More Cars Are Powered by Biofuel Than Electricity — But Why?
My friend and colleague Tom Konrad of AltEnergyStocks.com comments on my piece on biofuels:
(The efficiency of PV) is still 10x better than biofuels, but the capital costs of all those solar panels are probably much more than costs of planting, harvesting, and converting the plants into biofuel….which is why a lot more cars are powered by biofuel than electricity.
You may be right about the former, i.e., the capital costs. However, though I can’t find a study on this, I wouldn’t discount the capital costs of biofuels (and, more to the point, the operating costs) of the tractors, etc. Also, the opportunity cost of arable vs. desert land is enormous – and seldom brought into the equation.
As to why more cars are powered by biofuel than electricity, I think it’s more a matter of our current devotion to the dispensing infrastructure for liquid fuels, which is (albeit slowly) eroding. The shift away from burning hydrocarbons that are ruining our planet in favor of plug-in vehicles powered by renewables isn’t happening as fast as many of us would like, but it’s most certainly in motion. And when liquid fuels leave, they won’t be coming back. In the words of Simon and Garfunkel, “When she goes, she’s go-o-o-o-ne…”
I think the high capital costs of using PV to support electrically powered cars are more to do with the cost of the batteries in the cars than of the PV electricity – especially in sunny countries with simple permitting systems.
Take a less than ideal example
Suppose a UK company has a fleet of electric cars with 30kWh batteries and wants to produce as much electricity from a solar array as will be used by the cars – assuming an average of 10 kWh use per day (Roughly 30 miles a day of use which is enough to cover the journeys of most urban drivers). On a good site in Southern England 1,000 kWh per annum can be achieved per kW peak.
Each car needs around 3.3 kW of PV array which in the UK would cost around £4,000 or $6,000 as part of a >100 kW array. The battery systems in the same cars would cost around £10,000 or $15,000 so are a much bigger part of the total cost.
If you consider somewhere like Australia where solar array costs are slightly lower than the UK and there is perhaps 50% more sunshine you would be looking at an array cost closer to $4,000 per vehicle – which considering it produces (on a net basis) all the fuel an electric vehicle will use in its lifetime is not an excessive cost.
Gary is right that both batteries and PV contribute to the high capital costs of electric vehicles.
Craig is also right that operating costs should not be discounted, and that desert land is much less valuable than arable land.
If we can significantly bring down the cost of batteries (in my estimate by about 5x), then the all in cost of ownership of EVs will start to look good in comparison to liquid fuels (bio or fossil.) You can see my calculations of the unsubsidized paybacks for EV batteries here http://www.altenergystocks.com/archives/2011/09/its_time_to_kill_the_car_culture_drive_a_stake_through_its_heart_and_deincarnate_mobility.html (I assume a 10c per kWh electricity price, which is lower than what can currently be achieved by unsubsidized solar.)
Yes, biofuels have an in-built advantage in the for of the distribution infrastructure, but don’t discount the advantage EVs will gain from the already paid-for electric grid. Imagine the additional advantage biofuels would have if ever home owner could (at the cost of an extension cord) fill their gas tank with biofuel overnight in their tank overnight at 1/2 gallon an hour. For most people, that would mean no more stops at the gas station (except on long trips.)
Tom’s reference is very US centric and the economics begin to stack up rather differently in certain other countries.
In Europe, fuel prices generally include a substantial proportion of tax / internalization of externalities so that gas prices are already around $8 per US gallon with electricity prices higher roughly in proportion to gas prices in most places ($0.22 would be typical in the UK for single tariff with lower rates available at night).
I understand that in Norway where fuel tax is the most expensive in Europe, and electricity to retail customers at around $0.14 / kWh – low by European standards electric vehicles are already making inroads.
In the UK when used as company cars, there are substantial tax savings to the end user of an electric vehicle, and in London, electric vehicles are exempted from a $15 a day congestion charge when using the roads of the city centre.
In Europe, I would say that if range can be increased to around 200 miles with a modest increase in battery capacity and no further increase in cost such vehicles would be very attractive for many company fleets.
To achieve this would I think involve the use of advanced lightweight materials, modest increases in battery energy density and durability, elimination of parasitic losses i.e. battery discharge whilst the vehicle is parked, (Tesla is said to have a problem with this – soon to be fixed by new software), development of stable ambient temperature batteries using plentiful metals like sodium and which do not require expensive battery management systems, and an ongoing scale up of electric vehicle production.
Craig,
I think you are still missing the boat on this issue. The costs are still everything. We all know that EV’s are FAR more expensive than comparable ICE’s for a lifetime cost/mile, so I won’t get into that here. But it’s worth looking at the economics of using land for farming vs land for solar power production to get a sense of how far we still have to go here.
Breaking it all down and truly comparing the costs is the only way to resolve some of this.
(corn farming numbers come from Googled Illinois data)
Farmland costs (high producing farmland): ~$10,000/acre.
30-year amortized cost/year (5%): $645
Property taxes/year: ~$20
Variable costs/year (fertilizer, pesticides, seed, drying, fuel, machine repair, etc): ~$340
Other costs/year (labor, amortized building costs, storage, machine depreciation, insurance, etc.: ~$190
So the total cost of purchasing and operating a newly-bought corn farm breaks down to ~$1195/year.
The average yield for high-producing land is ~160 b/acre/yr. At $7.2/b, that’s $1,152/year. That leaves ~$40/acre in losses that have to be made up for by subsidies, and bi-product sales.
160 b would convert to ~480 gallons of ethanol, or ~330 gallons of gasoline equivalent (gge). So the loss per acre works out to ~$0.12/gge.
For a solar farm in the Nevada desert, the land price might be ~$2000/acre, for a 30-year amortized price of $130/yr.
Average power density of 7.8 MW/acre.
Average installed cost for industry-scale solar farm: $3.5/W.
Total capital cost/acre: $27,300,000.
Amortized 30-year loan: $1,758,600
O&M costs (~0.5% install costs/year): $136,500
Inverter replacement cost at 15-year point: $2,730,000.
15-year inverter loan amortized throughout the 30-year analysis: $129,528/year
Insurance: 135,000??? (this is a guess based on 0.5% of the capital outlay)
Total annual cost excluding insurance/acre: $2,339,758
Average capacity factor of ~20%.
Solar cell degradation: ~0.6%/yr?
Total electricity produced over 30 years:
376,220 MWh
Total electricity produced/year (average): 12,540 MWh.
Value of electricity: ~$150/MWh. Total value of product/acre/year: $1,881,000.
So the solar farm loses a hypothetical ~$278,758/year/acre – which must be made up with subsidies and/or green tags.
It would take ~7000 acres of farmland dedicated to ethanol to equal the amount of needed subsidies that one single acre of industrial solar would require.
12,540 MWh is roughly equal to 348,333 gge, so that loss works out to ~$0.80/gge, before the additional losses/subsidies involving EV’s are considered (>$2/gge).
Glenn: Thanks for this. Please see: http://2greenenergy.com/biofuels-and-electric-transportation/34849/.
I think this article is highly relevant to the discussion
http://cleantechnica.com/2013/03/28/solar-electric-cars-crush-biofuels-in-efficiency/