed, and research, development, and demonstration efforts continue. Cost of alternatives. Levelized costsâthat is, the per-unit costs of electric power production taking into consideration plant operating capacity, capital costs, fixed operating and maintenance costs, variable operating and maintenance costs, and transmission investmentsâfor lower-carbon power sources such as wind and solar have improved in recent years relative to traditional power sources (EIA 2013a). Yet the more cost-competitive nature of certain alternatives does not imply that it would be inexpensive to pursue a rapid transi- tion from fossil-based electric power generation to renew- able sources. To begin with, levelized cost estimates pertain to building and operating new capacity, whereas much of the nationâs current electricity supply is provided by existing coal and natural gas plants; such plants are more economical to operate given that the capital costs are already invested. Addi- tionally, as described in the preceding text, all of the renew- able or low-emissions options face certain challenges, such as limited resources (e.g., for current geothermal technology or new conventional hydropower projects), competition for resources (e.g., biomass), intermittency (wind and solar), perceived safety and security concerns that translate to signi- ficant public acceptance challenges (nuclear), and the need for further technical advances (e.g., unconventional hydroelectric technologies, enhanced geothermal energy, and carbon capture and sequestration). D.1.3 Distribution In discussing electrical distribution issues, it is helpful to distinguish between the longer-range transmission of power from plants to major load centers (e.g., cities) and the shorter- range distribution of power within load centers to individual commercial, industrial, and residential customers. This is discussed in the following. Long-range transmission. Existing transmission capacity is not viewed as imposing significant constraints on the adoption of EVs (Kintner-Meyer, Schneider, and Platt 2007; May and Johnson 2011). On the other hand, new transmission capacity investments will likely be needed to enable growth in the amount of renewable energy on the grid, which would in turn help maximize the environmental benefits of shifting to EVs. the amount of biomass devoted to electric production to around a billion dry tons annually, the amount of the nationâs electricity generated from biomass would rise to about 40% (NRC 2010). Achieving this level, though, would require some dedicated crop production in addition to waste and residues. This would almost certainly compete with the production of biomass for liquid fuels, and potentially with the production of food and animal feed crops. Near-term opportunities for bio- mass power include co-firing biomass in existing coal power plants (Ortiz et al. 2011), dedicated biomass power plants, and generating electricity as a coproduct in manufacturing biofuels. Longer-term opportunities include breakthroughs in the digestion and gasification of biomass to produce an economic biogas for combustion and the engineering of new biomass strains to enhance photosynthesis efficiencies (NRC 2010). Nuclear power. Nuclear power plants provide around 20% of the nationâs electricity, but this source has not expanded significantly in recent years (EIA 2012c). Lack of growth in the nuclear industry stems from several important challenges and risks. These include the high capital costs of construct- ing a nuclear plant, difficulties associated with environmental permitting and liability, unresolved issues regarding how and where to store spent nuclear fuel on a long-term basis, concerns that nuclear proliferation increases the chances that terrorists could gain access to nuclear material, and the risk of natural disasters triggering nuclear catastrophes (LaTourrette et al. 2010). The latter can lead to strong local opposition to the siting of new nuclear power plants, and the recent meltdowns in Fukushima following the earthquake and tsunami are likely to intensify such opposition. On the other hand, nuclear power also offers advantages. Once constructed, nuclear power plants provide an inexpensive source of base load power that generates no harmful air pollutants or greenhouse gases. With increasing concerns over the threat of climate change, the lack of emissions in particular has stimulated renewed interest in nuclear power. A recent forecast from the EIA assumes that the nuclear industry will add about 19.1 gigawatts of new generating capacity by 2040. In February of 2012, the U.S. NRC voted to approve Southern Companyâs application to build two new nuclear reactors, Units 3 and 4, at its Vogtle plant, the first reactors to receive construction approval in over 30 years. As of early 2012, the U.S. NRC had applications for a total of 28 new reactors. Given the challenges and concerns described previously, however, it is unclear how many of the proposed plants will actually be built (EIA 2012c). Carbon capture and sequestration. It may also be possible to reduce the carbon intensity of electricity generated from coal and natural gas through carbon capture and sequestra- tion (also known as carbon capture and storage). CCS is the process of removing CO2 from the emissions stream prior to its release into the atmosphere and then storing it permanently,
150 the country where peak demand for air-conditioning was not viewed as a requirement in designing the local distribution system (May and Johnson 2011). D.1.4 Recharging Electric vehicles have onboard chargers that interface with grid outlets to allow proper charging of the battery packs. In theory, BEVs and PHEVs can charge from any available outlet. Indeed, this is one of the key advantages of EVs in comparison to conventional vehicles and other alternative-fuel options: that they can be charged at home, or perhaps at work, with little or no additional investment. On the other hand, most BEVs offer limited driving range (e.g., less than 100 miles) in comparison to conventionally fueled vehicles. For extended travel, many owners may find it necessary on occasion to recharge their vehicles when they are away from their home or work locations. This section considers both the availability and potential con- figurations of charging infrastructure to support such needs. The discussion is most applicable to BEVs, which must rely entirely on electric power; while PHEV owners might opt to replenish their charges in the midst of their travels, they can also choose to rely on readily available petroleum fuel should they run low on electric charge before returning home. Publicly accessible charging infrastructure. Even with their limited range, BEVs can accommodate typical trip patterns for many drivers without the need to recharge during the day. A 50-mile range BEV, for example, can easily handle a round- trip commute of 10 to 15 miles each way. For BEVs to achieve significant market penetration as primary vehicles for house- holds, though, it may nonetheless prove necessary to deploy a network of publicly accessible charging stations, for two rea- sons. First, owners whose daily travel is occasionally greater than the range enabled by a single battery charge might find it necessary, or at least convenient, to recharge their vehicles during the course of their travels, and the availability of publicly accessible charging stations would make this possible. Second, the limited range capacity of most current and pro- jected BEV models may lead to range anxiety on the part of prospective buyersâthat is, the concern that they could one day run out of charge and become stranded before they are able to return home. The knowledge that publicly accessible charging infrastructure is available, even if it never proves to be needed, may help overcome this concern, thus paving the way for more BEV purchase decisions. While most charging is expected to occur at home (NPC 2012), publicly available charging infrastructure would reduce range anxiety and enable extended daily travel. Following such logic, the Obama administration, in sup- port of its goal for widespread adoption of EVs, has devoted millions of stimulus dollars from the American Recovery and Reinvestment Act (ARRA) to fund the installation of publicly This is because many of the best locations for siting renewable energy facilities are in sparsely populated regions far from high-capacity transmission linesâon the high plains for wind turbines, for example, or in the Southwest for solar arrays (Kaplan 2009). Investment in new long-range transmission capacity faces several challenges. To begin with, the permitting process for new transmission lines can be difficult and time consuming. Projects that span multiple states, for example, must receive approval from the Federal Energy Regulatory Commission as well as individual permits in each state through which the line passes. Financing new transmission capacity for certain types of renewable energy can also prove problematic; because of the intermittent nature of solar and wind, lines built to accom- modate peak power will be underutilized much of the time, making it more difficult to recover costs. Relatedly, there is lit- tle agreement on who should ultimately bear the costs of the new capacityâjust those customers who will benefit directly from the new transmission (i.e., customers of utilities con- nected to the line) or all customers in the broader network who will ultimately benefit from greater system capacity and reliability (Kaplan 2009). Local distribution. In contrast to long-range transmission, where increased capacity would mainly be helpful in support- ing an expanded role for renewable electricity on the grid, many local distribution networks are likely to require upgrades simply to accommodate the demand patterns imposed by EV charging. The main constraint involves the capacity of local transformers in residential areas in relation to the amount of power drawn when charging an EV (NPC 2012). Secondary transformers in the United States are typically designed to accommodate three to six houses. The amount of electricity drawn when charging an EV, however, can be about the same as that used to power an entire house. A Nissan Leaf charging on a 240-volt, 15-amp circuit, for example, translates to a 3.6-kW load (watts are calculated as volts multiplied by amps), which is greater than the amount used by an average home in Berkeley, California. If several homes connected to the same transformer were to charge EVs at the same time, perhaps on a warm sum- mer afternoon with air-conditioning also in use, the trans- former could easily become overloaded, triggering a local brownout (May and Johnson 2011). Achieving a significant transition to EVs is thus likely to require considerable investment on the part of utilities to upgrade secondary transformers. The need will be most acute in neighborhoods with a greater share of likely early adopters (e.g., affluent urban or suburban locations with strong envi- ronmental leanings where residents are able to afford EVs and are motivated to make such purchases), in older neighbor- hoods where transformers were originally sized for smaller houses (i.e., 100-amp service rather than the 200-amp service more commonly in use for new houses today), and in areas of
151 EV owners to recharge their vehicles in the midst of their travel without too much delay; the need to spend a much longer time to recharge a vehicle would almost certainly be viewed as a major inconvenience that could deter many pro- spective owners from purchasing an EV. Even 30 minutes may be viewed as too inconvenient for a significant share of customers, given that refueling a gasoline tank typically takes about 5 minutes or so. Two conceptual approaches to fast charging have been considered. The first involves the installation and operation of publicly accessible fast-charging kiosks that offer some form of Level 3 charging, although further research may be needed to verify that fast charging does not cause battery packs to deteriorate more rapidly. Some of the ARRA funding for public EV charging mentioned previously has been invested in the fast-charging kiosk concept (DOE 2010). An alter- nate approach to fast charging is battery swapping, in which depleted batteries are mechanically removed from EVs and replaced with fully charged batteries in less than 2 minutes. This concept was first introduced by the firm Better Place (Better Place 2011), which subsequently filed for bankruptcy; more recently, Tesla Motors has announced its intent to develop a network of battery swapping stations for its customers (Tesla 2013a). Vehicle-to-grid power. One longer-term possibility for EV charging infrastructure is often described as vehicle-to-grid power. The basic idea would be to use the collective battery storage capacity of the EV fleet to help balance variations in supply and demand on the grid. Even small amounts of power provided back to the grid could regulate grid frequency and provide other ancillary services to the grid. When not in use, EVs plugged into the grid could draw power during off-peak hours when there is slack capacity and then feed energy back into the grid during periods of higher demand. From a system- wide perspective, vehicle-to-grid power would reduce the need to invest in more generation capacity for peak loads. It could also make it possible to increase the share of power on the grid that comes from intermittent renewable sources such as solar and wind, for which periods of production do not always align with peak demand. Finally, it could create an opportunity for EV owners to earn a small profit by buying electricity from the grid at lower cost during off-peak hours and then selling back at higher prices in peak hours. On the other hand, vehicle-to-grid power would also accelerate the degradation of an EVâs battery pack, and large- scale implementation of this idea would require a range of advanced smart-grid technologies still under development. Thus, though promising in concept, the vehicle-to-grid idea requires further study and demonstration (Sovacool and Hirsh 2009). The U.S. Air Force is testing the vehicle-to-grid concept for non-tactical vehicles located at several military installations (Simeone 2013). accessible charging infrastructure (DOE 2010). As of September 2013, there were a little more than 19,000 publicly accessible charging stations in the United States (EERE 2013a). About 1,500 of these are located in California, some of which are residual from earlier efforts to support the stateâs ZEV mandate in the 1990s and early 2000s. Charging levels. Separate from the availability of public charging infrastructure, another potential concern for EVs is the amount of time required to fully recharge a depleted battery pack. When a vehicle is being charged at home over- night, a lengthy recharge time may be viewed as acceptable. If an EV owner needs to recharge in the middle of the day between trips, in contrast, a much faster recharge time would be desired. Higher levels of charging provide more power to the battery per given unit of time, and can recharge batteries faster (EERE 2011). Level 1 charging, the slowest and least expensive, refers to the use of a standard three-prong household electric outlet running at 120 volts and 15 amps. To illustrate the speed of Level 1 charging, consider a Nissan Leaf with its 24-kWh battery pack. A circuit with 120 volts and 15 amps supplies a 1.8-kW load; at this rate it could take up 13 hours (24 kWh divided by 1.8 kW) to fully charge the Leafâacceptable per- formance for charging a vehicle overnight but certainly not for a quick midday recharge. The main advantage of level 1 charging is that it relies on existing household outlets; no further electrical installation work is required. Level 2 charging uses a 240-volt circuit at 15, 20, 30, or even 60 amps, translating to a load of between 3.6 and 14.4 kW. At the upper end of this spectrum, it would take a little less than 2 hours to fully charge the Leaf âs 24-kWh battery. Level 2 is viewed as the desired standard for home EV charging and is usually installed as a permanent wall-mounted electric vehicle supply equipment (EVSE) unit to regulate vehicle charging safety. NPC estimated the cost of purchasing and installing such units in a typical residential garage at about $1,500 to $4,000 (NPC 2012). It found that commercial installation of Level 2 charging infrastructure ranged from $2,700 to more than $30,000, depending on the amount of construction and infrastructure required. Level 3 charging, defined as loads exceeding 14.4 kW, can charge EVs even more quickly. Such loads exceed the capacity of most residential electrical panels, making Level 3 charging more applicable for areas with access to industrial or commer- cial electrical service. Level 3 charging also requires an EVSE unit. NPC estimated that direct-current Level 3 charging infrastructure and installation can cost more than $50,000 (NPC 2012). Fast charging. Another term often used in discussions of EV charging infrastructure is âfast charging,â which has been defined as the ability to charge an EV in 30 minutes or less (EERE 2011). The basic goal of fast charging is to enable
152 customers. The Northern California utility Pacific Gas and Electric (PG&E) offers residential customers a flat rate struc- ture as well as a time-of-day rate structure aimed at EV owners. (In both cases the rate structures are also tiered, meaning that the per-kWh rate increases with total volume of use.) For flat- rate customers, the price of electricity begins at 11.87 cents per kWh and escalates up to 40.03 cents per kWh. For time- of-day customers, in contrast, the off-peak price of electricity begins at 4.14 cents per kWh and escalates up to 32.35 cents per kWh, while the peak price begins at 27.49 cents per kWh and escalates up to 55.96 cents per kWh (PG&E, undated). By choosing a time-of-day rate structure and recharging their vehicles mainly at night, EV owners may have the opportunity to save considerably on the retail cost of electricity, further enhancing the fuel-cost advantages of EVs. D.2 Vehicle Technology Following the unsuccessful efforts to develop and market EVs in the 1990s, the underlying technology has progressed significantly. Several BEV and PHEV models have been released in the past few years, and many more are anticipated in the near future. Current models still face limitationsâmost notably signifi- cant price premiums on the order of $10,000 or more stemming from the current cost of battery technology, as well as reduced range compared to gasoline ICE vehicles. Most of the BEV models that have been released or are planned for the near future, for example, are limited to around 100 miles or less between charges, while an ICE averaging 30 miles per gallon might be able to drive for more than 300 miles between refuel- ing stops. Battery technology. Commercial success for EVs will likely hinge on the extent to which future advances in battery technology can help reduce the cost and improve the perfor- mance of such vehicles. Relatively recent battery cost estimates range from $500 to $800 per kWh (NPC 2012, NRC 2013), though costs continue to decline. For a PHEV with a 16-kWh battery pack, this would translate into a premium of $8,000 to $13,000. To compete effectively with conventional vehicle technologies in the future, significant further reductions in cost will likely be needed. Other important areas for improve- ment are battery weight, which influences an EVâs efficiency and in turn range (Shao, Pipattanasomporn, and Rahman 2009), calendar and cycle life, specific energy (Wh/kg), specific power (W/kg), and energy density (W/liter). These different aspects of battery performance are influ- enced by the chemistry involved. Options developed to date include lead-acid, nickel metal hydride, lithium-ion, and sodium nickel metal chloride. All of these battery types present advantages and disadvantages in the context of BEV and PHEV applications, so there is no clear choice for the best D.1.5 Current and Future Electricity Costs Retail electricity prices in the United States vary by region depending on the type of power plants, fuels, and pricing regulations and structures. Prices are usually highest in Hawaiiâover 25 cents per kWh in 2010âdue to the stateâs heavy reliance on fuel oil. At the other end of the spectrum, Wyoming had the lowest rates in the nation in 2010, at a little over 6 cents per kWh, based in part on low-cost hydropower from federal dams. The average retail price in 2011 for the United States as a whole was 10.0 cents per kWh; industrial customers enjoyed the lowest rates, with an average price of 6.9 cents, while residential customers faced the highest rates of around 11.8 cents (EIA 2012b). Looking forward, whereas the price of oil is generally expected to increase, prices for electricity may remain rela- tively flat. In the reference-case projections in the most recent Annual Energy Outlook from the EIA, the world price for imported crude oil, in 2011 dollars, rises from $102 per barrel in 2011 to $155 per barrel in 2040, an increase of about 52% (EIA 2013a). The average U.S. retail price of electricity rises, again in 2011 dollars, from 9.9 cents per kWh to 10.8 cents per kWh over this same period, an increase of just 9%. Based on these assumptions about future energy prices, and setting aside any future fuel economy improvements for conventionally fueled vehicles and for EVs, the comparative per-mile fuel- cost advantage of electricity may continue to widen. One factor that could increase the future cost of electricity would be a shift to greater use of renewable sources, although the effect on prices could still be modest. In a recent analysis, the EIA evaluated the cost implications of imposing a hypothetical clean energy standard that would require 80% of electricity generation to come from hydroelectric, wind, solar, geo- thermal, biomass power, municipal solid waste, landfill gas, nuclear, coal-fired plants with carbon capture and sequestra- tion, and natural gas-fired plants with either carbon capture and sequestration or combined-cycle technology by 2035. The results indicated that such a standard would increase the average retail price of electricity to 11.7 cents per kWh, a 29% increase over the reference-case scenario used in the study (EIA 2011). (The analysis did not include a provision for bank- ing or borrowing clean energy credits, which could reduce the cost of compliance.) Greater incorporation of time-of-day electricity pricing, on the other hand, could further reduce the cost of electricity for charging EVs. With time-of-day pricing, the cost of elec- tricity is higher during peak hours when demand is highest and lower during off-peak hours when there is slack genera- tion capacity. Such rate structures are relatively common but are typically aimed at large-scale industrial and commercial customers. Increasingly, though, utilities are beginning to make time-of-day rates available as an option for their residential
153 level, after which the operation shifts to charge-sustaining mode. Some PHEV designs use only battery power during charge-depleting mode, while other designs use engine power as well to boost the combined efficiency of engine and bat- tery power. The split between electricity and gasoline usage for either vehicle type would depend on its use patternâin particular, how frequently it is driven on trips that exceed the possible range in charge-depleting mode, after which the ICE will be relied upon more heavily. D.3 Cost and Performance Current and anticipated BEV and PHEV models perform quite well in some regards; they offer impressive power and torque, lower per-mile fuel costs than conventional vehicles, and zero tailpipe emissions. On the negative side of the ledger, as noted previously, most EVs offer only a limited driving range and can require a long amount of time to recharge, and they also require a significant price premium to cover the costs of the battery pack. The potential for greater adoption of EVs in the future will likely hinge on advances in battery technol- ogy that help reduce vehicle cost and, for BEVs in particular, increase range. D.3.1 Vehicle Cost As already mentioned, the current premium for BEVs and PHEVs due to the high cost of batteries represents a significant barrier to broader adoption of electric vehicles. To illustrate the price difference between EVs and their more conventional counterparts, the Prius plug-in has a premium of almost $8,000 over the standard third-generation Prius HEV (Toyota 2013a, b), the Chevy Volt has a premium of almost $17,000 over the Chevy Cruze (GM, undated a, b), and the Nissan Leaf has a premium of almost $15,000 over the Nissan Versa (Nissan, undated b, c). To help offset the cost of an EV, the federal government has offered tax credits of up to $7,500, depending on the battery capacity of the model purchased. Some states, such as California, offer additional subsidies. Given mounting pres- sure to trim federal and state budgets, however, it is unclear whether the public sector will be able to keep offering such financial support over the longer term. Absent public subsidies, the cost premium associated with EVs, largely reflecting the cost of the battery pack, will need to decline considerably to allow for mass market adoption. According to the findings of Michalek et al. (2011), the savings in per-mile fuel costs that result from powering a car with electricity rather than gasoline will not be sufficient for most drivers to recover the premium price for an EV unless gasoline becomes much more expensive than it is today or the price of batteries falls considerably. battery for all applications. Additionally, there are inherent trade-offs between energy density, power density, cycle life, and cost so that even for a particular type of battery, it is necessary to design them for specific applications. For each of these chemistries, cells and modules of different amp-hour ratings and voltages have been developed and manufactured by battery producers around the world. Most of the electric vehicles and hybrids produced in the early years used either lead-acid or nickel metal hydride batteries, whereas the most recent BEV and PHEV models are using lithium-ion batteries. Lithium-ion batteries provide several advantages over other types of batteries such as, most notably, longer vehicle range. Lead-acid batteries, in contrast, are used primarily in low-speed NEVs with a relatively short range of 25 to 50 miles and a top speed of 25 mph, while nickel metal hydride batteries were employed in the early (non-plug-in) hybrids. The key requirements for the energy storage unit for a par- ticular vehicle design are safety and abuse tolerance, usable energy stored, peak power, and cycle and calendar life. These requirements must be met with a unit with a weight and volume that are less than specified values based on the drive- line packaging. Energy storage and peak power affect vehicle performance attributes such as range and acceleration, while cost and cycle life are important from a marketability per- spective. Whether a particular type of battery is suitable for electric vehicles depends on the desired characteristics of the vehicle in which it is to be used. For example, peak power is important for HEV batteries, while usable energy is much more important for PHEVs and BEVs. Plug-in hybrid technology. Beyond the issues associated with battery technology just outlined, the integration of electric power with the internal combustion engine for PHEVs involves additional technical considerations such as power blending strategies and battery charging and discharging modes. One key design choice is how to employ the power generated by the internal combustion engine. In the Chevy Volt, power from the ICE is used mainly to charge the battery pack, which in turn powers the drivetrain. The other alternative, essentially an extension of the approach employed in most conventional hybrids, is to blend output from the battery and ICE in powering the drivetrain. A related question is how to manage discharge from the battery. Two modes are possibleâcharge-depleting and charge- sustaining. In charge-depleting mode, the vehicle relies mainly on power from the battery, which is therefore discharged more quickly. In charge-sustaining mode, the battery energy is kept at roughly the same energy level by using power from the engine or from regenerative braking to recharge the batteries during driving. HEVs, which do not rely on an off-board source of power, must by definition rely on charge-sustaining mode, whereas PHEVs use both. PHEVs typically operate in charge- depleting mode until the battery energy falls to a specified
154 D.3.2 Energy Cost of Travel While EVs may demand a significant premium for vehicle purchase, they perform quite well in terms of the energy cost of travel. Additionally, because BEVs are mechanically simpler than conventional vehicles, routine maintenance costs may be lower as well. As noted earlier, the average residential cost of electricity in the United States was 11.8 cents per kWh in 2011. Assuming that the fuel efficiency for an EV is 3 miles per kWh, roughly in line with EPAâs estimate for the Nissan Leaf (fueleconomy.gov, undated), the average cost per mile would be about 4 cents. By comparison, consider a conventional vehicle with impressive fuel economy, say 40 miles per gallon, and assume that the retail price of gasoline is $3.50 per gallon. This would trans- late to 8.75 cents per gallon, more than double the per-mile cost of electricity for the EV example. The relative energy cost per mile for an EV in comparison to a conventional vehicle will ultimately depend on the cost of electricity, the efficiency of the EV in miles per kWh, the cost of gasoline or diesel, and the fuel economy of the con- ventional vehicle in miles per gallon. For PHEVs, the compar- ison also depends on the percentage of driving that occurs in all-electric mode versus driving powered by the internal com- bustion engine. Figure D.3, adapted from a chart developed by INL, compares the energy cost per mile for BEV models (the dashed lines) and conventional vehicles (the solid lines) with varying levels of fuel economy at different price levels for electricity and gasoline (INL undated). As shown, one can construct scenarios with very high electric costs and very low gasoline costs in which the energy cost of travel for a conventional vehicle would be as low as that for an EV. But at As with any technology, it is reasonable to assume that, over time, battery capabilities will improve and prices will fall. There is considerable uncertainty, however, regarding the magnitude and pace at which costs will come down. As one point of reference, researchers at ANL, drawing on a review of the technical literature along with expert inter- views, summarized expectations for future reductions in the price premium associated with EVs (Plotkin and Singh 2009). These were then compared with program goals established by the U.S. Department of Energy, as reported by Michalek et al. (2011). Figure D.2 compares the results from the ANL review with the DOE goals for five types of vehicles in 2015, 2030, and 2045. The five vehicle types are a conventional vehicle (CV), an HEV, a plug-in hybrid with a 20-km (12-mile) all-electric range (PHEV20), a plug-in hybrid with a 60-km (37-mile) all-electric range (PHEV60), and a battery electric vehicle with a 240-km (150-mile) range (BEV240). The figure lists expected retail prices (2010 $), which are assumed to be about 50% higher than production costs. Solid bars cor- respond to the ANL results, while dotted bars represent DOE targets. Several observations emerge from the data in this figure. First, EV costs are indeed expected to decline in real terms. Second, the expected reductions in premiums based on the ANL review are less than those based on the DOE targets; that is, DOE targets, at least relative to ANL results, appear optimistic. Third, even with the more optimistic DOE targets, a premium of several thousand dollars is still expected for both PHEVs and BEVs in 2045. In other words, according to these results, the premium for EVs will be smaller but still appreciable. Source: Plotkin and Singh (2009), Michalek et al. (2011). $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 2015 2030 2045 Re ta il Pu rc ha se Pr ic e (2 01 0 $) ANL Review CV DOE Goals CV ANL Review HEV DOE Goals HEV ANL Review PHEV20 DOE Goals PHEV20 ANL Review PHEV60 DOE Goals PHEV60 ANL Review BEV240 DOE Goals BEV240 Figure D.2. Potential decline in EV cost premiums through 2045.
155 as suggested by these two studies, it is likely that either battery costs will need to fall considerably or petroleum costs will need to rise and remain high on a sustained basis in order for EVs to represent an attractive cost proposition for many potential buyers absent continued subsidies. Such outcomes are certainly possible but cannot be taken as a given. D.3.3 Operational Performance The main performance issues for EVsâlimited range and significant time to rechargeâare mainly relevant for BEVs. PHEVs, in contrast, can run on the ICE as the battery becomes depleted, and any needed mid-trip refueling can occur at a gas station rather than at a charging station. A number of manufacturers, including Chevrolet, Ford, Honda, Mitsubishi, Nissan, Tesla, and Toyota, have already released BEV models or are planning to do so within the next few model years. Among these, Teslaâs Roadster and Model S sedan stand out as exceptions in terms of range. The Roadster has an advertised range of 245 miles (Tesla 2013c), while the Model S can be configured for a range of up to 265 miles (Tesla 2013b), but these are both high-end luxury vehicles with a corresponding price premium. Most models aimed at a broader consumer market have advertised ranges of around 100 miles or less, supported by battery packs of between 16 and 24 kWhs. As noted earlier, for example, the Nissan Leaf âs 24-kWh battery pack provides an advertised range of about 75 miles (Nissan, undated a). While 100 miles is enough to accommodate most routine driving patterns, longer road trips would need to be supported by publicly accessible charging infrastructure. Even with Level 3 fast charging, the recharge time may be as much as 30 minutes, and this could deter many potential customers. current pricesâless than 12 cents per kWh and near $4 per gallon of gasâthe energy costs for EVs are much lower than for conventional vehicles. Looking solely at energy cost per mile, however, fails to account for significant differences in the initial cost of the vehicles. Because vehicles require a substantial up-front invest- ment, it may be more instructive to examine the total cost of ownership on a per-mile basis. Such a measure ideally accounts for the present-value costs of capital expenses (including the vehicle and potentially any charging infrastructure installed at home), fuel, maintenance, battery replacement (if applicable), depreciation, insurance and amortization, and salvage value, allocated over total miles of travel during the period of owner- ship. A core challenge in estimating total ownership costs is the degree to which cost-per-mile computations are sensitive to each of the assumptions listed. Some analyses omit some of these parameters, making comparisons between different studies difficult. Two of the most important and uncertain parameters in comparing total cost of ownership between EVs and conven- tional vehicles are the cost of batteries (and in turn the cost of an EV) and the cost of petroleum. As an example, Lemoine and Kammen (2009) found that EV battery prices would have to fall to less than $200 per kWh in order to break even with ICEs and HEVs at fuel costs of $4 per gallon and electricity prices of $0.10 per kWh. Michalek et al. (2011) looked at current EV cost estimates and then computed and compared total ownership costs on a per-mile basis with those for conven- tional vehicles at different price points. Their analysis found that the cost of gasoline would need to be well above $4 per gallon in order for PHEVs and BEVs, assuming currently envisioned battery and electricity costs, to compare favorably with conventional vehicles for total ownership costs. In short, Source: Adapted from INL (undated). $2.00 $2.25 $2.50 $2.75 $3.00 $3.25 $3.50 $3.75 $4.00 $4.25 $4.50 $4.75 $5.00 $0.04 $0.06 $0.08 $0.10 $0.12 $0.14 $0.16 $0.18 $0.20 $0.22 $0.24 $0.26 $0.28 $0.00 $0.05 $0.10 $0.15 $0.20 $0.25 $0.30 Gasoline Cost per GallonEl ec tr ic ity C os t p er k W h Energy Cost per Mile BEV 2 m/kWh BEV 3 m/kWh BEV 4 m/kWh Gas 18 mpg Gas 22 mpg HEV 45 mpg Figure D.3. Energy cost of travel for electric vehicles and conventional vehicles.
156 use of the fuel in the vehicle. For each of the fuels and vehicle technologiesâgasoline, diesel, hybrid electric, natural gas, biofuels, plug-in and battery electric, and hydrogenâthe team used GREETâs specifications for a mid-size passenger vehicle in 2010 along with two hypothetical configurations estimated by NRC (2013) for similar vehicles in the 2050 time frame. The two future cases are generally consistent with expectations in the literature regarding possible advances in fuels and vehicle technologies, but one embeds baseline assumptions while the other is more optimistic. In the following are presented the GHG emissions modeling results for conventional vehicles and EVs. For the latter, the analysis includes a PHEV with a 10-mile all-electric range, a PHEV with a 40-mile all-electric range, and a BEV. The intent of including both current and future conventional vehicles is to help clarify not only how PHEVs and BEVs might perform in relation to the current light-duty fleet but also how they might perform against conventional vehicles with much- improved fuel economy in the future. Table D.1 lists the assumptions for the analysis, including on-road (as opposed to EPA-rated) fuel economy for both gasoline and electric mode, share of miles powered by gasoline and by electricity, and the emissions intensity of electric power generation. The 2010 case assumptions and results for all vehicles are derived from the GREET model. For 2050 base- line and optimistic cases, data from the NRCâs Transitions to Alternative Vehicles and Fuels (NRC 2013) are used for future fuel economy for ICEs, HEVs, and BEVs. For the PHEV models, the electric-mode fuel economy ratings for the 2050 baseline and optimistic cases mirror the corresponding cases for the 2050 BEV models. For gasoline mode, the fuel economy In addition to these BEV models, Ford, GM, Honda, and Toyota have recently released or begun to market PHEVs. GMâs Chevy Volt, the first to market, now boasts an all-electric range of 38 miles (GM, undated b), while Toyotaâs plug-in Prius offers an all-electric range of 11 miles (Toyota 2013c). Ford is selling two plug-in models, the C-MAX Energi and the Fusion Energi, both offering all-electric ranges of 21 miles (Ford 2013a, b), and Hondaâs new plug-in Accord is configured for 13 miles of all-electric range (Honda 2013). The ability of these vehicles to operate based on power from the ICE reduces the need to provide for a longer range in electric mode. D.3.4 Greenhouse Gas Emissions The performance of EVs with respect to greenhouse gas emissions depends in part on the source used to generate the electricity. If the power is solar or produced by wind, for exam- ple, the reduction in GHGs can be substantial. If the power is generated by the combustion of coal, in contrast, then driving an EV can actually produce more life-cycle GHGs per mile than a conventional hybrid-electric vehicle (Michalek et al. 2011, Mashayekh et al. 2012). The general expectation, however, is that the average carbon intensity of grid power will continue to decline over time. As part of this study, with the aim of facilitating a con- sistently framed examination of the GHG emissions reduc- tion potential for the different fuels and vehicle technologies considered, the research team conducted an exercise relying on emissions factors from ANLâs GREET model (ANL 2012). The analysis provides for a well-to-wheels analysisâthat is, it includes emissions from the production, transport, and Fuel/Vehicle Scenario MPG (per gallon of gasoline equivalent) Percent of Miles Powered By: Emissions Intensity of Electric Power Production Gasoline Electric Gasoline Electric Gasoline ICE 2010 24.8 â 100% 0% â 2050 baseline 72 â 100% 0% â 2050 optimistic 91 â 100% 0% â PHEV10 2010 34.7 84.4 80% 20% 2010 U.S. Grid 2050 baseline 93 202 80% 20% 30% cleaner 2050 optimistic 121 296 80% 20% 50% cleaner PHEV40 2010 34.7 84.4 40% 60% 2010 U.S. grid 2050 baseline 93 202 40% 60% 30% cleaner 2050 optimistic 121 296 40% 60% 50% cleaner BEV 2010 â 84.4 0% 100% 2010 U.S. grid 2050 baseline â 202 0% 100% 30% cleaner 2050 optimistic â 296 0% 100% 50% cleaner Source: Computations by authors based on data from ANL (2012) and NRC (2013). Table D.1. Assumptions in emissions comparisons for BEVs and PHEVs.
157 respect to fine particulate matter (PM2.5) and SOx. Accord- ing to the GREET model (ANL 2012), for example, a current PHEV10 can be expected to generate 60% more PM2.5 and 40% more SOx per mile than a comparable ICE on a well- to-wheels basis, while a current PHEV40 can be expected to generate 200% more PM2.5 and SOx per mile. This is largely due to existing coal-fired power plants in the U.S. electricity mix. In the future, the retirement of older coal plants and pollution controls installed on newer power plants are expected to greatly reduce the amount of conventional air pollutants associated with charging electrified vehicles. One additional point to note is that EVs emit no pollutants while driving; rather, any air pollutants are created in the processes of producing or extracting feedstocks and generating power. As such, EVs, even if relying on power from fossil fuels, may still contribute to significant improvements in urban air quality. D.4 Market Prospects If one were to assume that future advances in battery tech- nology led to significant cost reductions and greatly extended the range that an EV could be driven between charges, and further that publicly accessible fast recharging stations had been deployed across the road network, the potential market share for EVs within the light-duty fleet would be significant. Given the inherently lower per-mile costs of driving on elec- tric power, the economic advantages of EV ownership would be compelling to most households. In fact, however, there is significant uncertainty surrounding the expected pace of battery technology advances, and the network of fast recharg- ing infrastructure is still quite sparse. Given these challenges, unbiased estimates of future EV adoption rates tend to be rather conservative. The remainder of this section first reviews some of the market penetration projections that have been assumptions for the 2050 baseline and optimistic PHEVs use the same ratings as for the 2050 baseline and optimistic HEVs (discussed in Appendix A). Finally, the assumed 20% of miles in electric mode for the PHEV10 and 60% of miles in electric mode for the PHEV40 align roughly with findings in the lit- erature on typical driving profiles. These assumptions reflect a range of possible values for these vehicles in the middle of the century and are not intended as precise projections of the future. Based on these assumed specifications and GREETâs emis- sions factors, Figure D.4 graphs the greenhouse gas emissions performance for current and future conventional models, PHEVs, and BEVs. Again, values represent well-to-wheels emissions but do not include emissions associated with the production of the vehicle and battery pack. From these results, it appears that the BEV option uniformly outperforms the PHEVs as well as the ICE and HEV options. The picture is further complicated, however, if one considers full vehicle-life-cycle GHGs, including from the production of the vehicle and battery pack. The basic issue is that battery production, in comparison to other vehicle components, is cur- rently an energy-intensive process. As shown by Mashayekh et al. (2012), the carbon emissions from the production of a large battery pack for a BEV, if apportioned over the expected lifetime miles of a vehicle, can account for as much as 20% of a BEVâs GHG emissions. Factoring in emissions from battery production, therefore, brings the overall GHG performance of BEVs and PHEVs closer in line since PHEVs have smaller battery packs than BEVs. D.3.5 Local Air Pollutant Emissions While EVs can be expected to help reduce greenhouse gas emissions, their performance with respect to local air pollutants on a well-to-wheels basis is more mixed, particularly with Source: Computations by authors based on data from ANL (2012) and NRC (2013). 0 100 200 300 400 500 BEV PHEV40 PHEV10 Gasoline ICE Grams CO2-Equivalent per Mile of Travel (well-to-wheels) 2010 2050 Base 2050 OpÂmistic Figure D.4. GHG reduction prospects for PHEVs and EVs in 2050.
158 There have been a number of sales projections of BEVs and PHEVs for over the next 20 to 30 years. In its most recent Annual Energy Outlook, for example, EIA (2013a) projects that combined annual sales for light-duty BEVs and PHEVs will increase from about 1,800 in 2010 to a little over 560,000 in 2040. This would correspond to about 3% of the projected market for new light-duty vehicles in 2040, estimated by EIA to be a little over 18 million. Actual U.S. plug-in vehicle sales have already surpassed EIAâs early projections, however, with more than 53,000 sales in 2012 and more than 41,000 in the first 6 months of 2013 (EERE 2013b). Yet these still represent less than 1% of total U.S. vehicle sales. Since 2010, the Chevy Volt has been the market leader across plug-in vehicles, with more than 41,000 vehicles sold. The Nissan Leaf has sold about 29,000 vehicles, with the Toyota Plug-in Prius and Tesla Model S each selling around 12,000 (EERE 2013b). It seems likely that within the next 5 to 10 years, California and other states with similar incentives or regulations will experience the greatest sales of BEVs and PHEVs (Anderman 2010). Baines and Nelson (2009) suggest that the penetration of BEVs after 2020 will start to increase, but that the over- all market share will remain modest, not exceeding 15% by 2050. On the other hand, they project that the market share for PHEVs could increase to 60% by 2050 under a scenario in which virtually all new vehicles will be either HEVs, PHEVs, or BEVs. CARB, in contrast, envisions a potential future in which BEVs and FCVs eventually emerge to dominate the light-duty vehicle market (CARB 2009). Under the CARB scenarioâ which should be viewed as more of a conceptual imagining of a plausible future than a formal forecastâconventional vehicle sales begin to decline after 2010, eventually being phased out entirely just after 2030. HEV sales begin to rise in the 2000s, peak at around 40% market share in 2020, and then decline to zero by 2040. PHEV sales, following a similar if slightly delayed trajectory, begin to ramp up in the later 2010s, peak at around 25% in 2030, and then decline to zero by 2040. Finally, BEVs and FCVs enter the market in signifi- cant numbers following 2020 and then account for nearly all sales by 2040. One of the uncertainties of the CARB scenario is the fate of hydrogen fuel-cell vehicles. If fuel-cell vehicles decline in cost and hydrogen fueling infrastructure is developed, then BEVs will face strong competition from fuel-cell vehi- cles and perhaps fail to attain a significant market share. If FCV cost and lack of refueling infrastructure remain as significant barriers, then the market share of BEVs could rise significantly to dominate the market. Thus, the relative share of BEVs and FCVs in the CARB scenario, which col- lectively account for most new vehicles sales by 2040, is left unspecified. offered in the literature and then summarizes key issues and uncertainties that will have an influence on whether EVs will be successful. D.4.1 Future Market Projections In order to market BEVs and PHEVs, overall ownership costs must be comparable to those of conventional ICE vehicles of the same size and type. A higher premium for an EV may be tolerable if it can be shown that the life-cycle cost is equal to or lower than that of a corresponding ICE vehicle. In addition, of course, the functional utility of the BEV or the PHEV must meet the needs of the consumer. There have been a num- ber of studies of marketing and ownership considerations relative to BEVs (e.g., Deloitte 2011, Axsen and Kurani 2013). Such studies generally indicate that there is a relatively small (10% to 20%), but nonetheless significant, potential market for BEVs assuming that the price differential is not too large. However, the predictions of sales and market penetration in the available studies vary widely. As would be expected, the potential market increases as the assumed range of BEVs is greater and the price differential is smaller. Based on the discussion in previous sections, the prospects for a significant penetration of electric vehicles into light-duty automotive markets do not appear to be promising as long as the customer focuses primarily on the initial vehicle pur- chase price, at least until battery prices fall by 50% or more. Vehicle range and recharging time currently limit the utility of electric vehicles, and most consumers want a vehicle that can serve their most demanding requirements (e.g., the longest trips that they might take in a year) even if those requirements are infrequent. Alternative business models, such as BMWâs program to loan gasoline ICE cars several times a year to customers who buy their EVs (Gareffa 2013), might reduce the anxiety of owning an EV that meets most, but not all, of a driverâs needs. The higher initial price of the BEV and its reduced utility have made it difficult to sell electric vehicles except to consumers that place a high priority on environ- mental objectives and have the means to afford the additional premium. On the other hand, when purchase incentives have been available, as occurred in the late 1990s as part of the ZEV mandate, sales and leases of BEVs have shown a marked increase. Large incentives for the purchase of BEVs are again being offeredâfor example the $7,500 federal tax creditâ and sales of BEVs have picked up over the past few years. The characteristics of PHEVs should help alleviate con- sumersâ concerns about BEVs. PHEVs have ranges similar to or greater than conventional vehicles, and their smaller battery could allow for a smaller incremental cost than BEVs. Nevertheless, the capital cost of PHEVs is still much higher than for conventional vehicles, and this incremental cost can reasonably be expected to dampen consumer demand.
159 Changing electricity generation mix. In the future, new regulations that cause a shift away from coal to renewable and other less-polluting forms of power could affect both the price of electricity and the environmental benefits of promoting EVs. Price of conventional fuel. The relative cost of petroleum- based fuel is also likely to influence the relative attractiveness of EVs. While many expect that electric vehicles could someday compete when gasoline is priced in the $2 to $4 per gallon range, the break-even price for gasoline given the current pre- miums associated with EVs is well over $4 per gallon for most driver profiles. Improvements in other fuel vehicle technologies. Improve- ments in other fuels and vehicle technologiesâfor example, cheaper production costs for biofuels or fuel-cell vehicle componentsâwould make it more difficult for EVs to com- pete for market share. References Anderman, M. 2010. The Plug-in Hybrid and Electric Vehicle Opportunity Report. 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Analysis of Impacts of a Clean Energy Standard as Requested by Chairman Hall. D.4.2 Factors Affecting Market Prospects As described in this appendix, the commercial success and societal benefits of EVs will depend on many uncertain factors. These can be summarized as follows. Vehicle and battery costs. Given the current state of tech- nology, a primary obstacle to EV market penetration will be the differential in the initial vehicle price compared to competing conventional ICE vehicles. Even as the technology matures, many expect that the premium could still be thousands of dollars without government subsidies. PHEVs with smaller batteries (lower all-electric range) are expected to have the lowest cost differential. Most but not all of this difference is due to battery cost. Battery costs have improved significantly in the past few years, but further improvement is still needed. Alternate chemistries with higher performance and lower costs than lithium-ion batteries may ultimately be required for widespread adoption. Battery life cycle and replacement. In addition to the initial cost, battery life is critical to the successful market penetration of electric vehicles. Initial test data suggest that the cycle life appears to be adequate for light-duty applications, but there is greater uncertainty regarding calendar life. Battery performance and range limitations. Current battery technology does not support driving distances comparable to conventional vehicle technology. Furthermore, Level 1 and even Level 2 recharging can take hours to complete, which may only be viewed as acceptable when recharging at home or at work. In order for wide-scale BEV adoption to occur, advances in battery technology that address these issues may prove necessary, although it is also possible that households could choose to purchase a BEV for short commutes and local trips and a conventional vehicle for longer trips. PHEVs are less affected by range limitations and recharge times given their ability to run on gasoline when needed. Availability of publicly accessible fast recharging stations. Relatedly, major investments in publicly accessible stations capable of fast recharging may be needed to support wide-scale adoption of BEVs. However, if 30 minutes, the current standard for fast recharging, remains the fastest available option, then the time required to recharge a vehicle during the middle of a trip may still be viewed as sufficiently inconvenient to deter broad adoption of BEVs. Additionally, it remains unclear how investments in fast recharging will be coordinated and financed. Impacts on the power grid. 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