TRANSPORTATION:

Forthcoming study finds gap between expectations and reality of electric cars

As the roll-out of plug-in electric vehicles approaches, IHS Cambridge Energy Research Associates (CERA) is preparing a report that challenges hopes for a rapid deployment of the plug-in models. It argues that they will be held back, in part, by shortages of recharging stations for urban motorists.

CERA Vice President Larry Makovich said the report, to be released in November, also takes issue with a scenario that foresees millions of plug-in electric vehicles being recharged at night by wind power. The study will assert that in a number of urban areas where wind or hydro power is not readily available, electric vehicles are likely to be recharged by coal-fired generating plants, whose carbon emissions will substantially undercut the vehicles' climate benefits.

CERA's study will also contend that in the absence of federal policy to tax carbon emissions, wind power will lose ground to natural gas-fired power generation, which should remain relatively cheap because of the huge increase in U.S. natural gas reserves stemming from shale gas development, he said.

"There is gap between the expectations ... and the reality," Makovich said in an interview. "The gap arises in part because people would love to have some technological fix to all the problems we face" on the climate front. "Without some kind of technology silver bullet, we have a really difficult problem on our hands from a standpoint of cost and political support in getting something meaningful done on CO2. ... Some of that wishful thinking has crept into the expectations."

Plug-in electric vehicles are a crucial part of the Obama administration's long-range scenario for reducing greenhouse gases. President Obama has set a goal of having 1 million all-electric or hybrid electric-gasoline vehicles on the road by 2015, and administration has channeled Smart Grid grants to support advanced battery development, charging stations deployment and production facilities for electric cars.

Federal Energy Regulatory Commission Chairman Jon Wellinghoff points to the potential for electric car batteries to provide voltage and frequency support for the power grid when the vehicles are plugged in and not in use, for which vehicle owners would be paid.

A 'fast track' has serious obstacles

The Pacific Northwest National Laboratory concluded in a 2007 report that the existing U.S. high-voltage transmission network could supply enough power for overnight recharging of the majority of plug-in vehicles as they replace conventional gasoline-power cars. Because wind power blows more strongly at night than in the day, wind generators are a perfect choice for overnight recharging, the wind industry says.

The Electrification Coalition projects that an investment of $120 billion over eight years, through a variety of federal tax credits, would fund a fast-track deployment of plug-in cars and charging stations that would put the United States on a path toward an electric vehicle future. By 2040, three-quarters of U.S. vehicle miles could be powered by electricity, the coalition says, and the reduction in crude oil imports and the improvement in the nation's trade balance would pay for the investment many times over.

The outlook for future electric vehicle sales appears now to be substantially better for hybrid plug-ins versus all-electric models, according to experts at the Electric Power Research Institute, since hybrids will have small gasoline motors available for recharging, extending their range and permitting smaller and lighter batteries. Hybrids could effectively lead the way toward all-electric vehicles. Experts also say that it's not clear how quickly improvements in battery technology will shrink the cost gap between plug-in cars and gasoline or diesel-driven vehicles, making predictions risky for this technology.

But the electric car movement will not accelerate on its own, says Robbie Diamond, president of the Electrification Coalition. "Unless the U.S. gets more serious about deploying these vehicles and creating communities where you have at-scale deployment of infrastructure and cars, it will be very hard for the U.S. to have electric vehicles break into the market, except for early adopters," Diamond said in a recent interview.

CERA's research indicates that there will be serious economic and logistical obstacles to widespread development of public recharging stations in urban areas -- the logical target for electric vehicle deployment because of the shorter distances urban commuters and residents drive each day, Makovich said.

"There are tremendous challenges to implementing electric vehicles in urban settings, particularly in older cities," Makovich said. Cities like San Francisco have many neighborhoods where a majority of car owners park their cars at the curb, not in garages where plug-in recharging would be convenient and secure. The most likely customers for all-electric cars are motorists in cities' close-in suburbs, where round-trip daily commuting distances are 35 miles or less, CERA's report will conclude.

In cities like Detroit, where renewable resources are currently meager, a large-scale increase in electricity use to recharge vehicles is likely to be met by coal power in the foreseeable future, he said. "We're talking about multiple decades before you have a meaningful change to what's on the margin off-peak" for power generation.

Fueled with wind, or coal?

Moreover, CERA believes that increasing production from large U.S. shale gas resources will restrain the cost of natural gas-fired generation, putting wind power at a continuing competitive disadvantage unless Congress puts a significant price on carbon emissions from fossil-fuel power plants -- an unlikely scenario as matters stand, Makovich said.

"There is fundamental gap between what the scientists are telling us we need to do and the kinds of costs people are willing to accept politically."

One of the smartest things the United States could do to get the right pacing and intelligent deployment of electric vehicles would be to resolve the debate over pricing carbon, he said. Questions about the future of electric vehicles, wind and solar power and nuclear reactors loom, he added.

"We'd have a heck of a better ability to figure that out if there were clarity on CO2. It's quite striking where we're sitting today versus a year and a half ago," he added. Then, it looked like Congress would produce climate legislation. "Now, it's back to the drawing board."

CERA's report should have a high-level audience -- the firm's chairman, Daniel Yergin, is a member of Energy Secretary Steven Chu's Energy Advisory Board.

CERA's client base is populated by oil and gas industry leaders, as evidenced by the speakers who lead its annual energy outlook forum, and advocates of renewable power and electric vehicles may say the report's findings are tilted toward conventional energy interests. Makovich responded that the firm's research on electric vehicles solicited views from alternative energy developers. "We have a good cross section," he said.

But he expects the report will draw fire. "It's a very, very controversial topic," he said.