May 10, 2011
How Competitive Electric Cars?

When do electric cars make sense? A Time magazine piece quotes the company Better Place (that is setting up electric car battery swapping operations in Israel and Denmark as claiming that the Better Place electric battery swapping model makes sense at $9 per gallon. Not exactly a ringing endorsement of electric cars for people paying American or Canadian or Australian gasoline prices.

The customers also pay a one-time fee equal to $2,000, but even so, in both Israel and Denmark where gas runs about $9 a gallon, Better Place calculates that the typical customers would stand to save 10% to 20% against a comparable gasoline car — and enjoy most of its satisfactions.

Note that a Dane travels many fewer miles per year than an American. So a car battery in Denmark probably does not go thru as many charging cycles per year as one in America or other less densely populated industrialized countries. Daniel Indiviglio at The Atlantic takes a look at electric cars that are sold with electric batteries and finds the Nissan Leaf starts to make sense for Americans at only $5 per gallon for gasoline. Note that his analysis assumes a $7500 tax credit from the US government. So the real cost effectiveness is considerably worse than these numbers indicate.

But when gas hits $5 per gallon, the LEAF begins to look more attractive. Then, you just need to drive a hair over 100,000 miles to break even, which isn't so outlandish for many Americans. But even at $5 per gallon, you'd need to drive the Volt more than 175,000 miles to justify its purchase over the Elantra. In fact, if you only plan on driving the Volt a little over 100,000 miles, its electric capability doesn't justify its price tag until gas nears $8 per gallon.

Take out the government subsidy and then you'll have to burn at least another 1500 gallons of gasoline at $5 per gallon to pay for that extra $7500. It is worse than that since you'll also have to pay battery charge costs.

Tom Whipple, writing about Peak Oil, provides some useful context to think about when comparing electric cars to gasoline cars.

The average U.S. personal vehicle (cars, trucks and SUVs) consumes about 700 gallons of fuel a year. At $4 a gallon this is now about $2800 a year to fuel the average passenger vehicle. Each dollar a gallon increase adds only $60 a month to the gasoline bill, an amount manageable by many given the “essential” of personal transport.

He's wrapping together older cars that travel fewer miles per year with newer cars that spend more time on the road. Plus he's combining SUVs and all sizes of cars together. People who are considering an electric car are much more likely to compare it to a Toyota Prius which gets about 50 mpg. That Prius will use only 240 gallons at 12000 miles per year. At $5 per gallon that's only $700 per year and that lowers the price bar EVs need to get down to in order to compete. Battery costs need to plummet or gasoline needs to hit $8+ per gallon.

The Nissan Leaf has an MSRP of $32,780 minus whatever tax rebates you might be eligible for. Since the Prius MSRP starts at $22,120 a competitive electric car lies some years in the future. That car won't be as flexible as the Prius. It'll have much shorter range and limits on where you can take it.

So how fast will oil prices go up and how fast will battery prices drop? Answer those two questions correctly and you can predict when EVs will make economic sense.

Share |      Randall Parker, 2011 May 10 09:50 PM  Energy Electric Cars


Comments
Michael B. said at May 10, 2011 10:46 PM:

This isn't surprising to me at all. Electric cars are probably a long ways off. I'm concerned that all of this money thrown at alternative energy and fuels is preventing other options from every being researched and used, like natural gas powered cars.

Mercy Vetsel said at May 11, 2011 4:36 AM:

Finally some hard numbers on costs! From the article itself we can now make a easy comparison and confirm that these BEV people are nuts if they think this plug-ins or swappables with 100 miles of range are an economical alternative.

I was starting to feel like Alice in Wonderland when listening to people like Shai talk about battery cars.

So let's compute...

If a Prius averages 45 miles per gallon, gasoline needs to be at $26/gallon to justify the low mileage plan and $17/gallon to justify the unlimited plan (at 20,000 miles per year).

Yep, ***$26*** per gallon. That would have been my headline. "Better Place to Offer Gasoline Alternative for $26/gallon."

Now that we have a "cell-phone model" customer offering, the gasoline comparison calculations are now easy:

From the article the low plan is $300/month or $3600 per year for 6,200 miles and the unlimited plan is $7200/year. Plus there is a starter fee of $2000.

Ignoring the starter fee, it's straight forward to figure out that the cost is $3600 / 6200 miles = $0.58 per mile. At 45 mpg that's equivalent to gasoline at 45 x $0.58 = $26.13/gallon.

But wait, the Shaister said that we're going to save "10 to 20%". That means gasoline needs to cost $29 and $33 per gallon.

Okay, so I'm comparing this to a Prius, but maybe the Shaister is using different assumptions. Let's work back from $9/gallon. Then a Better Place Mobile car on the low plan would save 10% versus a car getting.... ***14*** miles/gallon.

"Hmmm, gas is $9 gallon and I WAS going to by a Hummer H2 to tool around Tel Aviv, but thanks to Better Place, I have another option that saves me 20% on fuel!"

Or maybe he's assuming his customers drive more miles. If a cab driver is choosing between a 45 mpg Prius, the unlimited plan costs him $7,200 per year. In Israel, that would buy 7200/9 = 800 gallons of gasoline.

But 800 gallons will only take him 36,000 miles in a Prius, about 100 miles per day, seven days per week. A cab driver who works 250 days per year and drives 180 miles per day, would indeed save almost 20% on fuel.

So, there we have it. As long as you drive a taxi cab for a living or want to trade in your Hummer H2 for a battery car, Shai can save you up to 20% on fuel.

-Mercy


JoeKing said at May 11, 2011 10:35 AM:

This isn't surprising to me at all. Electric cars are probably a long ways off. I'm concerned that all of this money thrown at alternative energy and fuels is preventing other options from every being researched and used, like natural gas powered cars.

I agree. How much human energy is being squandered on these dead end technologies which after decades haven't shown any economic (non-subsidized) viability? The current favorites are forcing researchers to follow the money instead of investing in potentially economically self-sustaining technologies.

I don't agree that electric cars are a long way off...I'd say never. Viability @ $9/gallon doesn't reflect lifetime costs & just encourages the gov't to self-fulfill the $9 price with taxes.

Nick G said at May 11, 2011 2:55 PM:

Better Place calculates that the typical customers would stand to save 10% to 20% against a comparable gasoline car

When we remember that fuel costs are less than 1/3 of the total cost of ownership, a 10-20% margin begins to look like a huge cost reduction.

Wolf-Dog said at May 11, 2011 6:15 PM:

All these calculations above are made with the current cost of electric cars. But most of the cost of an electric car is due to the battery. The miracle is that during the last decade the cost of the batteries decline dramatically and the life cycle of these batteries increased dramatically. It is a safe bet that by 2020 the cost of these batteries will decline at lest 50 % and their range and durability will increase at least 50 % and probably 100 %. The electric car itself, without battery can be bought for $13,000 because it has very few components and a lot less moving parts than a gasoline car.

So by 2020, it is a safe bet that electric cars will become competitive with gasoline selling for $5 per gallon, without government subsidies. It is very possible that the electric cars will become competitive with gasoline selling for $3.

Wolf-Dog said at May 11, 2011 9:46 PM:

This article above is only about the classical lithium-ion batteries. It says nothing about other new technologies that are being researched like mad. Before 9/11, there was very little commercial interest in inventing revolutionary batteries, since only laptop computers and cell phones needed batteries. Also the latter article makes no mention of the new research in nanotechnology that will be applied to batteries. Separately, although the prices of the mentioned lithium-ion batteries is not declining, this is hiding the fact that the life cycle of these batteries is increasing dramatically. Previously the lithium-ion batteries could be charged a lot less often before losing their capacity to hold charge. The latter quality is part of the "price" of the lithium-ion battery, as the longevity of the battery is factored in the price of an electric car, since the cost of using the battery is combined with the cost of electricity to find the cost of operating the car.

Right now more money is allocated for battery research, and a lot more universities are joining the research. Certainly other kinds of batteries are being researched besides lithium-ion.

Wolf-Dog said at May 12, 2011 4:39 AM:

One problem with the pricing of the subscription "plans" for electric cars is that these are likely to be enforced by government backed monopolies. When it becomes illegal to use a gasoline car and if the only electric car network is the one supported by the government, then the citizens are are at the mercy of the provider of the the subscription "plans".

So let's temporarily ignore the business minded price manipulations by these uber-feudal capitalists masquerading as socialists, and let us calculate the cost of driving an electric vehicle only based on electricity. After the Stalinist monopoly sucks a lot of blood by means of these subscription "plans", many years later, there will ultimately be private competition, offering alternative batteries that can be charged outside the government backed monopoly's charging pods. So let's start by the cost of electricity and then let's discuss the prices of batteries.


It is calculated that Chevrolet Volt, in its pure electric mode (for the first 40 miles) will need 0.25 kWh of electricity per mile:

(http://www.physics.uci.edu/~silverma/voltmileage.html
EXCERPT:
" The Chevy Volt is quoted as using 25 kWh for 100 miles of city driving. This would be 10 kWh for 40 miles of electric only driving or 4 miles per kWh. The Chevy Volt’s range on purely battery electricity is quoted as 40 miles, and its charging capacity is 8 kWh, which would be 5 miles per kWh. There is already a discrepancy, unless the difference is due to a mix of city and highway driving. I will use the 4 miles per kWh for city driving, which is the same as 0.25 kWh per mile. ")

Assuming that a mid-size electric sedan would need 0.30 kWh of electricity per mile instead of 0.25 kWh per mile, and assuming that in California the cost of electricity is $0.12 per kWh of electricity, the cost of electricity for driving such a mid-size electric sedan would be ($0.12) x (0.3) = $0.036 per mile, or $3.6 per 100 miles. At the current prices of gasoline this means that the equivalent gas mileage of an electric car in terms of the cost of electricity would be close to 100 miles per gallon. But let us assume that the price of electricity will go higher when we start using more expensive nuclear plants all over the United States, let us assume that the price of electricity will be $0.20 per kWh, and so the higher estimate for the cost of driving an electric car will be ($0.2) X 0.3 = $0.6 per mile, or 60 miles per gallon at current prices of gasoline.

Thus the electricity cost of driving such a mid-size electric car for 10,000 miles per year would be between $360 and $600.

But the problem is that the cost of owning the battery must be added to the cost of electricity: The pure electric car without battery can be purchased for only $13,000 because it is much simpler to manufacture due to the much smaller number of components and/or moving parts. The problem is the battery, which can range from $10,000 to $20,000, depending on the type of battery. The reason the price of the battery must be considered separate from the cost of the car (without battery) is because the longevity of the battery is much less than the longevity of the pure electric car: A pure electric car can survive for at least 30 or even 50 years with minimal repairs, while the current lithium-ion batteries are designed to last about 10 years, because these can be charged 2,000 times before they lose 80 % of their charging capacity.(http://peswiki.com/index.php/PowerPedia:Lithium_Ion_Batteries). This estimate of at least 2,000 charges is based on the latest generation batteries from A123, and it's worth noting that the older generation lithium ion batteries could be charged only about 500 times before degradation.

Now if we divide the price of the battery by the number of years of the battery, we get the cost of owning the battery (to be combined with the cost of electricity to use the car):

http://www.greentechmedia.com/articles/read/nissan-prices-the-leaf-32780-but-will-they-make-money/

For a $10,000 battery (which currently has a range of 100 miles), the annual cost of owning and using this battery is: $10,000 / 10 = $1,000.

For the higher estimate ($20,000) for the cost of such a battery, the annual cost of owning and using this battery is: $20,000 / 10 = $2,000.


Now if we add this annual cost of owning the battery to the cost of pure electricity to drive the electric car, we get:

$360 + $1,000 = $1,360 as the lower estimate (assuming the cost of electricity is $0.12 per kWh and the battery costs $10,000).
$600 + $2,000 = $2,600 as the higher estimate (assuming the cost of electricity is $0.20 per kWh and the battery costs $20,000).

But if we assume that a very efficient gasoline car has a mileage of 40 miles per gallon (small turbocharged 1.2 liter engine with the latest enhancements), the annual cost of driving such a vehicle for 10,000 miles with gas selling at $3.6 per gallon, would be only $3.6 X ( 10,000 / 40 ) = $900.

Thus the cost of using an electric car at the current prices seems to be higher than the corresponding gasoline car, but if the price of oil reaches $9 per gallon in the United States, then the cost of driving the gasoline car 10,000 miles per year would be $9 x (10,000 / 40 ) = $2,250. At that price of gasoline, even the current estimates for driving an electric car seem to be competitive.

Note that the older lithium ion batteries that can be charged only 500 times, would have a much lower longevity. The improvements in the longevity of the A123 batteries made a big difference here.

But the founder of the A123 Systems, has just created a new company called M24, which he expects will vastly reduce the prices of lithium ion batteries by 85 %. He says that it will take 5 years to develop this new idea, but we still have time until 2020:

http://www.greenoptimistic.com/2010/08/16/24m-battery/

So it would appear that the subscription plans for the electric cars in Europe might be based on government enforced feudal monopolies, but in the end this will be circumvented by the free markets in the long run.

Wolf-Dog said at May 12, 2011 4:43 AM:

One problem with the pricing of the subscription "plans" for electric cars is that these are likely to be enforced by government backed monopolies. When it becomes illegal to use a gasoline car and if the only electric car network is the one supported by the government, then the citizens are are at the mercy of the provider of the the subscription "plans".

So let's temporarily ignore the business minded price manipulations by these uber-feudal capitalists masquerading as socialists, and let us calculate the cost of driving an electric vehicle only based on electricity. After the Stalinist monopoly sucks a lot of blood by means of these subscription "plans", many years later, there will ultimately be private competition, offering alternative batteries that can be charged outside the government backed monopoly's charging pods. So let's start by the cost of electricity and then let's discuss the prices of batteries.


It is calculated that Chevrolet Volt, in its pure electric mode (for the first 40 miles) will need 0.25 kWh of electricity per mile:

" The Chevy Volt is quoted as using 25 kWh for 100 miles of city driving. This would be 10 kWh for 40 miles of electric only driving or 4 miles per kWh. The Chevy Volt’s range on purely battery electricity is quoted as 40 miles, and its charging capacity is 8 kWh, which would be 5 miles per kWh. There is already a discrepancy, unless the difference is due to a mix of city and highway driving. I will use the 4 miles per kWh for city driving, which is the same as 0.25 kWh per mile. ")

Assuming that a mid-size electric sedan would need 0.30 kWh of electricity per mile instead of 0.25 kWh per mile, and assuming that in California the cost of electricity is $0.12 per kWh of electricity, the cost of electricity for driving such a mid-size electric sedan would be ($0.12) x (0.3) = $0.036 per mile, or $3.6 per 100 miles. At the current prices of gasoline this means that the equivalent gas mileage of an electric car in terms of the cost of electricity would be close to 100 miles per gallon. But let us assume that the price of electricity will go higher when we start using more expensive nuclear plants all over the United States, let us assume that the price of electricity will be $0.20 per kWh, and so the higher estimate for the cost of driving an electric car will be ($0.2) X 0.3 = $0.6 per mile, or 60 miles per gallon at current prices of gasoline.

Thus the electricity cost of driving such a mid-size electric car for 10,000 miles per year would be between $360 and $600.

But the problem is that the cost of owning the battery must be added to the cost of electricity: The pure electric car without battery can be purchased for only $13,000 because it is much simpler to manufacture due to the much smaller number of components and/or moving parts. The problem is the battery, which can range from $10,000 to $20,000, depending on the type of battery. The reason the price of the battery must be considered separate from the cost of the car (without battery) is because the longevity of the battery is much less than the longevity of the pure electric car: A pure electric car can survive for at least 30 or even 50 years with minimal repairs, while the current lithium-ion batteries are designed to last about 10 years, because these can be charged 2,000 times before they lose 80 % of their charging capacity.(http://peswiki.com/index.php/PowerPedia:Lithium_Ion_Batteries). This estimate of at least 2,000 charges is based on the latest generation batteries from A123, and it's worth noting that the older generation lithium ion batteries could be charged only about 500 times before degradation.

Now if we divide the price of the battery by the number of years of the battery, we get the cost of owning the battery (to be combined with the cost of electricity to use the car):


For a $10,000 battery (which currently has a range of 100 miles), the annual cost of owning and using this battery is: $10,000 / 10 = $1,000.

For the higher estimate ($20,000) for the cost of such a battery, the annual cost of owning and using this battery is: $20,000 / 10 = $2,000.


Now if we add this annual cost of owning the battery to the cost of pure electricity to drive the electric car, we get:

$360 + $1,000 = $1,360 as the lower estimate (assuming the cost of electricity is $0.12 per kWh and the battery costs $10,000).
$600 + $2,000 = $2,600 as the higher estimate (assuming the cost of electricity is $0.20 per kWh and the battery costs $20,000).

But if we assume that a very efficient gasoline car has a mileage of 40 miles per gallon (small turbocharged 1.2 liter engine with the latest enhancements), the annual cost of driving such a vehicle for 10,000 miles with gas selling at $3.6 per gallon, would be only $3.6 X ( 10,000 / 40 ) = $900.

Thus the cost of using an electric car at the current prices seems to be higher than the corresponding gasoline car, but if the price of oil reaches $9 per gallon in the United States, then the cost of driving the gasoline car 10,000 miles per year would be $9 x (10,000 / 40 ) = $2,250. At that price of gasoline, even the current estimates for driving an electric car seem to be competitive.

Note that the older lithium ion batteries that can be charged only 500 times, would have a much lower longevity. The improvements in the longevity of the A123 batteries made a big difference here.

But the founder of the A123 Systems, has just created a new company called M24, which he expects will vastly reduce the prices of lithium ion batteries by 85 %. He says that it will take 5 years to develop this new idea, but we still have time until 2020:

http://www.greenoptimistic.com/2010/08/16/24m-battery/

Wolf-Dog said at May 12, 2011 2:47 PM:


Let me add that a hidden (but obvious) benefit of adopting pure electric cars is to eliminate the imported oil component of the trade deficit (assuming that the batteries will be made in the United States). This can save the US economy, and separately it can also solve the political problems in some parts of the world.

Michael B. said at May 12, 2011 4:08 PM:

The cost of the electricity to power electrical cars is very, very low compared to gas powered cars, but it's true that it's a cost that most people often forget. I still would like to know about the prospects of natural gas powered cars or maybe even natural gas and gas hybrids (not electrical hybrids) as something to hold people over until electrical cars become more economically feasible.

Wolf-Dog said at May 12, 2011 7:15 PM:

Natural gas is so abundant in the US that if it is adopted it can fuel all vehicles for several decades before we run out, giving us plenty of time until electric batteries are made cheaper and more powerful. Already the buses in Los Angeles run on natural gas.

It's a matter of politics, because if we switch vehicles from oil to natural gas or electricity, various oil-related jobs will be lost in the short run, and the oil lobbies would use their leverage to slow down any deviation from the current oil based economy. This is the other reality.

Otherwise if it is legislated that all trucks, buses, and trains will be converted to natural gas, this would reduce the imported oil component of the trade deficit by at least 50 %. It is easier to convert trucks, buses and trains to natural gas because in this case it will be faster to establish "gas" (natural!) stations for these vehicles.

And it is also possible to convert natural gas to liquid fuels such as diesel, but once again the problem is the politics of those who are worried of their own livelihoods from the oil industry.

This is one situation where traditional capitalism, due to its short sighted nature, failed to fulfill its promise, and some government leadership is needed to legislate and plan the national standardization of various new industries such as natural gas based vehicles and electric cars. In China the decision has already been made to adopt electric cars.

Michael B. said at May 12, 2011 10:28 PM:

Wolf-Dog, natural gas cars haven't not been appearing because capitalism has failed. They haven't appeared because of government. All of these subsidies and other policies that prop up renewable energies like ethanol and battery powered cars is the reason.

Engineer-Poet said at May 13, 2011 5:46 PM:

The Time article doesn't appear to count non-fuel expenses like vehicle taxes.  The Atlantic article doesn't take into account the falling dollar; buying a Leaf or Volt with dollars today may look really smart compared to trying to buy gasoline with them a few years from now.  There's also depreciation to consider; these new models are likely to hold their value really well.

Remember the recent downgrade of estimates of world-wide coal reserves?  It looks like we're about to see the same for shale gas.  From the press release:

San Francisco, CA (May 12) A detailed new energy report argues that the natural gas industry has propagated dangerously false claims about natural gas production supply, cost and environmental impact. The report, “Will Natural Gas Fuel America in the 21st Century” is authored by leading geoscientist and Post Carbon Institute Fellow J. David Hughes.

The most significant of the natural gas industry’s claims – one that has been bought hook, line and sinker by everyone from the Energy Information Agency (EIA) and the Obama Administration, to leading environmental groups – is that the United States has a 100-year supply of cheap natural gas. The report shows this to be a pipe dream. Natural gas would require higher costs and unprecedented drilling efforts to meet even baseline supply projections. In fact, the U.S. faces a decline in domestic gas supplies in the very near future unless drilling rates quickly increase.
NG vehicles look good at $4/mmBTU, but mandated NG use is probably a bigger mistake than mandated ethanol use (which is a Charlie Foxtrot itself).

Electric vehicles are expensive today for two major reasons:

  1. Traction batteries are still low-volume items and cost a large multiple of the materials cost.  The cost will fall with cumulative industry experience.
  2. The manufacturers are charging premium prices to get maximum profit from the early adopters.  GM's estimated price for the Volt increased about $8000 between the first announcement and the final sticker determination; they had a figure for what consumers would pay, and when Congress added a $7500 subsidy GM acted to grab it.  This won't last either.
The upshot is that EVs are going to come down in price while petroleum generally goes up.  This will be compounded by exchange-rate shifts; nations which bring their oil use down will see oil remain relatively more affordable.  This rewards the contrarian, and buyers in the USA going against the truck culture are definitely contrarians.  I hope to be one of them.

Wolf-Dog said at May 14, 2011 8:47 AM:

Engineer-Poet:

Why did you say that " mandated NG use is probably a bigger mistake than mandated ethanol use (which is a Charlie Foxtrot itself). "?

It seems that buses, trucks and trains are very easy to convert to NG. Already the buses in Los Angeles run on NG. NG does not hinder food production like ethanol production is currently doing, although ethanol and methanol will ultimately be produced from more dedicated biomass like harvested wood, etc.

If the government legislates to convert all trucks, buses and trains to NG, this will cut in half the imported oil component of the trade deficit. This would be a very economical stop-gap measure until electric car batteries are ready.

Bruce said at May 14, 2011 1:48 PM:

"leading geoscientist and Post Carbon Institute Fellow"

David Hughes supposedly: "he coordinated the recent publication of a comprehensive assessment of Canada’s unconventional natural gas potential."

Does Canada need to worry about gas? Nope. And Neither does the USA.

" shale formation in the northeastern corner of British Columbia contains twice as much natural gas as previously thought, says a study released Friday.

The National Energy Board and B.C.'s Ministry of Energy and Mines estimate that the Horn River Basin contains 78 trillion cubic feet of natural gas that can be brought to market.

"This report should provide residents of our province with a sense of optimism about the future," B.C. Energy and Mines Minister Rich Coleman said in a statement.

"B.C. is recognized for its significant shale gas reservoirs as well as for having world-class regulations," Coleman said.

To put the study's numbers into perspective, the National Energy Board estimates the entire Western Canadian Sedimentary Basin contains 197 trillion cubic feet of natural gas. However, that does not account of unconventional gas resources that have not yet been assessed."

http://www.winnipegfreepress.com/business/breakingnews/121405289.html


The trouble with EProctologist and the anti-shale crowd, is that every few months an assessment comes out doubling the amount of NG because the technology is progressing faster than the pessimists can spew out biased reports.

"CONSOL Energy Inc. (NYSE: CNX), the leading diversified fuel producer in the Eastern U.S., has proved gas reserves of 3.7 trillion cubic feet (Tcf) as of December 31, 2010. This is an increase of 1.8 Tcf, or 95%, from the 1.9 Tcf reported at year-end 2009. The proved developed reserves (PDP) increased by 86% and the proved undeveloped reserves (PUD) increased 107%."

http://phx.corporate-ir.net/phoenix.zhtml?c=66439&p=irol-newsArticle&ID=1526229&highlight=

etc etc

Michael B. said at May 14, 2011 5:58 PM:

This kind of thinking is the reason the energy markets are so f***ed up right now. The government shouldn't be interfering in the energy markets at all. That would tremendously improve the allocation of resources in terms of where money is invested in research and what not. It would also remove all of the damaging distortion their interference has been causing. The free market would handle the problem a lot better than government ever would.

Randall Parker said at May 14, 2011 7:02 PM:

E-P,

Yes, I bet GM figured out what the markets will bear and then when the $7500 tax credit came along they increased the price accordingly. So no tax credit should translate into a $33k Volt. How fast will batteries and other component costs drop?

I find it interesting that on gasoline power the Prius is much more efficient. Is the weight of Volt to blame?

Engineer-Poet said at May 15, 2011 10:59 AM:
Why did you say that " mandated NG use is probably a bigger mistake than mandated ethanol use (which is a Charlie Foxtrot itself). "?
Let's take California as an example.  California's NG pipeline network has been faced with demand in excess of capacity during heat waves before.  Now add mandated use of e.g. LNG in heavy trucks, which also adds the power for the liquefaction systems.  The pipelines now run into limits at lower levels of demand all around, and price spikes affect other users.  Being able to switch fuels to what's cheaper or more available would ameliorate that, but if a particular fuel is mandated....

This is the same problem we've got with ethanol.  Corn prices are sky-high due to the mandate, cascading into milk, meat and eggs.  The last time this happened, we got a really screwed-up system of agricultural subsidies.  Our "leaders" are not likely to incorporate these lessons, so it's best to head the problem off by not specifying a particular fuel.

How fast will batteries and other component costs drop?
The balance of powertrain is already much cheaper.  GCC reports on a projection around $200/kWh at OEM prices.
I find it interesting that on gasoline power the Prius is much more efficient. Is the weight of Volt to blame?
No idea, but the aerodynamics are not as good and the engine doesn't even use the Atkinson cycle.  A turbo Scuderi would make a large difference in the Volt.

Bruce said at May 16, 2011 11:44 AM:

"California's NG pipeline network has been faced with demand in excess of capacity during heat waves before."

Actually I thought California needs gas in the winter and stores gas in the summer to use in the winter. I guess they squandered the money need to upgrade capacity on wind turbines. Idiots.

However ... yes new pipline capacity will be needed anywhere shale gas is found. And the steel needed and jobs gained will be local instead of spending money on gas imports from Qatar and wind turbines from China.


Nick G said at May 16, 2011 2:55 PM:

Randall,

The Volt was not optimized for fuel efficiency. As EP notes, the engine is very conventional - it was chosen for convenient availability and unit pricing, not efficiency.

On the one hand, only about 20% of miles will be powered by fuel, so it's not really the place to place the bulk of one's optimization efforts.

On the other, the Volt was developed in only 29 months - later generations will benefit from much more engineering/design optimization.

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