Tag Archives: EV

Closing in on the Big One; EVs Reach 100,000

[Photo: BYU Bonneville Flats EV.  Although it isn’t the world’s fastest EV, the car uses 880 DeWalt Drill batteries which produce about 200hp.  The car set a record at 155mph but hit a top speed of 175mph.]

Soon, probably within the next six weeks based on recent monthly sales figures, somewhere in the US someone will purchase the 100,oooth electric vehicle.  But what does that really mean?

Being directly involved in sales/business development for an EV charging station provider has opened my eyes to a few of the realities of the market place and the relevance of this number.  Like most emerging technologies, but particularly ones that promise radical change to the existing system and the formidable interests invested in them, the road to deployment is not straight and flat.  Misinformation abounds- about the car’s cost, its range, its battery’s resiliency, an EV’s carbon emissions, the superiority of other alternative fuels, its”green” political pre-disposition.   Often the one with the bullhorn shapes the “facts”.  I read a mix of daily articles from news sources all over the world and it would be interesting to document the ratio of negative to positive commentary as an indicator of the market’s actual progress.

Even as recently as six months ago, when I would go into auto dealerships to sell chargers, they would listen politely and tell me they had sold very few Volts or LEAFs and their customers weren’t interested in charging stations.

Where are we today? We have Nissan, Tesla, Chevy, Ford, Honda, Mitsubishi, Toyota, BMW, even FIAT, manufacturing PEV models with their own branding.  Now when I go into auto dealers, they invite me back to speak to their sales staff and discuss charging as an issue and what their customers will need to make better use of the car’s range capabilities.  Anecdotally, last month in Portland’s metro area, Nissan dealers collectively sold more 2013 LEAFs than any other model- including the Altima- over 65 units between the four major dealerships. Tesla’s stock is up over 43% since the beginning of the year.  17,813 PEVs have been sold this year since March, practically matching the entire PEV sales for all of 2011.  While PHEV still account for a 2/3 share of all sales to date, March revealed that BEV purchases exceeded PHEVs for the first time since 2011, fueled in part by Nissan’s aggressive pricing and the Tesla S’s popularity.  Consumers are embracing both technologies- and no one can predict which may become dominant even in the short-term. We are on track create a passenger fleet of almost 100,000 PEVs in a little over two years, and the graph shows purchasing accelerating faster than the adoption of the Toyota Prius over the same timeframe- by some estimates soon to experience 48% annual growth.

From a grid perspective, we now have over 2,000 megawatts of battery storage associated with the domestic PEV fleet.  To provide perspective, Boardman Coal Plant, the largest remaining coal plant in Oregon, has a nameplate capacity of 550 mWh- and serves as base power generation for a service territory of over 800,000 people. Many utilities have now begun to consider the imminent prospect of using PEV related storage for direct load management to assist in smoothing their peaks and avoid triggering activation of older, dirtier generation sources.  This is shown by a number of pilot studies going on nationally and increased interest in pursuing them as part of smart grid planning and utilizing smart meters communication capabilities. I recently met with a representative of Puget Sound Energy, with a service territory in Seattle, who remarked that their DMV data showed purchases of over 300 PEVs in their territory- just for the month of March.  These numbers make utilities imagine the future is much, much closer- and spur investment in harnessing ancillary benefits for the grid.

So as we take stock in April 2013, and try to be objective and critical and dispassionate, we can admit that the reality of where we are is a great place compared to where we have been. Over 93,000 PEVs have now been sold. We were correct about the prospects for growth of PEV technology, as their sales progress outpacing the growth of the hybrid vehicle over its first three years.  And hybrids did not have “range anxiety” issues or the complex amount of information associated with them. We were correct in believing that the American consumer would accept an alternative choice besides gasoline if the technology delivered performance and savings over the long haul.  A virtuous market- and policy-based cycle has developed to bring down prices and spur R & D. We appreciate that these vehicles are not just “green,” they are advanced vehicle technology creating better transportation choices and superior driving experiences.  They can become the Car of the Year.

Most importantly we are now soon to celebrate 100,000 PEVs on the road in the United States.  When has that happened before?  Never.

So as we mark the 100,000th domestic sale of a car with a plug, which should happen in the next six weeks, we need to recognize that we are emerging from the fog onto a clear, flat, open expanse where we can stomp the accelerator and let the true qualities of what’s under the hood  be free and- as if that’s not enough-the posted speed limit just increased.

 

 

 

 

Time to Join the Party: Early Data on Plug in Adoption and Industry Investment

By choosing to employ regulatory streamlining and supportive policies and incentives on consumer deployment and in-state industry development, Oregon and California now have evidence that those dollars leverage high economic value.

In late 2009 in Oregon, a few EV oriented businesses, manufacturers and professionals created an industry cluster in a third floor conference room of the Portland Development Commission, and concocted a strategy to harness state funds to promote its development.   Now called Drive Oregon, the group convinced the Oregon Innovation Council of its value and successfully lobbied state legislators to invest $1.2m of state funding at a time when the state’s budget left many lawmakers on the retreat, cutting public safety measures and teacher salaries.  The pitch, that Oregon needed to have a means of fueling its EV industry cluster’s growth and have a conduit for federal and private grants funding alternative fuel technologies, was persuasive but not without great uncertainty.  Should Oregon gamble on using state funds to fuel development in a sector that many, even today, dismiss as doomed to fail?  Recently the Northwest Economic Research Center (“NERC”) released the results of its first study designed to define what companies constitute Oregon’s EV cluster and measure its strength and economic impacts.

Tom Potiowsky, director of NERC and former Oregon state economist, concluded that: “Our research indicates that the electric vehicle industry generates gross economic activity of $266.56 million, total value added of nearly $148 million and provides more than $89 million in total employee compensation.  The industry continued to grow during the Great Recession, while other transportation industries suffered enormous losses.”

NERC estimated that EV economic activity created a ripple effect, adding 1169 jobs to the economy in addition to the 411 full-time EV jobs.  Tax revenue to the state amounted to $11.9m and $20.8m to the federal authorities.   More importantly, in a little over a year DriveOregon has gotten over forty businesses to join the cluster and leveraged over $2.5 million dollars to date through its matching grants program.

Why has the EV industry taken root in Oregon?  Sophisticated local demand may explain some of this phenomena, a population given to a willingness to try new things for the benefit of themselves and the planet.    Oregon’s skilled workforce, supportive legislative and regulatory policy atmosphere, and a diffuse EV industry structure involved in manufacturing of different types of EVs, parts and components all contribute to its health. But it is more.  It took impassioned individuals and courageous political leadership.

What of the other side of the coin- deployment? What benefits might be achieved through a state’s aggressive measures to foster consumer purchasing of PEVs?

In the UCal-Berkeley study released in September 2012, titled, “Plug-In Electric Vehicle Deployment in California: An Economic Assessment”, focused on providing an economic assessment of the state’s accelerated deployment of PEVs.   Its author, David Roland-Holst, who employs a long-term economic forecasting model, concludes that:

-Light duty vehicle electrification can be a catalyst for economic growth, contributing up to 100,000 additional jobs [in California] by 2030.

-On average, a dollar saved at the gas pump and spent on other goods and services that households want creates 16 times more jobs. (Yes, read that again).

-The majority of the new demand financed by PEV fuel cost savings goes to in-state services.

Individual Californians gain from economic growth associated with fuel cost savings due to EVs, whether they buy a new car or not. Average real wages and employment increase across the economy and incomes grow faster for low-income groups than for higher-income groups.

(Emphasis added.)

In essence the type of savings achieved through PEV adoption are quite different than those expenditures on the fossil fuel supply chain, creating stronger multiplier effects on state product and job creation and providing a positive net value to those states that adopt them.  PEV-related transportation efficiency also stimulates job creation across all economic activities, not just in the  “green collar” sector, through this expenditure shifting phenomenon.  Quite simply, “a dollar saved on traditional energy is a dollar earned by 10-100 times as many new workers.” (p.17)

The importance of these studies should not be underestimated.  They add yet another analytic block to the foundation supporting the business case for society’s investment in PEV technology and adoption and, perhaps most importantly, for the ongoing political support of policies designed to assist its rapid ascent.  When read in conjunction, these studies make clear that we have ever more to gain by the acceptance of EVs then “just” GHG reduction, balancing the grid, and a better driving experience.   We have local jobs to gain and, with them, hope for a sustainable energy future.  For California and Oregon, the gamble appears to be paying off.  Can other parts of the country afford to not to invest in a technology sector whose odds get more favorable all the time?

 

Portland Auto Show’s Dynamic Tension; Consumer Pull v. Dealer Resistance

 (Photo- Thanks to Joe Mayer.  On the right is Oregonian Reporter Scott Learn talking to Charlie Allcock of PGE.  The distinguished looking guy on the far left is me (ha) speaking to Cindy Laurilla, Manager of Real Estate for PGE.)

Okay, I’m tired. I just spent the last four days manning the ClipperCreek Booth at the Portland Auto Show, speaking to consumers, networking with dealers and industry insiders, breathing the air, taking the temperature, trying to keep my mind open to determine “the truth” about where we are as a going as but a small slice of the industry; in Zen Buddhism, this is known as exercising the beginner’s mind.  Before I quickly shift gears into the week, I need to share some observations that we all must process as we continue to promote this technology vociferously.

The first is we need to stop allowing ourselves to be pigeonholed as “green”.

The Portland Auto Show has put our technology in the “Eco-Center” for the past three years.  Our real name is the “Advanced Vehicle Technology Center.” If smoke comes out of your tailpipe in 2013, you are not driving an advanced vehicle.  You are driving old technology and reading yesterday’s newspaper.  To rephrase a Palinism, a putting lipstick on a pig does not make it less porcine.  I thought of this as I looked at the “new” Chevy Corvette.  We need to force our hand.  If we’re paying for exhibiting, we should drive the proper message.  We must be clear that these cars are not about being green, they are about superior driving experience, interactivity, and the future. Should we have booth babes? Ah, I won’t even go there.

The media.  We had an Oregonian reporter, Scott Learn, (whose name seems appropriate for someone in journalism) come to the Eco Center and speak for an hour to many knowledgeable people- including Charlie Allcock of PGE who was recently listed as one of the top one hundred electrifying leaders nationally.  Was he quoted in the article? No.  “Are Electric Vehicles Poised to turn Corner with Public?” was the title.  “Too Pricey.”  “Too much Plastic inside.”(?) “What if we run out of juice?” were all issues stated in theopening paragraphs. But the best line of all, from GM’s spokesmen Kevin Kelly, “The biggest issue here is cost, let’s just be honest.”  Then more than halfway through the article things got rosier and some follow-up comments were hopeful.  Kelly added,  that the cost is dropping and “we’ll see generational improvements and we’re working on those as fast as we can.”  He likened it to other new technologies like cell phones and the range and other performance metrics are ticking up as the costs fall.  So all is not doom and gloom, but we have a lot of convincing- of the media, consumers and dealers- to do.

Tesla needs to be at these shows.  Consumers demand to see the Tesla and the Auto Dealers refuse to let them into these dealer-sponsored shows because they are not part of the “franchise” network but do direct selling.  So what?  This show is about consumers, and the Tesla perfectly exemplifies advanced vehicle technology.  If the Dealers won’t allow Tesla to be present, we should have them (even if its only obliging Tesla owners) rent space at a neighboring parking lot and show people the cars there.  Seriously.

What really continues to frighten me is the fact that Auto Dealers do NOT want to sell these cars.  Walking the main floor, NOT ONE AUTO DEALER HAD INFORMATION ABOUT THE $7500 FEDERAL TAX CREDIT.  Excuse me?  They said such things as, well not everyone qualifies and so we can’t tell them about it. Huh? As someone versed in the art of persuasion, having litigated hundreds of cases in state and federal courts, and having been a consumer for over fifty years, since when is a huge potential savings on a product not critical information for decision making?  The only takeaway is that there is an ongoing force or forces at work the dealership level (and beyond) to NOT sell these cars.  What that source is and what is sustaining it in the face of consumer interest remains to be clearly defined, but it is clearly present.  We must work around the dealers recalcitrance whenever possible.

ECOtality no longer provides free charging stations in the Northwest- whether to promote furtherpublic infrastructure or to give to residential customers.  It happened.  The market is starting to shift and EVSE providers will now have an opportunity to enjoy open competition.  Dealers no longer have the luxury of pointing their customers to one source (because its easy to sell “free”) and the consumer and local electricians will win. Period.

People are infinitely curious about these cars.  The most common questions are- how long do they take to charge?  What is their range?  What do you think of your LEAF? How much does electricity cost?  People have reasonable questions and the dealers are not answering them, particularly about charging.  Members of the EVSE industry and public advocates need to fill this gap.  My main response to consumer questions is for them to drive the cars and see what they think.  Test drive a Volt and a LEAF.  Speak to other owners.  The public is tired of paying gas prices that tap $200-$600 per month of their income.  They are hungry for alternatives.  We should feed them!

Thank your local electric utility (if they show up at the car show with a booth). PGE had a booth all four days with people answering questions, showing customers the LEAF, sharing information.  Your electric utility is your new “dealer” when it comes to advanced vehicle technology.  They have nothing to lose and everything to gain- just like the consumer.  Thank them for putting resources into this movement toward electrified transportation.  They get it.

Comments?  What do you think?