[Senate Hearing 110-671]
[From the U.S. Government Publishing Office]
S. Hrg. 110-671
VEHICLES POWERED BY THE ELECTRIC GRID
=======================================================================
HEARING
before the
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
TO
RECEIVE TESTIMONY REGARDING THE CURRENT STATE OF VEHICLES POWERED BY
THE ELECTRIC GRID AND THE PROSPECTS FOR WIDER DEPLOYMENT IN THE NEAR
FUTURE
__________
SEPTEMBER 16, 2008
Printed for the use of the
Committee on Energy and Natural Resources
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COMMITTEE ON ENERGY AND NATURAL RESOURCES
JEFF BINGAMAN, New Mexico, Chairman
DANIEL K. AKAKA, Hawaii PETE V. DOMENICI, New Mexico
BYRON L. DORGAN, North Dakota LARRY E. CRAIG, Idaho
RON WYDEN, Oregon LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota RICHARD BURR, North Carolina
MARY L. LANDRIEU, Louisiana JIM DeMINT, South Carolina
MARIA CANTWELL, Washington BOB CORKER, Tennessee
KEN SALAZAR, Colorado JOHN BARRASSO, Wyoming
ROBERT MENENDEZ, New Jersey JEFF SESSIONS, Alabama
BLANCHE L. LINCOLN, Arkansas GORDON H. SMITH, Oregon
BERNARD SANDERS, Vermont JIM BUNNING, Kentucky
JON TESTER, Montana MEL MARTINEZ, Florida
Robert M. Simon, Staff Director
Sam E. Fowler, Chief Counsel
Frank Macchiarola, Republican Staff Director
Karen K. Billups, Republican Chief Counsel
C O N T E N T S
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STATEMENTS
Page
Balkman, Thad, General Counsel and Vice President, External
Relations, Phoenix Motorcars, Ontario, CA...................... 27
Bingaman, Hon. Jeff, U.S. Senator From New Mexico................ 1
Dalum, Joseph T., Vice President, DUECO, Waukesha, WI............ 18
Domenici, Hon. Pete V., U.S. Senator From New Mexico............. 2
Kjaer, Edward, Director, of Electric Transportation, Southern
California Edison Company, Rosemead, CA........................ 9
Wimmer, Robert, National Manager, Toyota Motor North America..... 14
Wynne, Brian P., President, Electric Drive Transportation
Association.................................................... 4
APPENDIX
Responses to additional questions................................ 51
VEHICLES POWERED BY THE ELECTRIC GRID
----------
TUESDAY, SEPTEMBER 16, 2008
U.S. Senate,
Committee on Energy and Natural Resources,
Washington, DC.
The committee met, pursuant to notice, at 10 a.m., in room
SD-366, Dirksen Senate Office Building, Hon. Jeff Bingaman,
chairman, presiding.
OPENING STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR FROM NEW
MEXICO
The Chairman. OK, why don't we get started here.
This hearing is to hear testimony on the current state of
the electric vehicles and their prospects for widespread use in
the United States. It is hard to find an article in a newspaper
lately about the automobile industry that does not mention
hybrids, plug-in hybrids, or the future of the industry. So we
thought it was a good time to talk about how close this
electric car future actually is, and also a good time to talk
about the issues, since people are understandably focused on
the high price of gasoline and wondering when they are going to
have real alternatives to that.
So the case for seriously reducing our reliance on foreign
oil is exceptionally strong. We make that case ourselves here
on a daily basis. We consume roughly a quarter of the world's
oil production, and obviously this is a serious economic
problem for our country in the long term.
Let me indicate that electrification of the transportation
sector I think is held out as one of the great hopes for
dealing with several of our problems. Obviously, there is a
benefit to consumers as they would pay costs estimated to be
less than a quarter of what they now pay in order to get
around. You add to this the benefits to the country, both with
regard to the balance of trade and national security and
reducing our need to import such large amounts of expensive oil
and allowing instead the use of abundant domestic electricity,
I think there clearly are great benefits there.
Let me also indicate that we have examples of the
technology that is going to be talked about here outside the
northwest corner of the Russell Building that some of our
witnesses have arranged for us, and these will be displayed for
a time following the hearing. There is, as I understand it, a
two-wheeled electric vehicle from Vectrix. If I misstate this,
correct me. There is a four-wheeled, low-speed electric vehicle
from Chrysler's GEM brand, which is also there. There is a
plug-in hybrid electric Prius from Toyota, and there is a plug-
in work truck from DUECO, and we appreciate you making those
available for us to look at. I'm hoping if we can complete the
hearing at a good hour, we will have time to go see those
before the noontime.
So let me defer to Senator Domenici for any comments he
wants to make, and then I will introduce our witnesses.
STATEMENT OF HON. PETE V. DOMENICI, U.S. SENATOR FROM NEW
MEXICO
Senator Domenici. Thank you very much, Mr. Chairman. I
apologize to the witnesses for not joining you down there to
shake their hands and thank them for coming. As you know,
Senator Bingaman has a few years of youth over me, and he can
walk around and greet people while I sit down. That is a pretty
good working relationship.
In any event, let me suggest that today the American people
are more focused on energy policy than at any other point in
the 36 years that I have been a United States Senator and with
good reason. Over the past year, gasoline prices have reached
unprecedented levels. The transportation sector is the largest
user of petroleum in the United States--we all know that--
totaling 70 percent of all consumption. Moreover, the
transportation sector accounts for about one-third of the
greenhouse gas emissions in this country.
Sometimes we do not agree on much around here, but one
thing we all agree on is that we must reduce our reliance on
imported oil. It seems quite obvious that what follows after
that is we must find some way to use less crude oil to get
around and less crude oil for the daily transportation needs of
the United States people.
It is no secret that I am a strong advocate of increasing
domestic production through offshore drilling, and I am also a
strong supporter of more investment in advanced technologies.
More conservation of our resources will be needed if we are to
meet our long-term energy challenges. I have been part of
enacting legislation over the past few years that helps achieve
both of these goals, and I have introduced legislation this
year to do even more.
Last year we took action by increasing the fuel efficiency
standards by 40 percent for the first time in 32 years,
establishing a 36 billion gallon renewable fuels standard and
dramatically increasing funding for clean energy technologies.
While Congress has made considerable progress in advancing
policies that will strengthen our Nation's energy security, we
must go further to address our Nation's energy challenges.
Over the past several months, I have talked a lot about a
bridge of increased domestic production that is needed to
sustain the country until we have developed new technologies.
On the far side of that bridge lies an age when clean energy
technologies like plug-in hybrid electric vehicles are
available and deployable on a wide scale across the country. We
must continue to take greater steps toward implementing
policies that speed our path across this bridge.
The Gasoline Price Reduction Act, which I introduced along
with Senator McConnell and 42 Republicans, authorized $500
million over the next 5 years to develop a better battery
technology.
In response to high gas prices, Americans have curtailed
their behavior by driving less. This has been rather amazing.
They are also trading in their gas-guzzlers for more efficient
cars. The marketplace is speaking.
Today, as we will hear from our witnesses, nearly every
major manufacturer is in production or development of some kind
of hybrid electric technology. According to the Electric Drive
Transportation Association, increasing the number of electric
and hybrid vehicles into our fleet could reduce our petroleum
fuel consumption significantly. I believe you all think that is
true.
Plug-in vehicles, with their potential to reduce our
Nation's consumption of oil and our greenhouse gas emissions,
have generated a great deal of excitement. However, technology
hurdles from battery manufacturing to grid infrastructure
improvements remain. I am hopeful that this new technology will
benefit from the loan guarantee programs that we set up in the
Energy Policy Act of 2005.
In addition, through the appropriation process, we are
working with other colleagues to provide short-term assistance
such as loans to help auto manufacturers retool and adjust to
the new mandates and the marketplace.
I thank the witnesses, each one of you, for appearing
today. This is a gloomy day not only because of the clouds, but
obviously because of what is going on on Wall Street. You
probably would much prefer to be elsewhere, but we will have
some good testimony today.
Who knows when we will make that breakthrough that is
generally needed for the United States in terms of our
excessive use of petroleum products.
Thank you very much, Mr. Chairman. I am pleased to be with
you this morning.
The Chairman. Thank you.
Let me introduce our witnesses and then call on them each
to make their statement.
Brian Wynne is the President of the Electric Drive
Transportation Association. Thank you for being here.
Edward Kjaer--is that the correct pronunciation? Kjaer is
the Director of Electric Transportation with Southern
California Edison. Thank you for coming.
Robert Wimmer--is that correct?
Mr. Wimmer. Wimmer.
The Chairman. Wimmer, the National Manager, Technical and
Regulatory Affairs, in the Energy and Environmental Research
for Toyota Motor North America. Thank you for coming.
Joseph Dalum----
Mr. Dalum. Dalum.
The Chairman. Dalum, Vice President of DUECO in Waukesha--
--
Mr. Dalum. Waukesha.
The Chairman. Waukesha, Wisconsin.
Thad Balkman, who is General Counsel and VP for External
Relations with Phoenix Motorcars in Ontario, California. Thank
you for being here.
If each of you could take about 5 or 6 minutes and give us
the main points that you believe we need to understand about
this issue, we would appreciate that. We will include your full
statement in the record as if it were read, but we would
appreciate you summarizing it if you could.
Mr. Wynne, go right ahead.
[The prepared statement of Senator Domenici follows:]
Prepared Statement of Hon. Pete V. Domenici, U.S. Senator From New
Mexico
Good morning. Thank you all for being here. Thank you also to
Chairman Bingaman for convening this oversight hearing on plug-in
electric vehicles--technology with tremendous potential.
Today, the American people are more focused on energy policy than
at any other point in my 36 years as a United States Senator. And with
good reason. Over the past year, gasoline prices have reached
unprecedented levels. The transportation sector is the largest user of
petroleum in the United States, totaling 70% of all consumption.
Moreover, the transportation sector accounts for about \1/3\ of the
greenhouse gas emissions in the country. Sometimes we don't agree on
much around here. One thing we all agree on, however, is that we must
reduce our reliance on imported oil.
It is no secret that I am a strong advocate for increasing domestic
production through offshore drilling. And I am also a strong supporter
of more investment in advanced technologies and more conservation of
our resources will be needed if we are to meet our long term energy
challenges. I have enacted legislation over the past few years that
helps achieve both of these goals. And I have introduced legislation
this year to do even more.
Last year, we took action by increasing the fuel efficiency
standard by 40% for the first time in 32 years; establishing a 36
billion gallon renewable fuel standard; and dramatically increasing
funding for clean energy technologies. While Congress has made
considerable progress in advancing policies that will strengthen our
nation's energy security, we must go further to address our nation's
energy challenges.
Over the past several months, I've talked a lot about a bridge of
increased domestic production that is needed to sustain the country
until we have developed new technologies. On the far side of the bridge
lies an age when clean energy technologies like plug-in hybrid electric
vehicles are available and deployable on a wide scale basis across the
country. We must continue to take greater steps toward implementing
policies that speed our path across that bridge. The Gas Price
Reduction Act, which I introduced along with Senator McConnell and 42
other Republicans, authorizes $500 million over the next five years to
develop better battery technology.
In response to high gas prices, Americans have curtailed their
behavior by driving less. They're also trading in their gas guzzlers
for more fuel efficient cars. The marketplace has certainly spoken.
Today, as we'll hear from our witnesses, nearly every major
manufacturer is in production or development of some kind of hybrid
electric technology. According to the Electric Drive Transportation
Association, increasing the number of electric and hybrid vehicles into
our fleet could reduce our petroleum fuel consumption significantly.
Plug-in electric vehicles, with their potential to reduce our
nation's consumption of oil and our greenhouse gas emissions, have
generated a great deal of excitement. However, technological hurdles--
from battery manufacturing to grid infrastructure improvements--remain.
I am hopeful that this new technology will benefit from the loan
guarantee program that was set up in the Energy Policy Act of 2005. In
addition, through the Appropriations process I am working with my
colleagues to provide short-term assistance such as loans to help auto
manufacturers re-tool and adjust to the new mandates and marketplace.
I thank the witnesses for appearing before us today. I look forward
to your testimony on the state of today's technology and what we can
strive for in the near-term.
STATEMENT OF BRIAN P. WYNNE, PRESIDENT, ELECTRIC DRIVE
TRANSPORTATION ASSOCIATION
Mr. Wynne. Thank you, Mr. Chairman, Ranking Member
Domenici, members of the committee. My name is Brian Wynne. I
am President of the Electric Drive Transportation Association,
which is located here in Washington. I am very pleased to be
here today to talk with you about our industry's
accomplishments, plans, and vision for electric drive
transportation.
The electrification of the transportation sector brings
together a range of interests and industries. At the Electric
Drive Transportation Association, we represent auto
manufacturers, battery and other technology developers,
utilities, energy companies, and others. I am pleased to say
that all of the witnesses this morning are members of my
organization.
I am also pleased to report that we are on track to build
new technologies and markets at a rapid pace. But building a
new transportation sector will require industry and Government
to work together and it will not happen overnight.
Grid-connected vehicle technology is moving forward very
quickly. There are plug-in vehicle options available today,
including the ones that the chairman referenced that are
outside the Russell Building, and a significant number are
coming, which I am going to list. They are coming to market in
the next 3 years.
Major manufacturers have established ambitious vehicle time
tables. Battery manufacturers are looking to scale up
production, and electricity providers are making changes in
order to integrate vehicles into their customer base.
I will give a brief summary of what you can expect in the
next few years, but first let me explain a bit about electric
drive.
In electric drive vehicles, electricity provides either all
or part of the motive power for a vehicle. Electric drive
vehicles are not just cars. They can be large trucks and
neighborhood electric vehicles and everything in between. They
get power from the grid or recharge on board. While there is
enormous diversity in the technology, all the vehicles share a
common benefit: they displace oil with electricity.
Vehicles that run on electricity from the grid, our focus
here today, can be battery electric or plug-in hybrid vehicles.
Battery electric vehicles operate entirely on their electric
drive motor and have various range and speed capabilities. For
instance, thousands of low-speed battery electric vehicles are
in use today, like the Global Electric Motorcars neighborhood
electric vehicle, and they provide a petroleum-free option for
urban commuters across the country. Electric motorcycles, such
as the Vectrix, are changing the two-wheeled fleet.
Also available is the Tesla Roadster, which goes 0 to 60 in
just 4 seconds and travels 220 miles on a charge. Next year
Phoenix, Suburu, and ZENN are planning to begin production of
full-speed battery electric vehicles. The field will expand
considerably in 2010. Toyota plans a Prius plug-in hybrid for
the model 2010 year. Ford will put its plug-in hybrid Escape
into production in the same year. Daimler has announced plans
for production of a battery electric Mercedes-Benz and smart
car. Tesla will begin producing their four-door family sedan.
Nissan is rolling out a battery electric vehicle for fleet use
with mass market introduction expected in 2012. Also in 2010,
GM will begin production of the Saturn Vue plug-in hybrid and
the battery electric Chevy Volt.
The Volt is different than a plug-in hybrid because the car
will be propelled solely by the battery. It will have an
internal combustion engine that only functions as a range
extender by providing backup power to the battery. So that
gives you a sense of some of the flexibility of the technology.
The 2010 production model of the Volt is being unveiled in
Detroit this morning actually. It is a passenger vehicle with a
range of about 40 miles on a single charge and that would cover
the average commute for most Americans. GM is expecting that
production will reach 60,000 units a year in 2012.
Hyundai is expecting a hybrid production over the next 4
years and is planning to commercialize plug-in hybrids sometime
after 2013.
We are excited about the expanding availability of plug-in
electric drive options, but how quickly they can reach
commercial scale depends on a number of factors.
First, there are technology challenges that manufacturers
and issue suppliers must address. The most obvious is
performance and supply of new battery technologies. Some of the
emerging plug-ins and the next generation of electric vehicles
will use lithium-ion batteries. We need to ensure that they are
as safe, durable, and affordable as the vehicle market demands.
We should also work to make sure that they are manufactured
here in the United States.
The shift to electric drive technology also requires
significant investment in manufacturing infrastructure. Large
scale production of electric drive vehicles and components in
the United States will require new materials, new processes,
and new production facilities.
In the utility and energy industries, grid-connected
transportation will also require changes in electricity
infrastructure and business models.
Changing transportation is a major undertaking. The right
Federal policies can help us achieve it sooner. EDTA supports
policy initiatives in three broad areas.
First, we support market initiatives to help industries and
consumers invest in electric drive.
Second, we need reliable R&D support to advance the
technology.
Finally, Federal policy can expand deployment in public and
private fleets.
I have details on each of these three areas, which I would
be more than happy to provide during the question and answer or
for the record.
This is just a sampling of the work that the electric drive
industry is doing to bring grid-connected vehicles to
production, grow them to commercial scale, and prepare the grid
for a plug-in vehicle future. Working together with
policymakers we can make it happen even sooner and realize the
economic, security, and environmental benefits of displacing
oil with electricity.
Thank you very much for your attention this morning.
[The prepared statement of Mr. Wynne follows:]
Prepared Statement of Brian P. Wynne, President, Electric Drive
Transportation Association
Mr. Chairman, Ranking Member Domenici, members of the Committee. My
name is Brian Wynne, I am president of the Electric Drive
Transportation Association and I am very pleased to be here today to
share with the Committee our industry's accomplishments, plans and
vision for electric drive transportation.
The electrification of the transportation sector brings together a
range of industries and interests. At the Electric Drive Transportation
Association, we represent auto manufacturers, battery and other
technology developers, utilities and energy companies and universities.
All of these companies and organizations are committed to realizing the
economic, security, and environmental benefits of displacing oil with
electricity.
The reasons we need to pursue this course are painfully clear. Gas
prices reached record highs this year, at one point reaching almost
$140 a barrel. While they were headed down recently, we know that OPEC
or Ike can change that any day.
More than the price of oil, the COST of oil to our security is
enormous. Close to 60% of the petroleum we use is imported. If we
switched over the U.S. light duty fleet--cars and SUVs--to electric
drive vehicles--a combination of plug-in and standard hybrids, battery
electric and fuel cell vehicles, we would cut liquid fuel consumption
by 83%.
Environmentally, electrification of transportation makes sense as
well. The transportation sector accounts for about a third of the
greenhouse gas emissions in the U.S. and about 80% of urban air
pollution.
A recent study conducted by the Electric Power Research Institute
with the National Resources Defense Council found that plug-in electric
drive vehicles running on electricity from today's power grid would
produce \1/3\ less greenhouse gas emissions than vehicles running on
traditional combustion engines.
Understanding the potential of plug-in electric drive, we are here
to discuss the current state of the industry and how to get these
vehicles on the road in substantial numbers.
Grid-connected vehicle technology is moving forward at a rapid
pace. There are plug-in vehicle options available today, including the
ones that are outside, and a significant number coming to market in the
next three years.
Major manufacturers have established ambitious vehicle timelines;
battery manufacturers are looking to scale up production and
electricity providers are making changes and plans for integrating
vehicles into their customer base.
I am going to mention some specific vehicles (it is not a complete
list) that you will be seeing on the road in the next couple of years.
Along the way I would like to clarify what the differences are in these
emerging technologies and why it's important to keep that diversity in
mind when you are building policies to help accelerate their adoption.
As an introduction to the technology, let me explain that in
``electric drive'' vehicles, electricity provides either all, or part,
of the motive power that propels the vehicle. Electric drive vehicles
are not just cars; they can be trucks, forklifts, scooters, buses,
neighborhood electric vehicles and even trains. They can get power from
the grid, or recharge on board.
While there is enormous diversity in the technology, all the
vehicles share a common benefit--they displace oil with electricity.
There is tremendous flexibility in electric drive and, as this
panel indicates, different technology and market paths are emerging.
The focus here today is on vehicles that run on electricity from the
grid. These vehicles can be battery electric or plug-in hybrid
vehicles.
Battery electric vehicles operate entirely on their electric drive
motor and have various range and speed capabilities.
For instance, thousands of low speed battery electric vehicles in
use today, like the Global Electric Motorcars neighborhood electric
vehicle, provide a petroleum-free option for urban commuters across the
country. Electric motorcycles, such as the Vectrix maxi-scooter, which
gets between 35 and 55 miles per charge on a nickel metal hydride
battery, are changing the two-wheeled fleet.
At the top end of the speed scale is the Tesla Roadster, which
operates on lithium-ion battery technology. The Roadster can go to zero
to 60 in just 4 seconds and can travel 220 miles on a charge. This car
is available today and is the fore-runner of the company's planned line
of battery electric sedans, the first of which is the Whitestar--that
is being developed as--and priced more like--a family sedan.
Nissan has made a commitment in their mid-term business plan to be
``the leader in zero emissions vehicles'' and is rolling out a battery
electric vehicle in late 2010. They plan for select fleet use at first
and mass market introduction in 2012.
Phoenix, Subaru and Zenn have both announced 2009 production plans
for full-speed battery electric vehicles.
Mitsubishi plans to produce a battery electric vehicle (the iMiEV)
in 2010.
Daimler has announced plans for serial production of battery
electric Mercedes-Benz and smart cars in 2010 and has entered into a
joint agreement to provide more than 100 in Berlin in 2009.
The 2010 production model of GM's Volt is being unveiled in Detroit
this morning. It is 4 door passenger vehicle with a range of about 40
miles on a single charge, which would cover the average American's
daily commute.
The Volt, it is important to note, is a range-extended battery
electric vehicle. Although it has an internal combustion engine, it is
not a ``plug-in hybrid.'' The engine will only be used to provide
backup power to the battery. It will not provide any propulsion, as the
engines in plug-in hybrids do.
Plug-in hybrid vehicles also connect to the grid, but include
additional on-board power sources that can move, or assist the battery
in moving, the vehicle.
Some examples of these include the planned Saturn Vue plug-in
hybrid, Ford's Plug-in hybrid Escape, and Toyota's Prius Plug-in Hybrid
Vehicle. These manufacturers have all announced 2010 production plans.
Hyundai is expanding its hybrid production over the next four years
and is planning to commercialize plug-in hybrids sometime after 2013.
We are excited about the expanding availability of plug-in electric
drive options, but how quickly they reach commercial scale depends on a
number of factors.
First, there are technology challenges that manufacturers and
energy suppliers must address. The most obvious is the performance and
supply of new battery technologies. Some of the emerging plug-ins and
the next generation of electric vehicles are likely to use lithium-ion
batteries. These batteries, which are used today in laptop computers
and mobile phones, hold more energy than their conventional
counterparts. We need to ensure that they are also as durable, safe,
and affordable as the vehicle market demands.
We should also be working to make sure they are manufactured here
in the United States.
The shift to increasing electric drive technology also requires
significant investment in manufacturing infrastructure by the vehicle
and battery manufacturing industries. Large scale production of
electric drive vehicles and components in the U.S. will require new
materials, new processes and new production facilities.
In the utility and energy industries, grid-connected transportation
will also require changes in electricity infrastructure and business
models. Utilities need to make infrastructure investments to upgrade
the transmission grid to bring new renewable sources from remote
locations to urban centers where the power is needed.
They also will need to invest in smart meters to monitor the flow
of electricity to the consumer household. These meters will allow
consumers to recharge their vehicle batteries during off-peak times for
energy savings. And, they potentially allow electricity providers to
use the stored energy for load management.
Policymakers can accelerate the shift toward electrification by
working with us to address these challenges. Specifically, accelerating
policies include:
Market incentives, to help industries and consumers invest
in electric drive;
Reliable R&D support to advance the technology; and
Expanded demonstration and deployment in fleets.
Market incentives are a powerful tool in promoting manufacturing
development and making new technologies more affordable for consumers.
To help buyers overcome the first-cost hurdle of new technologies
and to build market acceptance, a performance-based consumer tax credit
should be available for purchases of all plug-in electric drive
vehicles.
As I noted earlier, there are a variety of electric drive
technologies in--and coming to--the market. Tax incentives should
reward performance (in reducing petroleum consumption with electricity)
without picking a winning configuration. The credit should include all
grid-connected transportation options--including battery electrics and
hybrids and including large vehicles and small ones. The threshold for
eligibility should not prejudice the development of the technology.
They all will play a role in advancing the technology, building
consumer acceptance and promoting infrastructure development.
Incentives also need to be provided upstream. Tax policies
promoting the significant investments in electric drive technologies
and facilities will accelerate the growth of the industry, for
instance, by encouraging battery manufacturers to site their facilities
in this country and by helping automakers to expand and establish their
production facilities.
The bipartisan bill, S. 1617, of which Senator Cantwell is a
coauthor, captures the key elements of effective tax incentives for
consumers and manufacturers. Some of the proposals emerging in these
last few weeks have included refinements to the concept that EDTA could
potentially support. There are also some new provisions being offered
that would actually limit plug-in technology development and vehicle
options. These we would oppose.
Congress, and this Committee, included other critical support for
electric drive in the 2007 energy bill, the Energy Independence and
Security Act (EISA). EISA authorizes important grants, loan guarantees
and direct loans to manufacturers of advanced vehicles and components.
These programs can provide a real boost to domestic capacity--but
only if they are actually funded. We hope that Congress acts as quickly
as possible in making these programs a reality.
In addition to market incentives, consistent and substantial
federal investment in research and development will speed the
development of necessary technologies.
EISA authorized approximately $300 million/year for research,
development and demonstration projects for electric drive efforts,
including plug-in vehicle research, advanced battery research, and
medium and heavy duty vehicle R&D. The bill also authorized substantial
investments in smart grid research and development programs.
These programs can make the difference in what is ``near-term''
technology and what is not. As I said previously, the sooner we can get
these programs underway, the sooner we can address the technology and
infrastructure challenges that come with rethinking transportation.
Along with R&D, Federal, state and local governments can expand
efforts to deploy electric drive vehicles in private and public fleets.
These ``real world efforts'' provide energy and environmental
benefits--and they also help to identify what works well and what needs
to be improved in a new technology.
Federal support for demonstration projects can help utilities and
manufacturers work together to demonstrate grid-connected technologies.
Today, Ford, Johnson Controls and Southern California Edison are
partnering on a demonstration of the plug-in hybrid Escape. GM is
working with EPRI and a group of utilities to address the
infrastructure and charging issues raised by plug-in vehicles.
These kind of collaborative efforts are critical to launching a
transportation shift that requires changes in vehicles, in fuel
providers and even drivers.
This is just a sampling of the work that the electric drive
industry is doing to bring grid-connected vehicles to production, grow
them to commercial scale and prepare the grid for a plug-in vehicle
future. Working together with policymakers, we can make it happen even
sooner and realize the economic, security and environmental benefits of
displacing oil with electricity.
I thank you for the opportunity to testify today and look forward
to answering any questions you may have.
The Chairman. Thank you very much.
Mr. Kjaer, go right ahead.
STATEMENT OF EDWARD KJAER, DIRECTOR OF ELECTRIC TRANSPORTATION,
SOUTHERN CALIFORNIA EDISON COMPANY, ROSEMEAD, CA
Mr. Kjaer. Good morning. Chairman Bingaman, Ranking Member
Domenici, members of the committee, my name is Edward Kjaer and
I am the Director of Electric Transportation at Southern
California Edison. Thank you for the opportunity to speak
briefly to you today.
For over 20 years, Edison has been a leading supporter of
electric transportation. Today Edison operates the Nation's
largest and most successful private fleet of electric vehicles,
having traveled over 16 million EV miles on electric power.
Our Electric Vehicle Technical Center, unique in the
utility industry, is one of only several facilities recognized
by the United States Department of Energy to evaluate all forms
of electro-drive technology.
Edison is working in partnership with EPRI and automakers
such as Ford, General Motors, Mitsubishi, and others to
evaluate and demonstrate prototype plug-in vehicles and their
connection with and control by the grid.
So what are some of the challenges we face as we connect
transportation to the grid?
First, helping the industry get to a sustainable business
case. The stark reality is that while most major automakers are
working to develop and commercialize plug-in vehicle
technology, few see a sustainable business case without
critical Government, State, NGO, and private sector incentives
and support. Simply put, without adequate and sustained
incentives, many of which Mr. Wynne has just referred to, and
support, there is no guarantee that we can quickly transition
from early adoption low volumes to the mass market high volumes
we need in the marketplace.
The second challenge is getting multiple markets plug-in
vehicle ready. Edison Electric Institute held a utility CEO
Transportation Taskforce meeting several days ago, chaired
jointly by our Chairman, Ted Craver, and Progress Energy CEO
Bill Johnson. The goal is to generate industry-wide support for
appropriate and sustained plug-in vehicle policy in partnership
with EDTA, automakers, and major vehicle launch markets. In
addition, the utilities will and are working with their local
States to develop sustainable incentives to attract automakers
to launch plug-in vehicles in their respective markets.
The third challenge is creating industry standards for
effective load control of plug-in vehicles. Today the electric
grid is changing dramatically across the country. We are seeing
the development of smart grid technologies designed to improve
the reliability and efficiency of the electrical system while
at the same time delivering more customer control of their
energy use and ultimately their monthly energy bill.
Part of this effort is so-called smart meters. Edison will
deploy 5 million next generation advanced meters called Edison
SmartConnect by 2012. Smart meters will help control vehicle
fueling load, optimizing it to generation plant utilization and
infrastructure needs. This real-time control will be achieved
through vehicle and grid communications, customer rates and
incentives and other technologies designed to optimize the
integration of transportation into the energy system. Edison,
in partnership with EPRI, leading automakers and the Society of
Automotive Engineers, is working to socialize industry-wide
vehicle and grid communication requirements today.
The fourth challenge is products and technologies to test
in the utility lab. Today we have several plug-in vehicle
prototypes and more coming to Edison's unique EV Technical
Center. However, we have virtually no data on the communication
and load control of plug-in vehicles. It is critical that we
get industry stakeholders together to fully vet the emerging
technologies and communication protocols before they are
implemented in vehicle design.
The fifth challenge is addressing the high cost of
batteries. Edison is actively exploring whether advanced
batteries developed for the auto industry have other uses
outside of the vehicle for stationary applications such as
emergency backup and home energy storage. The vision is to
combine early market battery volumes for the automakers and
potentially for the utilities to help reach economies of scale
faster, helping to strengthen the business cases for plug-in
vehicles in the early years.
The sixth challenge is addressing the needs of home and
public refueling infrastructure. Edison, EPRI and the
automakers are working to assess the infrastructure needs of
plug-in vehicles. The industry is working to finalize a single
connector standard and working on a single communication
standard, as I have mentioned. Additionally, markets around the
country are determining the need for public charging and in
some areas have already committed to construction. Again,
successfully deploying appropriate infrastructure will likely
need both policy and financial support in the early years.
The seventh and final challenge is integration of smart
grid technology and future electric transportation. Smart grid
technology is required for the long-term vision of so-called
vehicle-to-grid systems and energy storage systems where
millions of batteries, both in the vehicles and in stationary
applications, have the capacity to move stored energy backward
and forwards in the grid.
But these applications are many years away. First, we must
get the batteries to simply drive the wheels and last the life
of the vehicle reliably. We believe that with continued
engineering advances and appropriate public policy support, the
widespread use of advanced batteries in plug-in vehicles and in
stationary storage applications will become one of the Nation's
most effective strategies in the broader effort to address
energy security, reduce greenhouse gas emissions and reduce air
pollution.
We congratulate the committee for the work you did last
year on the energy bill. Of course, now we need to secure
appropriations for the provisions authorized in 2007.
We also need Congress to pass legislation providing for
consumer tax incentives and tax credits for renewables and
accelerated depreciation of smart meters. The House and Senate
have passed their own bills, but so far haven't reached
agreement. Even before all this, though, we need manufacturing
incentives to encourage a domestic supplier and production
base, as Mr. Wynne mentioned.
Edison is committed, as we have been for almost 20 years
now, to working with the committee, industry organizations such
as EDTA, EEI, EPRI, and Federal and State agencies to realize a
plug-in transportation future.
Thank you.
[The prepared statement of Mr. Kjaer follows:]
Prepared Statement of Edward Kjaer, Director of Electric
Transportation, Southern California Edison Company, Rosemead, CA
Chairman Bingaman, Ranking Member Domenici, Members of the
Committee, my name is Edward Kjaer and I am the Director of Electric
Transportation at Southern California Edison.
Thank you for the opportunity to speak to you today.
Let me begin by describing the efforts of Southern California
Edison and our industry associations to address the challenges we face
over the next two to three years integrating transportation in to the
electric energy system.
For over 20 years Edison has been a leading supporter of electric
transportation. Initially, this support was based on the need to clean
up the air quality in California. Since then however it has become
clear that this nation has a significant energy security challenge and
a growing concern around climate change. As a recent EPRI study
demonstrated, electrifying the wheels of this nation's transportation
future could be the single biggest move we make to reducing our
dependence on foreign oil, reducing CO2 and improving the air we all
breathe.
Today, Edison operates the nation's largest and most successful
private fleet of electric vehicles, having traveled more than 16
million miles on electric power.
Our Electric Vehicle Technical Center, unique in the utility
industry, is one of only several facilities recognized by the U.S.
Department of Energy to evaluate all forms of electro-drive technology.
It is an ISO-certified facility that is widely known for its battery
and prototype plug-in vehicle testing. Now the Center is focused on
evaluating ``smart charging'' and building industry-wide consensus
around vehicle/grid connection, communication and control in
conjunction with next generation utility advanced meters.
To this end, last year SCE and Ford announced an industry leading
collaborative to help evaluate and demonstrate plug-in hybrids (PHEVs)
and their connection and control by the grid. EPRI was added to this
partnership in April 2008 and they are now identifying up to seven
major utilities across the country willing to participate and co-fund
this first-of-a-kind program. The U.S. Department of Energy (DOE) is
providing up to $10 million in co-funding support for this important
effort.
In addition, SCE is part of a broad 37 utility partnership with
EPRI and General Motors working to prepare the retail market for the
upcoming and much anticipated Chevy Volt and Saturn Vue plug-in
vehicles.
Recently Mitsubishi and SCE announced a partnership to evaluate and
demonstrate Mitsubishi's new iMiEV battery EV prototypes. This vehicle
will go into production in 2009 in Japan and Mitsubishi is assessing
the U.S. market for EVs. I was in Japan meeting with automakers several
weeks ago and I had the opportunity to test drive the iMiEV. I'm very
excited about the potential of this vehicle here in the U.S.
Nissan is also intending to launch EVs to the U.S. market in the
2010-2012 timeframe. Other automakers have announced either research,
prototype demonstration or production programs for plug-in vehicles
including Toyota, BMW, Daimler, Chrysler, Audi, Think and Tesla Motors
to name a few.
SCE will shortly announce additional automaker partnerships as we
continue to collaborate with the auto industry, helping ensure that the
grid is ready to connect, fuel and control mass market volumes of plug-
in vehicles.
What are some of the challenges utilities face however as we
connect transportation to the grid?
1. Helping industry get to a sustainable business case.--The
stark reality is that while most major automakers are working
to develop and commercialize plug-in vehicle technology, few
see a ``sustainable'' business case without critical
Government, State, NGO and private sector support. Brian Wynne
from Electric Drive Transportation Association (EDTA) has
touched on the importance of early market Federal and State
incentives to encourage domestic jobs through a robust
manufacturing and supplier base as well as consumer incentives
to help buy down the early introduction cost of these
inherently more expensive technologies. Without adequate
support there is no guarantee that we can quickly transition
from early adoption low volumes to the mass market high volumes
we need to sustain this technology in the marketplace.
2. Getting multiple markets ``plug-in vehicle ready''.--
Edison Electric Institute (EEI) held a utility CEO
Transportation Taskforce meeting several days ago chaired
jointly by our Chairman, Ted Craver and Progress Energy CEO
Bill Johnson. This taskforce of major investor owned utility
CEOs is now working to engage utilities across the country in
the electric transportation movement. The goal is to generate
industry-wide support for appropriate and sustained plug-in
vehicle policy in partnership with EDTA, automakers and major
vehicle launch markets.
3. Creating industry standards for effective load control of
plug-in vehicles.--Today the electrical system is changing
dramatically across this country. We are seeing the development
of ``smart grid' technologies designed to improve the
reliability and efficiency of the electrical system while at
the same time delivering more customer control of their energy
use and ultimately their monthly energy bill. Edison will
deploy 5 million next generation advanced meters called Edison
SmartConnect TM by 2012. These meters will help
Edison and our customers manage the energy system. With plug-in
vehicles we do not see a large system-wide challenge fueling
the vehicles however we do see early adopter concentrations of
vehicles that may challenge the local distribution system in
some areas. To effectively and efficiently manage the system,
utilities will want to ``control'' vehicle fueling load,
optimizing it to generation plant utilization and
infrastructure needs. This real time control will be achieved
through vehicle and grid ``communications'', customer rates and
incentives and other technologies designed to optimize the
integration of transportation in to the energy system. Edison,
in partnership with EPRI, leading automakers and the Society of
Automotive Engineers (SAE) is working to socialize industry
wide vehicle/grid ``communication'' requirements'' today. But
there is still much work to be done and very little research
and evaluation data available.
4. Products and technologies to test in the utility lab.--As
mentioned, Edison has a unique EV Technical Center that is
exploring the convergence of transportation and grid
technologies. Today we have several plug-in vehicle prototypes
and more coming. We have been bench testing advanced lithium
battery modules for over three years now in the lab. However we
have virtually no data on the communication and load control of
plug-in vehicles. It's critical that we get industry
stakeholders together to fully vet the emerging technologies
and communication protocols before they are implemented in
vehicle design.
5. Addressing the high cost of batteries.--Edison is actively
exploring whether advanced batteries developed for the auto
industry have other uses and system benefits for the electrical
grid such as emergency backup and energy storage. To develop
data in this area, Edison has recently constructed a ``Garage
of the Future'' lab at our EV Technical Center. This lab will
begin modeling the convergences of residential PV, home energy
storage devices, vehicle energy storage and advanced meter
control and communication. By combining battery volumes for the
automakers and potentially the utilities, we may reach
economies of scale faster, helping to strengthen the business
cases for plug-in vehicles in the early years.
6. Addressing the needs of home and public refueling
infrastructure.--Edison, EPRI and the auto makers are working
to assess the needs of plug-in vehicles. Battery EVs, because
of their 240 V charging requirements, dictate the need for more
complex infrastructure development that the plug-in hybrid
charging at 110 V. The industry is working to finalize a single
connector and connection standard. Additionally markets around
the country are determining the need for public charging and in
some areas have already committed to construction. Again
successfully deploying appropriate infrastructure will likely
need both policy and financial support in the early years.
7. Integration of smart grid technology and future electric
transportation.--Smart grid technology is required for the
long-term vision of so-called ``vehicle-to-grid'' systems, and
energy storage systems where millions of batteries both in the
vehicles and in stationary applications have the capacity to
move stored energy back to the grid.
In essence, these mini power plants become integrated into
the future energy system as distributed energy resources. Plug-
in vehicles and even stationary batteries may further enhance
electrical system reliability by providing temporary power to a
homeowner when outages do occur.
Plug-in vehicle technologies are not just for passenger vehicles.
In fact, in the near term, we are likely to see significant growth in
heavy duty trucks, buses, seaports, airports and truck stop
electrification. For instance, SCE has one of about 25 prototype heavy
duty hybrid utility bucket trucks built by Eaton and International that
are presently being tested. A medium duty plug-in hybrid is also being
built on a Ford 550 Chassis by Eaton and EPRI. SCE expects to have its
prototype by the end of this year. These technologies also require
public policy support.
We believe that with continued engineering advances and appropriate
public policy support, the widespread use of advanced batteries in
plug-in vehicles and in stationary storage applications will become one
of the nation's most effective strategies in the broader effort to
address energy security, reduce greenhouse gas emissions and reduce air
pollutants.
We congratulate this Committee for the work you did on last year's
energy bill. Let us just take a minute and recall all the good things
that bill achieved last year.
i. $295 million per year for six different R&D programs on
electric transportation including both vehicles and stationary
energy storage applications.
ii. $95 million in grants per year for transportation
electrification, such as truck stops and ports.
iii. $90 million per year for early demonstrations of PHEVs
and battery EVs.
iv. Grants and loans for manufacturing PHEVs, BEVs, and EV
components in the United States and grant funds for PHEV smart
grid investment costs.
Of course now we need to secure appropriations for these
provisions. We also need Congress to pass legislation providing for
consumer PHEV tax credits, as well as tax credits for renewables and
accelerated depreciation of smart meters. The House and Senate have
passed their own bills, but so far haven't reached agreement. We need
appropriations for fleet acquisition incentives to help buy down early
costs to fleet operations of this new technology. Even before all of
this, though, we need manufacturing incentives to encourage a domestic
supplier and production base.
Edison is committed to working with this Committee, industry
organizations such as EDTA, EEI, EPRI and Federal and State agencies to
realize a plugged-in transportation future. These and other
organizations help bring together automakers, utilities and industry
stakeholders so we can effectively address the common energy and
environmental concerns of this country.
Thank You.
The Chairman. Thank you very much.
Mr. Wimmer, go right ahead.
STATEMENT OF ROBERT WIMMER, NATIONAL MANAGER, TOYOTA MOTOR
NORTH AMERICA
Mr. Wimmer. I would like to thank Chairman Bingaman and the
Senate Energy Committee for inviting Toyota to testify at this
hearing on a topic we feel passionately about, electric drive
vehicles.
Though the average price of a gallon of gasoline has
declined from record highs over the summer, consumers continue
to demand greater fuel efficiency in their vehicles. This has
led to an increased interest in vehicle electrification as a
way to reduce petroleum consumption.
But as far back as the early 1990s, when a gallon of
gasoline was less than $1.50 a gallon, Toyota was investing in
vehicle electrification by developing both hybrid and battery
electric automobiles. This type of forward thinking is
summarized in the phrase, ``Today for Tomorrow.'' Said another
way, think for the future, but act now. This is one of Toyota's
core philosophies and the basis for our environmental vision.
Since Toyota introduced our first hybrid, the Prius, in
Japan in 1997, we have sold over 1.5 million hybrids around the
globe. These vehicles have saved over 660 million gallons of
gasoline and eliminated 13 billion pounds of CO2
emissions. In the United States, fuel savings alone have saved
Americans nearly $1 billion.
Once considered science experiments by some and novelties
by others, hybrids are now mainstream vehicles for Toyota. We
currently sell 6 fuel-saving hybrids in the United States, 3
Toyota and 3 Lexus models, and they account for over 10 percent
of our United States sales. Next January in Detroit, we will
introduce our third generation Prius, plus an all-new dedicated
Lexus hybrid vehicle.
Future hybrid goals include global sales of a million a
year in the next decade, and sometime in the 2020s, we expect
hybrid drivetrains to be offered as either standard or optional
equipment in all of our passenger vehicles.
Hybrid is a core technology for Toyota and will serve as
the foundation for the next generation of vehicles such as
plug-ins, battery electrics, and fuel cells. This evolution of
mainstream technology will allow us to shorten development time
and maximize use or shared components that will result in lower
production costs and broader market penetration of these new
technologies.
When considering the benefits of new technologies, we must
understand the relationship between sales volume and fuel
savings. For example, if we doubled sales of a hybrid model,
the cumulative fuel savings is greater than doubling its fuel
economy with no change in sales volume. Therefore, it is
critical that new technologies, such as plug-ins, battery
electrics, or fuel cells, are introduced at a price point and
utility that allow for high volume sales. Otherwise, their
petroleum savings and environmental benefit will be negligible.
Mass market appeal is the basic philosophy behind the plug-
in prototype Prius we have on display today. With minimal
software changes and the addition of a second battery pack, the
vehicle demonstrates the plug-in potential of Toyota's hybrid
vehicle design. The vehicle operates in a manner similar to the
current Prius, switching between electric mode to gas engine
mode to a blended gas/electric mode. The larger battery allows
the plug-in Prius to store greater amounts of electricity and
to be charged by plugging into a standard electrical outlet.
With more power in reserve, the vehicle is capable of operating
in pure electric mode for longer periods of time and speeds up
to 60 miles an hour. This means substantial gains in fuel
economy and a reduction in total tailpipe emissions versus
conventional hybrid systems.
Battery experts have estimated the cost of batteries for
plug-in hybrids to be between $500 and $1,000 per kilowatt
hour. As such, the size of the battery pack will greatly
influence the retail price of the vehicle and therefore its
market viability and sales potential.
The energy tax package, released by the Finance Committee,
places an arbitrary 6 kilowatt hour minimum on battery pack
size and redefines plug-in electric vehicles to seemingly
eliminate the consumer tax credit for all but one plug-in
vehicle design. Toyota believes this approach is
counterproductive. It will discourage manufacturers from
developing and consumers from purchasing blended plug-ins that
are affordable to the greatest number of consumers. We believe
consumer incentives should encourage all plug-in designs and
allow the consumer market to select winners not legislation.
Before high-volume production can begin, significant
challenges such as battery cost, durability, and safety must be
addressed. We intend to examine these issues when we introduce
our next generation plug-in hybrid with lithium-ion batteries
as a 2010 model. A significant number of these vehicles will be
deployed in commercial fleets around the world to help Toyota
quantify real-world durability and performance and customer
acceptance.
To realize the full promise of plug-in hybrids or battery
electric vehicles, they must use green electricity. From an
energy security standpoint, certainly any substitution of
domestically produced electricity for gasoline is beneficial.
Carbon reduction, on the other hand, varies greatly depending
on how the electricity is generated. In France, where over 80
percent of the electricity comes from nuclear power, the plug-
ins and battery electrics can significantly reduce carbon
emissions. On the other extreme, if the electricity comes
mostly from coal-fired plants, the reduction in carbon
emissions is modest at best.
Let me conclude with a brief description of Toyota's fuel
cell hybrid vehicle, another evolution of our basic hybrid
drive technology. This vehicle is based on the previous
generation Toyota Highlander SUV but with a fuel cell, one of
Toyota's own design and manufacture in place of the
Highlander's gasoline engine. The combination of an advanced
fuel cell system with our hybrid drive technology more than
doubles the vehicle's fuel efficiency with zero tailpipe
emissions.
As with plug-ins, challenges must be resolved before fuel
cell commercialization can begin. Costs must drop significantly
while system power density and durability must increase. Also,
a coordinated effort is required between the auto industry and
energy providers and governments to assure hydrogen refueling
infrastructure is in place to support fuel cell vehicle
development.
So why does Toyota continue to invest millions in long-term
technologies? It goes back to our ``Today for Tomorrow''
philosophy that drives us to develop technologies and products
today that improve society for tomorrow.
I would again like to thank Senator Bingaman and the Senate
Energy Committee for inviting Toyota to be part of this
hearing.
[The prepared statement of Mr. Wimmer follows:]
Prepared Statement of Robert Wimmer, National Manager, Toyota Motor
North America
I am Robert Wimmer, a National Manager in Toyota's Washington DC
office, working on energy and environmental research, and with over 15
years' experience in hybrid and fuel cell vehicle development. I would
like to thank Chairman Bingaman and the Senate Energy Committee for
inviting Toyota to testify at this hearing on a topic we feel
passionately about: Electric Drive Vehicles.
Though the average price of a gallon of gasoline has declined from
record highs over the summer, consumers continue to demand greater fuel
efficiency in their vehicles. This has led to an increased interest in
vehicle electrification as a way to reduce petroleum consumption. But,
as far back as the early-1990's when a gallon of gas cost less than
$1.50/gallon, Toyota was investing in vehicle electrification by
developing both hybrid and battery electric automobiles.
This type of forward thinking is summarized in the phrase ``TODAY
for TOMORROW.'' Said another way--think for the future, but act now.
This is one of Toyota's core philosophies and the basis for our
environmental vision.
Over the last 15 years of hybrid development, we have established
more than 700 hybrid patents and hybridized more than a dozen vehicle
models globally. Perhaps more importantly, we believe hybrid technology
will be the foundation for our emerging electric propulsion systems.
Since Toyota introduced our first hybrid, the Prius in Japan in
1997, we have sold over 1.5 million hybrids around the globe. These
vehicles have saved over 660 million gallons of gasoline and eliminated
13 billon pounds of CO2 emissions. In the US, fuel savings
alone have saved Americans nearly a billion dollars.
Once considered science experiments by some and novelties by
others, hybrids are now mainstream vehicles for Toyota. We currently
sell six fuel-saving hybrids in the US--3 Toyota and 3 Lexus models,
and they account for over 10% of our US sales. Next January in Detroit,
we will introduce our third-generation Prius plus an all-new dedicated
Lexus hybrid vehicle.
Future hybrid goals include global sales of a million a year in the
next decade. And sometime in the 2020s, we expect hybrid drivetrains to
be offered as either standard or optional equipment in all our
passenger vehicles.
Hybrid is a core technology for Toyota and will serve as the
foundation for the next generation of vehicles such as plug-ins,
battery electrics and fuel cells. This evolution of mainstream
technology will allow us to shorten development time and maximize use
of shared components that will result in lower production costs and
broader market penetration for these new technologies.
When considering the benefits of new technologies, we must
understand the relationship between sales volume and fuel savings. For
example, if we double sales of a hybrid model, the cumulative fuel
savings is greater than doubling its fuel economy with no change in
sales volume. Therefore, it is critical that new technologies, such as
plug-ins, battery electrics or fuel cells, are introduced at a price
point and utility that allow for high volume sales. Otherwise, their
petroleum savings and environmental benefit will be negligible.
Mass market appeal is the basic philosophy behind the prototype
plug-in Prius we have on display today. With minimal software changes
and the addition of a second battery pack, the vehicle demonstrates the
plug-in potential of Toyota's hybrid design.
The vehicle operates in a manner similar to the current Prius,
switching from pure-electric mode, to gas-engine mode, to a blended
gas-electric mode. The larger battery allows the plug-in Prius to store
greater amounts of electricity and to be charged by plugging into a
standard household electrical outlet. With more electric power in
reserve, the vehicle is capable of operating in pure-electric mode for
longer periods of time and at speeds up to 60 mph. That means
substantial gains in fuel economy and a reduction in total tailpipe
emissions versus current conventional hybrid systems.
Similar vehicles were recently given to two California universities
for research and testing to evaluate real-world customer use, to help
determine the optimal balance between electric mode range, charge time,
battery size and cost.
Battery experts have estimated the cost of batteries for a plug-in
hybrid to be $500-$1000/kW-hr. As such, the size of the battery pack
will greatly influence the retail price of the vehicle and therefore,
its market viability and sales potential. The Energy Tax package
released late last week by the Finance Committee places an arbitrary
6kW-hr minimum on pack size before receiving a consumer tax credit.
Toyota believes this is counterproductive. It will discourage
manufacturers from developing smaller, lower cost plug-ins that are
affordable to the greatest number of consumers. Toyota agrees the
amount of tax credit should be based on battery size, but it should
begin at approximately two times the size of a typical hybrid battery,
1.2-2.0 kW-hr. This way the consumer market will drive plug-in vehicle
design, not legislation.
Before high-volume production can begin, significant challenges
such as battery cost, durability and safety must be addressed. We
intend to examine these issues when we introduce our next generation
plug-in hybrid with Li-Ion batteries as a 2010 model. A significant
number of these vehicles will be deployed in commercial fleets around
the world to help Toyota quantify real-world durability, performance
and customer acceptance.
Toyota is also re-examining battery electric vehicles. Between 1998
and 2003 Toyota delivered more than 1200 RAV4-EVs to customers in
Arizona and California. Many of these were sold--not leased--to the
general public, making Toyota the only Original Equipment Manufacturer
at the time to sell full-performance EVs. With many of these still on
the road and millions of miles of cumulative experience, Toyota
understands the opportunities and challenges of producing and marketing
battery EVs.
To realize the full promise of plug-in hybrids or battery electric
vehicles, they must use green electricity. From an energy security
standpoint, certainly any substitution of domestically produced
electricity for gasoline is beneficial. Carbon reduction, on the other
hand, varies greatly depending how the electricity is generated. In
France, where over 80% of the electricity comes from nuclear power,
plug-ins and battery electrics can significantly reduce carbon
emissions. On the other extreme, if the electricity comes mostly from
coal fired plants, the reduction of carbon emissions is modest at best.
Let me conclude with a brief description of Toyota's Fuel Cell
Hybrid Vehicle . . . another evolution of our basic hybrid drive
technology. This vehicle is based on the previous-generation Toyota
Highlander Hybrid SUV but with a fuel cell, of Toyota's own design and
manufacture, in place of the Highlander's gasoline engine. The
combination of an advanced fuel cell system with our hybrid drive
technology more than doubles the vehicle fuel efficiency with zero
tailpipe emissions.
Toyota has made great progress over the last decade improving fuel
cell technology. Our next generation fuel cell vehicle will be able to
start from -30 degrees Centigrade and will have a driving range of over
400 miles between refuelling.
As with plug-ins, challenges must be resolved before fuel cell
commercialization can begin. Cost must drop significantly, while system
power density and durability must increase. Also, a coordinated effort
is required between the auto industry, energy providers and governments
to assure a hydrogen refuelling infrastructure is in place to support
fuel cell vehicle deployment.
So, why does Toyota continue to invest millions in a technology
like fuel cells, which is more than a decade away from commercial
viability? It goes back to our ``Today for Tomorrow'' philosophy that
drives us to develop technologies and products Today to improve society
Tomorrow.
I would again like to thank Senator Bingaman and the Senate Energy
Committee for inviting Toyota to be part of this hearing and am happy
to take your questions.
The Chairman. Thank you very much.
Mr. Dalum, go ahead.
STATEMENT OF JOSEPH T. DALUM, VICE PRESIDENT, DUECO, WAUKESHA,
WI
Mr. Dalum. Good morning, Chairman Bingaman, Ranking Member
Domenici, and distinguished committee members. Thank you for
inviting me here today.
My name is Joe Dalum and I am Vice President of DUECO.
DUECO, headquartered in Waukesha, Wisconsin, is one of the
largest final-stage manufacturers of utility trucks in the
country. We produce aerial devices, digger derricks, and cranes
that are sold to electric utilities for the maintenance of
their power lines. DUECO also provides equipment and services
for the telecommunications market, other industries, and the
government.
In 2006, DUECO began to assess alternative hybrid
technologies, which led to a collaborative effort between DUECO
and Odyne Corporation, a developer of plug-in hybrid electric
vehicle powertrains for medium- and heavy-duty trucks that
weigh over 16,000 pounds. Our efforts resulted in the
introduction of the utility industry's first commercial plug-in
hybrid medium-duty truck in the fall of 2007.
While you have already received my more extensive written
testimony, this morning I will focus on our development of
plug-in hybrid medium- and heavy-duty trucks.
There are several factors that favor the introduction of
plug-in hybrid trucks, including rising fuel prices, increased
pressure to reduce emissions, including greenhouse gas
emissions, and the national priority to improve energy
security. The photo in my written testimony shows a plug-in
hybrid heavy-duty bucket truck used to help maintain power
lines. I invite you to see a similar plug-in truck on display
outside today.
The truck is unique in that a very large battery system of
approximately 35 kilowatt hours, more than 15 times larger than
one used in a conventional hybrid, provides power to help
propel the vehicle along with a diesel engine and provides
power for equipment on the truck. When the truck returns to the
garage, domestically generated electricity recharges the
battery system, offsetting the need for petroleum. The size of
the battery system and the ability to recharge using grid power
differentiates the plug-in hybrid system from a conventional
hybrid. Using energy from the large battery system reduces fuel
consumption and emissions during driving and provides for an
all-electric stationary mode. The system completely eliminates
fuel consumption and emissions at the job site for a typical
day while also reducing noise.
Fuel savings and corresponding reduction in greenhouse gas
emissions are dependent upon the application. The current
vehicle reduces fuel consumption, resulting in an estimated
savings of approximately 1,400 gallons of fuel per year per
vehicle for a typical utility application, or approximately
20,000 gallons of fuel over the projected life of the vehicle.
DUECO plans to deploy 25 plug-in hybrid trucks to early
adopters for evaluation, 10 of them produced to date. Our first
unit was delivered earlier in the year. Several major utilities
will test the units soon. We plan to ramp up production
significantly in 2009 and beyond and expand the use of the
technology into other applications.
Other manufacturers are also working on development of
plug-in hybrid trucks. There are several challenges that affect
wide-scale deployment of plug-in hybrid trucks, including
battery system cost and performance challenges, infrastructure
requirements for charging large numbers of high-capacity
battery systems, and high costs for research, development, and
investment in production systems.
DUECO encourages the Federal Government to implement
programs that help the development of plug-in hybrid systems
for medium- and heavy-duty trucks that are open to final stage
manufacturers and other entities. The creation of tax
incentives for customers, loan guarantee programs to support
investment, and modification of Government purchasing policies
to favor the acquisition of plug-in hybrid trucks can also
accelerate deployment.
Commercial fleets consume large amounts of fuel. Developing
more efficient trucks that utilize domestically sourced power
from the Nation's energy grid would have several benefits. The
development of this technology in the United States would
provide opportunities for job creation, export opportunities,
reduce the cost for businesses competing in a global market,
reduce greenhouse gas emissions and emissions of other
pollutants, reduce dependency on foreign oil, reduce noise
within our cities, and potentially improve productivity for
certain applications such as electric crews who could perform
work at night in residential areas.
This is potentially an historic opportunity to develop and
deploy the technology needed for the electrification of medium-
and heavy-duty trucks. I ask for your support of the proposed
measures outlined in my written testimony and legislation such
as the Heavy-Duty Hybrid Vehicle Act that would help to
accelerate research in the plug-in hybrid technology and
encourage partnerships between manufacturers, utilities and the
government.
Thank you.
[The prepared statement of Mr. Dalum follows:]
Prepared Statement of Joseph T. Dalum, Vice President, DUECO,
Wakuesha, WI
introduction
Good morning Chairman Bingaman, Ranking Member Domenici, and
distinguished members of the Committee on Energy and Natural Resources.
Thank you for inviting me here today. Also thank you for the
opportunity to offer the views of DUECO and for soliciting the views of
others on the current state of vehicles powered by the electric grid
and the prospects for wider deployment in the near future.
My name is Joe Dalum, and I am Vice President of DUECO.
Headquartered in Waukesha Wisconsin, DUECO is one of the largest final
stage manufactures of utility trucks in the country, with facilities
also located in South Dakota, Minnesota, Indiana, Ohio and
Pennsylvania. We produce aerial devices, digger derricks and cranes
that are sold to electric utilities for the maintenance of their
transmission and distribution power lines in a 15 state region and are
also used by utilities throughout the country through UELC, our rental
and leasing company, with direct facilities in Florida, Texas and
California. DUECO also provides equipment and services for the
telecommunications, contractor, electric cooperative, municipality, gas
utility and tree care markets.
In 2006, DUECO began to assess alternative hybrid vehicle
technologies. Those activities lead to a collaborative development
program between DUECO and Odyne Corporation. Odyne Corporation is a
developer of Plug-In Hybrid Electric Vehicle (PHEV) power trains for
medium and heavy duty trucks that weigh over 16,000 pounds. Our efforts
resulted in the introduction of the utility industry's first commercial
plug-in hybrid medium duty truck in the Fall of 2007.
Trucks consume a disproportionately large amount of fuel. Plug-in
hybrid technology can substantially reduce fuel consumption, emissions
and noise for many truck applications. Electricity, generated from
domestic sources, partially displaces the use of petroleum. The
technology is particularly beneficial for trucks that can be positioned
close to the power grid when not in use to allow for recharging, are
operated in stop and go driving, and/or idle for extended periods.
Plug-in hybrid technology for medium and heavy duty trucks is in
the very early stages of testing and deployment. Low production volume
and high cost threaten wide-scale adoption. In order to rapidly
accelerate the use of plug-in hybrid trucks in the next five years, a
large increase in resources directed toward research, development,
engineering and production will be required.
A close partnership between manufacturers, utilities and the
government can help increase wide-scale deployment of plug-in hybrid
medium and heavy duty trucks. The government in particular can help
accelerate the use of plug-in hybrid trucks by providing additional
funding for research, by creating incentives for consumers to purchase
medium and heavy duty plug-in hybrids through tax credits, by
supporting private investment through loan guarantees and by
encouraging federal, state and local governments to purchase medium and
heavy duty plug-in hybrid trucks. The U.S. can lead the world in plug-
in hybrid technology for medium and heavy duty trucks if we take strong
and decisive action now.
background
According to the Department of Energy, approximately 80 percent of
all the goods transported in the U.S. are moved by truck. In total, the
U.S. consumed approximately 140 billion gallons of gasoline and about
40 billion gallons of diesel fuel for on-road transportation in 2004.
Trucks consume billions of gallons of fuel annually, and ``there exists
today great potential from several heavy-duty hybrid truck technologies
to significantly reduce fuel consumption and emissions.''\1\ Plug-in
hybrid technology is one of the technologies that have great potential
to reduce fuel consumption for large numbers of trucks.
---------------------------------------------------------------------------
\1\ Testimony for the U.S. House Committee on Science and
Technology, Energy and Environment Subcommittee, prepared Statement of
Terry Penney Technology Manager, Advanced Vehicle Technologies,
National Renewable Energy Laboratory, June 10, 2008
---------------------------------------------------------------------------
Truck fuel economy, power requirements and duty cycles often can
differ depending upon the application. A duty cycle, the proportional
time during which a truck is operated, in particular varies depending
upon the application. Trucks may spend much of their time idling to
power heating or cooling for the cab, or to operate truck mounted
equipment. U.S. trucks idle an average of 1830 hours per year and
idling of commercial vehicles is estimated to consume more than 2
billion gallons of fuel annually, while producing unwanted
emissions.\2\ Although the number of trucks is small compared to
passenger vehicles, their fuel consumption and emissions are
disproportionately large. According to figures by the Oshkosh Truck
Corporation there are approximately 90,000 refuse collection trucks in
the U.S. but their collective fuel consumption is roughly equivalent to
2.5 million passenger vehicles (based on 10,000 gallons/year per
truck).\3\
---------------------------------------------------------------------------
\2\ Testimony for the U.S. House Committee on Science and
Technology, Energy and Environment Subcommittee, prepared Statement of
Terry Penney Technology Manager, Advanced Vehicle Technologies,
National Renewable Energy Laboratory, June 10, 2008
\3\ Committee on Science and Technology, Subcommittee on Energy and
Environment, U.S. House of Representatives, Hybrid Technologies for
Medium-to-Heavy Duty Commercial Trucks, Tuesday, June 10, 2008
---------------------------------------------------------------------------
There are more than 6,000,000 medium and heavy duty trucks in the
U.S., excluding road tractors (18 wheelers). Medium and heavy duty
trucks are trucks that weigh 14,001 pounds or more.
Trucks are used in a wide variety of applications and are often
specialized. Trucks may perform numerous functions, resulting in a
variety of types, such as parcel and postage delivery trucks, utility
trucks, refuse haulers, beverage and refrigerated goods delivery
trucks, road maintenance and other work or service trucks, dump trucks,
concrete mixer trucks, liquid or gas transport trucks, shuttle and
school buses, military vehicles and over the road trucks. Trucks also
are built in many different configurations, sizes and weights.
Medium and heavy duty trucks are typically manufactured and
marketed to customers much differently than cars and light duty trucks.
Medium and heavy duty trucks, used by the utility industry and other
vocations are typically built in multiple stages. During the first
stage an original equipment manufacturer builds an incomplete vehicle,
commonly known as a chassis. The vehicle is then often completed by a
different company, referred to as a final stage manufacturer. Final
stage manufacturers typically evaluate the intended application of the
vehicle, perform engineering analysis, and then install an appropriate
body, equipment and interface components with chassis systems in a
manufacturing operation.
Medium and heavy duty trucks may also have multiple companies
involved in marketing the final product. A chassis manufacturer may
market directly to an end user and a final stage manufacturer may also
market to the same end user. Multiple companies involved in the
manufacturing and marketing of medium and heavy duty trucks tend to
result in less integration of the overall process and more
customization in comparison to cars and light duty trucks.
Hybrid drive systems for medium and heavy duty trucks differ in
design. Some systems are primarily designed to be installed during the
chassis manufacturing process by the original equipment manufacturer.
Other systems are designed to facilitate either an installation during
the chassis manufacturing process or in a later stage of manufacturing
by another entity, such as an intermediate or final stage manufacturer.
DUECO installs the plug-in hybrid drive system and interfaces the
system with the chassis and installed equipment during the latter stage
of manufacturing.
Hybrid drive systems for medium and heavy duty trucks can also
either be installed on new vehicles or designed to be retro-fit on an
existing chassis for certain applications. The plug-in hybrid system
developed by DUECO and Odyne can be either installed during the
manufacturing process of a new truck or it can be installed as a retro-
fit on an existing chassis. Retro-fit applications must be carefully
engineered, installation of a system on an existing truck requires
sufficient payload, packaging space and specific chassis data
communications interfaces.
Trucks used by utilities typically drive to a job site and then
conduct stationary operations. In a conventional truck, the diesel or
gas powered engine provides the sole source of propulsion for the
vehicle and is also used to power truck mounted equipment, such as an
aerial device, digger derrick, crane, compressor, winch or other
equipment. While at the job-site, the vehicle may idle for many hours
to provide power for the equipment and provide heat or air conditioning
in the cab. A medium duty truck may average approximately 8 mpg while
being driven and while at idle will typically consume approximately 1
gallon per hour or more.
A plug-in hybrid electric vehicle (PHEV) is a hybrid vehicle with
batteries that can be recharged by plugging into our nations electric
power grid. It shares the characteristics of both conventional hybrid
electric vehicles and battery electric vehicles, having an internal
combustion engine and batteries for power.
Hybrid systems used in larger trucks, greater than 16,000 pounds
have typically utilized two basic design configurations--a series
design or a parallel design.
Series design configurations typically use an internal combustion
engine (heat engine) with a generator to produce electricity for both
the battery pack and the electric motor. There is typically no direct
mechanical power connection between the internal combustion engine and
the wheels in an electric series design. Series design hybrids often
have the benefit of having a no-idle system, include an engine-driven
generator that enables optimum engine performance, typically lack a
transmission (on some models), and accommodate a variety of options for
mounting the engine and other components. However, series design
hybrids also generally include a larger, heavier battery; have a
greater demand on the engine to maintain the battery charge; and
include inefficiencies due to the multiple energy conversions. Parallel
design configurations have a direct mechanical connection between the
internal combustion engine and the wheels in addition to an electric or
hydraulic motor to drive the wheels.
Parallel design hybrids have the benefit of being capable of
increased power due to simultaneous use of the engine and electric
motor or hydraulic motor, having a smaller engine with improved fuel
economy while avoiding compromised acceleration power, and increasing
efficiency by having minimal reduction or conversion or power when the
internal combustion engine is directly coupled to the driveshaft,
typically through a transmission. However, parallel design hybrids
typically lack a no-idle system and may have non-optimal engine
operation (e.g., low rpm or high transient loads) under certain
circumstances. Existing systems on trucks that have a gross vehicle
weight rating (GVWR) of greater than 19,500 pounds have traditionally
not had a system that combines the benefits of a series system and a
parallel system.
DUECO has produced plug-in hybrid electric trucks, hybrid electric
trucks and conventionally powered trucks for the utility industry.
The need for plug-in hybrid trucks
There are several factors that favor the development and use of
plug-in hybrid trucks:
Rising fuel prices.
Increased pressure for environmentally friendly and green
operations with lower carbon emissions.
A national priority to reduce foreign oil dependency and
increase energy security.
Increased maintenance costs.
Differences between plug-in hybrid electric trucks and hybrid electric
trucks:
The following compares some of the benefits of a plug-in hybrid to
that of a conventional hybrid. The primary difference between the plug-
in hybrid and the conventional hybrid is the size of the battery system
and the ability to recharge the battery system from the domestic power
grid.
While a plug-in hybrid truck offers some of the same benefits as a
conventional hybrid truck, plug-in hybrids offer advantages in several
areas:
Reduced fuel consumption
--A plug-in hybrid system has a large battery system that operates
in a charge depleting mode. The energy from the battery is
typically used to help propel the vehicle and operate
equipment. Energy required to recharge the battery is
ideally provided by the power grid or from regenerative
braking, displacing the use of petroleum. A vehicle with a
large enough battery system could potentially eliminate
fuel consumption by operating in an all electric driving
mode for a limited distance and operating in an all
electric stationary mode. All electric trucks are available
in Europe, while there are disadvantages such as limited
range; electric trucks demonstrate that the technology is
available for emission free operation.
--A conventional hybrid typically uses power from the diesel and
gas engine to recharge the battery or may be recharged from
regenerative braking. Since much of the energy in the
battery system results from recharging through the engine,
fuel consumption may be higher.
Reduced emissions, potentially eliminates emissions at the
job site.
--A plug-in hybrid typically reduces fuel consumption and
corresponding CO2 emissions during urban driving
and has a large battery system that can allow the engine to
stay off the entire day at the job-site. The large battery
system is used to power truck mounted equipment such as an
aerial device or electrically powered air conditioning
system. Electricity to recharge the battery system may be
generated by sources with lower emissions; some utilities
generate a sizable portion of power from non-emitting
sources. As an example, PG&E generates over 50% of their
energy from renewable sources.
--A conventional hybrid due to a smaller battery system often may
need to restart the engine at the job-site to recharge the
battery and may not have enough energy in the battery
system to power large loads, such as an electrically driven
air conditioner, with the engine off. When the engine is
started periodically for short durations in the field to
recharge the smaller battery system, emission systems may
not be at optimal effectiveness, potentially resulting in
greater emissions of harmful pollutants.
Lower noise levels during stationary operations.
--The engine typically stays off with a plug-in hybrid, resulting
in lower noise levels. This increases the safety for
linemen and offers quieter operation for working in
residential areas. A conventional hybrid may require the
engine to restart to charge the batteries.
Uses low cost, domestically produced energy from nation's
electric grid.
--Off-sets fuel consumption by displacing petroleum with
electricity. Ability to recharge at off-peak hours.
Maintains a charge or is recharged at any time with
conventional engine.
--While a plug-in hybrid is typically designed to deplete the
charge in the battery system and recharge through the grid,
the system can be designed to maintain a minimum state of
charge in the battery system by recharging through the
engine if needed. This allows extended operations in the
field during situations where it is impossible to recharge
through the grid. In other words, while it is desirable to
recharge a plug-in hybrid through the grid, it is not
necessary to plug it in. Charging using the engine is
similar to how a conventional hybrid recharges.
Improved vehicle acceleration.
--Electric motors provide additional power and torque to the drive
train of the truck. The larger battery system of a plug-in
hybrid provides more energy for extended use of the
electric motor. The smaller battery system of a
conventional hybrid may become depleted more quickly,
reducing available power when needed for climbing grades or
other demanding situations.
Standby power capability: option for 9 kW or more exportable
power for applications such as job site power tools, lighting
and temporary restoration of power to facilities.
--The large battery system of a plug-in hybrid offers the ability
to export power from the vehicle for external uses. In the
more distant future it may be possible to export power from
the vehicle to the grid (Vehicle to Grid, or V2G) to reduce
peak loads on grid generation systems. The smaller battery
system in a conventional hybrid typically does not have
enough energy for export without turning on the engine to
provide additional power.
Reduced maintenance costs.
--Utility vehicles often are serviced based upon hours of engine
operation. A plug-in hybrid truck has reduced hours of
engine operation, potentially extending maintenance
intervals.
Benefits of Electricity as a Fuel
A plug-in hybrid electric truck uses electricity to supplement or
replace the use of fossil fuels. There are several benefits to using
electricity as a fuel.
Electricity is typically produced from domestically sourced
fuel or energy.
Feed Stock diversity promotes stability
--Hydro, Wind, Bio-Mass, Natural Gas, Coal, Nuclear
portion of our nations existing generation fuel mix is
currently CO2 free.
--Example: approximately 56% of PG&E's energy portfolio is
CO2 free
Recent and ongoing legislation promotes cleaner generation
mix over time
--Renewable Portfolio Standard (RPS) legislation enacted in over 20
states
Low fuel cost and minimal additional infrastructure required
--Preferential rates for off-peak consumption
Projected future renewable energy sources tend to be an off-
peak energy resource
--Wind can often produce more energy at night
A plug-in hybrid electric medium duty bucket truck* is shown above.
This type of truck is typically used by utilities of maintenance and
installation of power lines. The truck has many of the benefits listed
previously. Specifically this vehicle has the following features:
---------------------------------------------------------------------------
* All pictures and diagrams have been retained in committee files.
Hybrid launch assist and regenerative braking
All Electric Operation at a job-site for a typical day
35 kWh Energy storage (note: a traditional hybrid may have 2
kWh of energy storage)
--Electrically powered hydraulic system moves Aerial lift &
outriggers, this function is also known as E-PTO
--Electrically powered air conditioning
110/220VAC Electric shore power 9 kW, more optional. Also
referred to as exportable power.
Interfaces with an Allison transmission, the system may also
interface with other transmissions (testing with other
transmissions has not been completed).
Modular design with standard components.
Enhanced reliability with redundant power for critical
operations.
Advanced diagnostics & data acquisition available, ability
to monitor vehicle via satellite
Very versatile design:
--Basic system design can be used on for a variety of truck weight
classes from approximately 16,000 pounds to over 33,000
pounds, GVWR. Testing of the system on vehicles with a GVWR
of 19,500 pounds and those of 33,000 pounds or greater has
begun.
Basic design can be used on a variety of chassis
configurations: 2x4, 4x4, tandem. Testing has begun on the 2
wheel drive application, testing on the tandem will begin
within the next year. Testing on the 4x4 has not been
scheduled.
--System should be able to interface with multiple power trains
from multiple chassis manufacturers. Testing has begun on
GMC and International units and on chassis with gas and
diesel engines.
Ability to tow trailer.
No special diagnostic software.
Enhances stability of vehicle for aerial device
applications.
Utilities can power their fleet with their own fuel:
Electricity
Charges in less than 8 hours using a 220--240 VAC 3 phase
power source and charging station.
Fuel savings are dependent upon the application and unique duty
cycle of the vehicle. The current vehicle reduces fuel consumption
during driving in urban areas by approximately 10--15%. The vehicle
will typically save 100% of fuel consumption during stationary
operations at a job site, resulting in approximately 1 gallon per hour
or more of reduction. There is little to no fuel savings during higher
speed highway driving.
Anticipated fuel savings for a plug-in hybrid in comparison to a
conventional truck depend upon many factors such as the type of system
architecture, size of battery and field application. The following is
an estimate for two types of plug-in systems, one with parallel system
architecture and one with series system architecture. The sample
application is a 20 mile drive, a 5 hour idling period, and an
additional 20 mile drive.
Parallel system with plug-in battery system compared to a
conventional truck:
Stated Assumptions:
Conventional chassis: approximately 8 mpg fuel efficiency
during driving and approximately 1 gallon per hour fuel
consumption during idle.
Parallel system with plug-in: approximately 12% decrease in
fuel consumption for a plug-in hybrid during driving and 0
gallons per hour fuel consumption during idle.
Estimated fuel savings: 56% reduction in fuel consumption, or
approximately 1400 gallons of fuel saved per year, based upon
250 work days per year. Over 15 years, estimated fuel savings
exceed 20,000 gallons per truck.
Series system with plug-in battery system compared to a
conventional truck:
Stated Assumptions:
Conventional chassis: approximately 8 mpg fuel efficiency
during driving and approximately 1 gallon per hour fuel
consumption during idle.
Series system with plug-in: 50% decrease in fuel consumption
for a plug-in hybrid during driving and 0 gallons per hour fuel
consumption during idle.
Estimated fuel savings: 75% reduction in fuel consumption, or
approximately 1875 gallons of fuel saved per year, based upon
250 work days per year.
Due to the large amount of savings, medium and heavy duty trucks
with plug-in hybrid technology may be able to reach an attractive
return-on-investment more quickly than other vehicles.
A diagram of a plug-in hybrid electric system for a truck is shown.
Electrical energy is used to increase efficiency while driving through
hybrid launch assist and regenerative braking. Electrical energy also
powers equipment loads at a job site, potentially eliminating the need
to run the engine.
Deployment of Plug-In Hybrid Trucks
DUECO has started to deploy 25 plug-in hybrid medium duty trucks to
early adopters. A number of major investor owned utilities across the
country have agreed to use the plug-in hybrid bucket trucks in field
evaluations. Ten units have been built as of September 2008; the
remaining units are targeted for completion before the end of the year.
DUECO completed delivery of the first unit to Adams Electric
Cooperative earlier in the year. The unit has been operated by Adams in
regular fleet operations to maintain power lines. Using a large 35 kWh
battery system and interfacing with an Allison transmission, the plug-
in hybrid system provides launch assist, regenerative braking, power
for hydraulically operated equipment, electrically powered air-
conditioning, and 120/220 VAC exportable power. DUECO plans to
significantly ramp-up production of units in 2009 and beyond.
In June of 2008, DUECO introduced the first medium duty PHEV digger
derrick. The unit is currently undergoing testing, production is
planned for 2009. Digger derricks are used by utilities to drill holes,
set poles and lift large loads. The demand for power from the plug-in
hybrid system can be very high during certain operations, such as
digging in rocky terrain.
Other manufacturers have begun to test plug-in hybrid drive systems
and all electric power trains.
According to testimony provided by Mr. Eric M. Smith on June 10,
2008, Eaton was working with the Electric Power Research Institute to
develop commercial PHEV trucks and was also working on the development
of a PHEV for use in utility truck applications.
European truck manufacturers Modec and Smith Electric Vehicles have
produced all electric commercial vehicles.
Prospects for wider deployment in the near future
While plug-in hybrid technology for medium and heavy duty trucks
offers numerous benefits, there are several technical and commercial
hurdles that must be overcome to enable the wide-scale deployment of
plug-in hybrid trucks in the near term. Near term is considered to be 5
years or less.
DUECO believes that these challenges can be overcome, or largely
mitigated, in the short term with a focused effort and the proper
partnership between industry and government.
Major technical and commercial hurdles for wide-scale deployment of
plug-in hybrid trucks
Although current plug-in hybrid technology has the potential to
provide significant benefits for many applications, short comings in
certain areas decrease the value proposition of plug-in hybrid systems
for medium and heavy duty trucks. Wide scale deployment must be driven
by demand. It is necessary to improve the value proposition by
providing greater performance and fuel savings for less incremental
cost.
Battery system technology
Existing battery technology either tends to offer battery systems
that are relatively low cost, but heavy, large and of limited life or
are relatively expensive, but much lighter, smaller and with
potentially longer life. While certain applications of trucks may be
able to carry lower cost, heavier battery systems, it is generally
desirable to minimize battery system weight, size and cost. Development
of cost effective larger advanced battery systems, potentially with
energy storage in excess of 35 kWh, or even in excess of 100 kWh, would
improve the performance and reduce the operating cost of plug-in hybrid
trucks.
In order to accelerate deployment of plug-in hybrid trucks using
existing technology, it may be desirable to design battery systems that
are modular, that allow for newer technology battery systems to be
placed on existing vehicles when the original battery system no longer
performs to acceptable standards.
Battery systems for commercial trucks must operate in different
conditions and duty cycles than those in automotive applications.
Trucks must often locate the larger battery system on the exterior of
the truck, exposed to the elements. Trucks may also operate for much
longer duty cycles. Commercial vehicles may be driven 12--16 hours per
day, or operate for multiple shifts. Cars used for commuting may only
operate for a few hours per day.
System architecture
Existing hybrid systems for trucks tend to utilize system
architectures that are similar in many ways to that of existing truck
power trains. The internal combustion engine typically remains
operating while the vehicle is driven to power auxiliary loads such as
power steering systems, brake systems and HVAC systems. Keeping the
engine running while stationary or in low speed stop and go traffic
increases fuel consumption. Some vehicles also do not have a clutch in
between the internal combustion engine and the transmission. While such
systems utilize an automatic transmission, it may be desirable to
create a method to uncouple from the transmission from the engine for
improved regenerative braking or an all-electric drive mode.
In order to improve fuel economy further, different system
architectures that are designed for high volume production in which the
internal combustion engine can remain off during driving need to be
developed. The development of electrically driven sub-systems such as
braking, power steering, HVAC and others need to be brought to high
volume production for medium and heavy duty trucks.
Existing parallel hybrid electric vehicle systems for trucks also
tend to use relatively small electric drive components with relatively
low power output, compared to the power provided by the internal
combustions engine. Larger electric motors and higher capacity battery
systems may allow smaller engines to be used that operate at higher
efficiency without a reduction in vehicle performance, or allow the
vehicle to be driven entirely by electric propulsion. Future system
architectures could also combine the benefits of plug-in hybrid
technology, which requires battery systems with high energy densities,
with that of hydraulic hybrids that have high power densities. The
combined plug-in electric hybrid system with hydraulic hybrid
components could offer high horsepower during acceleration and
recapture more energy during braking while providing enough energy for
sustained operation with the engine off.
Alternative power train architectures, such as a combined series/
parallel hybrid system with a plug-in battery system are also
recommended for consideration. A combined series/parallel system would
allow the vehicle to operate in an all electric mode, a series hybrid
configuration or a parallel hybrid configuration, depending upon which
is most advantageous given operating requirements.
Utility infrastructure
While studies tend to indicate that there is sufficient capacity in
the nation's energy grid at off-peak periods to provide power for
charging a large number of plug-in vehicles, there has been little
testing on the effects of charging a large number of commercial plug-in
hybrid trucks. A commercial fleet of 1000 vehicles, each with a 35 kWh
battery system, could require approximately 25,000 kWh (or 25 MWh) of
energy to recharge overnight. Assessment and testing on the effects of
charging a large number of plug-in hybrid trucks is suggested, along
with an assessment of the interface with Smart Grid technology and
associated advanced metering systems.
Commercial trucks with large battery systems also typically require
higher charging voltages in order to recharge overnight. The lack of
higher voltage circuits in existing truck storage areas could create
barriers and increase the cost to deploy such technology.
Research into specific medium and heavy duty applications
Plug-in hybrid technology for medium and heavy duty trucks has the
potential to reduce fuel consumption and emissions in a wide variety of
applications. Besides aerial utility trucks and delivery trucks, other
truck applications such as those that use cranes, compressors, welding
equipment, or are used in gas utility maintenance, refrigeration,
rescue, refuse and construction may benefit from plug-in hybrid
technology.
Specific information about the energy required for various mobile
and stationary applications is typically not available. In order to
optimize the design of a plug-in hybrid medium or heavy duty truck, it
is recommended that data be collected on actual fleet utilization,
including miles driven, time at idle, power requirements, fuel
consumption and other operational factors. The development of plug-in
hybrid systems for vehicles that operate at especially low efficiency
should be a priority and testing should be undertaken to validate
improved efficiency and reliability.
Accelerated testing
Plug-in hybrid technology for medium and heavy duty trucks is
relatively new and still under development. Assistance is needed to
accelerate testing and reduce the costs of large scale field tests.
Investment requirements
Development of new technology and manufacturing capability requires
significant investment. The cost of capital for development has
increased for a variety of reasons. Assistance such as funded loan
guarantee programs backed by the government can enable companies to
continue development in difficult economic times. Needed investment is
estimated to be well in excess of $300 million, excluding additional
investment needed for battery development.
Grants can also accelerate investment in the development of new
plug-in hybrid technology. DUECO strongly encourages the Senate to
adopt and support ``The Heavy Duty Hybrid Vehicle Act'' H.R. 6323 or
similar legislation.
Low initial production volume and high cost
Low initial production volume, combined with high start-up costs
can prohibit companies from pursuing plug-in hybrid technology. As
volume increases, fixed costs are spread over more units, resulting in
lower unit costs. Tax incentives can accelerate demand by lowering the
initial cost to the consumer. DUECO encourages the government to
consider tax incentives that result in lower costs to the market for
large PHEV systems in vehicles with GVWR of 19,500 lbs. or greater and
battery system sizes of up to 60 kWh or greater.
Additional weight
The large battery systems required for medium and heavy duty trucks
add weight to the vehicle. Since newer technology battery systems with
lower mass may not be ready at a commercially viable price in the near
term, heavier batteries with shorter effective life may be the only
cost effective alternative. The additional weight of less advanced
battery systems can cause a truck to exceed 33,000 lbs., the weight
limit for exemption from Federal Excise Tax. The government should
consider waiving FET on vehicles that have plug-in hybrid drive
systems. This will further reduce the effective cost to the consumer
and accelerate deployment of PHEV technology in trucks.
DUECO's experience with government technology development programs and
how the federal role can be enhanced
Federal technology development programs focused on plug-in hybrid
systems for medium and heavy duty trucks have been very limited. DUECO
has not obtained federal assistance in this area, with the exception of
possible general research tax credits. Most of the funding in this area
has focused on the development of plug-in technology for automobiles or
has been focused on large original equipment manufacturers. The medium
and heavy duty truck industry is unique in that many of its products
are often manufactured in multiple stages and brought to market by
companies that are not directly affiliated with the original equipment
manufacturer.
DUECO encourages the federal government to develop programs that
help to specifically fund research into the development of plug-in
hybrid systems for medium and heavy duty trucks used in specific
applications and that are open to final stage manufacturers and other
entities. Assistance with testing, certification, the creation of tax
incentives for customers, and modification of government purchasing
policies to favor the acquisition of more fuel efficient trucks using
plug-in hybrid technology can also accelerate development and
deployment.
Commercial fleets consume large amounts of fuel, developing more
efficient trucks that utilize domestically sourced power from the
nation's energy grid would have several benefits.
The development of this technology in the United States would
provide opportunities for job creation, export opportunities, reduce
the costs for businesses competing in a global market, reduce
greenhouse gas emissions and emissions of other pollutants, reduce
dependency on foreign oil, reduce noise within our cities and
potentially improve productivity for certain applications, such as
electric crews who could perform work at night in residential areas.
This is potentially a historic opportunity to develop the
technology needed for the electrification of medium and heavy duty
trucks. I ask for your support of the proposed measures that would help
to accelerate deployment of plug-in hybrid technology for medium and
heavy duty trucks and encourage the development of partnerships between
manufacturers, utilities and the government.
The Chairman. Thank you very much.
Mr. Balkman, go right ahead.
STATEMENT OF THAD BALKMAN, GENERAL COUNSEL AND VICE PRESIDENT,
EXTERNAL RELATIONS, PHOENIX MOTORCARS, ONTARIO, CA
Mr. Balkman. Thank you, Mr. Chairman. Good morning, members
of the committee. I am Thad Balkman. I am Vice President of
External Relations with Phoenix Motorcars. As a former State
legislator, I am a little bit used to these hearings, albeit on
a much smaller scale and sitting on the other side of the dais.
But I appreciate the opportunity to come this morning and
give you the perspective of a small startup electrical vehicle
company.
We are based in Ontario, California, and we manufacture
freeway speed, full-sized battery electric vehicles. We make a
sports utility truck and a sport utility vehicle. We will get a
picture of the sports utility truck over here. Our vehicles
sell for $47,500. We are beginning to build on a demonstration
fleet and expect to begin production in early 2009.
Mr. Chairman, last week you asked about game changers. The
electric vehicle is a game changer. The EPA estimates gives us
a rating of 135 miles per gallon. It is 135 miles per gallon on
a single charge of the battery. No gas is required. The major
benefit of the electrical vehicle is that electricity costs
about one-sixteenth the cost of gasoline. So I can charge the
sports utility truck. It is going to cost me about $4 to charge
the battery, whereas when I go back home and go to fill up my
Hyundai Sonata, I am going to pay about $64 to refill the gas
tank. So electrical vehicles give consumers a great amount of
choice, but also a cash back.
So I guess one of the points I want to emphasize is that--
and it has been emphasized by other members of this panel--by
adopting electrical vehicle transport, we are going to be no
longer dependent on foreign oil. Instead, we are going to be
using electricity and start using domestic resources, domestic
coal, domestic natural gas, wind power, hydroelectric power,
solar power, which gives us obvious benefits of national
security. Best of all, it is a lot cleaner. In fact, in
California, our vehicles qualify for the California zero
emission vehicle gold standard and does a lot to clean up the
smog that we have in Los Angeles and even here in Washington,
DC.
Our sports utility truck and sport utility vehicles can be
charged two ways. You can plug them in at home and let them
charge overnight. It takes about 4 to 6 hours. Or you can
actually use a rapid charge device, and they are recharged in
as little as 10 minutes. This really helps address some of the
concerns of range anxiety because with the rapid charge you can
go a lot longer than the 130 miles on a single charge for a
battery.
I want to also address some suggestions I have for the
Senate. They are outlined in my written testimony.
But I want to encourage members of this committee and the
rest of the members of the Senate to follow the House and pass
the $7,500 tax credit. I know there is a number of energy
measures out there, but this will do a lot because what it does
is it gives people that purchase electric vehicles up to $7,500
in tax credit.
I put a little plus sign there because we would actually
like to ask you to lift that cap for battery electric vehicles.
Pure battery electric vehicles have twice the battery capacity,
twice the energy independence, and have twice the benefits for
global warming concerns. Therefore, we would hope that they
would earn twice the credit. By doing that, you are actually
going to be bringing down that cost I mentioned earlier. They
run about $47,500. By lifting that tax credit, you are going to
make the vehicle and price just about the same price range as
its internal combustion gas counterpart.
Also, we would like to ask the Senate to help level the
playing field with other alternative energy sources and create
an alternative refueling investment tax credit.
We would also encourage the Senate to--I have heard a lot
about greening the capital. We would like to see the Government
fleet green and purchase electric vehicles for use in various
Government departments, including here at the United States
Capitol.
I would also suggest that we bring electric vehicles into
the refueling fuel standard. Including renewable energy into
the RFS encourages more investment in solar and wind power,
which is used to recharge or in some cases used to recharge
electric vehicles.
Also, I know there has been a lot of discussion about a cap
and trade program. When you all figure out the details on that,
I would hope that you would include electric vehicles in any
future cap and trade program and allow electric vehicles a
carbon allowance that would help reduce the incremental costs
that we are faced with in electric vehicles these days.
Also, another suggestion would be to create a Government-
backed battery guarantee program. We have heard some of the
members of the panel talk about how battery technology is still
in its infancy, and by creating such a guarantee program, it
would help address some of those concerns because, quite
frankly, the biggest cost of the electric vehicle is in the
battery.
Finally, we would ask you to increase investment in
advanced technology, particularly in the battery development.
Today, unfortunately, the United States lags far behind other
countries in the world in battery development. We would like to
change that.
Like I said, I have put more detail into the written
testimony and I would ask you to look at that.
I would be happy to answer your questions and also would
like to invite each one of you, next time you are in southern
California, to stop by. We would like to give you a drive in
one of our sports utility trucks. We plan on bringing them out
here in December, and you will also be invited to take a ride
at that time too.
Thank you very much.
[The prepared statement of Mr. Balkman follows:]
Prepared Statement of Thad Balkman, General Counsel and Vice President,
External Relations, Phoenix Motorcars, Ontario, CA
Mr. Chairman and members of the Committee, this document
supplements and expands upon my oral testimony during today's hearing.
Thank you for your invitation to share with you what Phoenix Motorcars
is doing to meet the dual challenges of our nation's dependency on oil
and global climate change. We join all Americans in applauding your
interest in learning about the current status of vehicles powered by
the electric grid and the prospects for wider deployment. Based upon
our experience in developing an advanced all-electric Sport Utility
Truck, we at Phoenix Motorcars are convinced that all-electric vehicles
present the best near-term solution to eliminate our dependence on oil
and tackle the difficult challenge of climate change. We hope that the
information we share with you this morning will be of value as you
consider legislation to address these important issues.
introduction to phoenix motorcars
Phoenix Motorcars was founded in 2001 in Southern California. Our
mission is to develop best in-class, zero emission vehicles (ZEV) for
the U.S. commercial and government fleet markets initially and then
later expanding into the consumer market. Phoenix is headquartered in
Ontario, California. Our team of employees has over 300 years of
collective experience working on vehicle and alternate fuel programs
for leading automotive companies.
After six years of research and development work into full
performance battery electric vehicles, Phoenix began the
commercialization process of our Phoenix Sport Utility Truck model with
the assistance of many strategic partners including Energy CS,
Altairnano Technologies, AeroVironment and many other innovative
companies. The accumulated effort of Phoenix and our partners has
produced a truly best in class electric vehicle that will set the
milestone for battery electric vehicles (BEV) to come. A few highlights
about our BEV:
Range of 100+ miles per charge
Top speed of 95 mph
High crash test safety rating
Battery charging in as little as 10 minutes with off-board
fast-charging equipment
$3 cost per charge using the on board charger
A projected EPA rating of 135 mpg
0 to 60 mph in 10 seconds
Phoenix is now set to begin production in the fourth quarter of
this year with deliveries beginning in the first quarter of 2009. Our
demonstration fleet is currently under build to complete testing prior
to vehicle production. These demonstration vehicles use the Altairnano
lithium titanate battery and demonstrate a Phoenix BEV's ability to
rapid charge and perform in real world applications. The price of the
Phoenix SUT and SUV are $47,500 and $54,000 respectively.
life cycle costs
The retail costs of the Phoenix SUT and SUV are a bit higher than
their gasoline fueled counterparts, mainly due to the cost of the
battery pack. However a comparison of the life cycle cost of electric
vs. gasoline shows that the owner of a Phoenix saves a considerable
amount of money--with a payback in about 2 years. Per mile, electricity
is 1/16th the cost of gas. The owner of a Phoenix BEV who drives 15,000
miles per year can expect to save approximately $4,000 in gasoline
costs. Furthermore, BEVs have less than 10% of the moving parts when
compared to gasoline powered cars. BEVs don't have pistons,
transmissions, engine oil, spark plugs, valves, starters, clutches,
distributors, oil filters, fuel pumps, fuel filters, air filters, water
pumps, timing belts, fan belts, catalytic converters, or mufflers. No
fumes, no exhaust, no smog tests, no oil changes, no radiator flushes,
no loud engine, no warm-ups, and no gas lines. Maintenance savings
equal about $1500 per year. Coupled with available incentives like
California's $5000 tax rebate and the federal $7500 rebate under
consideration, and the purchaser of an BEV realizes a payback in less
than 2 years.
rapid charge infrastructure
Phoenix Motorcars is currently the only electric vehicle
manufacturer that has safely demonstrated the ability to rapid charge a
vehicle in 10 minutes, using fast-charging technology developed by
AeroVironment, Inc., which like Phoenix Motorcars is a home grown
American BEV technology leader. This unique ability requires industrial
480V 3 Phase power and a 250kW off-board charger that is controlled by
the vehicle's battery management system. Because our advanced Li-Ion
batteries can be fully recharged in 10 minutes with no impact on
battery calendar or cycle life, so-called ``range anxiety'' is
eliminated. Our vehicles can be recharged in the same time it takes to
fill the tank of a gasoline vehicle. Even with this ability, some
utilities have expressed concern about the potential impact on the grid
of many Phoenix vehicles ``rapid charging'' during peak power use.
However, duty-cycle studies show that most of our vehicles will be
recharged overnight when electricity demand is low. According to the
U.S. Department of Energy's National Renewable Energy Laboratory, the
large-scale deployment of plug-in hybrid electric vehicles will have
negligible impact on the electric power system which has sufficient
available capacity to electrify up to 84% of our nation's cars, pickup
trucks, and SUVs for the daily 33 mile driving distance of the average
American. For the small percentage of electric vehicles that will be
``rapid-charged'' at central charging stations, Phoenix has developed a
technical solution that will enhance penetration of renewable energy
such as solar and wind power, and is based on an electrical storage
variation of the traditional gas station model.
Today, gasoline stations rely upon underground liquid petroleum
storage tanks. When the driver realizes she's low on fuel, she simply
pulls into a conveniently located gas station and purchases a desired
amount of fuel for her vehicle. The capital cost of storage and
dispensing equipment at these gas stations typically exceeds a million
dollars. But, if one also considers the external costs associated with
groundwater contamination, smog and its associated disease and property
damage, the total cost of each service station is millions of dollars.
The electric vehicle ``rapid charge'' station concept developed by
Phoenix follows a similar model but with a fraction of the capital cost
and none of the external human health and environmental cost. Instead
of petroleum storage tanks to hold gasoline and diesel, multi-megawatt
battery banks will be installed below or above ground to fill the need
for daily electric vehicle charges. These batteries can be recharged
from the utility grid during off-peak distribution times (such as in
the middle of the night), from solar panels, wind power or other
electricity power generation methods. An electric vehicle driver
finding her vehicle in need of a quick charge will pull into a charging
station, connect the charging cable to the vehicle, and begin
transferring energy from the stationary battery bank to the electric
vehicle battery. The same credit card system we use today in gasoline
stations will be used to purchase the charge and return the driver back
on the road in a matter of minutes.
This charging station model will provide real benefits to electric
vehicle owners as well as to federal and state governments. Batteries
will present no lingering environmental concerns for the sites they are
located on. Rapid charging stations will hasten and assist mass
adoption of electric vehicles and will create synergy for the adoption
of renewable electricity from wind and solar technology. Battery banks
at recharging stations also will provide a second life for older
vehicle batteries no longer suited for transportation but which are
still viable for stationary applications. Battery banks will feed
energy back onto the energy grid under certain conditions. Cost of the
energy can be regulated and controlled domestically, on US soil. In
this way, batteries will provide power sources distributed across the
nation that can be deployed as temporary power sources during
emergencies.
forecast for future
Phoenix has received over 600 orders from fleet customers and more
than 20,000 individual reservations. These orders represent billions of
dollars in domestic production. Among those placing orders are: City of
Fresno, City of Santa Monica, Waste Management, and Clark Pest Control.
We are also on the GSA list and have begun discussions with numerous
federal agencies interested in greening their fleets.
Our current business plan sets the following sales targets for both
the fleet and consumer markets:
2009: 2,500 vehicles
2010: 10,000 vehicles
2011: 51,000 vehicles
challenges we face
Phoenix BEVs incorporate the following core technologies: BEV
integration, vehicle drivetrain, accessory components, battery systems,
battery tray, vehicle integration module, battery management system,
drive-by-wire, climate control operations, and vehicle certification.
While some of these components are common to traditional ICE vehicles,
the market and supply chain for batteries and electric motors is still
in its infancy and is limited. This is especially true here in the
United States. And the cost for these essential components is still not
competitive. The Center for Automotive Research estimates battery costs
alone add $7,000 to $10,000 per vehicle.
past attempts to address evs
In order to overcome these barriers to market and to promote energy
independence for our nation, Government must take bold steps to adopt
an alternative fuel policy agenda that places BEVs front and center and
elevates them to at least the same level if not higher as other
alternative fuels supported in the past.
Nearly 32 years ago, in the face of our last energy crisis,
Congress passed the Electric and Hybrid Vehicle Act of 1976, which
declared that the era of the electric vehicle had arrived and that it
was the policy of Congress to:
(1) encourage and support accelerated research into, and
development of, electric and hybrid vehicle technologies;
(2) demonstrate the economic and technological practicability
of electric and hybrid vehicles for personal and commercial use
in urban areas and for agricultural and personal use in rural
areas;
(3) facilitate, and remove barriers to, the use of electric
and hybrid vehicles in lieu of gasoline and diesel powered
motor vehicles, where practicable; and
(4) promote the substitution of electric and hybrid vehicles
for many gasoline-and diesel-powered vehicles currently used in
routine short-haul, low-load applications, where such
substitution would be beneficial.
The Act created a new loan guarantee program to encourage the
commercial production of electric and hybrid vehicles. The new program
authorized DOE to guarantee principal and interest on loans for the
purposes of:
(1) research and development related to electric and hybrid
vehicle technology;
(2) prototype development for such vehicles and parts
thereof;
(3) construction of capital equipment related to research on,
and development and production of, electric and hybrid vehicles
and components; or
(4) initial operating expenses associated with the
development and production of electric and hybrid vehicles and
components. See 15 U.S.C. Sec. 2509.
Unfortunately, the loan guarantee program utterly failed. Since the
passage of the Act in 1976 (following an over-ride of President Ford's
veto), precious little has been done to help create the market for
BEVs. This is not to say that the Congress has not tried. In fact,
since 1976, various Congressional committees have convened more than 40
hearings and received tens of thousands of pages of testimony from the
automobile industry, academia, government laboratories, government
agencies and other experts seeking an answer to the same question we
face today: how can our Nation break our addiction to petroleum? A
sampling of these various Congressional hearings follow:
November 24, 1979: Hearings on Storage Batteries for Electric
Vehicle Applications;
March 7, 18, 1980: Hearings on World Auto Trade: Current Trends and
Structural Problems;
April 15, 1980: Hearing on Automotive Average Fuel Economy
Standards;
May 2, 1980, Hearings on Automotive Technology and Fuel Economy
Standards;
May 28, 1980: Hearings on National Automotive Research Act;
July 17, 1985: Hearings on Rollback of CAFE Standards and Methanol
Vehicle Incentives Act of 1985;
September 14-16, 1988: Hearings on the Global Environmental
Protection Act of 1988;
May 2, 1989: Hearings on Global Warming and CAFE Standards;
September 7, 1989: Hearings on Motor Vehicle Efficiency Act of
1989;
January 11, 1990: Hearings on Alternative Fuels
September 23, 1990: Hearings on Electric Vehicle Technology and
Commercialization;
October 24, 1990: Hearings on Energy Policy Implications of the
Middle East Oil Crisis;
February 21, 1991: Hearing on Motor Vehicle Efficiency Act;
April 26, 1991: Hearings on Global Warming and Other Environmental
Consequences of Energy Strategies;
May 16, 1991: Hearings on HR 1538, National Electric Vehicle Act of
1991;
June 11, 1991: Hearings on Electric and Hybrid Vehicle
Technologies;
May 11, 1993: Hearings on Status of Domestic Electric Vehicle
Development;
September 29, 1993: Hearings on Alternative Transportation Fuel
Additives;
June 30, 1994: Hearings on Electric Vehicles and Advanced Battery
R&D;
June 14, 2000: Hearings on the Clean Air Act: Environmental
Benefits and Impacts of Ethanol
January 2, 2001: Hearings on National Energy Policy: Conservation
and Energy Efficiency;
March 21, 2001: Hearings on the Clean Air Act Oversight Issues;
May 30, 2001: Hearings on Innovative Environmental Technologies;
June 22, 2001: Hearings on National Energy Policy: Conservation and
Energy Efficiency;
June 12, 2001: Hearings on Effect of Federal Tax laws on the
Production, Supply and Conservation of Energy;
July 18, 2001: Hearings on National Energy Issues;
December 6, 2001: Hearings on Corporate Average Fuel Economy (CAFE)
Reform;
January 24, 2002: Hearings on National Security, Safety,
Technology, and Employment Implications of Increasing the CAFE
Standards;
June 2, 2002: Hearings on Department of Energy's Freedom Car:
Hurdles, Benchmarks for Progress and Role in Energy Policy;
March 5, 2003: Hearings on The Path to a Hydrogen Economy;
March 6, 2003: Hearings on Energy Use in the Transportation Sector;
March 3, 2004: Hearings on Reviewing the Hydrogen Fuel and Freedom
Car Initiatives;
February 9, 2005: Hearings on Improving the Nation's Energy
Security: Can Cars and Trucks Be Made More Fuel Efficient?;
May 15, 2005: Hearings Public Policy Options for Encouraging
Alternative Automotive Fuel Technologies;
July 28, 2005: Hearings on Automotive Technologies and Energy
Efficiency
October 20, 2005: Hearings on U.S. Foreign Policy, Petroleum and
the Middle East
May 17, 2006: Hearings on The Plug-In Hybrid Electric Vehicle Act
of 2006
March 7, 2006: Hearings Energy Independence
October 3, 2007, Hearings on Energy Storage Technologies: State of
Development for Stationary and Vehicular Applications;
January 3, 2007: Hearings on Transportation Sector Fuel Efficiency;
After 32 years of hearings and debate it is time for action. Today,
our Nation is perilously dependent upon foreign oil to fuel our cars
and trucks. In June of 2008 the Energy Information Administration
reported that in 2007 we imported 12 million barrels of foreign oil
each day. With crude hovering at $100 per barrel Americans sent $120
million per day of their hard-earned wages to foreign countries. This
dependency poses both a security risk and an economic crisis never
before experienced by our Nation. The urgent nature of the problem
compels Congressional intervention to finally catalyze the market for
electric vehicles. No other near term automotive technology offers the
ability to immediately end dependence on foreign oil, drastically cut
smog and global warming emissions, and avoid a massive decades-long
investment in new fuel distribution infrastructure.
Phoenix Motorcars understands that Congress is appropriately
reluctant to legislate winners and losers among competing technologies.
However, battery electric vehicles should be the one exception to this
rule. It is the only technology that can solve our problem of petroleum
dependency and global warming emissions within 10 years. The battery
technology enabling high density energy storage has finally arrived and
is steadily improving. The supply infrastructure to refuel the vehicles
exists in every home and business across the Nation. At the very least,
Congress must give electric vehicles equal treatment with the other
alternative fuel options. With the right mix of market incentives, an
historic opportunity exists to change fundamentally our transportation
paradigm away from petroleum and toward electricity supplied from
renewable sources.
It is only with decisive action by the Congress will our Nation
finally begin to solve its twin Achilles Heels of dependence on foreign
oil and runaway carbon emissions. The time for more hearings, more
debate, and more study has passed. Meaningful legislative action is
needed.
how government can assist
Cost is the principal barrier to rapid adoption of BEVs. Our
vehicles cost about $15,000 more than their gasoline counterparts
largely because economies of production in battery manufacturing and
vehicle integration have not yet been achieved. This incremental cost
is a big barrier to commercialization of the technology because data
show that consumers will not pay extra for more fuel efficient vehicles
unless the pay-back is 2.5 years or less. The pay-back must be
relatively immediate or consumers will not pay the higher price. This
means that BEVs with incremental costs upwards of $15,000 may not sell
and manufacturers, facing an uncertain market, will not produce them.
Phoenix Motorcars is pleased that the House passed a tax credit for
plug in vehicles in the energy extenders bill earlier this year. But
this tax credit does not go far enough. Phoenix Motorcars believes that
a key to accelerating the adoption of BEVs is to foster fairer
competition among the various alternative fuels within the Federal
Government's existing fuel diversification policy framework. Electric
vehicles currently receive less incentives than other alternative fuel
vehicles even though they release no pollution, require no massive
investment in new fuel infrastructure, and cause no price disruptions
in our food supply.
Following are a number of additional tools that Congress should
provide to help expedite the commercialization and wider deployment of
battery electric vehicles in the near future.
Congress should not cap the tax credit for BEVs at $7,500.
The existing proposed tax credit of up to $7,500 for qualified
plug-in hybrid electric drive vehicles consists of a base
credit of $2,500 for each qualified plug-in hybrid electric
drive vehicle plus $400 for each kilowatt hour of battery
capacity above 4 kilowatt hours. As structured, the credit
treats BEVs the same as hybridelectric vehicles even though
BEVs eliminate the use of gasoline entirely, have zero
emissions, and are more costly, all due to their larger battery
packs which eliminate the need for internal combustion engines.
By lifting the $7,500 cap for BEVs only, Congress would provide
greater incentives for the production of all-electric vehicles
because the cost premium would be substantially reduced. Thus,
the Phoenix Motorcars SUT, which uses as 35kWh battery, would
qualify for a $15,000 credit. The Tesla sports car, which uses
a 53kWh battery, would qualify for a $22,000 credit. Due to
their higher cost, BEVs will have a much smaller market
penetration in the next few years when compared with PHEVs
unless they receive tax credits proportional to their larger
battery size and energy-independence benefit. Raising the tax
credit limit for BEVs would require additional funding for the
legislation, but not by a substantial increment given the low-
volume production which is projected over the next five years.
Congress should bring electric vehicles charged with solar,
wind, or other renewable electricity, into the Renewable Fuels
Standard program under Section 211 of the Clean Air Act. The
Energy Independence and Security Act of 2007 amended the RFS
created by the 2005 Energy Policy Act by requiring refiners to
ramp-up production of ethanol to 36 billion gallons by 2022.
The RFS program provides for credit trading between refiners
subject to the RFS standard. Certain other fuels that are not
even blended into gasoline also qualify for credits, including
biodiesel and biogas. However, renewable electricity used to
fuel BEVs currently is not included in the RFS. By making
renewable electricity eligible under the RFS, the Congress
would encourage more investment in solar, wind, and other
renewable energy sources to recharge electric vehicles. In
turn, petroleum refiners subject to the RFS mandate would have
more options available to satisfy the RFS mandate by purchasing
credits generated by solar and wind electricity. This, in turn,
would help alleviate some of the economic pressure to divert
corn crops to the production of ethanol. The diversion of 25-
35% of the domestic corn crop to ethanol production is a prime
factor in the recent increase in global food prices.
Congress should mandate government fleet purchases of BEVs,
with particular emphasis on Air Quality Control Districts with
severe ozone non-attainment issues to leverage the co-polluton
reduction benefits of BEVs. This could be accomplished by
revising the alternative fuel vehicle (AFV) fleet program
created by the Energy Policy Act of 1992. The AFV fleet program
was intended to reduce our dependence on foreign oil by forcing
government agencies, oil refiners and energy utilities to buy
alternative fuel vehicles. By legislating market demand, the
AFV fleet program was expected to induce the automobile
industry to manufacture AFVs at scale, thereby leading to a
gradual conversion of our Nation's vehicle fleet to AFVs.
Unfortunately, as with the loan guarantee program of the
Electric and Hybrid Vehicle Act of 1976, the AFV program has
failed. The only mass-produced alternative fuel vehicle
technology inspired by the program is a $100 change to the fuel
system of gasoline vehicles to enable so-called E85 ``flex-
fuel'' capable vehicles. Ninety-eight percent of the Federal
Government's AFV purchases in 2006 were E85 flex-fuel vehicles
that run on ethanol only a tiny fraction of the time due to
limited ethanol delivery infrastructure. By mandating that a
specified percentage of government AFV purchases be all-
electric vehicles, the Congress would create the kind of market
demand first envisioned by the 1992 Energy Policy Act.
Congress should include BEVs in any future CO2
cap & trade program thereby monetizing their lifetime
CO2 benefits and creating additional value that
would reduce their high incremental cost. CO2
allowances could be awarded to BEVs at the point of initial
sale under a ``lifetime bonus allowance set-aside.'' We suggest
an initial bonus allowance set-aside ratio of 4:1. Under the
bonus concept, certain valuable technologies are allocated
allowances at a ratio greater than one allowance to one ton of
CO2 reduced or sequestered. The bonus concept is
consistent with the Carbon Capture & Storage provisions of the
Lieberman-Warner bill. Using EPA data, we estimate that a
single Phoenix Motorcars SUT or SUV eliminates roughly 35 tons
of CO2 over 150,000 miles as compared to an average
light-duty gasoline powered vehicle at 20 miles per gallon, a
CO2 emissions rate of 19.4 pounds/gallon, and the
national average CO2 content of the electric grid.
At a projected allowance price ranging between $22 and $61 per
ton in the year 2020 under various future cap and trade
scenarios, monetizing the lifetime CO2 reductions of
BEVs under a bonus allocation of 4:1 would reduce incremental
cost by roughly $3,000 to $8,500. Making BEVs eligible for
lifetime CO2 bonus allowance set-asides within the
CO2 cap and trade system--at least until economies
of production scale are achieved--would create a direct
incentive for OEMs to produce BEVs and would reduce incremental
cost by monetizing their CO2 reduction benefits. By
capturing the discounted value of the total amount of avoided
CO2 emissions over the lifetime of a BEV, the
incremental cost of BEVs could be reduced and the technology
could enter the market more quickly. The lifetime
CO2 reduction benefits could be monetized through a
prepaid forward contract approach, under which the buyer of a
commodity stream over time prepays the seller for the entire
stream up front. This prepaid forward contract approach is
often used in energy markets, such as natural gas volumetric
production payment contracts, which enable energy traders to
hedge price risk. As applied to BEVs the prepaid forward
contract approach would enable the estimated income stream from
the CO2 allowances generated each year over a
specified period to be monetized, discounted to present value,
and transferred at the vehicle point-of-sale. The associated
``income'' from the sale of the lifetime pollution reduction
benefits would be revenue neutral.
Congress should consider creating a government-backed
battery-guarantee program, which was suggested by David
Sandalow of the Brookings Institute in his book ``Freedom from
Oil.''
Congress should increase investment in advanced
technologies, namely advanced battery development.
final observations
Loan guarantees, basically direct subsidies to large OEMs, will not
create the necessary competitive market conditions to foster innovation
to create truly advanced vehicles, like the Phoenix Motorcars SUT and
SUV. This kind of subsidy program did not work with the 1976 Electric
and Hybrid Vehicle Act, nor did it work more recently with the 2005
Energy Policy Act, Title 17 of which had a similar $2B loan guarantee
program for ``production facilities for fuel efficient vehicles,
including hybrid and advanced diesel vehicles.'' Tellingly, none of the
Big 3 applied for loan subsidies under either of these programs.
It is also doubtful that massive retooling really is necessary to
produce electric vehicles at scale. The basic components of both the
Phoenix Motorcars SUT and SUV, for example, the body, electric motor,
and battery pack are produced and supplied by third-party vendors. The
same is largely true for the Chevrolet Volt, the motive power for which
will be supplied by an electric motor and a battery pack produced and
supplied by third parties who have the expertise and manufacturing
know-how in electric motors, power electronics, and battery chemistry.
Therefore, Phoenix Motorcars does not perceive a true need to retool
drive train manufacturing facilities to produce electric vehicles like
the Volt, because the engines and mechanical transmissions are entirely
eliminated with electric vehicles. Instead, Phoenix Motorcars believes
it would be far more effective if Congress would implement market-based
measures such as those advocated previously in this testimony.
One-hundred years ago, there were dozens of American automobile
manufacturers who were primarily vehicle integrators not unlike Phoenix
Motorcars, Tesla, Miles Electric, Zap Electric, and the handful of
other entrepreneurial companies today who are working on the
commercialization of electric vehicles. Much like the start-up
companies of today, these early pioneers assembled bodies and engines
produced by independent third-party suppliers. This fostered innovation
and enabled start-up firms to enter the market with minimal barriers.
If you had a better idea you could find the capital and run with it.
Steam-powered, electric, and gasoline-powered automobiles all competed
for predominance. While petroleum-based transportation ultimately won
the day, and dozens of competing American firms were consolidated into
three, many believe that this was only because petroleum was cheaper
than electricity and was more capable of being stored.
Today, we are witnessing a total reversal of the underlying
fundamentals that drove transportation toward petroleum. No longer is
gasoline cheaper than electricity. In fact, depending literally on the
day, it is four to five times more expensive than electricity. And, as
we have come to learn, its true external cost in the form of national
security costs, human health costs, and climate costs, make petroleum
far more costly than electricity. Finally, as our electricity is
supplied by ever-more diverse forms of generation, from solar, wind,
biomass, natural gas, nuclear, and coal, electricity-based
transportation is the ultimate fuel diversifier.
The Chairman. Thank you very much. Thank you all for your
excellent testimony.
Why don't we do a 5-minute round of questions here?
Let me start with you Mr. Kjaer. You say in your testimony
that the industry is working to finalize a single connector and
connection standard. Could you indicate when that is going to
be done?
Mr. Kjaer. The connection standard is basically done now,
Mr. Chairman. What we are starting to focus on now is the
communications standard. That is what is going to be so
critical. So J1772 I think it is--J1772 I think is the
connection standard. That is basically done. But what we need
work on now, between the utility industry and the auto
industry, is how these vehicles are going to communicate with
the grid and the grid communicate with the vehicle. That is a
combination of work under the Society of Automotive Engineers,
utilities like Edison which is leading the progress toward the
communication standard, and then two core global alliances,
Home Plug and ZigBee. ZigBee is a wireless communication
protocol. Home Plug is a power line carrier. So what we have
done is we have worked to bring these two global alliances
together, and now work with the auto industry on a
communication protocol for the vehicles.
The Chairman. Mr. Dalum, you talked about other
applications for your technology, as you see it, that you are
going to be exploring. What are some of those other
applications that----
Mr. Dalum. There is a diversity of trucks that are
operating in the United States obviously. So our company is
going to be looking at what is called a gas crew truck, which
is another nice application for this technology. Those are
trucks are used by gas utilities to service the infrastructure
of the gas lines themselves. Those trucks typically operate at
a job site stationary. The engine idles all day to operate
large pieces of equipment. Our technology will have enough
power to operate that type of on-board truck-mounted equipment.
There are other applications like refuse trucks and
obviously shuttle buses and things like that that are
applicable for plug-in hybrid technology in my opinion.
The Chairman. Mr. Wimmer, as I understand your testimony,
the vehicle you have out there for folks to see today is a
nickel metal hydride battery and that is not what you would
intend to bring to market as a plug-in electric vehicle. Is
that right?
Mr. Wimmer. Correct. Our next vehicle generation vehicle,
which we will introduce late next year, will use lithium-ion
batteries that are being produced by our joint venture company
with Panasonic EV.
The Chairman. That would be available for purchase by
consumers when?
Mr. Wimmer. The plan is to introduce a fair number of these
vehicles, in the hundreds, to commercial fleets both in Japan,
United States, and Europe in the 2010 timeframe. Based on how
those vehicles perform, we would then look very carefully at
introducing a consumer version. But we need to confirm the
battery durability and how the operators are using the vehicle
before we move forward.
The Chairman. What distance range do you expect to have
without use of the engine?
Mr. Wimmer. We have not said specifically on that vehicle
the range of that vehicle. That information has not been
released yet. But we have said publicly that a 15- to 20-mile
range for a plug-in--electric range is a good target.
The Chairman. Mr. Balkman, let me ask you. Do you have any
purchases by Federal agencies for your sport utility truck, any
contracts to purchase?
Mr. Balkman. We are on the GSA list and we have actually
had a lot of Federal agencies come and talk to us. I do not
know that we are able to disclose those, but it is safe to say
that there are quite a few Federal agencies that have expressed
an interest and cannot wait to get their new Phoenix when we
start production.
The Chairman. You are starting production early this next
year.
Mr. Balkman. Yes.
The Chairman. How many do you expect to produce, say, in
2009/2010?
Mr. Balkman. We expect to produce 2,500 vehicles in 2009
and then ramp up to about 10,000 in 2010.
The Chairman. Are the components of that--are you doing
assembly if they are in Wisconsin, or are you doing actually
manufacture of most of----
Mr. Balkman. We have an assembly production facility in
Ontario, California. The auto body actually comes over overseas
as a body part. Then we assemble the electric motor and the
battery pack in the vehicle. That is all done in Ontario,
California.
The Chairman. The battery pack comes from where?
Mr. Balkman. Altairnano. That is a Reno, Nevada company.
The Chairman. Very good. Thank you again for the testimony,
all of you.
Senator Domenici.
Senator Domenici. Thank you, Mr. Chairman. Thanks to all of
you. A very interesting panel, and I think we will have enough
time, Mr. Chairman, to go take a look, if that is what you
would like to do.
Let me just ask any of you or all of you--how is the United
States positioned in advanced battery technology? Do you want
to start at your end, anybody that thinks they can contribute
to the----
Mr. Wynne. Good news and bad news, Senator. I think we have
some excellent technologies coming available particularly in
the lithium-ion area and some that actually leverage old lead-
acid technology but with new nanomaterials, et cetera. There
are a variety of technologies that are coming to market, I
think as many as 23 or 24 different chemistries that leverage
lithium-ion, which is not as energy-dense as gasoline, but it
is a lot better than the batteries than we have been working
with.
The challenge that we are going to have is the
manufacturing because there is very limited manufacturing today
with lithium-ion batteries, partly because it is relatively
new. It has been proven technology in cell phones and laptops,
but we need to get to automotive grade and we need to get the
volumes in order to bring those battery prices down to levels
where it is reducing the premium associated with these
vehicles. That is going to be the big challenges:
infrastructure, developing the infrastructure. A new battery
plant could cost as much as $300 million of investment and that
is what we are asking for Government support with, along with
industry investment.
Senator Domenici. I do not want to use the whole time. I do
not want to take a lot of time, but just give me your own views
real quick, going on to you, Edward.
Mr. Kjaer. Senator Domenici, I think one of the things that
we need to be concerned about is are we swapping reliance on
imported petroleum for reliance on imported batteries.
Senator Domenici. Yes, sir.
Mr. Kjaer. So we definitely need to be focused on how to
encourage domestic supplier and manufacturing base in the
United States to, Mr. Wynne's point, automotive grade. That is
five nines production quality. Every single cell in every
single module in every single pack has to be of consistent
quality. Otherwise, that pack will not perform in the harshest
of environments imaginable being the automobile. So this is not
a cell phone battery. It is not a laptop battery. It is a
considerably different proposition. We do not have domestic
capacity today.
Senator Domenici. Are you the right people? I will get
right to you, Mr.--how do you say your name?
Mr. Wimmer. Wimmer.
Senator Domenici. Wimmer. You are at Toyota. Right?
Mr. Wimmer. Yes.
Senator Domenici. I could call you Mr. Toyota.
Mr. Wimmer. No, no.
Senator Domenici. If you know, tell me; if not, pass to the
next person. I am very concerned about the very point you have
made. This is happening in a couple of areas. We are moving to
a new technology, but it looks like maybe somebody else will
take over that technology and we move away from the use of
crude oil to a new one. But we do not own the new technology.
Now, with appropriate partnership funding by the United
States, can we make a good, competitive case for advanced
technology and advanced batteries in the United States? Where
would we get the estimate for how much that might cost?
We have been talking about putting up a lot of money, and
we talk about advanced battery R&D and technology. We have to
know how to do that. Are you the ones to tell us, or are there
other experts to tell us how?
Mr. Kjaer. Nobody here is a battery manufacturer. I mean, I
would strongly recommend----
Senator Domenici. Is that where we should go?
Mr. Kjaer. Absolutely. Johnson Controls-Saft, A123.
But I was just in China 2 weeks ago--China and Japan. The
governments of China and Japan and Korea, for that matter, are
very, very focused on this issue of energy storage technology,
maturing energy storage technology, creating industry around
energy storage. Sadly, we are not there yet, and so that is a
big concern to us, that we are losing this race before we even
launch the cars in the United States market.
Senator Domenici. Does anybody want to comment on my
question? I am going to go ahead and yield back in a minute. I
will just make an observation myself.
Mr. Balkman. I will just add as a domestic producer, we
would like to buy domestic batteries. In fact, we are using
Altairnano. They are a great R&D company. They do lack a
manufacturing capacity. That is one of the concerns we have.
But we want to buy American. Unfortunately, there are just not
a lot of choices.
Mr. Dalum. I would just add that one of our primary
concerns is the current cost of the technology. For us I would
consider it prohibitive for many of our customers.
Senator Domenici. Might I ask, Senator Bingaman, do you
remember where we are right now with reference to money for
advanced batteries? Do we have it in an appropriation bill now?
Does anybody know?
The Chairman. My impression is we have a significant amount
in the defense appropriation bill, both current year and the
upcoming year. We also have a smaller amount in the energy and
water appropriation that you are responsible for. We have
various proposals legislatively to try to integrate those two
and have a national program that coordinates those because we
are not spending near the amounts we should in this area. Of
course, as we all know, we wind up authorizing a lot of stuff
we do not appropriate.
Senator Domenici. That is right.
Mr. Wynne. Senator, if I might. My testimony does get into
this in some detail. I would like to thank the committee for
your leadership, particularly in the EISA bill. There was a
very significant authorization for battery technology R&D which
we supported. All of the companies that have been mentioned
here, A123, Johnson Controls-Saft, Electrovaya, et cetera are
members of EDTA, and we have been pushing very hard for this.
But we do need those authorizations appropriated. That is what
we are working on today.
Senator Domenici. I do not think there is any Senator
Bingaman is correct in his summary. We have a lot of
authorization, but we have to put up the dollars and it has to
be more than 1 year. We cannot put the dollars up for more, but
we could have a program that indicates we are committed for 2
or 3 years at least with the battery companies.
I thank you, Mr. Chairman. I yield.
The Chairman. Senator Craig.
Senator Craig. Thank you very much, Mr. Chairman.
Gentlemen, your testimony is fascinating. I sense when you
hear questions coming from Senator Domenici or Senator
Bingaman, there really is an obligation on the part of your
industries collectively to awaken us to the needs and to stay
at it and stay at in a very focused way, whether it is through
your associations collectively or individually.
I say that because we are making a variety of assumptions
here that may or may not develop but could develop and develop
much more rapidly if we were to not only incentivize, Thad,
like you are suggesting and do more of it more aggressively,
but also focus resource or create the incentives that allows
resource to focus.
I am not sure you should rely as heavily on us for the
dollars and cents as you should for allowing us to help you
direct the traffic. We spin our tires here a great deal and it
is not through electric power that we spin them. We tried to
put a loan guarantee program together in the Department of
Energy, and finally some of the industry just left. They did
not need it anymore because they had to wait too long. Please
do not wait on us.
But more importantly, I become very excited. I tell my
children and grandchildren that there will be the day when they
drive and they will only own an electric car. I suspect that
will happen based on what you are telling us and what is going
on in the industry, and the marketplace is adjusting for that.
Have there been any studies done--because we make these
assumptions that there is this abundance of electricity sitting
out there at night. We can all go plug into it. Have there been
any studies done that would say there is an abundance, but it
peaks out at about a certain volume of plug-in? Because we have
an obligation also to create policy that keeps the grid
growing, that keeps the supply of electricity going.
Mr. Wimmer, I know you ought to be proud of the Prius. It
is a fine vehicle. At the same time--and yes, you did displace
a lot of carbon, but the point has been made when you plug
these cars into the grid, if you really want a green car, then
the power has to be green. Sixty percent of it is not today, or
somewhere in that vicinity, or more or less.
So would any of you respond to how many million cars can
plug into the current electrical infrastructure we have before
we max it without focus on the grid and the production and
generation of electrical power in that respect? Has any of that
kind of work been going on?
Mr. Kjaer. Yes, it has, Senator Craig. The Department of
Energy did a study about 12 months ago, I believe, and they
looked at the United States grid and suggested there is enough
excess capacity off peak in the United States grid to fuel
about 73 percent of all of the light-duty cars and trucks on
the road today.
Senator Craig. So we have got substantial capacity there.
Mr. Kjaer. Somewhere in the neighborhood of about 160
million/170 million vehicles could connect to the grid
tomorrow, and we would not have to build one new powerplant.
This is a really important point.
The electrical grid is a national energy security asset. Of
all of the alternative fuels that we are excited about in this
country, ethanol, methanol, biodiesel, natural gas, hydrogen,
electricity, there is only one that has a ubiquitous
infrastructure today, and that is electricity. That
infrastructure has a lot of excess capacity because we have a
very peaking system.
The operative phrase, though, is going to be we have the
capacity with control. So it is going to be important that we
create the communication standards, the technology that, as
these vehicles connect to the grid, the market design, the
right incentives to encourage the right customer behavior so
that they do soak up that excess capacity first before we start
putting charging on peak.
Senator Craig. You also mentioned the ability of the
automobile to communicate to the grid. Put some more to that
for my own interests and knowledge. What are you talking about?
Mr. Kjaer. This is kind of really an interesting notion.
Today we consume electricity, and 30 days later we get a bill.
We look at it, and we really do not understand what we did to
cause the bill to be what it is. We have no concept of what
electricity costs, and we have little concept of how to control
those costs.
With advanced meters, we are going to have the ability for
two-way communication. So now for the first time, we are going
to send information and incentive programs and education
through to the customer, and they are going to be able to look
at this on their laptop or their PDA or their cell phone, and
they are going to be able to understand cause and effect in
much more real-time terms, not 30 days after they have
consumed, but hour by hour.
Senator Craig. I assume that they will be able to go sit in
their car, push a button on the screen. It will also show it?
Cars are going to do that?
Mr. Kjaer. What is amazing--it is called human interface
technology. What is amazing is the computing power on board the
vehicle and the ability with this communication standard and
protocol that I am talking about to send data bursts to the
car. So, for instance, with your key, you could go in, turn
your electric car on or your plug-in hybrid car, and it could
say, good morning, Mr. Craig. Yesterday you consumed X kilowatt
hours and it cost you $1. Your wife could go and do the same
thing and she could get some different information. So this is
all kind of added features and benefits and communication and
education that the auto industry is working on in conjunction
with the utility industry.
Senator Craig. So I am also making the assumption--and I
think several of you talked about it. Thad, you had mentioned
it--the ability to fast charge because out West, when you guys
talk 20 and 40 miles and even 100 miles, I begin to say maybe
at 100 you are beginning to talk interest. I want something
that does 400 miles or I want something that does 300 miles.
That is just a trip across a quarter of my State. So I need
some capacity, folks, before you are really going to excite me.
Commuting? Different story.
I want to fast charge but not at my meter. I want to fast
charge down at the office, but I am not going to bill the
office for my transportation or they are not going to bill me.
Does my car send a message that it is charging somewhere else
and that I should be billed because me, the car, is charging
somewhere else other than at my own home meter? Are we doing
that kind of capability?
Mr. Kjaer. That is the kind of capability that is being
engineered into this communication protocol. That is called
roaming. Think of it as your cell phone. It is kind of a cell
phone model. So as long as that car is connecting to a ``smart
grid,'' there will be the ability for that car to identify
itself relative to you as the owner wherever that car travels.
That is the goal.
Senator Craig. Yes, because if you can recharge me in a few
minutes, I could stop and have a cup of coffee along the way
and wait for a new power source to build up so I could go a
little further.
Mr. Kjaer. Those are other issues. That is kind of fast
charging. I mean, I was talking about the communication and the
billing. But fast charging is a whole other issue.
Senator Craig. I can see the routine pattern here of home
to work to home, but when you want to get beyond that pattern,
the concept of a smart--or roaming, that begins to make a lot
of sense. You have got to do it.
Mr. Kjaer. Yes. You have the battery electric car for urban
commuting and then you have the plug-in hybrid for both urban
commuting and highway travel.
Senator Craig. Thank you, gentlemen. Please, go ahead.
Mr. Dalum. Yes. I would just like to add that one of the
considerations that you have when you have a very large battery
system--we have a 35 kilowatt hour battery system--in order to
charge that, you do need higher voltages. Not every customer
has that type of capability where they are going to be charging
these vehicles. So I just want to bring that to your attention.
Especially for trucks, that is a factor that as you put larger
batteries in there, you need higher voltages.
Senator Craig. So truck stops take on a whole new
character.
Mr. Dalum. Potentially, or truck depots, you know, where
they store their trucks that they require 220, 240, or even
higher voltage.
Senator Craig. Thank you.
Mr. Balkman. If I could chime in, that is one of the
reasons why one of our suggestions was that we expand the
investment tax credit into these refueling stations so that we
can help develop an infrastructure.
Senator Craig. Thank you.
The Chairman. Senator Murkowski.
Senator Murkowski. Thank you, Mr. Chairman.
If you come up north to Alaska, at our public parking lots,
at the school parking lots, you have got the plug-ins. Every
car has a head bolt heater. You have got to keep warm. A little
bit different but kind of the same in the sense of you are not
charging from your home, but if you did not have it, you would
be losing employee time by going outside and heating your car
anyway. That is up north.
But I do want to ask a question about the technology and
where we are right now. I think in your testimony, Mr. Wimmer,
you indicated that Toyota is looking to the technology and
where we are with those batteries that can withstand the colder
temperatures. I think I had seen that you are looking at
perfecting the fuel cell vehicle that can start and run in cold
climates down to 30 below. Where are you with that technology?
What is the situation right now with the plug-ins that we have
now? Do we see a loss in storage capacity and performance at
colder temperatures, and where are we in understanding the
performance?
Mr. Wimmer. I think the industry is beginning to understand
the performance degradation that particularly lithium-ion
batteries have at cold temperatures. Now, based on the
chemistry, some perform better than others at very low
temperatures, but there is--at least our experience, most
lithium-ion chemistries will have a reduction in performance at
sub-zero temperatures. But because these are plug-in hybrids,
if they are charging, you could program the vehicle to preheat
or precool so the cabin temperature is comfortable when you
choose to leave. That will also help prewarm the battery to
allow you to have greater all-electric range in very cold
temperatures.
Senator Murkowski. Is it going to affect your range then? I
mean, if you've got a vehicle that can theoretically go 100
miles in colder temperatures, would you only be able to do 75?
I am trying to understand----
Mr. Wimmer. For a pure electric vehicle, for a pure battery
vehicle, yes, that would affect your range, but with the plug-
in concept, the engine starts and the vehicle operates normally
as a standard hybrid vehicle.
Senator Murkowski. So you are working on developing that.
Mr. Wimmer. Yes. That is the plug-in technology that we are
developing. We are also reexamining battery electric
technology.
Senator Murkowski. Let me ask a question--I don't know--
maybe to you, Mr. Balkman, or any of you can join in. You have
suggested or you have encouraged us as policymakers to move
forward with the tax credit for individuals so that they can
purchase the vehicles, whether it is a $7,500 offset toward the
purchase. Is that where we should be putting the Federal
dollars, to help the consumer there, or should we perhaps be
putting those incentives to help with the technology to develop
the battery so that we can get the cost down? I suppose you are
going to throw that back at me and say, well, that is for the
policymakers to decide.
But right now, people are kind of looking at what is going
on out here. They get excited when they see nice flyers like
this and think about the technology, but then they hear that,
well, it is going to cost me $47,000. Maybe I wait. Maybe I
hold off and do not make this purchase. So we are kind of a
little bit of a limbo.
Where should we be putting the incentives? Do we want to
incent people to buy now and that encourages you to do more, or
should we be putting more into that R&D, more into the credits
for the manufacturers so we can get the prices down to the
consumers? What end do we----
Mr. Balkman. I will take a stab at that. You know, I think
the tax credits are a big help because there is clearly a
market for these. We have done very little by way of sales and
marketing. We have a waiting list of some 6,000 people who
said, hey, I want one.
You kind of have to look at the electric vehicles and the
battery technology as the same place where laptops were 10
years ago. Laptops were a lot more expensive. The batteries did
not last as long. They had issues with overheating. We have
come a long way in addressing those. There is still a long way
to go in perfecting the art of the batteries for vehicles. But
I think the best way you are going to get people to be early
adopters and to broaden the deployment of these vehicles is put
the cost down.
We are not talking large scales. I told you our numbers.
Next year--or 2010, we expect to have 10,000 vehicles. That
will be great for us. That is not a lot of cars in the grand
scheme of things. Primarily those cars will be on the west
coast in California. So that is still a small scale. Let that
experiment work, and I think as more people start driving and
increase demand, things will follow.
But the best answer is we want both. We would like to have
tax credits and more research and development in the battery
because it is all part of the same picture.
Senator Murkowski. Mr. Dalum.
Mr. Dalum. Yes. I would like to comment on the heavy truck
side. In my opinion, I agree we need both. Research assistance
would be very helpful and also tax credits.
On the research side, there is in the House the Heavy-Duty
Hybrid Vehicle Act. Much work has been already done. That
provides competitively awarded grants. The proposal would be
for competitively awarded grants for the development of medium-
and heavy-duty hybrids. It would be open to also plug-in
hybrids. So that is one that is underway that I think has a lot
of promise.
Then on the tax credit side, some of the legislation that I
have seen has not specifically addressed medium-and heavy-duty
trucks, and I would encourage to look at larger battery systems
and the overall gross vehicle weight of the vehicle and offer
incentives that address some of these unique characteristics of
a medium-duty truck, a larger battery system and heavier
weight.
Mr. Wynne. Senator, if I might, I would just put a broader
context around it, that we are competing with a very mature
technology, the internal combustion engine, a very well
entrenched fuel system. It is difficult to pick and choose. We
really have barriers here to market entry that tax credits will
help us address. We have R&D challenges that will help us move
that technology down the road and get it more competitive.
Ultimately deployment helps us with greater scale that helps
with all of these things. So it is difficult for us to pick and
choose.
I think to Senator Craig's point before, the industry, as
you can see, is moving down the road. The question is how many
of these things can we work with Government on to accelerate
that progress.
Senator Murkowski. Thank you.
Mr. Wimmer. Senator, Toyota generally supports consumer-
based tax incentives as a way to increase volumes and to
maximize the affordability of the technology to the largest
number of consumers. Our hybrid program, for example. We have
been selling hybrids for over a decade now, and due to the high
volumes, we are still improving the technology, bringing costs
down. So from our standpoint, it is really high-volume
production that helps bring the cost down to be competitive
with gasoline.
The Chairman. Senator Sessions.
Senator Sessions. Thank you.
Senator Domenici. Senator Sessions.
Senator Sessions. Yes.
Senator Domenici. Would you yield for 1 second?
Senator Sessions. I would be glad to.
Senator Domenici. I have to leave now, and I was just
telling the Senator I would be leaving. But I did want to make
a statement for the record.
On funding for battery research, what we can find out so
far is that there is $100 million in the energy and water
appropriation bill that is a $50 million increase over what was
in the executive branch bill. That is to go for battery
research. That might not be enough, but I just want to report
that that is what is in there. That bill is waiting
consideration and match-up with the House and see what they
have done.
As I leave, I am going to try to go see your vehicles and
meet some of you out there. I want to thank you again.
Thank you, Senator Bingaman. You are probably in the most
exciting part of trying to help with the oil problem. We have
rocked along for so many years, but it looks to me like you are
on the threshold here. This is going to be something for real.
How quickly you can go I do not know, but I wish you wonderful
luck next year.
Thank you.
The Chairman. Senator Sessions.
Senator Sessions. Thank you.
This is, indeed, exciting. As I have had my town hall
meetings and heard the pain really of consumers in Alabama with
high energy prices, we think about the negative impact it has
had on our economy, our balance of trade deficit. Half of that
is fuel. We need to do better.
I have been saying that I consider the thing that is most
close to success to become practical that could virtually
eliminate a huge portion of our demand for fuel would be plug-
in hybrids.
But the question is this. Maybe, Mr. Dalum, I will just ask
you. We could pass a law that says we are going to incentivize
hydrogen or incentivize eliminating the law of gravity, and we
might not be able to get there yet. I was at the University of
Alabama Transportation Center, and one professor told me that
on conventional battery technology, there was not--his best
judgment was--a lot of increase possible. It was going to take
a breakthrough technology.
How would you as a consumer--I guess you are a little bit
of a skeptic here. Give us your view of how much--are the
lithium-ion batteries today--you use them in your vehicles,
which are utility vehicles, I guess, mostly. What is your best
judgment about whether we are ready for prime time with the
lithium-ion and how much improvement is necessary?
Mr. Wimmer, maybe I will ask you to comment also.
Mr. Dalum. Let me first state that there is a variety of
different battery technologies available. Lithium-ion is one of
the most promising. From our company's standpoint, as I
previously stated, lithium-ion is an extremely expensive
technology, and that is probably one of the primary limitations
that we have right now.
Our company has chosen, in order to accelerate production,
to go with a different, more conventional technology. Because
of the large truck you can carry much larger payloads, so we
have gone with the more conventional advanced lead-acid
battery, an AGM lead-acid battery, that is modular, that can be
exchanged because it does have a limited life. So we have
chosen to go a different direction until, in our view, lithium-
ion is ready.
So I think there is a variety of different approaches. It
just depends on, quite frankly, what kind of constraints you
put on your design.
Senator Sessions. Mr. Wimmer, in your view, is the battery
technology available today that would make a plug-in hybrid
practical and feasible, and if not, what kind of improvements
in the battery would be necessary and how much, what kind of
percentage increase?
Mr. Wimmer. I think the lithium-ion battery technologies
that are out there today, although they are expensive and
durability has yet to be proven, they have the potential to
satisfy the requirement of a light-duty plug-in electric
vehicle. But longer term, if we are looking at true battery EVs
that can compete with gasoline vehicles for range and
durability, that is really going to take a battery
breakthrough, new technology.
Toyota feels strongly about that and has actually created a
research division now to study these next generation batteries
just to try and find the breakthrough that will get us to a
battery that is low cost and durable enough to compete with a
conventional gasoline vehicle.
Senator Sessions. So you were saying it is not quite there
yet?
Mr. Wimmer. We are working hard on it, and hopefully will
determine in, as I mentioned, our commercial fleet test program
whether our battery will be durable enough.
Senator Sessions. Now, the plug-in hybrid, as I understand
it--if your commute is, say, less than 20 miles and the goal
would be to be able to go 40 miles, about there, without any
utilization of a liquid fuel and after that, there would be an
engine that would carry you an indefinite distance. Is that
what we are talking about?
Mr. Wimmer. It depends on the system design. Our approach,
which is a blended design, will provide vehicle speeds up to
approximately 60 miles an hour just off the battery. If you
wanted to go faster than that, the engine would start and
supplement the battery. If you are running in, let us say, a
lower speed, urban type of mode, that range could be in--we
feel it should be in the 15 to 20 mile range before the engine
would start and the vehicle would operate as a conventional
hybrid vehicle.
Senator Sessions. So you would have an unlimited range
ultimately----
Mr. Wimmer. Correct.
Senator Sessions [continuing]. With the plug-in hybrids.
But what about cost? Would we have a shortage of the
components that would go into a battery if we made large
numbers of them?
Mr. Wimmer. There have been some studies that have
questioned the supply of lithium if we were to double the
quantities of lithium that is currently being used today for
the consumer electronic market, if we were to double it with
battery vehicles. I have not looked at a number of studies to
draw a conclusion myself. But lithium is currently only
produced in a number of Latin American countries, only a couple
of sites in the entire world. So there are some limitations
there on lithium.
Senator Sessions. Mr. Kjaer or Mr. Wynne, one question.
Would you agree? Both of you, I think, would see the advantage
to move forward with electric or hybrid vehicles. Should we be
looking at things other than the lithium-ion battery? Do we
have enough funding and research going on in other kinds of
battery technology that could be this breakthrough technology
that would be a leap ahead of traditional battery systems?
Mr. Wynne. I think there are other types of battery
technologies that are being explored. There is no question
that--again, lithium is not as energy dense as gasoline. So at
the end of the day, if you are going to compare them one on
one, that is the benchmark.
My perspective on this is we must not let the best be the
enemy of the good, and the beauty of electric drive--forgive
for being one of its greatest fans--is it is so flexible, and
it can be configured many, many different ways. There are lots
of different vehicles and drive cycles in the fleet today.
So I think what you are seeing here is as many different
approaches as I have mentioned manufacturers to electric drive
aiming perhaps even at different areas of the market and
different demographics. So the plug-in hybrid or even the
battery EV with a range extender is sort of an effort to
leverage the technology that exists today, including improving
lithium-ion battery energy storage technologies, but certainly
there is room for improvement going forward and that is being
explored.
Senator Sessions. Mr. Kjaer.
The Chairman. Senator Sessions, let me just indicate I am
going to have to leave. Why don't you go ahead and ask any
remaining questions and then conclude the hearing?
Senator Sessions. I would be pleased to.
The Chairman. Great. Thank you all very much for being
here. We appreciate it very much.
Mr. Kjaer. Senator Sessions, we have lithium-ion batteries
from a number of major battery companies in our labs now bench
testing. The longest test we have had running is over 3 years
for plug-in hybrid modules, battery modules. We are seeing good
cycle life that would be commensurate with the life of the
vehicle. We do not know yet about calendar life. But I think
the technology is maturing quite rapidly.
The automakers that are the most aggressive about plug-in
technology feel that the vehicles will definitely be ready
somewhere between that 2010-2012 time period. Some of them are
saying that they feel that the batteries will absolutely be
ready as well.
The Japanese Government and I think the Chinese Government
are very focused on not just maturing lithium technology, but
to your point, what is the next whiz-bang technology after
lithium technology. The Japanese Government is very, very
focused on that area and have set targets to get to over the
next, I think, 10 or 15 years. We should be also concerned
about that and be thinking about what are we doing here in the
United States We absolutely have the capability of doing it.
This is not a question of can we do it. It is a question of
will we do it.
I think it comes back again to that fundamental point that
I made earlier on, and that is that we need a much more robust
focus domestically on energy storage technology because it will
be a fundamental game changer not just to the transportation
industry, but also to the utility industry.
Senator Sessions [presiding]. So you would say that it is
possible to make a quantum leap, a major step forward, but it
would take a new technology probably and we should be investing
in that?
Mr. Kjaer. I think we absolutely should be investing in the
lithium technology today because that will help to get these
cars out on the road that will start to create new applications
in the energy system around energy storage. But we should not
take our eye off the ball about what is the next step 10, 15,
20 years from now.
Senator Sessions. The implication is in your testimony we
are not doing enough of that in the United States. Is that a
function of governmental incentives, and should we have more?
Briefly. I do not want to take too long.
Mr. Kjaer. I do not think it is just incentives. I do not
think we can lay all of the blame just on incentives or lack of
incentives. I think we need to get focused as a Nation around
the issue of energy storage and what that can mean to us from
an energy security perspective and from an energy efficiency
perspective.
Senator Sessions. Mr. Wimmer, I saw something that Toyota's
Camry had the quickest payback of any battery car. I do not
know if you want to comment on that.
But how do you feel about this question of should the
United States be doing more? Surely we should pursue the
lithium-ion or any traditional type batteries, but should we be
looking for more of a breakthrough technology?
Mr. Wimmer. I think when we are talking about battery
breakthrough technology, it is a global challenge. Scientists
have been working on batteries for centuries. I mean, it is
hundreds of years of development. So with that type of
challenge, it is going to take all the nations and all the
scientists to jump beyond where we are today with the next
generation of batteries.
So I think DOE's basic energy sciences activities is
working on battery materials. A number of the national labs are
working on these advanced materials. I think all of that is
going to be very useful in finding the material breakthroughs,
as well as the basic electrochemistry breakthroughs that are
going to be necessary.
Senator Sessions. But just throwing money at that does not
mean we are going to solve the problem next year.
Any other comments on that particular question? Mr.
Balkman?
Mr. Balkman. Yes, Senator Sessions. I just want to point
out that I testified earlier that we will begin production in
2009. Another pure electric company out in California, Tesla,
is actually delivering electric cars that are on the roads
today. We are beginning this now. It is not perfected, but it
is here.
I would add--and I do not know the specifics of all the
battery technology, but I can tell you this, that if the
Congress and if our Federal Government will put as much effort
behind this technology, specifically battery technology, to
drive electric transport, as we have in other alternative
energy sources, just level the playing field and pay as much
attention to this as we have other things, I think we will see
a lot more progress a lot quicker, and we will be a lot closer
to electrifying our fleet not just in years from now, but maybe
as soon as next year and a lot closer, a quicker.
Senator Sessions. I offered legislation that would require
the Department of Energy to evaluate all our incentives and
make some recommendations as to which ones they think have the
best prospect. I have not heard from them. But I really think
it is difficult for us as nontechnicians, nonscientists, to be
sure exactly where we should put the research dollars.
Mr. Wimmer, one thing I would ask you is I believe you made
reference to nuclear power. It seems to me, without any doubt,
that nuclear power emits no greenhouse gases or other
pollutants into the atmosphere and has virtually unlimited
capacity to expand and comes out cost effective. I am convinced
that it is at least as cheap as coal will be. So would that not
be a wonderful future in which we have a nonpolluting nuclear
electric generation with battery automobiles that could run on
that clean power?
Mr. Wimmer. I think clean power is key, or cleaner power.
Whether that is from nuclear or renewables, it really depends
on the flexibility of the power grid and what makes the most
sense from an economic standpoint, as well as potentially from
a regulatory standpoint. But clearly, as the grid becomes
greener, the amount of CO2 produced generating
electricity and therefore driving these advanced electric
vehicles will come down and they will become more
environmentally friendly.
Another concern is, with this pending climate change
legislation, how the credits for electric vehicles would be
handled. Would that be given to the utilities, or would that be
given to the auto manufacturers? I think that is something that
we need to work out here as we move forward. Or to the
customer?
Senator Sessions. That is an honest--you are correct.
Any more brief comments on the nuclear question?
[No response.]
Senator Sessions. Thank you very much.
Chairman Bingaman does such a good job of having hearings
on important issues. I really compliment him on that. He is
seeking the truth, and that is what we have been trying to do
today.
I am so excited about the possibility of plug-in hybrid
technology and would hope that we can see that develop and
become a big part of what we do. But I know it is maybe not
perfectly ready today to do everything we would like, but maybe
we can make those breakthroughs and continue to do so. That
will be a very feasible future for us.
Thank you so much and I appreciate your excellent
testimony.
[Whereupon, at 11:28 a.m., the hearing was adjourned.]
APPENDIX
Responses to Additional Questions
----------
Responses of Edward Kjaer to Questions From Senator Bingaman
Question 1. It's notable that many of the nearer term entrants we
are likely to see are ``city cars'' or other shorter range vehicles.
One might imagine that cities where these would be the most useful
would also likely be places where housing is dense a substantially
smaller part of the population have garages to plug in vehicles at
night. Is this true, and if so are there programs to address this?
Answer. Various studies suggest between 30--60% of the U.S.
households have access to a plug for ``home refueling.''
The issue of providing metered charging facilities in high-density
housing (apartments, condos, etc) situations is one of the important
actions required of plug-in vehicle (PEV) infrastructure development. A
few startup companies, several cities (San Jose and San Francisco, CA),
and some utilities are beginning to address how to deal with this
aspect of vehicle charging infrastructure. In general, much more work
needs to be done in this area to understand planning, placement, and
costs to install and operate this kind of charging infrastructure.
Adoption rates for PEVs will likely be modest in the early years as a
result of technology cost and product availability/choice. It is
anticipated that early adopters will have access to home refueling
plugs.
In the mid-to-long term, understanding how to support all types of
charging infrastructure (residential, workplace, fleet and public
charging) is critical to effectively supporting mass market adoption of
electric vehicles (EVs) and plug-in hybrids (PHEVs). Planning, combined
with a strategically timed rollout of infrastructure to support
developing populations of plug-in vehicles is likely to result in the
most effective use of available public and private capital resulting in
higher vehicle owner satisfaction.
There is substantial risk in broad pre-deployment of public
charging facilities without the vehicle population to adequately use
these facilities. This will tie up near-term capital that could be
better applied to support home-based charging infrastructure (this will
better serve most early adopters) and creates a strong possibility of
poor station location or negative public perceptions of plug-in
technology (unused, reserved parking locations resulted in poor public
perceptions of electric vehicles in the 1990s in CA).
Question 2. In your testimony you discuss your efforts in
developing `smart charging' where vehicle charging is controlled
remotely in order to best match generation availability. Where are you
in respect to developing Vehicle-to-Grid (V2G) technology where a plug-
in can take energy from the grid AND put it back on the grid?
Answer. While the potential of V2G is intriguing, we are many years
away from realizing a scalable model across the U.S. Most challenging
is how to control a complex and diverse system of vehicles sending
energy back to the grid.
However SCE is exploring with several automakers the potential of
Vehicle-to-Home (V2H). In this scenario small amounts of energy may be
drawn occasionally from the vehicle's battery (without impacting
battery life) for residential ``peak shaving'' or ``emergency backup''.
However, the energy would not be sent back to the grid, but only back
to the home.
We believe it is a matter of prioritization. We believe that there
is much work to be done on ``grid-to-vehicle.'' In others, we need to
focus on getting the vehicle to be successful, before focusing on long-
term value propositions.
Question 3. What are the main challenges, both for technology and
policy that you see in developing V2G?
Answer. Like any other RD&D project, V2G will have to go through
all the phases of development from proof-of-concept to large-scale
demonstrations. The complexity of managing energy from millions of
vehicles will have to be addressed. Automakers will need to be brought
into the process, as the V2G capable vehicles will need large kW
discharge capability, battery warranties, and other issues to be
addressed. If this technology is proven, then policies at FERC and
other agencies will need to be revamped.
Responses of Edward Kjaer to Questions From Senator Domenici
Question 4. In your testimony you said that you do not see a large
system-wide challenge fueling plug-in electric vehicles. Can you
explain that in more detail? For example, if we saw a significant
increase in the number of electric vehicles, say 50% of the light duty
vehicle fleet, what would that represent in terms of increased energy
demand with all other things being equal and how does that translate
into the number of new power plants required?
Answer. A joint study by Electric Power Research Institute (EPRI)
and the Natural Resources Defense Council (NRDC) studied the
environmental and energy impacts of large fleet penetrations of PHEVs.
The range of electrical energy demand possible by converting the light-
duty transportation fleet to PHEVs or EVs is relatively modest in the
context of the full electric sector--if 10 million plug-in vehicles
with 40 miles of electric range (similar to the Chevy Volt)
materialized on today's grid they would represent less that 0.5% of
total U.S. electrical demand.
EPRI and NRDC also found that large market penetrations of plug-in
hybrids (as much as 80%) would create at most a small need for
additional capacity, between 1.2% and 4.6%. This equates to 19-72 GW in
total new capacity added over a forty-year period (an average
nationwide annual increase of 475 to 1800 MW from 2010 to 2050).
The above number is based on a very conservative scenario where 25%
of the charging occurs on-peak. However, defective implementation of
smart charging technologies and customer programs to incentivize off-
peak charging will have the potential to minimize the need for new
power plants while improving generation plant utilization. Off-peak
charging is defined primarily as minimizing charging load during the
weekday peak hours in the summer months or winter for cold-weather
utilities. This is synergistic with providing vehicle owners with the
lowest possible cost of electricity while maintaining convenience of
charging. Other studies by the Department of Energy's Oak Ridge
National Lab and Pacific Northwest National Lab found that the on-peak
demand for new power plants could almost entirely be mitigated with
utility involvement.
Question 5. With regard to the efforts now underway to standardize
technology needed for the vehicle to grid interface and for ``smart
grid'' technologies, do you believe these efforts are sufficient to
establish robust industry standards by the time we see significant
market penetration by plug-in vehicles? In other words, what is the
risk of consumers being stranded with obsolete technology like the
Betamax tape systems of the late 1970s?
Answer. Representatives of the electric utilities have been working
closely with the automotive industry on creating the necessary
``recommended practices'' that would guide all automakers in designing
PHEVs and EVs that are compatible with smart charging infrastructure.
There are two important recommended practices, one defining the
physical connection between vehicles and the grid (SAE J1772) and one
defining the way vehicles communicate with smart metering and other
smart grid systems (SAE J2836). Both of these standards efforts are
scheduled to be completed in over the next several years. Once
completed and approved by standards committees representatives
(comprised of automaker, supplier, utility, and government reps),
automakers would follow these practices in the design of their
production plug-in vehicles.
Electric utilities and EPRI are also conducting intensive
technology development efforts with automotive partners (Ford, GM, and
others) to ensure a rapid maturation of the technology and verification
of the sufficiency of these standards to ensure that the many different
smart grid approaches are easily compatible with the single automotive
standard for smart charging.
From a policy perspective, we support open-source standards, and
are concerned that a proprietary charging system may occur for 120 or
240 V charging. We believe policy is needed to discourage development
of proprietary charger connection or communication standards, or
proprietary technology that limits free access.
Question 6. Please describe your company's history of using
electric drive vehicles.
Answer. Southern California Edison (SCE) has a long history of
using electric drive vehicles. Since the 1970s, SCE has actively
researched and implemented electric vehicles in its operations. It
began with early prototypes from auto manufacturers, to pre-production
prototype evaluation in partnership with major OEMs, to refined fully-
functional electric vehicles in fleet revenue service. Since 1998, SCE
has maintained a fleet of EVs of greater than 200 in number, which
reached a peak of 320 in 1999, and currently numbers 293. Today, SCE
operates the largest private fleet of EVs in the country that has
traveled over 16.7 million EV miles in real world day-to-day fleet
operations with company meter readers and field service personnel, and
saved over 830,000 gallons of gasoline.
Question 7. How many PHEVs do you currently have in your fleet?
Answer. SCE currently has 4 PHEV prototypes in its evaluation and
testing fleet. This includes: 2 Ford Escape PHEVs, 1 Sprinter PHEV van,
and 1 International heavy-duty PHEV utility truck. Today there are no
commercially available PHEV vehicles from Tier 1 manufacturers.
Question 8. What has been the feedback from employees who are
driving the vehicles?
Answer. SCE's EVs in our meter reader services division perform
flawlessly and are well liked by employees. Their feedback includes
favorable reactions from customers and the general public; access to
carpool lanes greatly reducing ``windshield time'' and quite, clean
reliable operation without having to go to a gas station.
The Ford PHEV prototypes have consistently returned favorable
reviews. SCE staff report that the vehicles are just as comfortable and
smooth riding as conventional versions, with the smooth power
transitions between electric and hybrid drive. Charge time is easily
accommodated overnight with 120 volt power.
The Daimler Sprinter prototype van has been useful for fixed route
delivery type applications, such as hauling medium loads in an
efficient package. The electric drive function of the Sprinter PHEV has
been reported to be very powerful and capable of full driving
functionality in excess of 50 mph.
The International PHEV truck prototype was the first of its kind,
built by SCE in 2001, and demonstrated in the SCE fleet in 2004. It was
able to do all the work of a ``troubleman'' truck with the added
benefit of reduced exposure to harmful noise and emissions.
Question 9. Are you tracking the PHEV miles per gallon? If so, what
kind of values are you seeing?
Answer. Several Ford PHEVs have been tested in multiple
configurations at SCE's EV Technical Center located in Pomona, CA. They
have also been baselined against the stock Ford Escape HEV version.
Currently two PHEVs are in reliability test and mileage accumulation.
With regard to fuel efficiency, we are evaluating the vehicles
under accepted procedures based on industry and government developed
standards. So we are indeed tracking miles per gallon, but it is
probably more appropriate with this technology to use different terms
to describe fuel economy. With the broadening of technology which we
are currently experiencing in the transportation field, comes a need
for new metrics to understand energy use. With these vehicles we are
actually replacing one fuel for another--electrical energy in place of
gasoline--and that can lead to confusion. PHEVs also do not have
constant fuel economy; rather, the fuel economy is related to the
distance driven. As the electrical energy is used first to maximize the
benefit, the fuel economy is much higher for shorter drives than longer
drives. Vehicle usage data for the U.S. showed that 68% of all
residents drive 30 miles or less per day to go to work and back.
If we were to use the traditional metric of miles per gallon for
fuel efficiency with a PHEV like the Chevrolet Volt, and apply that to
the 68% of commuters with a round-trip drive of 30 miles or less, the
Volt, with a stated 40 mile range on its battery, would in fact have
infinite ``mpg.'' Pure electric vehicles have previously been rated
with window stickers showing miles per unit AC kWh. Groups like the
Society of Automotive Engineers have required conversion of electrical
energy to liquid fuel equivalence, which is then added to the volume of
liquid fuel used.
SCE's results for a 30-mile drive of the 1st Ford Escape prototype
PHEV on the urban test course show a 57% reduction in gasoline used
over a stock hybrid Escape without PHEV capability. The amount of
gasoline used by the prototype PHEV Ford Escape for the 30-mile test
loop was less than one-third of one gallon, with the balance of the
drive energy coming in the form of electrical energy from the grid. The
gasoline savings on a national basis if such vehicles were in use for
those 68% of commuters can thus be easily estimated, given the total
number of commuters.
These are the actual results from both test vehicles for the 30-
mile urban test loop (30.6 miles actual distance):
HEV: 0.68 gallons gasoline
PHEV: 0.29 gallons gasoline and 6.0 AC kWh 10.
Question 10. What kind of charging system are you using to recharge
the PHEVs?
Answer. Due to the size of their batteries, most PHEVs utilize an
on-board charger. Using appropriate safety equipment (e.g. GFCI), the
on-board charger is connected to the power grid. Depending on the
vehicle requirements and design features, power is then transferred
from the utility grid at either 120 volts or 240 volts.
Question 11. What kinds of corporate applications are you using the
PHEVs for? Meter reading? Distribution work? Company outreach efforts?
Answer. SCE's PHEV prototypes are in vehicle testing applications
only and are not integrated in to our working fleet. As PHEV products
become commercially available SCE will integrate them in to our fleet
operations where appropriate.
Question 12. What is the current status of Lithium Ion batteries
for hybrid electric vehicles (HEV), plug-in hybrid electric vehicles
(PHEVs), and electric vehicles (EVs)?
Answer. Lithium Ion batteries include more than a dozen different
electro-chemistries. The performance, safety and cost vary widely.
Small form factor (cylindrical cell vs prismatic cell) Lithium-Ion
batteries are commonly used in consumer products. Large battery packs
require massive paralleling of small form factor battery cells or the
use of larger form factor batteries. Several battery manufacturers are
currently producing large lithium cells suitable for automotive
applications, and use various electrochemistries and form factors.
Laboratory testing of those cells have shown encouraging results. In
general, Lithium Ion ``power'' batteries (gasoline hybrids) are just
coming to market now in limited volumes/applications. Next year we will
start to see Lithium Ion ``energy'' batteries in low volume launches of
BEVs and possibly PHEV demonstrations. In both cases however, the
technology is still in very early stages of maturity.
Question 13. What are the major technical/market barriers for
commercialization of lithiumion batteries?
Answer. Recently, lithium Ion batteries have made significant
progress, although manufacturers are still working on improving overall
battery safety, cycle life (the ability of the battery to maintain
performance after multiple charge and discharge cycles) and calendar
life (the ability of the battery to sustain performance over the life
of the vehicle).
One of the main barriers remaining is cost. At current low
production volumes, the cost remains high. At higher production levels
(several hundred-thousand battery packs a year), the cost is expected
to drop significantly. From a policy perspective, establishing large-
scale volume to get to mass production (secure lower costs due to
economies of scale) is the key issue for policymakers to help address.
While the costs are higher today, the historical introduction of new
technology into the auto industry (e.g. automatic transmissions) has
been overcome as the value has been understood by the consumer.
Question 14. Plug-in vehicles hold great promise in our ongoing
efforts to lessen our dependence on foreign sources of oil. However,
U.S. transmission infrastructure has increased by only 6.8% since 1996.
In last year's energy bill, Congress encouraged the modernization of
the electricity grid in ``Smart Grid'' provisions that include the
deployment and integration of plug-in electric and hybrid electric
vehicles. What kind of infrastructure improvements must we undertake to
accommodate the eventual use of plug-in vehicles?
Answer. SCE strongly believes that research is needed covering the
intersections of vehicle connection and communication, load management
and smart charging, bi-directional energy flow, smart meters and smart
grid. A smart grid will greatly enhance the deployment of PEVs, but is
not a prerequisite for the large-scale deployment of PEVs.
Given the anticipated slow adoption rates, we do not anticipate any
near term transmission system challenges meeting the load from
transportation grid connecting. However we do anticipate some local
distribution system challenges with early adopter concentrations of
PEVs. These challenges will be addressed at the local utility level,
and are similar to other challenges that utilities have been addressing
for years. The impact of full function pure battery EVs on the
distribution system is greater than the impact of PHEVs. This is
because full size, full function battery EVs use 6.6 kW charging
systems (or larger) which is much larger than the typical 1.4 kW
charging system used by PHEVs.
Also see answers to questions 4 and 5 for answers on the impact on
utility generation systems and other infrastructure.
______
Responses of Brian P. Wynne to Questions From Senator Bingaman
Question 1. You mentioned that tax incentives should reward
performance rather than picking winners and losers. Others might argue
that basing the incentive on the size of the battery is biasing policy
towards a particular technology. Is there a more neutral approach such
as one linked to fuel consumption that would be equally effective for
electric vehicles and competing technologies?
Answer. If the goal is to reward only efficiency, than a completely
neutral incentive with an efficiency-only metric could be developed.
However, if a credit were to have multiple goals, such as rewarding
efficiency and advancing technology development, or promoting fuel
diversity, then additional metrics are useful.
In the current tax code, consumer credits are available for
alternative fuel vehicles, hybrids, advanced diesel and fuel cell
vehicles. Each has specific metrics to ensure that diverse technologies
meet emissions and efficiency goals of the credits.
Based on the current tax policies for advanced vehicles, a battery
metric measures emissions and oil displacement performance and targets
the highest cost element in emerging plug-in vehicle technology.
Question 2. It's notable that many of the nearer term entrants we
are likely to see are ``city cars'' or other short range vehicles. One
might imagine that cities where these would be the most useful would
also be likely to be places where housing is dense [and] a
substantially smaller part of the population have garages to plug in
vehicles at night. Is this true and if so are there programs to address
this?
Answer. First to clarify, ``city car'' sometimes is used as a
technical term for a mid-speed vehicle (as opposed to a low or full
speed battery electric vehicle.) In this instance, assuming that the
term is used here meaning ``for urban use,'' the answer is that a large
segment of the early adopters of plug-in vehicle technology, be it
battery electrics or plug-in hybrids is likely to be urban consumers
using the vehicle for commuting and other shorter range travel.
Plug-in hybrids and extended range battery electrics offer
additional fuel, or recharging power, on board. Pure battery electrics
do not. All will need their batteries recharged at some point. The
difference is how often.
Whether plug-in vehicles have a short or long range on a charge,
new charging models need to be identified to serve consumers that do
not have a private garage charging option.
Options being privately demonstrated include daytime public
recharging; with a fast charge option; multi-tenant garage recharging.
Other models, such as the Better Place demonstrations are promoting a
recharging model that would allow customers to swap out batteries at
ubiquitous stations rather than recharging them.
Different users, such consumers and commercial fleets, are likely
to require different recharging approaches. Efforts to promote non-
private charging should allow for this diversity while moving toward
equipment and recharging standards to maximize interoperability and
safety.
The Department of Energy, through programs like the Clean Cities
program, can help to fund cooperative vehicle and fueling
demonstrations, but is constrained by limited funding. Additional
demonstrations authorized in Section 131 of the Energy Independence and
Security Act (EISA) of 2007 offer validation paths for recharging
models as well, but they have not yet been funded.
Responses of Brian P. Wynne to Questions From Senator Domenici
Question 3. In your written testimony, you note that there some tax
provision being offered that would actually limit plug-in technology
development and vehicle options. Please elaborate.
Answer. During the extended debate on energy tax legislation,
several versions of a tax credit for plug-in vehicles were at some
point considered. There were several bills that would have established
a credit only for ``plug-in hybrid vehicles,'' excluding battery
electric vehicles that plug-in, but are not hybrids.
Later in the debate, a proposal to lift the threshold eligibility
requirement from a 4 kWh battery to 8kWh. The latter threshold would
have excluded many of the smaller-battery plug-in hybrid models that
have been proposed, such as the including the proposed Prius plug-in.
In addition, the higher threshold would also have penalized plug-in
vehicles vehicles that operate in a blended fashion, i.e., the battery
and conventional engine can work simultaneously, rather than serially.
These can be extremely efficient using a smaller battery.
With this emerging technology, we support the inclusive incentive
that was adopted, which allows the market to determine a preference in
plug-in options, including blended operation plug-in hybrids, pure
battery electric vehicles, extended range battery electrics like the
Volt or plug-in hybrids that would operate serially, like the proposed
Saturn Vue.
Question 4. Please describe the differences between EVs, HEVs, and
PHEVs. Which technology is most widely used in the U.S.?
Answer. Each of these, as well as fuel cell electric vehicles
(FCEVs) are electric drive vehicles, meaning electricity provides some,
or all, of a vehicle's motive power--i.e., electricity moves the
wheels.
Battery Electric Vehicles (BEVs) are plug-in electric drive
vehicles. (Not all plug-in's are hybrids.) They use batteries to power
an electric motor to propel the vehicle. BEVs produce no tailpipe
emissions. The batteries are recharged from the grid and from
regenerative braking. Full function EVs are being produced by Tesla and
are planned by other manufacturers, including Nissan, Mitsubishi,
Chrysler and BMW. Battery electric vehicles in widespread use today
include low-speed, neighborhood electric vehicles, airport ground
support equipment, and off-road industrial equipment such as fork
lifts.
An extended-range battery electric vehicle (BEV-ER) is variation on
the BEV configuration. It includes an internal combustion engine or
fuel cell, but that power source is only used to recharge the battery;
it does not move the wheels.
Hybrid Electric Vehicles (HEVs) use both an electric motor and
another energy source such as internal combustion engine (or
compression--diesels can be hybridized as well) to propel the vehicle.
A hybrid is designed to capture energy that is normally lost through
braking and coasting to recharge the batteries (regenerative braking),
which in turn powers the electric motor--without the need for plugging
in.
A `parallel' hybrid electric vehicle uses the electric motor or the
internal combustion engine to propel the vehicle. A `series' hybrid
electric vehicle uses the electric motor to provide added power to the
internal combustion engine when it needs it most, for example, in stop-
and-go driving and acceleration. Hybrid electric vehicles have the
potential to use electricity to power onboard accessories or to provide
outlets to plug in appliances or tools. All have the potential to
achieve greater fuel economy than conventional gasoline-engine
vehicles.
Plug-in Hybrid Electric Vehicles (PHEVs) are hybrid vehicles with
plug-in capability. That is, they use a combination of grid
electricity, regenerative energy from braking, and power from another
onboard source, such as an internal combustion engine or fuel cell. The
last of these is what distinguishes them from the other plug-in
vehicle, the BEV.
In addition, plug-in hybrids can be configured to operate serially,
or in a blended fashion. In a serial configuration, the vehicle runs on
electricity alone at some points, like starting, and uses its other
power source alone at others, for example, when accelerating.
Alternatively, a plug-in hybrid may be configured for blended
operation, i.e., the battery and the conventional engine operate
together.
While forms of battery electric vehicles have been around the
longest, HEV's have achieved the greatest commercial penetration in the
10 years since their introduction. Since the introduction of the Honda
Insight in late 2008, the number of hybrids offered for dale in the US
has risen to 20 models. Toyota has sold over a million hybrids
worldwide. In the U.S. this year, sales figures to date for hybrid
vehicles are approximately 270,000 vehicles. Due to variations in sales
reporting, the numbers are not exact. However, a breakdown of sales by
manufacturer and vehicles by year is available at: http://
www.electricdrive.org/index.php?tg=articles&topics=7
Question 5. How widespread is the use of electric drive in public
transportation?
Answer. Hybrid and fuel cell buses, school buses are being added
into city and school transit in small numbers, but with significant
benefits in fuel and operating cost as well as emissions. According to
the American Public Transportation Association's (APTA) ``2008 Public
Transportation Fact Book,'' electricity powered .1% of buses in 1996 to
2.3% in 2007.
The Park Service also uses electric drive for public
transportation. For instance, in Alaska's Denali National Park, the
Park Service is trying out a hybrid bus to reduce fuel costs and air
pollution in this pristine area. The bus has a hybrid system developed
by Enova Systems and will provide over 30% reductions in particulate
matter, 20% reduction in NOX emissions, over 40 percent
reduction in CO2 and in excess of 70% percent improvement in
fuel economy.
Question 6. What is the role of PHEV in fleet applications?
Answer. PHEVs can potentially play a significant role in private
and in regulated fleets, which have significant economic and regulatory
requirements to reduce petroleum use. The managed travel and central
recharging characteristic of fleets are optimizing features for plug-in
vehicles.
For fleets regulated under EPAct 92, the 2007 EISA explicitly
recognized the use of plug-in hybrids (and, finally, hybrids) in
meeting petroleum reduction requirements through alternative fuel
vehicle acquisition. This recognition will substantially expand the
acquisition of electric drive, specifically PHEVs, in covered fleets.
In private and municipal fleets, economic concerns and
environmental requirements have led to many fleets to incorporate HEVs
and plan to incorporate PHEVs into their fleets as they become
available.
At the local government level, at least 10 U.S. cities have or are
considering enacting requirements for taxicabs traversing their roads.
Other cities are trying an incentive approach. For instance, after the
New York City edict for hybridizing the cab fleet by 2012 was blocked
in court, city officials recently announced new financial incentives
for trading traditional taxis in for hybrids. The Medium and Heavy Duty
HEVs are currently being used in fleets of major enterprises such Wal
Mart, UPS, FedEx and others. Environmental Defense has a useful survey
of available vehicles in this category: http://www.edf.org/
page.cfm?tagID=13394
Question 7. You said that we could cut our fuel consumption by 83%
by switching the light duty fleet to electric drive and hybrid
technologies. Can you explain the assumptions you used to arrive at
this number?
Answer. We used an internal modeling exercise with aspirational
timing benchmarks to highlight the oil-saving potential of electric
drive. We posited a light duty fleet (cars & trucks) with a mixture of
electric drive technologies, including hybrids, plug-in hybrids, fuel
cells and battery electric vehicles.
We used the 2006 EIA projections of light-duty vehicle stock and
liquid fuel consumption. (The modeling was done last year.)We posited
market entry in 2010 with 100% new car sales being electric drive by
2020 (15 million per year) and 100% of the vehicles being electric
drive with an average equivalent electric of 40 miles by 2030.
The timeline we used is short, to highlight the oil savings
potential of electric drive, rather than project real-word market
penetration rates.
Question 8. As you noted in your testimony, we import the majority
of the oil we use for our transportation fleet. Not only does this put
as at a strategic disadvantage, it also causes us to send a huge
fraction of our nation's wealth overseas. Given the new technology and
materials involved in electric and hybrid vehicles, are there crucial
areas we should monitor to may give rise to strategic vulnerabilities
for our country?
Answer. In addition to the importance a domestic automobile
manufacturing industry, domestic capacity for advanced battery
manufacturing is a critical need for the emerging electric drive
industry. Currently there is very little domestic manufacturing of
lithium ion batteries and hurdles to commercial scale industry include
not only the materials but the manufacturing processes and equipment
for automotive scale battery manufacturing must be developed. Congress
can play an important role in building a domestic industry by funding
the battery and manufacturing programs authorized in EISA 2007.
Questions have also been raised about the availability of lithium.
It has been noted that lithium is currently known to be concentrated in
geographically remote and geopolitically inhospitable areas of the
world, including the Andes in South America.
Answer. While Congress should be monitoring the availability of
lithium, it is worth noting that reliance on lithium ion batteries for
the global personal computing and cell phone applications has not been
limiting to date. Nevertheless, the search for the next iteration of
the lithium ion chemistry, and of advanced battery technology, is
ongoing.
Question 9. You noted the importance of developing and maintaining
a domestic battery manufacturing capacity. Recently there have been
advances in the performance of traditional lead acid batteries for
which there is a mature manufacturing and recycling industry in this
country. What do you think the prospects are for traditional lead acid
batteries playing a role in the electrification of the transportation
sector?
Answer. Traditional lead acid batteries are already playing a role
in the electrification of transportation, as they power low speed
electric vehicles (or neighborhood electric vehicles). These vehicles
provide battery electric options in communities, campuses and
increasingly urban options. They are road legal in 40 states and help
to build market, infrastructure and acceptance of electric
transportation.
Advanced lead acid options are also options for certain
configurations of hybrid vehicles. For example, advanced lead-acid
batteries of the Absorbant Glass Mat type, are an excellent technology
for micro-hybrid vehicles, which operate with conventional powertrain
and use battery power at idle and stop (and in some cases mild
regenerative braking) to enhance fuel economy.
Question 10. What is the current status of the lithium ion
batteries for hybrid electric vehicles, plug-in hybrid electric
vehicles and electric vehicles?
Answer. First generation lithium ion batteries are market ready,
for instance lithium ion batteries power the Tesla EV, A123 plug-in
hybrid conversions and Johnson Controls' lithium ion battery will be in
the 2009 Mercedes hybrid. However, continuing advances are needed for
vehicle applications of this relatively young technology. Reductions in
cost, advances in battery life, durability and abuse tolerance are
needed to achieve the scale and performance certainty required for
global commercial scale vehicle applications.
Question 11. What are the major technical/market barriers for
commercialization of lithium ion batteries?
Answer. Technical barriers for widespread commercialization include
durability, length of life and safety. Department of Energy research
and development programs are a critical part of the industry effort to
address the technical challenges. The Department Energy Storage program
is working on some salient technical challenges, including performance
over time; abuse tolerance (including overcharge and over-discharging,
and high temperature environments); and life--the battery needs to last
and perform for the 15-year life target of the vehicle.
Cost is a technical and a market hurdle. The incremental cost of
lithium ion batteries for plug-in vehicles is estimated at $500 to
$1000 per kilowatt hour. To put this in perspective, the Chevy Volt is
designed to operate on a 16 kWh battery. Even at the lowest end of the
cost projections, the battery would add $8000 to the cost of the
vehicle. Federal and private research and development partnerships can
help to address the technical aspects of the cost. The market hurdle
can be mitigated by consumer tax incentives that address the retail
cost and manufacturing incentives that mitigate production costs.
Section 641 of EISA, the Energy Storage Competitiveness provisions
developed by the Senate Energy and Natural Resources Committee, provide
a critical template for advancing battery technology; funding for these
programs going forward can accelerate the development of energy storage
technology and electric drive transportation overall.
Question 12. Plug-in electric vehicles hold great promise in our
ongoing efforts to lessen our dependence on foreign sources of oil.
However, U.S. transmission infrastructure has increased by only 6.8%
since 1996. In the last year's energy bill. Congress encouraged the
modernization of the electricity grid in Smart Grid provisions that
include the deployment and integration of plug-in electric and hybrid
electric vehicles. What kind of infrastructure improvements must we
undertake to accommodate the eventual use of plug-in vehicles?
Answer. A 2007 study conducted by the Electric Power Research
Institute and the National Resources Defense Council concluded that 84%
of the energy needed for a plug-in light duty vehicle fleet could be
met with existing electricity capacity. Grid connected transportation
won't require more electricity generation for a very long time. It will
require better management of existing electricity resources.
The national scale adoption of grid-powered transportation requires
updating the the ``hardware'' and the ``software'' of electricity
infrastructure. Better technology and better communication will
optimize the energy and environmental benefits of plug-in vehicles.
Smart meters that allow two way communications between energy users
and suppliers are needed so that consumers can maximize savings and
benefit from price signals and electricity providers can manage load,
maximize off-peak charging and ultimately use the energy stored in
batteries to improve grid reliability.
Public charging and fast--charge infrastructure will be needed to
meet the needs of diverse drivers who want or need an alternative to
home charging. This will also require new payment protocols that allow
billing to be as mobile as the plug-in vehicle user.
Grid-powered transportation will become more sustainable as the
grid becomes greener. Transmission lines should be upgraded to increase
the efficiency of the grid, minimize line loss and enable distributed,
renewable generation to be used in the grid.
In addition, interconnection standardization will be needed to
enable the energy stored in batteries to be delivered to homes for
backup power and one day to the grid.
This committee identified key elements of the necessary
modernization effort in Title XIII of EISA and provided key threshold
incentives in the HR 1424 tax incentives for smart meters and
alternative fuel vehicle recharging infrastructure. Funding for the
former and expansion/extension of the latter can help to speed the
changes needed for large scale integration of grid-powered vehicles.
______
Toyota,
Washington Office,
Washington, DC, December 5, 2008.
Hon. Jeff Bingaman,
Unites States Senate, Committee on Energy and Natural Resources,
Washington, DC.
Dear Chairman Bingaman: Thank you for your letter of November 20,
2008 containing additional follow-up questions from your September 16
hearing on the Electrification of the Automobile. I appreciate the
opportunity to respond to these questions (attached).
If you have any further questions or if I can be of further
assistance as you move forward in consideration of legislation, please
do not hesitate to contact me.
Sincerely,
Robert Wimmer.
Responses to Questions From Senator Bingaman
Question 1. As I understand your testimony, the main factor in
determining the all-electric range of the next generation Prius is the
cost of the batteries and your desire to make a mass-marketable price
point. If the US market had incentives on the scale that Mr. Balkman
advocates that would significantly reduce the cost to consumers of
larger battery packs, would that alter the calculations for what is
feasible for the market?
Answer. Toyota supports broad-based consumer tax incentives to
promote the purchase or lease of advanced technology vehicles, like
those included in the Energy and Tax Extenders Act of 2008. Any
incentives that support all manufacturers' PHV designs are beneficial
to the industry and will speed deployment.
It is often a decade or more between the start of vehicle design
and the end of a model's production run. With such a long time frame,
it is risky to develop global designs optimized for one market's
incentives. Toyota designs our vehicles to provide attractive
affordable transportation to greatest number of potential customers in
multiple markets. Incentives in the early stages of marketing a new
technology are certainly beneficial in lowering a vehicle's price point
and making it more affordable to a greater number of possible
customers. But ultimately, such incentives are temporary and
technologies must compete on overall value to the consumer.
Regarding all-electric range of a PHV, the larger the battery the
more dead weight must be carried after the battery is discharged. This
of course negatively affects overall vehicle mileage, especially on
long trips. Also, the larger the battery the less room for passengers
and cargo, negatively affecting functionality, a key selling point of
the Prius (small battery) concept.
Question 2. We've heard previous testimony that prices for lithium
ion batteries are only likely to drop significantly when high
production volume is achieved. Of course, this high volume will only
follow from high sales volume of vehicles using lithium ion batteries.
In your estimation, what kind of volume in battery production might
represent a ``tipping point'' where the batteries would be inexpensive
enough to be used in a substantial portion of vehicles?
Answer. As Li-Ion battery production increases, manufacturers can
apply lessons learned and develop advanced manufacturing technologies
to,lower production costs. But even in high volumes, battery experts do
not expect pack prices to drop below--$500/kW-hr.
As Toyota designs new hybrid and PHV models we will evaluate all
battery options and select the chemistry that best meets vehicle
performance goals, customer expectations and price targets. Battery
cost is a key factor, but only one of many that go into the vehicle
design process.
Another consideration must be the long-term commodity price of
lithium metal. Current low-cost sources, like dry lakes in Latin
America, cannot support massive increases in the global demand for
lithium. New, more costly sources will need to be developed as demand
increases. As a result, much of the cost savings from manufacturing
improvements may be negated by higher material costs.
Responses of Robert Wimmer to Questions From Senator Domenici
Question 3. Are you performing any sort of vehicle-to-grid research
with these vehicles?
Answer. We have a joint research project with the French electric
utility EDF (Electricitee France) to explore public
recharging and some vehicle-to-grid communication issues. We also
participate in a number of national and international standards
organizations, Society of Automotive Engineers for example, that are
developing codes and standards for plug-in vehicles.
Question 4. How many miles will your vehicle or vehicles travel in
its ``all electric'' mode?
Answer. The current prototype travels about seven miles all-
electrically. Next year's PHV, to be leased to commercial fleet users,
will have significantly greater range. Once EPA certification testing
is completed and we near product launch, Toyota will announce the all-
electric range of the next-generation vehicle.
It is important to note that battery cost is closely related all-
electric range. As mentioned in our testimony, Toyota is seeking to
find the appropriate balance between electric range, vehicle cost,
consumer desires and other factors when determining electric range.
Question 5. What are the challenges presented to your vehicles by
extreme environments? What will buyers in Arizona and Wisconsin have to
face?
Answer. Toyota designs vehicles to operate reliably and efficiently
in all climatic conditions. The PHV will be no exception.
As with conventional vehicles, cold weather operation will reduce a
PHV's fuel efficiency. There should be no noticeable loss of
performance, but all-electric range will be less.
In extremely hot conditions, the vehicle's control system may limit
battery charge and discharge rates to assure battery longevity. This
will result in a slight increase in fuel consumption as the engine
operates more frequently, but should not affect performance.
Question 6. As sales of Toyota hybrid and electrical vehicles in
the U.S. increase what investments are Toyota prepared to make in
manufacturing infrastructure development in the U.S.? For example, will
a domestic lithium ion manufacturing capability be important to
Toyota's business model.
Answer. Toyota is a global company that strives to manufacture
where we sell. Since initial PHV volumes are expected to be modest,
production will likely take place at a single manufacturing facility to
minimize cost. As we near start of production, Toyota will announce
which facility is slated to produce PHVs.
Question 7. What is the current status of Lithium Ion batteries for
hybrid electric vehicles (HEV), plug-in hybrid electric vehicles
(PHEVs), and electric vehicles (EVs)?
Answer. We have announced we will be using Li-Ion batteries in our
next-generation PHY that begins production next year. This battery will
be built on a new, dedicated assembly line by Panasonic EV, a joint
venture between Panasonic and Toyota.
As Toyota develops new hybrid systems, we evaluate all battery
options and select the chemistry with the best cost/performance
tradeoff that meets our customers' expectations and provides required
battery durability and life.
Though Toyota is committed to mass production of Li-Ion batteries,
challenges of the chemistry have us looking ``beyond lithium. To this
end, we established a separate advanced battery group with facilities
in both Japan and the US (Ann Arbor) to examine innovative battery
chemistries that may lead to a breakthrough in energy storage.
Question 8. What the major technical/market barriers for
commercialization of lithium-ion batteries?
Answer. Key issues we see with Li-Ion batteries are cost, life-of-
the-vehicle durability and cold weather performance. Another issue is
sustainability of the lithium metal supply as demand grows for
automotive batteries. Lithium commodity prices are expected to increase
as demand grows and traditional lower-cost sources of lithium are
exhausted.
Question 9. Plug-in vehicles hold great promise in our ongoing
efforts to lessen our dependence on foreign sources of oil. However,
U.S. transmission infrastructure has increased by only 6.8% since 1996.
In last year's energy bill, Congress encouraged the modernization of
the electricity grid in ``Smart Grid'' provisions that include the
deployment and integration of plug-in electric and hybrid electric
vehicles. What kind of infrastructure improvements must we undertake to
accommodate the eventual use of plug-in vehicles?
Answer. Studies show that the US electrical grid has the nighttime
capacity to support tens of millions of PHVs. However, experience from
our electric vehicle program in California has shown that consumers are
``opportunity chargers'' and will charge whenever convenient.
We expect similar behavior from PHV owners as they will want to
maximize fuel and cost savings by ``plugging-in'' as often as possible.
Remote, public recharging stations will be needed to accommodate this
cell-phone mentality. Charging during lower-cost off-peak-hours will
initially dominate vehicle recharging, but significant growth in
daytime charging could ultimately stress the electric grid.
Notwithstanding the issue of daytime versus nighttime charging, the
greater near-term infrastructure need is at the residential level.
Currently, less than half of US households have the ability to
charge a PHV. Those that can not, include multi-unit residences with
parking lots and homes that have no off-street parking. Charging
infrastructure must be built for these residences before their
occupants can benefit from PHV ownership.
Another issue is the electrical capacity of sub-divisions. As more
and more households begin recharging their vehicles at night, the
electrical capacity of entire subdivisions could be exceeded. Smart
meters may reduce this possibility, but ultimately upgrading many
subdivisions' electrical systems could be required.
______
Responses of Thad Balkman to Questions From Senator Bingaman
Question 1. As you know, the automotive industry is both highly
competitive and capital intensive. Has something changed that has made
it more likely that a company such as yours, or Tesla is likely to
succeed in breaking in where other efforts have failed in the past?
Answer. The established model of vertically integrated automobile
manufacturing is giving way to a systems integration manufacturing
model much as occurred in the computer industry. This has profoundly
reduced barriers-to-entry for manufacturers of battery electric
vehicles (BEVs). Under the systems integration manufacturing model
employed by Phoenix, Tesla, and others, the manufacturer undertakes the
R&D and integrates the vehicle elements while suppliers contribute
virtually all components and materials and much of the innovation at
the sub-system level. See Nutek (Swedish Agency for Economic and
Regional Growth), Globalization and Regional Economies, Case Studies in
the Automotive Sector (2007) at http://fm.nutek.se/forlaget/pdf/
r_2007_11.pdf. The greater efficiency and cost reduction opportunity
presented by the systems integration model has enabled the emergence of
an entirely new collection of American automobile manufacturers within
the past five years, the first new entrants in the automotive sector in
decades. Nearly all of these new manufacturers are relying on electric
propulsion systems consisting of electric motors and advanced lithium
batteries designed and supplied by third parties. In contrast,
traditional automobile manufacturers depend on their own vertically
integrated manufacturing plants dedicated to the production of IC
engines and transmissions, which require the engineering, design and
manufacture of thousands of moving parts. Thus, the low-cost design and
manufacture of combustion technology and transmissions are the primary
``value added'' by traditional automobile manufacturers which have
accumulated substantial expertise over the past 100 years. The sheer
complexity of vertically integrated manufacturing for decades has
effectively barred the entry of new actors. See Green Mountain Chrysler
v. Crombie, No. 2:05-CV302 (D. Vt. Sept. 12, 2007), available at http:/
/www.vtd.uscourts.gov/Supporting%20Files/Cases/05cv302.pdf. The major
OEM's have become so large and complex that each new vehicle launched
costs hundreds of millions of dollars and requires hundreds of
thousands of unit production to break even. In contrast, BEVs replace
IC engines and transmissions, two of the primary business units of the
automobile industry. See U.S. EPA, Staff Technical Report: Cost and
Effectiveness Estimates of Technologies Used to Reduce Light-duty
Vehicle Carbon Dioxide Emissions , available at http://epa.gov/otaq/
climate/420r08008.pdf ; EVWorld.com, Inc., Interview with General
Motor's Vice President of Research and Development, Dr Larry Burns
(March 12, 2007), available at http://www.evworld.com/
article.cfm?archive=1&storyid=1208&first=3630&end=3629.
Question 2. Assuming we were to put in place some of the incentives
you advocated in your testimony to bring down the initial costs of
battery electric vehicles, how long would you anticipate such
incentives would be needed? In other words, at what point do you
anticipate that enough scale is achieved in battery manufacturing to
bring costs in line with standard vehicles available today?
Answer. Clearly investments in bringing down the initial costs of
battery electric vehicles must be a sustained multi-year effort to be
successful. Generally speaking, economics of scale in manufacturing are
not fully achieved until hundreds of thousand units are produced. See
Bandivadekar, Evaluating the Impact of Advanced Vehicle and Fuel
Technologies in Light Duty U.S. Vehicle Fleet (2008) http://
esd.mit.edu/people/dissertations/anup_bandivadekar.pdf. Internal
combustion technology has dominated for 100 years and benefits from
several billion units of production. New technology comes with a price
of development. If advanced electric vehicles are to be successful
market incentives are critical for a sustained period of time to help
early adopters offset the initial investment. As volume from Phoenix
Motorcars and others increase, component prices will come down and
allow for future cost reduction in our existing and future models.
Responses of Thad Balkman to Questions From Senator Domenici
Question 3. You testified that consumers will not pay extra for
more fuel efficient vehicles unless the pay-back is 2.5 years or less.
What is the pay-back period for the two electric vehicle models Phoenix
Motorcars will introduce next year?
Answer. Without incentives our vehicle shows a payback period of
3.5 years at a gasoline price of $4.00 per gallon. The higher the gas
prices the shorter the payback period and the lower the gas price the
higher the payback period. With the incentives available to today in
California and thru the Federal Government the payback period can be
met in the first year of operation making Electric Vehicles truly a
zero compromise alternative to the fleet or consumer in these economic
times.
Question 4. How do you arrive at the payback period for your
vehicles?
Answer. Payback period is determined by the annual cost of
ownership for an internal combustion vehicle (ICE) compared with the
annual cost of ownership of a Phoenix EV. While the initial cost of a
Phoenix SUT is higher ($47,500) than the initial cost of a comparable
ICE ($28,000) the operational costs is substantially lower with
electric vehicles.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Question 5. You note that there are a number of advantages that
electric vehicles have over traditional gasoline powered vehicles
including simpler mechanics and environmental emissions as well as
lower infrastructure emissions. Are there potential disadvantages that
are unique to electric vehicles, for example battery chemistry and
manufacturing infrastructure, that we must also consider?
Answer. There are three concerns that early adopters will have to
face. First--charging infrastructure will take time to build out to
provide the opportunity to quickly recharge your vehicle and continue
driving. Second--users will need to become familiar with the idea of
plugging in their vehicles at home leaving each morning with a full
charge. Statistics show that most Americans do not drive more than 40
miles per day. Third--battery technology production is just coming on
line in many instances and will take some time to allow large
production of hundreds of thousands of units. In most cases these large
format batteries will require cold and hot weather validation for use
in different climates within the US.
All of these challenges can and are being addressed and will be
proven out with time and marketing. The market is pulling for these
alternatives which greater assists in the reformation of the idea of
transportation in the US. Investments into furthering technologies for
alternative fueled vehicles will assist in closing the hundred year
head start that the internal combustion engine has had.
Question 6. What is the current status of Lithium Ion batteries for
hybrid electric vehicles (HEV) plut-in hybrid electric vehicles
(PHEVs), and electric vehicles (EVs)?
Answer. The market as a whole now views lithium ion based batteries
as the best alternative for transportation. With any transportation
application size, weight, safety and durability are all important
considerations. Lithium ion batteries allow for the highest energy
density batteries providing a smaller less weight solution. With
advancement in Lithium Titanate and Lithium Polymer batteries you now
have a durable safe chemistry. Phoenix Motorcars view that large
prismatic lithium cells are best suited for electric transportation.
Question 7. What the major technical/market barriers for
commercialization of lithium-ion batteries?
Answer. The largest barrier is the domestic manufacturing capacity
of large format lithium-ion based batteries.
Question 8. Plug-in vehicles hold great promise in our ongoing
efforts to lessen our dependence on foreign sources of oil. However,
U.S. transmission infrastructure has increased by only 6.8% since 1996.
In last year's energy bill, Congress encouraged the modernization of
the electricity grid in ``Smart Grid'' provisions that include the
deployment and integration of plug-in electric any hybrid electric
vehicles. What kind of infrastructure improvements must be undertake to
accommodate the eventual use of plug-in vehicles?
Answer. One advantage of electric transportation is the ability to
use the existing electricity grid infrastructure to refuel your
vehicle. Unlike our vehicles at present time that refuel most often
during the daytime hours, electric vehicles can recharge at night when
the existing utility grid capabilities are ``idling'' burning
electricity off the grid until the need arises the following day as we
wake up. In addressing the rapid recharge station we promote the model
that gas stations use today. Instead of large tanks that hold gasoline,
we envision using a large battery that recharges off the grid at night
or thru renewable sources. As a vehicle pulls ind uring the day it
transfers the required energy from this large battery instead of from
the grid. Not only would this proposed model assist the utilities thru
use of this elecgtricity during the day, but national security would be
greater assisted by having power distributed throughout the grid.
______
Responses of Joseph T. Dalum to Questions From Senator Bingaman
Question 1. Your technology seems to be an exceptionally good fit
for several heavy duty applications where idling is a significant part
of the fuel consumption. With fuel prices where they are, why isn't
this sector, which is historically so sensitive to fuel prices,
adopting this technology quicker? It would seem it would pay for itself
fairly quickly.
Answer. In my opinion there are several reasons that explain why
the heavy duty truck segment has not adopted plug-in hybrid technology
more quickly:
1) High acquisition price
Low initial production volume, combined with high
start-up costs contribute to a relatively high
acquisition price for current plug-in hybrid systems.
The high price deters wide-scale adoption of this
technology by commercial customers.
The start-up costs include costs for research and
development, testing and validation, production floor-
space and tooling, low volume manufacturing activities,
service and operator training, marketing and other
costs associated with launching a new product. Those
costs are spread over an initially low production
volume, resulting in higher per unit sell prices.
Critical components that are used in the system are
also not typically available in high volume, resulting
in higher material cost. Although per vehicle fuel
consumption is high, making the heavy truck segment a
good target for plug-in hybrid technology, heavy duty
commercial truck unit volume is low in comparison to
light duty car and truck volume. The relative low
volume for this sector makes it less attractive to some
automotive component suppliers to develop products for
this market.
DUECO strongly recommends that the Federal government
pass and fund legislation similar to H.R. 6323 Heavy
Duty Hybrid Vehicle Research, Development, and
Demonstration Act of 2008. The legislation would
provide for competitively awarded grants to accelerate
development of hybrid and plug-in hybrid technology. In
my opinion, additional research and development is
likely to result in plug-in hybrid systems for heavy
duty trucks with lower costs and better performance.
2) Weak economy and low fuel prices
Commercial truck customers are currently reducing
purchases and may have difficulty accessing credit.
When purchasing trucks with a limited budget, customers
tend to favor low priced products that provide the best
short-term return. Low fuel prices and a difficult
economy tend to make it more difficult to sell a higher
priced product, even if it has substantial benefits
over existing products.
The expected return on investment of current plug-in
hybrid systems for medium and heavy duty trucks may
extend beyond the period that some customers use to
determine whether they will pay more money up front for
a product with the expectation of lower operating costs
later. The recent collapse in fuel prices to less than
$2 per gallon essentially doubles the time before fuel
savings alone will offset the higher initial cost of
the system, compared to when the cost was $4 per
gallon.
DUECO strongly encourages the Federal government to
enhance the plug-in hybrid tax credits by doubling the
credit through 2011 for vehicles that weigh 14,001
pounds or more. The initial tax credit was developed
during a period of high fuel costs, but fuel prices are
now less than half of the peak price. The increase in
the tax credit would help to stimulate demand for this
green technology, create jobs and the increased
production volume would ultimately result in lower
costs.
In addition, DUECO recommends that a credit be
developed for plug-in hybrid trucks that weigh more
than 33,000 pounds, by modifying the Tax Extenders Bill
(H.R. 1424) to create a tax credit of up to $40,000 for
a plug-in vehicle weighing more than 33,000 pounds.
The plug-in hybrid tax credit should also be made
available for the upgrade of existing heavy trucks that
are modified by adding a plug-in hybrid drive system.
Unlike light duty cars and trucks, heavy trucks are
typically built in multiple stages for custom
applications and are more easily modified. Due to the
large number of existing Class 4-8 trucks on the road
today (6.5M, excluding road tractors), addressing the
retrofit market can have an immediate and sizable
impact on job creation, improved emissions, and reduced
fuel consumption within the medium and heavy duty truck
market.
Many of the trucks in this fleet of millions of
trucks can be converted to plug-in hybrids, potentially
creating tens of thousands of jobs in the retrofit
sector.
3) Hesitancy to adopt new technology
Commercial truck buyers are typically quite
conservative, and are currently more likely to buy
trucks that are very similar to others in their fleet.
Trucks that are purchased may remain in the field for
20 years or more, so unless there are substantial
incentives, the transition to plug-in hybrid trucks
will likely occur incrementally. Our experience has
been that some customers have adopted a wait and see
attitude.
4) Weight
Plug-in hybrid systems typically require much larger
battery systems. The additional weight can create a
problem for certain applications.
DUECO strongly encourages the government to support
advanced battery programs to develop advanced batteries
for commercial truck applications that have high power
and high energy densities at low costs. The lower
weight of an affordable advanced battery system would
increase the number of applications in which plug-in
hybrid system technology could be used.
5) Stability of supply chain
Current economic challenges and reduced access to
credit has negatively affected some suppliers of
critical hybrid components. The overall weakness of the
automotive supply chain could jeopardize the
availability of key components and cause consumers to
wait before purchasing new technology.
In order to reduce the cost of development and
improve access to capital, DUECO strongly encourages
the government to modify Section 136 of the Energy
Investment and Security Act (EISA--H.R. 6--P.L. 110-
140) which established the Advanced Technology Vehicle
Manufacturing (ATVM) program. The current law does not
provide for any loans or grants to manufacturers of
heavy duty trucks for the development of advanced
technology vehicles. The law only assists light duty
vehicle manufactures. DUECO believes this law should be
expanded to include final stage manufacturers of trucks
that weigh 14,001 pounds or greater, and include other
entities involved in manufacturing or modifying heavy
trucks, such as chassis manufacturers, intermediate
manufacturers and alterers.
Question 2. As I understand it, a big part of the fuel savings in
your vehicles is realized through idling reduction rather than
depleting the charge driving. The CAFE provisions in the energy bill we
passed last year contemplate future regulation of the medium and heavy
duty sectors. Do you know if the duty cycle fuel savings you achieve
would be given credit under such a CAFE regime?
Answer. DUECO does not know if the duty cycle fuel savings achieved
would be given credit under a CAFE regime that would be developed for
trucks that weigh 14,001 pounds or more. Our current experience in the
evaluation of various existing truck duty cycles indicates that many of
the duty cycles do not closely match the use of the vehicles we have
observed in the field. Work truck duty cycles may have a significant
component of stationary idle time in which the primary engine is used
to power truck mounted equipment at a job site. Most existing truck
duty cycles do not incorporate the same proportion of idle time and
stationary engine loads.
DUECO encourages the government, perhaps through the Department of
Energy (DOE) Laboratories, to measure and study actual truck duty
cycles and to assess other factors before determining if a standard
should be adopted. Unlike higher volume light-duty cars and trucks,
heavy trucks tend to be built in greater variation with different
profiles, weight distributions and uses. Additional regulation could
cause commercial truck prices to rise further if test costs and
associated administrative costs are spread over low sales volume. If
standards were adopted, DUECO recommends that test duty cycles closely
match actual use, be made optional, and that tax credits or other
incentives be used to encourage consumers to purchase higher efficiency
vehicles.
DUECO believes that the best performance standard for plug-in
hybrid heavy duty trucks is to measure the reduction in fossil fuel
consumption from diesel heavy duty trucks, provided that the heavy duty
hybrid truck utilizes a certified engine without modification. The DOE
is already using this standard through its Clean Cities program. DUECO
is confident that this metric will demonstrate substantial reductions
in fossil fuel consumption between comparable vehicles performing
comparable tasks over a period of time, whether this is one day, one
month or one year. Our initial testing indicates that fuel consumption
may be reduced by as much as 50 percent over the course of a day,
depending upon the duty cycle. We believe these savings will be even
higher once battery weight and costs are reduced.
DUECO initially recommends a performance metric that demonstrates a
reduction of 10 percent in fossil fuel use for the purposes of
developing various incentives, such as the use of an expanded Advanced
Technology Vehicle Manufacturing Program for plug-in hybrid heavy duty
trucks. This metric will allow oversight over the expansion of the
plug-in heavy duty truck sector, without harming efforts to expand this
sector. We recommend 10 percent initially because we are concerned that
fleet managers will not measure comparable vehicles, or that they won't
properly maintain the plug-in vehicles by failing to charge them
through an external grid, making them less efficient during the period
when they are learning to use these trucks.
DUECO recommends increased government funding for the DOE's Clean
Cities Program.
Responses of Joseph T. Dalum to Questions From Senator Domenici
Question 3. How many miles will your vehicle or vehicles travel in
its ``all electric'' mode?
Answer. Our vehicle has the capability to provide ``All Electric
Operation at a job-site for a typical day,'' as stated in my written
testimony. The all electric mode is used while the vehicle is
stationary to provide power for truck mounted equipment, lights, air
conditioning and exportable power (e.g. power for tools). Those loads
are normally powered by an idling engine in a traditional truck. Our
plug-in hybrid heavy duty vehicle utilizes a parallel hybrid power
train configuration in which the engine operates, along with the
electric motor. The electric motor is used to provide ``launch assist''
when the vehicle accelerates, and regenerative braking when the vehicle
decelerates which also recharges the batteries. Since the engine
operates along with the electric motor, there is no all electric range
using this configuration. Like conventional hybrid trucks of similar
size, the internal combustion engine must remain on when the vehicle
travels in order to power vehicle sub-systems such as brake systems,
steering and HVAC. Further changes to those sub-systems, such as the
possible electrification of associated components, and modifications to
the drive train could make it possible to create a truck with all
electric range. A series/parallel design could allow a truck to have a
limited all electric range as described in the System architecture
section of my written testimony shown below:
System architecture:
Existing hybrid systems for trucks tend to utilize system
architectures that are similar in many ways to that of existing
truck power trains. The internal combustion engine typically
remains operating while the vehicle is driven to power
auxiliary loads such as power steering systems, brake systems
and HVAC systems. Keeping the engine running while stationary
or in low speed stop and go traffic increases fuel consumption.
Some vehicles also do not have a clutch in between the internal
combustion engine and the transmission. While such systems
utilize an automatic transmission, it may be desirable to
create a method to uncouple from the transmission from the
engine for improved regenerative braking or an all-electric
drive mode.
In order to improve fuel economy further, different system
architectures that are designed for high volume production in
which the internal combustion engine can remain off during
driving need to be developed. The development of electrically
driven sub-systems such as braking, power steering, HVAC and
others need to be brought to high volume production for medium
and heavy duty trucks.
Existing parallel hybrid electric vehicle systems for trucks
also tend to use relatively small electric drive components
with relatively low power output, compared to the power
provided by the internal combustions engine. Larger electric
motors and higher capacity battery systems may allow smaller
engines to be used that operate at higher efficiency without a
reduction in vehicle performance, or allow the vehicle to be
driven entirely by electric propulsion. Future system
architectures could also combine the benefits of plug-in hybrid
technology, which requires battery systems with high energy
densities, with that of hydraulic hybrids that have high power
densities. The combined plug-in electric hybrid system with
hydraulic hybrid components could offer high horsepower during
acceleration and recapture more energy during braking while
providing enough energy for sustained operation with the engine
off.
Alternative power train architectures, such as a combined
series/parallel hybrid system with a plug-in battery system are
also recommended for consideration. A combined series/parallel
system would allow the vehicle to operate in an all electric
mode, a series hybrid configuration or a parallel hybrid
configuration, depending upon which is most advantageous given
operating requirements.
DUECO strongly recommends that the Federal government pass and fund
legislation similar to H.R. 6323 Heavy Duty Hybrid Vehicle Research,
Development, and Demonstration Act of 2008. The legislation would
provide for competitively awarded grants to accelerate development of
new power train designs.
In addition, to reduce the cost of development and improve access
to capital, DUECO strongly encourages the government to modify Section
136 of the Energy Investment and Security Act (EISA--H.R. 6--P.L. 110-
140) which established the Advanced Technology Vehicle Manufacturing
(ATVM) program. The current law does not provide for any loans or
grants to manufacturers of heavy duty trucks for the development of
advanced technology vehicles. The law only assists light duty vehicle
manufactures.
Question 4. Given the different duty cycles required for medium and
heavy duty trucks and light-duty passenger cars and trucks, how well do
you think technology development in either of these market segments
will benefit the other?
Answer. While medium and heavy duty truck cycles and power
requirements differ significantly from those of light-duty passenger
cars and trucks, there are some technologies that can be shared between
each segment. Areas of technology development that could be shared are
listed below:
Advanced battery systems
Charging technology (i.e. ``Smart Chargers'')
Inverters and electric motors
Control systems
While individual components may be different due to the larger
power and greater energy requirements of heavy duty trucks, the
underlying technology is very similar and could be shared in these
areas. In order to reduce the cost for heavy duty plug-in hybrids, it
would be beneficial to utilize higher volume, lower cost light-duty
vehicle technology wherever possible.
Question 5. Do you think any fuel economy differences seen between
parallel and series drive systems for medium and heavy duty trucks will
also apply to light duty vehicles?
Answer. In my opinion, the fuel economy differences seen between
parallel and series drive systems for medium and heavy duty trucks will
not be as readily apparent in light duty vehicles due to the fact that
technology for light duty vehicles is more mature and fuel consumption
per vehicle in the light duty segment is much less. Light duty power
train systems have in many cases already become highly efficient.
Light-duty hybrid power trains have been in production for years
(although present in only approximately 2% of light-duty vehicles) and
power trains that offer extended range or 100% electric operation are
under development and are targeted for deployment in 2010 (such as the
GM Chevy Volt). So, in other words, the relative difference as
technology improves for light duty power trains will not be as great as
that for heavy duty trucks.
In the near term it will be difficult to achieve further
improvements in advanced light-duty power trains while maintaining a
competitive value proposition relative to lower cost conventional
hybrids. As an example, a light duty vehicle that achieves 50 mpg using
conventional hybrid technology and 100 mpg using plug-in hybrid
technology saves approximately 100 gallons of fuel when driven 10,000
miles per year using the more advanced plug-in power train. At $2 per
gallon, a driver will only save $2000 over a ten year period (or less
if the cost of charging the vehicle is included). $2000 does not
currently cover the increased incremental cost required to obtain 100
mpg.
However, medium and heavy duty trucks, due to their lower overall
current efficiency, offer a more compelling value proposition for the
use of advanced power train technology. Overall, medium and heavy duty
trucks consume a disproportionately large amount of fuel as compared to
light duty vehicles. A large truck that can use advanced technology may
save over 1000 gallons of fuel per year. At $2 per gallon, the operator
can save $2000 per year in fuel costs, or $20,000 over a 10 year
period. It is more likely in my opinion that the increased cost of
power train advancements in heavy duty trucks can be offset by reduced
fuel expenditures. Unfortunately, as discussed previously, the current
cost of heavy duty plug-in hybrid technology is still relatively high,
which causes demand to be relatively low.
Question 6. What is the current status of Lithium Ion batteries for
hybrid electric vehicles (HEV), plug-in hybrid electric vehicles
(PHEVs), and electric vehicles (EVs)?
Answer. I have deferred this question to two manufacturers of
Lithium Ion battery systems: Valence Technology Inc. and Johnson
Controls--Saft.
Question 7. What the major technical/market barriers for
commercialization of lithium-ion batteries?
Answer. DUECO believes that the primary barrier for
commercialization of lithium-ion batteries is high cost. The price per
kWh of energy storage is prohibitively high for large plug-in advanced
battery systems. Other concerns including safety, ease of recycling and
limited performance history in the field can also deter wide-scale
commercialization.
DUECO recommends that a portion of government funding for advanced
battery research, development and demonstration programs should be
directed to heavy duty truck applications (trucks that weigh 14,001
pounds or greater). Any federal funding for advanced battery
manufacturing should also include funds for the manufacturing of
battery systems for heavy duty truck applications.
Question 8. Plug-in vehicles hold great promise in our ongoing
efforts to lessen our dependence on foreign sources of oil. However,
U.S. transmission infrastructure has increased by only 6.8% since 1996.
In last year's energy bill, Congress encouraged the modernization of
the electricity grid in ``Smart Grid'' provisions that include the
deployment and integration of plug-in electric and hybrid electric
vehicles. What kind of infrastructure improvements must we undertake to
accommodate the eventual use of plug-in vehicles?
Answer. There are two types of potential infrastructure
improvements in my view that are needed in order to accommodate the
eventual use of plug-in vehicles.
One is the immediate interface between the vehicle and the
surrounding infrastructure. A charge station is required to connect the
battery system of a plug-in vehicle to an electrical power source.
Charge stations must be installed near the parking places of plug-in
hybrid vehicles, which in the case of a commercial vehicles, may be a
garage or storage area (e.g. parking lot for commercial vehicles). It
may be necessary to modify or add electrical connections between the
charge station and the existing source of power for the location.
DUECO recommends that assistance be provided to users of plug-in
hybrid vehicles to help offset the cost of charge station
installations.
The second type of infrastructure improvement may be to the
electrical distribution or transmission system, depending upon the
number and type of vehicles connecting to the grid and the ability of
the utility to control the size of the loads added to the grid and the
timing of the addition of the loads to the grid. For further
information, DUECO recommends that the Senator contact PG&E for further
information. PG&E is one of the largest utilities in California.