Don't know if I would buy a plug-in hybrid. The cord would have to be hundreds of miles long.

Well, GM is building the Volt from the ground up.

Toyota already has the car.

All they need to do is test a few batteries and make a few tweaks to the car.

I doubt that they will try for a 40 mile all electric range, though.

Toyota needs to change the car to get higher electric top speed and keep the transmission lubed with the engine off.

They'v had a feasible car and batteries already for a decade, but the interests of major corporations often go hand in hand and you should never underestimate the power of oil companies.

http://www.youtube.com/watch?v=1J5f9x_RfHI

BBM,

No, a pluggable hybrid is not just a conventional hybrid with a bigger battery. The Prius electric motors are too weak for higher speed travel. I suspect other changes are needed as well.

No, a pluggable hybrid is not just a conventional hybrid with a bigger battery. The Prius electric motors are too weak for higher speed travel. I suspect other changes are needed as well.

Uh, I realize that Randall. But I doubt that Toyota is giving up on the Synergy drive, and as such they will continue with the parallel design. So they do not need a radically different design. They may increase all electric speeds up a little, and extend the electric boost somewhat, but the ICE will likely continue to be utilized to get the car up to speed. Cruising may be more electric than ICE etc.

"expensive batteries"

I checked with Tom Turrentine, the source in the Wired article, who was quoted as estimating the cost of Volt batteries at $1,000/KWH. He said he was misquoted, and that he was merely repeating someone else's estimate of the current market costs for lithium phosphate li-ion. That has very, very little to do with what GM (or Toyota, in roughly the same market) will pay in 3 years for larger format batteries in large-volume mass production.

This is what I said to Tom, and he didn't disagree (though he didn't discuss it at length - you should know that he's a research anthropologist, doing social research related to plug-in's, not a technologist):

"Tesla Motors says that they are paying $400/KWH, for small format, cobalt based batteries. I would think
that A123system's chemistry would be cheaper, that a large format would be cheaper, and that li-ion costs in general will fall by 2010. That assumes, of course, large volume production."

I would estimate $300/KWH by 2010.

How many KWH of power is needed to move a 3,000 lb object @ a speed of 60mph for 400 miles?

Is there a device that could recharge quickly?

I would like to see an all electric propelled vehicle with a diesel generator coupled to the battery system. A dual battery system with a 100 mile capability per battery. The Diesel could charge the 2nd battery while the 1st is operating the vehicle. The diesel might also serve as a resource for heating and cooling the vehicle.

The system should be programmed so the diesel runs only when the vehicle is moving and both the current drive battery is @ 70% and the backup battery system is @ 10%. This would allow for an 60 mile trip (1 hour). Enough time to fully charge the auxiliary battery. Then when the auxiliary batter is fully charged the system switches to the auxiliary and fully charges the main unless the vehicle stops moving.

Maybe an option could be to have an auxiliary drive mechanism that can couple directly to the diesel if the electrical system goes bad.

BMM, ever heard of the EV-1? GM is hardly starting from scratch here. Toyota is now learning what GM has known in fine detail for many years. The indication that they won't offer direct retail sale to consumers is highly reminiscent of GM's lease-only policy for the EV-1 due to the serious problems surrounding the batteries, their longevity, cost of replacement, and disposal issues.

BBM,

I think it costs less to remove the ICE from the drive train and just make it into an electric generator.

Ed,

Cars need from 200 to 500 watt-hours to move a mile. Small lighter weight cars are toward the low end of that range and SUVs toward the top. I bet there are huge SUVs that need even more. Though it could be more or less depending in grade, speed, aerodynamics, and other differences in conditions.

BMM, ever heard of the EV-1? GM is hardly starting from scratch here. Toyota is now learning what GM has known in fine detail for many years. The indication that they won't offer direct retail sale to consumers is highly reminiscent of GM's lease-only policy for the EV-1 due to the serious problems surrounding the batteries, their longevity, cost of replacement, and disposal issues.

What I mean by starting from scratch here is that GM is designing the car from the ground up... the exterior, interior, electrical system etc. They will need to make new dies for the pannels, create a factory and assembly line for the new dies etc. Toyota will not have to do this. Also GM has to figure out how to heat and cool the car solely on battery power etc.

Toyota already has the shell and the Synergy ready to go with a few tweaks... and since the Synergy drive is much closer to a conventional car than a EREV would be. As such, they do not have nearly as much work to do to create a PHEV, and I doubt that they will give the car a large all electric range, and I doubt that they're looking to put in as much battery as GM is into the Volt. So it is possible that they'd be ready in 2010.

In the long run, I think that the time and effort GM is putting into the special engineering needs of an EREV will pay off as this is really a leapfrog technology over Toyota's.

I'm planning on buying a Volt.

BBM,

Agreed that the Volt will probably be the bigger step forward.

As for buying it: Up to what price would you be willing to buy it?

I figure an acceptable price answer depends in part on the trend in gasoline prices over the next few years. It also depends on your personal use case. If you drive 35 miles to work and 35 miles home and can plug in at work to recharge then you have the ideal use case to justify buying one. Then you can save about a gallon and a half per day (as compared to driving a conventional Prius).

If you drive 250 days a year in that pattern then we are talking 375 gallons saved per year. If gasoline goes to $12 per gallon but the recharge cost is the equivalent of $2 per gallon then you would save 375 times $10 or $3750 per year.

The ability to recharge while at work will make a big difference for those who do long commutes.

Randall: Good comment.

Too much importance is placed upon Volt pricing. Cost of ownership matters but COE is not initial price. It is price plus what happens later.

For the Volt MPG (known), durability (perceived), depreciation (predicted), insurance and licensing, and a host of other factors will guide the buyer.

I live in an area where many homes now have solar electric. Even with the subsidies PV does not yet make economic sense. Those panels aren't there for today but for tomorrow when electricity costs may be double, triple, or higher. Some are also there because some owners like the idea of leading and have disposable income.

Sales of the Volt will depend upon the same factors boosting PV today. Belief about tomorrow.

K,

I do not think it makes sense to put solar panels in your house now because I do not expect solar panels to go up in price as fast as inflation. Until the utilities start charging so much that solar panels are a cheaper source of power one should hold off and wait before plunking down the money.

Randall: I'm not going to install PV in the near future and agree that panel prices will decline or at least not rise. That could well be offset by higher costs for labor and other materials. But the future is always an unknown land.

Overall large solar farms operated by utilities seem a better direction to me.

I was really using the PV comment to illustrate that buying is partly an economic decision, partly a bet on the future, and partly what we may call desire. Or what is summed up in the old adage "there is no accounting for taste".

IMO the Volt will sell or not sell on its merit as a car. Within wide limits the initial price will not seal its fate. The $30K initial projection struck me as nonsense two years ago, $40K for a base model might just prove possible. Todays dollars. But GM better get the car right.

"GM better get the car right."

I agree.

I think there's a useful alternative way to think about pricing. That is, for the first several years GM is going to produce as many as they can (roughly 10K in the 1st year, 100k in the 3rd), and they'll price the cars to sell (after doing quite a bit of market research). They'll push for tax credits, and they'll subsidize it as much as they need to, 1st because they desperately want the PR,and 2nd because they understand the need to bootstrap to economies of scale.

If there are enough early adopters who value the thrill of new tech; independence from oil; or reducing their contribution to CO2, then GM will be able to price it higher, and other, more bottomline oriented folks will be priced out for the first several years. I strongly suspect they'll keep the base price below $30K (for competitive PR), and pump up the price as needed with extras, like the Prius's $5K navigation package.

Of course, fleets like taxi's and police, who operate for 2-3 shifts and who have their own infrastructure, will have a very strong economic case - they might have a payback in 1 years or less, if they get organized properly.

This whole discussion could be repeated almost verbatim for PV.

"GM better get the car right."

Indeed. I test drove an EV-1 early on. Well, kind of -- actually, I didn't even bother with the driving part. When I got into the car, the first thing I noticed was that it felt like the car had been stripped, and then had a few things bolted on to its gutted body. The entire cockpit design was a case study in unusability -- everything was hard to reach, far apart, like an archipelago rather than an integrated set of controls. The roofing material was flimsy, veloured cardboard. Everything about the car felt cheap. It might as well have been some random, uninspired 1980s Buick, except not nearly as well made.

So yes, GM better get the car right. Sadly, I have near-zero hope of that happening. I would love to root for our domestic auto makers, but the problem is, they suck. I have no doubt that Toyota will blow Detroit's doors off yet again.

Randall,

As for the Volt, I'd probably spend 35k on it, maybe 40k if it looks well made on the interior to not make me feel too bad about it.

This would not be an entirely economic decision (I drive about 26 miles round trip on work days), of course, part of it would be gear lust etc, and the possibility that when solar prices fall I'd be able to put up a household system with net metering that could more or less run the car.

I already have a solar hot water system and have sprayed foam into the attic.

I also probably will wait until the second year of production to buy it (probably won't have much choice there anyway).

BBM,

Agreed. A car purchase decision obviously doesn't have to be fully justified on economic grounds. It would be cool to drive one of the first PHEVs.

What I can't see clearly: How high will the price of gasoline go? Is $20 a gallon possible once world production really starts to decline?

The question hinges on how much demand destruction happens at each price point. Will it take $20/gallon to get demand down as supply shrinks? The guy who coined the term Export Land Model, petroleum geologist Jeffrey Brown, has a 6.2% decline rate in his mid-level scenario for net exports once we get a few years past the production plateau.

If gasoline can get that high then a $40k Volt can pay back the added cost. It won't pay back as fast in 2011 as it will in 2014 or 2015. Also, the higher the gasoline price the higher the resale value.

Your guess is as good as mine (likely better actually) on how high gas can go.

I suspect that something like 20$/gal would be about as high as it could go since this would effectively quash demand so much that nearly everyone would be driving PHEVs (which by then should hopefully be cheaper due to economies of scale etc) or maybe even compressed air city cars.

Of course, another selling pt for the PHEVs would be reducing foreign oil dependence. Fortunately I live in an area that gets about 40-50% of its electricity from a nuclear plant, partially mitigating the concern of driving a "coal powered" PHEV.

I think liquid fuels would be mainly reserved for air travel, ocean transport, and intermediate distance trucking.

@ Randall - the Hymotion upgrade kit for the Prius adds a bigger battery but does nothing to the motors. A123 Systems confirmed to me that the battery can do most of the work at highway speeds.

@ BBM - As a plug-in, the battery won't be sized to carry a car or SUV for 400 miles. 40-50 miles tops. And you could make the argument that Chevy has a leg up in this particular contest, and that using the Synergy drive is a DISadvantage. The Synergy was developed based on the assumption that you aren't doing a plug-in. If you went in with the intent of making it plug-in from day one, would you go with a parallel architecture, or a series architecture? I think series, because you'd size the engine for making electricity, and you wouldn't need redundant ICE drive system components.

"Is $20 a gallon possible once world production really starts to decline?"

No. That would imply $750 oil, and $750 oil would pull $4T from the US economy, or more than 1/3 of total GDP. Oil can't go anywhere close to that.

$80 oil was sufficient to flatten oil consumption for close to 3 years. $130 oil is clearly going to force consumption to decline in all but a few oil exporting countries (even some exporters, like Iran and Mexico, who effectively don't subsidize, will see declines). Even in countries that popularly get blame for increasing consumption, like Mexico and India, consumption has been essentially flat the last couple years. $130 oil has broken through India's price controls, as well as some other countries like Malaysia - others, like China, will follow (probably after the olympics).

People have been fooled about elasticity because of the big difference between short-term and long-term elasticity - US (and world) consumers have been told that this was a short-term problem, until recently. In much of the world, the real consumer decision maker is the government, due to price controls and subsidies, and these consumers are now changing their behavior. Consumers everywhere are now reacting, and pretty decisively.

$200 oil (and $6 gas in the US) would be sufficient to make world consumption fall by 4-6% per year, I'm pretty sure. That's roughly the long-term maximum sustainable price.

I think speculators are, in effect, increasing the price till they get to a price point where long-term supply and consumption are balanced. I think they've found it at $130. It will be at least 5 years before (under the status quo ante) we would have gotten to depletion at 4-6% per year. $130 will force oil to start declining before the point it would have peaked otherwise, thus creating a decline that won't have to accelerate (due to depletion) for at least 10 years, and probably 15- in effect, the peak would be lopped off, and replaced by a long-term gentle decline. That kind of time period will be long enough for electrification to get ahead of the depletion curve.

I don't think even $130/barrel is sustainable, long term, since coal-derived synfuels should be extremely profitable at that price level.

"coal-derived synfuels should be extremely profitable at that price level."

I agree - heck, they should be profitable at $60 oil. OTOH, CTL plants are very large and slow to build; CO2 emission costs are uncertain, so there are substantial risks that get in the way; and it's not so easy to lock in future sales in the futures market, as there's real risk that some buyers (like airlines) may go bankrupt (aka "counter-party risk").

$80/ton for CO2, the cost envisioned by one major AGW report, would still leave CTL very profitable at these prices.

It's going to be interesting.

@ BBM - As a plug-in, the battery won't be sized to carry a car or SUV for 400 miles. 40-50 miles tops. And you could make the argument that Chevy has a leg up in this particular contest, and that using the Synergy drive is a DISadvantage. The Synergy was developed based on the assumption that you aren't doing a plug-in. If you went in with the intent of making it plug-in from day one, would you go with a parallel architecture, or a series architecture? I think series, because you'd size the engine for making electricity, and you wouldn't need redundant ICE drive system components.

I know how bateries will be sized for a plug-in. And I agree that the Synergy drive could be a liability.

That's kind of what I meant when I said:

"In the long run, I think that the time and effort GM is putting into the special engineering needs of an EREV will pay off as this is really a leapfrog technology over Toyota's.

I'm planning on buying a Volt."

If you read the thread from the beginning, my point is that Toyota could have something called a plug-in ready by 2010, despite starting on the project later than GM did. The Volt is really more of an EREV.

Nick G,

I agree that percentage of GDP places a limit on how high oil prices can go. But you are making an incorrect assumption when you assume the same amount of oil would get purchased at $750 per barrel (or any higher number of dollars per barrel). The reason oil would get so expensive in the first place would be that less would be (actually will be) available.

What is the price of oil when world production drops by 30 million barrels a day and world exports drops by 40-50 million barrels per day? The answer depends on part on when we come off the production plateau. The longer we stay on the plateau it might seem the less severe the adjustment will be. But on the other hand, the longer we stay on the plateau the more Asian demand will grow and so the downturn will leave us with even less available oil for OECD countries.

I'm not sure how the factors balance out. What's the highest price that gasoline will reach in the US?

"What is the price of oil when world production drops by 30 million barrels a day?

it would be pretty high, if it happened all at once (though not $750/barrel), but it's not going to.

"the longer we stay on the plateau the more Asian demand will grow "

No, Asian demand will respond to high prices just like that of anyone else: it will go to substitutes. Indian demand is already flat, and will start dropping at $130. Chinese demand will flatten out when they raise prices (very likely after the olympics), and eventually start dropping. They'll go to PHEVs and EV's - in the form of bicycles and cars.

Look back at my scenario - I think it's correct. What about it doesn't make sense?

Keep in mind, that substitutes to oil are cheaper than oil when oil rises above $70. Once oil rises above $70, it's just a matter of time before oil is replaced for everything except aviation. The higher it rises above that price, the faster substitutes will arrive - that's why the Saudis are so nervous. Also, people on TOD underestimate the effect on supply of high prices. Jeffrey Brown keeps citing the experience of Texas and the Lower 48, but they aren't at all parallel - prices weren't this high, higher prices weren't sustained, and there were substitutes in the form of imported oil. Production in the US is likely to rise in 2009, and plateau for some years. As time goes by, the oil services industry that got decimated in the oil-bust of the 90's will grow again, and enormously high drilling rates will at the very least greatly reduce the speed of world-wide oil production declines.

"What's the highest price that gasoline will reach in the US?

The highest sustained (for longer than a year), non-wartime price will be $6/gallon - that corresponds to $200 oil.

Also, Jeffrey Brown (Westexas) always leaves it out, but I have the impression that oil prices in the US in the 70's were price controlled, so world prices didn't apply directly.

Slightly weaselish words: that's $6 as a national average, adjusted for inflation from the present. For instance, the national average right now is about $4.

Nick G,

China and India are growing faster than the US and Europe. Now, China could collapse into a depression. But if China stays on its long term growth trend then its buying power in the oil market will continue to rise. So I do not see a decline in Chinese oil consumption until we leave the oil production plateau.

Again, China is different than the US because Chinese economic growth is much higher. The amount of price rise we need to decrease our demand is less than the amount they need to decrease their demand.

1970s oil price controls: Only in the US for domestic fields. Also, there were loopholes for new fields and oil used within a state. Imports still drove up the price of gasoline at the pump in the US. There were spot shortages due to government formulas for allocating oil by region. Socialism is bad. But high world oil prices spurred production increases in other countries.

Enormously high drilling rates: We already have them. There's less to tap.

Substitutes: Sure, they are happening. But some of those substitutes amount to lowered living standards. Buses take longer and are less convenient. So are bicycles and car pools. Smaller cars are smaller. People like bigger. Living closer to work is less desirable for people who want to live on bigger plots of land in nicer neighborhoods further from work. People go on vacations nearby rather than far away. Again, lower living standards.

Our advantage (at least those middle class and above) is that most of us (unless we are in debt up to our necks already - and I am relieved that I'm not) have room to lower. We can travel less. We can travel less conveniently and less luxuriously. But each reduction in demand involves giving up something. The steps will become increasingly less fun.

As for PHEVs and other techno-wizardly: The tech will eventually allow us to reverse the decline in living standards. But I do not see the tech coming fast enough to prevent the decline in living standards.

Coal-To-Liquid: Well it requires that we have a of coal. But our coal reserves are overstated.

"China and India are growing faster than the US and Europe. "

Yes, but I'm not sure that GDP tells us that much about oil consumption. US & European consumption are dropping, while growth continues. Indian consumption is flat for the last couple of years. Chinese consumption is (I believe - I'd welcome more info), like India more price-controlled than subsidized, and that can't possibly last - just like in India, the distributors are going bankrupt. The speculation I see is that China will raise prices after the olympics. Similarly, I hear that electrical generation around the Olympic area is going to diesel to reduce air pollution (several runners have dropped out of the games already for that reason), but that's temporary.

There has, despite generally high standards for fuel efficiency, been a trend towards SUV's in China lately - I think that will end just as abruptly as it's ending in the US. Much oil consumption has been for diesel electrical generation by individual companies. I don't think they'll be able to afford to continue doing that at the same level - they're facing an appreciating yuan and higher costs otherwise.

"The amount of price rise we need to decrease our demand is less than the amount they need to decrease their demand."

I'm not sure that follows. The cost of substitutes, like coal & electric vehicles (esp bikes), is similar, and the average income, though rising, is much lower. I think Chinese will respond just like anybody else.

Again, don't forget the dramatic difference between short-term and long-term demand elasticity - if you think high prices are temporary, your response is very different.

"1970s oil price controls: Only in the US for domestic fields. Also, there were loopholes for new fields and oil used within a state....high world oil prices spurred production increases in other countries"

Hmmm. Well, the question is: how much was the supply response suppressed in the US? "Westexas" makes the argument that US production didn't respond to a price signal - how much was that signal suppressed by price controls?

"Imports still drove up the price of gasoline at the pump in the US."

Yes, and overall US oil consumption fell by 19% over 5 years (while GDP still grew a bit, even in the face of interest rates that were very, very high only in part due to oil prices)!

"Enormously high drilling rates: We already have them. There's less to tap."

Drilling rates aren't that high - they could, and would, be much, much higher if the equipment and manpower was available - there are lots of opportunities that are going begging. It's not available because of the 90's crash, and that will change.

More later...

"some of those substitutes amount to lowered living standards."

I agree, but often not by much.

"Buses take longer and are less convenient.

I agree - buses are an enormous pain. OTOH, rail, IMHO, is greatly superior. I have a hard time seeing it as a great sacrifice.

"So are bicycles and car pools."

Sure, but carpools still get you to work. So, yes, they're inconvenient, but life goes on. Given that such expedients are likely to be temporary (basically a bridge until one can afford to buy a more efficient vehicle), it doesn't seem like such a big deal.

"Smaller cars are smaller. People like bigger."

SUV's are to a great extent fashion - they have often been difficult to drive, more dangerous, less practical in every way. Women wear high heels, though they injure their feet. They often wear clothes that are ugly, impractical and expensive. Changing fashion is not a great sacrifice.

"Living closer to work is less desirable for people who want to live on bigger plots of land in nicer neighborhoods further from work. "

I wouldn't suggest anyone move because of fuel prices - there are much better, cheaper ways to save.

"People go on vacations nearby rather than far away."

Yes, but that's not earth-shaking - it's a relatively small drop in "utility".

"each reduction in demand involves giving up something."

Maybe. I think a more efficient car can be an overall improvement - easier to drive & park, more comfortable, safer, less stressful on the budget.

" I do not see the tech coming fast enough to prevent the decline in living standards."

I agree, though for forewarned individuals, it will come pretty soon. Prii are available now, and the Volt is only 2.3 years away.

" our coal reserves are overstated."

No, not at all. Check this quote from Heinberg's essay:

" if Montana and Illinois can resolve their production blockages, or the nation becomes so desperate for energy supplies that environmental concerns are simply swept away, then the peak will come somewhat later, while the decline will be longer, slower, and probably far dirtier. "

The Illinois basin has 150-200 Billion tons of coal - the US uses 1B/year. It's more convenient than Powder River coal, and more energy-dense. It's less competitive by a couple of cents per KWH, because of sulfur, that's all.

The same thing applies to UK and European coal: under BAU, coal is declining - people who say otherwise are misinterpreting the data. I discussed this at length with one the often-quote authors on this subject, David Rutledge, and he agreed. If there are serious energy shortages, the old reserve numbers will apply, for better or worse.

I watched "Who Killed the Electric Car" movie and it relivant to this conversation. I am betting that Natural Gas cars will take off before the electric car gets out the door.

Natural gas is 0.70 per gallon equivalent vs. 3.80 for gasoline. The reason people do not use CNG for transportation is:
• there car is not equipped to burn it,
• there are few fueling stations,
• and the car manufacturers are not building them to burn CNG.
• the CNG tanks take up a lot more room than gasoline.
• a tank of CNG will only go 100 miles (reasonable size tank, reasonable compression ratio).
• The government won’t promote it because the road tax can’t be collected.

You can purchase conversion kits to run CNG or gasoline for $5000 installed. Most cars you can put the CNG tank in your trunk or pickup bed. If you have natural gas at home, you can fill up every night. The compressors to fill up are in-expensive. Gasoline stations could offer CNG. Most gasoline stations have natural gas pipes already. There is no need for big underground tanks or trucks to fill them up.

If only 25% of the gasoline stations carried CNG, than people would purchase the conversion kits and use CNG for the short trips (to and from work). The gasoline stations could charge 0.90 per gallon equivalent and re-coop their investment in a few months. They could advertise “GAS 0.90”. If a person asks about the cheaper gas, the station attendant would hand them a brochure about converting their car to CNG. The literature would be supplied by the state.

Honda, Toyota and Ford are offering CNG / gasoline hybrids now.