Webinar on Electric Transportation — Top Trends in the Adoption of Electric Vehicles
[youtube http://www.youtube.com/watch?v=nmWqERLtNYU]
For those who might have missed it, here is April’s webinar, in which I present some of my perceptions about the electric transportation industry, including my take on the most probably EV adoption curve.
Our energy consumption is closely tied to GDP. If we’re not going agrarian, if we’re concerned about shortages in energy, food, and water, EVs are 100% necessary.
National security requires energy security, and that requires weaning ourselves off oil. And there are other imperatives: health, peak oil, urban congestion, global climate change, and ocean acidification
Electric vehicles use electric motors, and batteries, capacitors, and fuel-cells.
They encompass all vehicle form-factors.
There are 230 million cars on US roads. Trucks contribute even more GHGs and other forms of pollution. Nay-sayers point to drivers’ demand for absolute freedom, risk aversion, the unwillingness to pay extra, and confusion and apathy about true ecological benefits. Global climate change deniers represent a PR miracle.
There is a huge market for EVs. The management form PRTM and I predict 10% penetration by 2020 — a $250 billion market.
There are 25 million multi-car households in single-family dwellings, with at least one car used for local commuting.
There is lots of low-hanging fruit.
There are natural limits to the adoption of EVs, e.g., Class 8 trucks, and aircraft. This
provides a large market for things like synthetic fuels for the foreseeable future.
The EV adoption curve is complicated, as supply affects demand, and demand affects supply.
There is a huge divorce between Big Auto and Big Oil. How happy is Big Auto? Ultimately, it doesn’t matter.
EV adoption faces many challenges, primarily offering the consumer an effective value proposition.
Regarding consumer adoption, here are the results of a consumer survey. The #1 reason for consumers to buy EVs is to save on gas. To what degree is consumer behavior affected by concerns for the environment?
Are EVs only applicable to a certain lifestyle? Are electric vehicles not for everyone?
I’m not sure. What happened to video rentals and CD sales?
Another point to be considered re: consumer adoption is patriotism.
If you’re concerns by things like terrorism, war, nations debt, the loss of international respect, admiration, and most of all, leadership, the replacement of internal combustion engines with EVs may be an important step in the right direction.
Do you remember what George C. Scott as General Patton said? America loves a winner and will not tolerate a loser.
Regarding the adoption of EVs, infrastructure is an issue. We need to be prepared to expect bottlenecks. There will be 400 EVs sold in San Diego in April, all with 220V charging systems, and all requiring SDG&E inspection. Customers are expecting 3 – 5 business day turn-around – all of whom will be disappointed.
Let’s explore the shifting total cost of ownership. In the old model, we had gasoline, and heavy maintenance. In the new world, we have electricity and services.
Telematics includes green routing, realtime traffic, battery monitoring, charge locations, interior preconditioning, and V2G information.
Let’s talk about business strategy – including the notion of a few tough realities. Is Carlos Ghosn for real?
No one on the “hardware” side has an incentive to push for the migration to EVs.
The OEMs and the dealers wish it were 1955.
OEMs of specialty EVs (e.g., tractors) wanting to sell through traditional dealers should think twice.
Here are a few other notes re: EV business strategy — a few more tough realities. Only niche-market strategies offer protection for start-ups. Some examples include Tomberlin, Emcycle, and EcoVElectric.
Other include e-scooters, enclosed e-bikes, and tandems.
I’ve reviewed many incredible business plans from entrepreneurs in this space. Do you want to get involved?
If so, there are numerous peripheral markets, including electricity generation, Smart-grid components, two-way communication between energy source and consumer, efficiency of consumption, demand response, and V2G.
Other opportunities lie in services, e.g., telematics, and billing.
Regaring billing services, note that this subject is totally up in the air. Suppose I live in France but I work in Germany or Belgium. Or suppose I live in Santa Barbara but I’m visiting a friend in Los Angeles. How do I pay for my charge?
Other issues in billing services include the idea of pre-paying. This does not enable CRM, which is awkward and time-consuming for the customer,
You can opt for post-pay, which enables CRM, but there are credit risks, and the expenses incurred in billing and customer service.
In either case, an issue is integration. An example of this is Easy Pass.
The charger lies between the grid and the EV. There are half a dozen or so charger manufacturers that perform grid connect. load balancing, smart charge, and certified/authenticated charge.
More chargers mean happier drivers. But how much are they used?
Batteries are improving steadily. There is no magic bullet, but with scale, technology innovation, design standards, vertical integration (BYD), and the steady removal of cost from the supply chain, we should achieve $300/kWh.
Other charging solutions include
Better Place and fast-charging.
Charging, done at home and in semi-private locations (e.g., workplace) will account for 70%+ for at least the next 10 years.
What I see in the years 2011 – 2015 includes EV sales to early adopters, and to fleets, like FedEx, Verizon, Frito Lay. This will show the world that EVs are ready to go.
What I see I the years 2016 – 2020 include the pragmatists getting onboard, and real evidence of hockey-stick growth curve.
What I see in the years 2021 – 2030 is rapid and smooth EV adoption. This is because EV powertrains are pure technology. To what degree does Moore’s Law apply?
I think we need to keep our eyes on France because of their:
Clean power (so EVs make a real difference)
Top-down public sector backing in all aspects (especially charging infrastructure)
Aggressive investments from the private sector
Active solicitation of business relationships with partners worldwide
Sophisticated/enlightened citizenry that prides itself in leadership
Smaller footprint (less than 1/10th the size of the continental US)
We should expect s surprise announcement from Toyota because:
They will cease resting on the laurels of the Prius
Toyota’s current plans for the plug-in Prius are a yawn
Their drive train is the worst of all worlds
I expect to see a heightened interest in renewable energy because of the:
Gulf spill, Japan, and gas prices
People are waking up, realizing that we in the US :
Have no energy policy, much less a federal RPS (renewable portfolio standard).
Offer only lip service in COP meetings like Copenhagen and Cancun.
Subsidize oil and coal at 12 times the rate we do renewables.
Heightened Interest in Renewable Energy
Scrupulously ignore the numerous externalities of fossil fuels
Feign concern about the national debt we’re leaving to our children
Act like we’re concerned about unemployment
Warmly embrace the behavior of an oil industry that employs 7000 lobbyists whose job is to extract favors
In the 2012 presidential election, every credible candidate will have a sane and workable position on the subject. Most will be disingenuous.
We won’t have a true democracy as long as Citizen’s United vs. FEC is in place
See www.MoveToAmend.org
The taxes to cover highway costs may be more adequately covered with a tax on tires. Every highway vehicle, no matter the propultion mode, will use tires. Bigger, heavier vehicles use heavier, more expensive tires, and tire wear is linear to use. Off road, or construction vehicles would have exemptions as they now do for fuel tax.
That’s a very interesting idea. I hadn’t heard that one. It seems the world is stuck in the paradigm of taxing the fuel; your idea is really thinking outside the box.
Phil, I think you are spot on The idea of using tire size and the wear factor being so closely related to road wear makes much more sense than replacing the fuel tax with a flat rate vehicle tax or a mileage from the odometer based tax paid annually at registration renewal.
Craig,
Good show with lots of good information. I really appreciate you adding EcoVElectric to your list of niche vehicles. We will make it and continue to work hard at getting started.
Couple of questions I would have answered differently and may be of interest to you. There is talk about taxiing EV’s because they do not pay road taxes thriugh gasoline. My answer is let’s tax all vehicles, but do it by a different formula. The tax should be done at State level but perhaps the Fed’s can figure our their cut. The taxes should go to more than fixing roads, perhaps 50% need to be put into mass transit systems. The tax would be based on the fuel economy of the vehicle and the emisisions and the type of fuel the vehicle uses, the weight of the vehicle and if we end up getting this data real time, the time of day the vehicle is used. This will cause EV’s which have zero emissions, 100’s of mpgge, are lighter weight, and if they use renewable energy, to pay a tax but it will be a whole lot less than a conventrional car. The time of day tax is to encourage reduced traffic jams and get people car pooling or working different shift hours.
The issue of conversions came up. I consider myself an expert at doing conversions having started GM on a conversion program back during EV1 days. Yes most are done by hobbyists who know nothing about how cars are designed and validated at all. Most of these conversions are dangerous and personally I would not let them on the road. However, EV conversions can be done much safer and be much more roadworthy. But the conversion process is not easy to do correctly without the proper backgound in automotive. Many companies doing them today are specializing in only certain makes and models. This simplifies the process and reduces the cost to figure out how to do to it and do it quicker after they do job #1. The major problem is that conversions have at least 3 x the labor and a lot of useless scrap that the customer pays for. The OEM assembles the car as gas; #1 labor, then the converter disassembles it, labor #2 (and usually has a lot of expensive stuff like engines, fuel tanks, radiators, exhaust systems, etc to throw away), and finally the converter reassembles; labor #3. Process #2 and #3 are not very efficient. This is why conversions are so expensive and most times not very reliable. The cost quoted is for using lead acid batteries. Adding Li battery technology makes these conversions more reasonable from a usage standpoint since they can get more than 20-40 miles on a charge. But Li is not well developed yet for aftermarket and the things that Li requires are not readily available with what is OEM validated. Cheap Li batteries are available from China, but the quality is not consistent and is not very good. What is the right answer is what Ford is talking about and that is converting gas engine vehicles into electrics, or PHEV’s on their assembly lines. Now you get a reasonable priced EV or PHEV that is new and tested and warranied and can find parts and service when you need it and it is probably less than the 10 year old Focus you had converted inproperly.
My last comment is about chargers. What a mess we are creating. Every charger company has their own pass key to their chargers for which you need to buy and register. If you go somewhere their chargers are not there, you are out of luck. This is rediculous and DOE is so dumb to not have addressed this with our taxpayer’s money. Next, we have not matured enough to ask the question how much more than 11 cents a kWh are we going to pay to charge our EV’s? Ultimately someone has to pay for the charger, installation, and service it may require in addition to the electricity it gives out. Level II charging is not realistic for any reasonable pay back. Look at an at-work-charger in a parking lot. It is probably about $5000 to install and make operational. Say it is used 500 times a year (that assumes who ever is plugged in moves their car and if electricity is 11 cents per kWh. Now the workplace doubles that so they make $1.10 on each charge that you pay $2.20 for. So your company makes about $550 dollars a year so pay back is 10 years less any maintenance and service. That dog dont hunt! Level III is even worse with about $50,000 to install. Are you willing to pay $10 for a $1 of electricity or how about a $100? Maybe once in a full moon. It will never make sense except in an emergency. So you better expect to pay $100 for your $1 in electricity from you Level III chargers. that dog hunts even less.
It is all about economics.
It is totally forgotten, that electricity can be converted into liquid fuels and thus can be distributed in our existing infrastructure and propel our existing vehicles. I think that Craig’s next webinar with David Doty in the hot chair will deal about that.
Furthermore, that may turn conventional wisdom on its head, as both direct methane and methanol fuel cells have had their breakthroughs making it possible to drive electric and fill up CNG or methanol instead of charging under standstill.