Moving Away From Oil:  The Role of Electric Vehicles

A wave of new plug-in electric vehicles, including both plug-in hybrids and all-electric cars, will hit the U.S. consumer market starting later this year. Nissan reports that it has taken 19,000 pre-orders for the all-electric Leaf it plans to begin selling in December 2010. GM’s Chevy Volt is expected to appear in showrooms about the same time. At least 25 new electric car models are slated for production in the next few years. A National Research Council study projects that market penetration is likely to reach at least 100 million electric vehicles by 2050, with a maximum penetration of approximately 240 million vehicles (roughly the size of the current U.S. light-duty fleet).

Rapid expansion of electric vehicles would substantially help reduce America’s dependence on oil. Of the approximately seven billion barrels of oil consumed by the United States in 2009, almost four billion barrels were used to power cars and trucks. In the same year, Americans bought about 10 million passenger vehicles. A study by researchers at Carnegie Mellon University estimates that every 10 million passenger vehicles replaced by plug-in hybrid vehicles would reduce U.S. oil consumption by 36-73 million barrels per year, or 55-91 million barrels per year if replaced by all-electric vehicles.

Rapid expansion of electric vehicles, however, will depend upon convenient charging and managing the expectations and customer experiences of new electric car owners. Consequently, automakers, equipment manufacturers, electric utilities, community planners, and policymakers are developing strategies to meet the charging needs of an expanding electric fleet. Most charging, especially for the first wave of owners, is expected to happen at home and at workplaces. According to the Carnegie Mellon study, more than 94 percent of U.S. residences have access to a garage or other off-street parking location that would accommodate home-charging.

A plug-in electric car typically can be charged from a regular 120-volt electric outlet, often called Level 1 charging, however, higher voltage charging devices can substantially reduce charging time. Some automakers are planning to offer the option of a Level 2 charger (220 volts) when the car is sold. Before a buyer takes delivery, an electrical contractor will have been scheduled to install the device (and an additional electric circuit if needed) in a garage or other home parking location. Level 2 stations can provide a full charge in approximately four to eight hours , depending on the specific battery.

Level 3 stations operate at 480 volts and reduce charging time to under an hour — as quick as 15 minutes in some cases. The cost and high-voltage of Level 2 and 3 devices make them more appropriate for frequently-used public and commercial applications. Businesses and local governments across the country have already begun installing such charging stations, but these devices do not need to be installed en masse. It is more cost-effective to install stations gradually as local electric vehicle use expands. For example, a parking garage may start with just a few charging stations, but could anticipate providing every space with charging capacity. In the meantime, planning where stations will be located and making installation of electric conduit for charging stations a standard practice for building projects will facilitate later expansion.

The EV Project , a multi-partner initiative sponsored by the U.S. Department of Energy (DOE), is placing 15,000 charging stations in 13 cities located in Oregon, Washington, California, Arizona, Tennessee, and the District of Columbia. The project estimates annual fuel savings of more than two million gallons of gasoline and more than 5,000 new jobs by 2017. The project was funded in part by the American Recovery and Reinvestment Act (P.L. 111-5) as part of the Transportation Electrification Initiative administered by DOE.

Electric drive technology is still relatively new, and production costs for electric vehicles are significantly higher than those of comparable internal combustion vehicles, with batteries accounting for most of the cost. Battery production costs have fallen under $1,000 per kilowatt-hour (kWh) and are projected to approach the $500/kWh mark within a few years. (The Chevy Volt will be equipped with a 16 kWh battery, while the Nissan Leaf will have 24 kWh.)

Electric vehicles generally have lower operating costs, however, in terms of fuel costs and maintenance — due to the mechanical efficiency and simplicity of electric motors. Whereas internal combustion engines only convert roughly 20 percent of the energy stored in gasoline into automotive power, electric motors convert electricity into mechanical energy with 75-90 percent efficiency. At a gasoline price of $3.00 per gallon, a conventional vehicle that gets 30 miles per gallon will cost 10 cents per mile, compared to an electric vehicle which, at an electricity price of 10 cents per kilowatt hour, will cost three to four cents per mile or the equivalent of less than one dollar per gallon.

Electric vehicles can also have significant value for managing the electricity grid. Electric cars will typically be parked for most hours of the day. When they are plugged in and connected to the grid, they can provide important storage, frequency regulation, and load management services. Revenues for these services can be substantial — up to $3,000 per vehicle per year in initial pilot projects. Industry observers have also suggested that the performance advantages of electric cars may command a higher consumer price — e.g. the high torque of electric motors provides for exceptionally rapid, smooth, and quiet acceleration relative to conventional engines.

In May 2010, bipartisan legislation to support and accelerate market penetration of electric vehicles was introduced in both chambers of Congress. Both the House of Representative bill, the Electric Drive Vehicle Deployment Act of 2010 (H.R. 5442), and the related Senate bill, the Electric Vehicle Deployment Act of 2010 (S. 3442), would provide incentives for the purchase of electric vehicles and the deployment of charging infrastructure.