UC Berkeley Study Concludes Battery Switching Model Would Accelerate Mass-Market Adoption of Electric Cars; Baseline Scenario Projects EVs Reaching 64% of New LDV Sales in 2030
14 July 2009
| EV penetration with a battery swap model in three scenarios. Becker (2009). Click to enlarge. |
A new study from the University of California, Berkeley, Center for Entrepreneurship & Technology projects that, given a battery switching model and pay-per-mile contracts such as proposed by Better Place (earlier post), electric cars would account, in the baseline scenario, for 64% of US light-duty vehicle sales by 2030 and comprise 24% of the US light-duty fleet by then.
In two other scenarios considered, a high oil price scenario (using EIA projections) and a battery swap operator-subsidzied scenario, EV new vehicle sales penetration reaches 85% and 86% respectively by 2030.
“Electric Cars in the United States: A New Model with Forecasts to 2030” was written by Thomas Becker, a Ph.D. candidate in economics with a specialization in international finance and environmental economics.
The analysis in the paper relies on a network externality model focusing on relative prices, operating costs, and the network effects of battery switching stations. The high rate of adoption is driven by the low purchase price and operating costs of electric cars with switchable batteries. The estimates include the cost of installing charging and battery switching infrastructure to extend the range of electric vehicles.
In Becker’s analysis, eliminating the need for the consumer to purchase the large battery pack upfront makes the purchase price of an electric car competitive with that of an internal combustion vehicle. Given expected battery prices, and the federal tax incentives for the purchase of electric cars, switchable battery vehicles are expected to be $7,500 less expensive than a similar gasoline-powered car when introduced to the market in 2012. The total cost of ownership of these vehicles is expected to be between $0.10 and $0.13 lower on a per-mile basis than gasoline-powered cars, depending on the future price of oil.
Becker calculates that the baseline scenario would require networks of more than 800 overlapping regional charging infrastructure cells, each supporting 100,000 electric car drivers supporting roughly 81 million electric car drivers by 2030. Estimated capital expenditures to deploy this network would be nearly $321 billion over the next two decades.
Under the operator-subsidized scenario, the resulting 151 million electric car drivers by 2030 would require nearly twice as much infrastructure investment.
By 2030, the annual capital investment in charging infrastructure is estimated to account for between 1% and 1.5% of total US investment.
—Becker (2009)
Becker suggests that EV adoption will occur first in the West Coast states and Hawaii, and uses these for the modeled initial market for electric cars between 2012 and 2014. He projects networks of switchable electric cars being deployed across the remainder of the United States beginning in 2014. By 2020, 700,000 (26%) of the 2.7 million electric cars sold in the United States are forecast to be sold in the four West Coast States.
Electric vehicles will overhaul the US light-vehicle transportation network over the next two decades. An electric personal transportation network that combines switchable Lithium-ion batteries with network operators offering pay-per-mile contracts will provide consumers with a more affordable alternative to efficient internal combustion-powered vehicles and will overcome the range limits inherent to fixed-battery electric cars. It will also lower health-impairing and greenhouse gas emissions, provide new sources of domestic employment and investment, lower the nation’s dependence on imported oil, and improve the trade balance.
—Becker (2009)
This most recent study is fundamental because it shows that the economics of electric cars with today’s technology favor a paradigm shift in the automotive industry.
—Ikhlaq Sidhu, Director of Berkeley’s Center for Entrepreneurship & Technology
Resources
Thomas Becker, Electric Vehicles in the United States A New Model with Forecasts to 2030 (CET 2009.1.v.1.0)
While I'd like to see this happen, a "paradigm shift" in anything requires the masses of sheeple to think in new ways.
Posted by: ai_vin | 14 July 2009 at 10:03 AM
ai_win:
Sheeples will follow any loud mouth with a barrelful of greenbacks.
Get a few good PR people, specially national (War, Sport or Hollywood) heroes, + $$$ Incentives and BEVs will sell by the million.
If it does not sell fast enough, raise the price of fuel to $5+/gal and give 150% credit for battery packs etc.
Many politicians were elected with the same approach.
Posted by: HarveyD | 14 July 2009 at 01:49 PM
Switchable batteries strike me as a narrow solution to the range problem. I could see them up and down Interstate 5 in California, for when electric car owners want to go from San Francisco to L.A. Within a specfic metropolitan area, I don't see them as being necessary when daily drives are less than a 100 mile round trip.
If you look at the perfect electrical energy storage system it has no mass, no volume, no cost, no conversion losses, holds 50+ Kwhr, recharges instantly, lasts indefinitely, can be rapidly brought to market and is very safe. Of the technologies on the horizon, the ones that seem closest to that ideal are A)eestor capacitors, B)silicon nanowire batteries, C)Zinc Air batteries, D)improved LiFe batteries, E)Other.
The most likely of the above to mature are the LiFe with incremental improvements, but they still may not have the density, storage capacity, and low cost needed for true gasoline range replacement.
Does anyone else see a better electrical storage device on the horizon?
Posted by: HealthyBreeze | 14 July 2009 at 01:51 PM
Separating the battery purchase out from the EV makes a lot of sense, but systems like Better Place that do not allow for home recharge are problematic.
What might work best is to have the EV buyer purchase the vehicle outright but lease the battery independently on a long term contract. The battery provider would be responsible for providing a battery with a base level of capacity. The provider would replace the battery when wore out. Having consumers lease the battery would also help to ensure that the battery was properly disposed of.
Posted by: jbremson | 14 July 2009 at 02:22 PM
Healthy Breeze, in addition to some of the possibilities you mention, Lithium sulphur may fit the bill:
http://www.sionpower.com/index.html
Lithium manganese has potential:
http://www.eco-aesc.com/en/liion.html
Lithium air is pretty much the ultimate battery:
http://www.polyplus.com/
Posted by: Davemart | 14 July 2009 at 02:55 PM
A quick scan of the study seems to indicate that the claim of lower per-mile cost of battery over ICE vehicles is based on a $7,500 per vehicle BEV subsidy and an expectation that batteries be amortized over 300,000 miles. I don't believe any manufacturers are claiming that extensive a life for batteries. In addition, a battery exchange infrastructure assumes all manufacturers agreeing to a standardized form factor for all vehicles, something we have never seen them do.
Posted by: fred schumacher | 14 July 2009 at 03:22 PM
I am skeptical of the battery swap idea, but if it can get more PHEVs and EVs onto the roads, then go for it. Sometimes ideas are successful on sheer determination. They are not the best way, but people make them work because they want to.
I seems like the Better Place idea is to control the show. You WILL buy the batteries, electricity and service from us, you have NO choice. Once people see that sort of thing they say no thanks...
Posted by: SJC | 14 July 2009 at 03:23 PM
"Estimated capital expenditures to deploy this network would be nearly $321 billion over the next two decades."
For Better Place charge ports??? When I can plug in my EV at home or work with an extension cord???
This study is written by an idealistic grad student in economics. He has little apparent understanding of human behavior or desires. People and sheeple, like security. Short term rental, manual battery replacement, no home-charging, make for a wildly unstable, insecure transportation solution. Forget it.
I give Agassi one credit. He's got a PR guy who can purchase and place "studies" supporting his highly problematic idea.
Posted by: sulleny | 14 July 2009 at 03:58 PM
"By 2020, 700,000 (26%) of the 2.7 million electric cars sold in the United States are forecast to be sold in the four West Coast States."
It would be interesting if those dozen years and 2.7 million EV's had already happened.. 1997 EV1's, RAV4-EV's, Honda EV's, EV95 batteries, a CARB with backbone, etc. improved and being here today.
Posted by: kelly | 14 July 2009 at 05:08 PM
We have been studying and working on a PHEV project for several years and have concluded that electric drive plus a small ICE range extender provides the most user-friendly, flexible experience. Even though a vast majority of daily driving involves less than 50 miles, the public will not accept a vehicle unless it provides the ability to, on a moment's notice, drive the vehicle 300 to 400 miles. About three fourths of cars have four doors even though the back seats seldom are used to carry people. People demand ease of use and flexibility.
Posted by: citizen | 14 July 2009 at 05:56 PM
@ Citizen,
Well, does the vehicle you describe have to cost $40,000? The general public doesn't seem to accept the Volt's $40K price point.
Alternatively, do people on this list believe the Volt will drop $10K in price because of lower labor costs, the almost complete writeoff of the old R&D costs, and incremental battery efficiencies? If so, would the general public accept the Volt for $30,000 if it got 40 mpg on gasoline, and went 30 miles per charge?
Posted by: HealthyBreeze | 14 July 2009 at 06:20 PM
We are aiming for less than $30k including batteries. www.milnermotors.com/phev.htm
Posted by: citizen | 14 July 2009 at 07:11 PM
The next question is will enough people make a major purchase of $30,000 from a company that may not have the financial backing to be around the next 20 years?
Posted by: SJC | 14 July 2009 at 07:31 PM
"1997 EV1's, RAV4-EV's, Honda EV's, EV95 batteries"
Jesus man. Try to live in the present. We've heard this whine for a decade.
Posted by: Reel$$ | 14 July 2009 at 07:50 PM
Wow what a load of bull.
At best ev fcev plug ins all combined will be 10% by 2020 and that only with one hell of alot of work and progress.
The main cost of cars is the car and insurance and such NOT the fuel. In places where you also have to pay for parking spaces and garage spaces it is just plain insane.
To make matters worse the main consumers of fuel have the longest ranges covered AND the biggest cars and thus are the least likely to go ev.
Posted by: wintermane2000 | 14 July 2009 at 09:20 PM
Whenever the auto companies stop trying to force ther consumer to pay horribly high prices for cars the EV's will take off.
At present the companies are trying to take all the cheap fuel benefit (electric power cost) for themselves. Actual manufacturing costs of the EV should be less (not counting development costs).
As far as the Better Place scheme - again just someone trying to milk the whole scheme. No thanks!
Plug in at home (or elsewhere) and rapid charging are the keys to me - along with reasonable prices for the vehicles.
Back in the 70's the Jap auto makers got market share by being reasonable - to bad they don't try that again!
Posted by: Account Deleted | 14 July 2009 at 11:35 PM
@russ
China will, and if the other major companies don't want to end like GM, they will have to follow.
Posted by: Alain | 15 July 2009 at 12:01 AM
I can't believe this would fly on a large scale.
If I take good care of my battery pack, I'm not going to want to trade it for one whose history I don't know. I'd want that replacement battery pack certified and tested - making a swap more costly by adding this overhead.
I think hybrids and plug-in hybrids are going to get you the most bang for the buck in the next 10yrs
Posted by: TM | 15 July 2009 at 12:32 AM
A plug-in hybrid with an all-electric range of 40 miles covering about 50% of all miles is, combined with 100% 2nd generation biofuel at 5$/gallon is still cheapest (and greenest). For driving 100000 miles, of which 50000 on the ICU, you need 1000 gallons of biofuel (50mpg drive) or 5000$.
At 5$/gallon, there are many ways to produce green fuel. Especially with 321 b$ subsidies for start-up costs. Even wind-energy -> H2 -> gasoline would be cheaper.
Posted by: Alain | 15 July 2009 at 01:25 AM
I actually like the idea of leasing the batteries. Just because an old battery loses the capacity I need in an EV doesn't mean it's not still usable in some ofter application, so if someone wants to take it off my hands in a direct trade when I see fit, OK. It's the battery swap as SOP I see problems with.
As I understand it the battery swap would only be used for long highway trips. The car itself would have enough stored energy for your average daily trip and a fast charge capability for any surprize [but still local] trips.
That being the case I have a simpler idea that is already being used by EV owners - trailers. The only part of the car or trailer that needs to be standardized is the hitch, that makes the idea flexible. The switching *technology* would be no more complex than a parking lot; you just back up to the trailer you need. Any car could use any trailer and any technology could be used in the trailer - as appropriate. The only thing you the driver has to worry about is picking a trailer suitable to the needs of the trip.
Does the trip have hill climbing? Well a pusher trailer could give you more power- http://www.jstraubel.com/EVpusher/EVpusher2.htm
Going across country and you may be facing H2 in California, gasoline in Texas, E85 in the corn belt and SVO in NY? How about a multifuel genset?
Driving the hydrogen highway from LA to Vancouver? Try a fuel cell.
Just going from SanFan to Vegas? Well all you'll need is extra batteries.
Going out to the woods for the weekend? Rent a tent-trailer with a genset under the bed.
Can't find the right trailer in the lot because of too much oneway traffic that week? Maybe they will paid you to take one they need transporting to your destination.
Posted by: ai_vin | 15 July 2009 at 04:20 AM
A switch battery scheme won't work because it would mean having something like a third more battery packs than cars using them so that every switch station always has a few spare.
Considering their price, is it reasonable?
Plus lithium is already rare, so needing more batteries could push their price up, not down.
Finally certain stations would have very strong demand (half way up a hill?) meaning they must either have an enormous stock or they have to move battery packs around switch stations, which isn't very green.
And that's without taking into account all the other good arguments above:
standards, unknown battery packs, flexibility...
Posted by: Simodul | 15 July 2009 at 04:43 AM
What will kill better place will be the first report of someone getting a bum pack swapped in then getting stranded and murdered/raped. And given the world is as it is that would happen sooner or later.
Posted by: wintermane2000 | 15 July 2009 at 06:32 AM
@ Wintermane2000
...My, you are a relentlessly cheery fellow.
Leased batteries, whether or not they are switchable, might get us over the technology maturity hump of the next 4-7 years. It offers obsolescence insurance for people who want electrics now, but don't want to own expensive batteries that drop precipitously in value because Zinc-Air, or Lithium-Sulfur, or Lithium-Air, or Silicon-nanowire, or just plain better LiFeSO4 batteries leapfrog them.
The question is, what is the business model for the company that leases out the batteries? Why do they want to take on merchandise that will rapidly depreciate? My guess is that they will do it because they sell electric cars, and it eliminates customer objections.
Posted by: HealthyBreeze | 15 July 2009 at 08:54 AM
Lease is one way of handling depreciation. Since we do not know the useful lifespan of the lithium battery packs and new technology is emerging every day, it might be a good idea to lease them.
Posted by: SJC | 15 July 2009 at 09:47 AM
@jbremson @SJC @russ: it's not hard for BP to incorporate home charging cost structure that would either pay you back for your home charging or give you credit toward per mile leasing cost. Technically, that's easy. Whether or not they will do that will depend on how many people think like you that they would like to get on their bandwagon.
@fred shumacher: not all manufacturers need to agree on the swapping standard. Just enough (Nissan) to get BP the critical mass necessary for profit. Then, once that happens, any other manufactueres who wants in will conform. It happened in the PC peripheral business.
@TM @wintermane2000: That's the beauty of battery swap/leasing. You don't have to worry about the battery as long as you know you have 100miles after every swap or full charge. If you keep the battery until the computer tells you it needs to retire (before its capacity degrades to less than 100miles), then you go swap for another one, no extra cost. Those degraded batteries will get taken out of circulation.
The main idea for wide adoption is affordability. Take the battery cost out of the BEV and you should be able to afford a car with a motor and controller replacing all that complicated ICE requirements. IMHO, I agree that this is the best scenario for BEV adoption I've run across so far -- as long as your per mile cost of energy and leasing is less than your gasoline cost over the life of the car, which is what BP projects @ $3/gal.
Posted by: occ | 15 July 2009 at 09:53 AM