New Federal Report Proclaims Plug-In Hybrids Won’t Help For Decades

The Upcoming Prius Plug-In Hybid Vehicle










One has to wonder how these reports get written. Is someone from the Auto Industry behind this tripe? Plug-in hybrid vehicles, if used properly, can greatly reduce consumption of oil by consumers. If individuals will plug in their cars overnight and then use as much of the electric range as possible, then their gasoline usage would be a fraction of what it is currently. A 40 mile PHEV like the Chevy Volt could conceivable obviate the need for ANY gasoline for a great number of commuters.

From Gas2.0:

According to an analysis conducted by the National Research Council and partly funded by the U.S. Department of Energy, the roll-out of plug-in hybrids (PHEVs) to the U.S. market will be too slow to have any real effect on our greenhouse gas emissions or oil addiction until at least the 2030s.

The report says that even with huge amounts of federal funding in the form of incentives, subsidies and tax breaks, battery costs will stay too high for the start of widespread PHEV adoption before 2020. The report also concludes that the added cost of manufacturing a PHEV over a conventional vehicle in 2010 will range from a $6,300 premium for a 10 mile all-electric range (PHEV-10) to an $18,000 premium for a 40 mile all-electric range (PHEV-40). Those numbers seem to make sense considering the Chevy Volt is expected to retail for $40,000 before tax breaks.

If gasoline prices stay below $4.00 per gallon, the analysis indicates that PHEV-40s won’t be cost-competitive before 2040 while PHEV-10s may reach cost competitiveness by 2030. Indeed, this seems to be the conventional wisdom within the automotive sector right now, with GMs Vice Chairman for Global Product Development, Bob Lutz, remarking at the LA Auto Show just a couple of weeks ago that without increasing the gas tax to artificially raise fuel prices, there will be no pressure on the consumer to buy plug-in vehicles.

Of course, the report points out that all of their conclusions are in lieu of some kind of unexpected battery technology development or some kind of unexpected market pressure. In the end, the report concludes that PHEVs will have very little effect on consumption of oil before 2030 because there will be too few of them in the national fleet—even at the report’s best case growth scenario of 40 million PHEVs on the road by then.

“A PHEV-10 is expected to use about 20 percent less gasoline than an equivalent hybrid electric vehicle, saving about 70 gallons in 15,000 miles. Forty million PHEV-10s would save a total of about 0.2 million barrels of oil per day. The current light-duty vehicle fleet uses about 9 million barrels per day. PHEV-40s will consume about 55 percent less gasoline than equivalent HEVs, saving more than 200 gallons of gasoline per year per vehicle.”

-TRANSITIONS TO ALTERNATIVE TRANSPORTATION TECHNOLOGIES—PLUG-IN HYBRID ELECTRIC VEHICLES, National Research Council, 2009

The report also concludes, as I’ve said in the past, that “It is not clear what technology or combination of technologies⎯batteries, hydrogen, or biofuels—will be most effective in reducing the nation’s oil dependency to levels that may be necessary in the long run. It is clear, however, that a portfolio approach will enable the greatest reduction in oil use.”

While I’m ultimately a firm believer in all-electric personal transportation, this unprecedneted extraction from our singular dependence on oil we’re currently at the start of will need all the help it can get—which means diversifying our transportation portfolio as much as possible in the beginning. If this means helping these fledgling technologies to compete against the established order, then I’m all for that as well. And even if plug-ins don’t have a huge impact for a couple of decades, we have to start somewhere. The time for hedging has long since passed.