Navigant Research Blog

Will the Natural Gas Boom Help EVs?

— November 11, 2014

Natural gas is better used to generate electricity to power electric vehicles (EVs) than as a direct transportation fuel, according to a new study by Oak Ridge National Laboratory.  The study, entitled “Well-to-wheel analysis of direct and indirect use of natural gas in passenger vehicles,” rates EVs powered by electricity from natural gas as being more energy efficient, less polluting, and cheaper to fuel than natural gas vehicles.

A contributing factor in the analysis is that natural gas power plants, especially combined cycle power plants, are very efficient in creating electricity, and when that electricity is used for locomotion by an electric motor, the net efficiency is higher than that of a natural gas engine.  The study assesses losses and energy used throughout the system, including leaks during transportation (from pipelines etc.), and during compression and decompression of the gas in the case of compressed natural gas vehicles.  In the case of EVs, the study assesses power losses throughout the distribution grid, electric vehicle charging, and the power transfer to and from the battery.

As seen in the figure below, the study concludes that even a low-efficiency natural gas power plant would provide a more energy efficient source of electricity than using gasoline in a car.  The study used the Nissan LEAF and the natural gas Honda Civic GX as the baseline for the vehicle fuel efficiency.

Wheel to Wheel Energy Use

(Source: Oak Ridge National Laboratory)

Emissions of greenhouse gases, including CO2, are also lower in the case of EVs when either the current mix of generation sources or any type of natural gas power plant are used to create the electricity.  And as is well known, electricity is also cheaper as a transportation fuel: Oak Ridge estimated at time of the study that natural gas costs $1.65 per 25 miles for compressed natural gas vehicles, compared to $1.02 for electricity.

Pipeline Peril

It may seem counter intuitive that an extra step in fuel conversion (i.e., gas to electricity) would still be more efficient, but the greater efficiency of stationary gas turbines relative to small engines (as referenced here by Forbes) explains the math.

However, turning natural gas into electricity for EVs requires sufficient pipeline capacity, and a surge of EVs could overwhelm the regional grid if charging occurs at peak times.  Natural gas also has to compete with other forms of generation on price, and there’s no guarantee that the surplus of natural gas from shale would find its way into EVs, as it may simply replace coal.

The study makes the case for facilities that have combined heat and power to add EVs to the fleet instead of adding the significant cost of a natural gas refueling station.  Conversely, a significant argument for natural gas vehicles is their longer driving range and lower upfront cost.  If an EV’s driving range of 80 to 100 miles doesn’t match with the driving requirements, then the economics or efficiencies won’t matter.

 

Partnering Takes the Pain Out of Paying for EV Charging

— October 27, 2014

At the dawn of the modern electric vehicle (EV) era (way back in 2010), EV industry participants recognized that a simple way to pay for vehicle charging was critical to EV adoption.  In fact, I recall having conversations with at least one international payment processing company back then regarding the need for a central clearinghouse for EV charging payments.  I described this segment as a small niche that would grow into a major opportunity over time.  Neither that company nor others chose to start building the necessary relationships.  But today, after years of considerable talk and little action, progress is finally being made as charging networks are collaboration and payment clearinghouses are starting to emerge.

During the past half-decade there have been numerous tales of the frustrations of EV drivers who carry multiple cards to be able to access competing proprietary networks.  The Hubject consortium in Europe has been leading the charge to make charging more consistent by simplifying customer authorization, and the group recently announced a method that enables mobile phones to pay for EV charging.

The PayPal Factor

The intercharge direct system is powered by online payment system PayPal.  Drivers scan a QR code on the charging station with their phone, which connects to the intercharge website where PayPal and other payment options are offered.  Customers who have a contract with an EV services provider can pay their existing rates, and more importantly, EV drivers without a contract can still access any of the 3,000 charging stations that support intercharge.

Things have come full circle for PayPal, which was founded by EV maker Tesla Motor’s founder, Elon Musk.  (Note the irony that, since Tesla offers free charging at its charging website, PayPal largely won’t come into play for its customers.)  PayPal is an effective backend payment system, since it’s used globally for small payment amounts.  PayPal is currently being used in the United States for EV charging payments by General Electrics’s WattStation, and in October ChargePoint announced that it would begin accepting PayPal as well.

Reducing the cost and hassle of roaming between EV charging networks will increase the use of public charging stations, which will result in more charging stations being made available, and in turn higher levels of EV adoption.

Makers Make Progress

Efforts to expand EV charging in the United States are slowly paying off, thanks in part to the work of the EV manufacturers themselves.  Nissan is offering free public charging to buyers of the LEAF and convinced competitors ChargePoint, Car Charging Group, AeroVironment, and NRG to each support its EZ-Charge card.  BMW’s ChargeNow program offers a single card for paying at stations from ChargePoint and NRG’s eVgo network, as well as other partners internationally.

Not all partnerships in the area have worked out; ChargePoint launched an ill-fated joint venture with ECOtality in 2013 called Collaboratev that would have streamlined payment processes across both networks, had ECOtality not gone bankrupt only a few months later.

While proprietary payment systems make business sense for the charging networks, they hurt more than help EV owners and automakers.  If the expected millions of EVs are to rely on public charging, roaming between networks should be as simple as roaming between mobile phone networks or getting money from any ATM.  These recent developments provide hope that such interconnections are starting to emerge.

 

Trucks Largely Overlooked in Emissions Targets

— October 15, 2014

In the transportation sector, trucks are a bit like offensive lineman in football: the heftier bodies do the hardest work, but they don’t get the same amount of attention as the smaller and more nimble players.  But trucks will need greater recognition for their impact on fuel consumption if goals for signification emissions reductions are to be reached.

Most of the discussion (and efforts) around improving fuel economy and reducing greenhouse gas (GHG) emissions is centered on light duty (LD) cars and the Environmental Protection Agency’s (EPA’s) ambitious Corporate Average Fuel Economy (CAFE) requirement, while neglecting the first rules for medium and heavy duty (M/HD) truck emissions reductions that the EPA implemented in 2011.  M/HD trucks and buses are expected to represent 32.6% of the total fuel consumption in the United States, according to Navigant Research’s report, Transportation Forecast: Global Fuel Consumption. Considering that light trucks (including minivans and SUVs) represent 51% of LD vehicles sold in the United States (according to Automotive News), trucks are the clear majority in the opportunity to reduce emissions.

Energy Consumption in Transportation by Vehicle Type, United States: 2014-2020

John truckblog chart

(Source: Navigant Research)

The alternative fuel truck options on the market (including electrified, natural gas, and propane vehicles) are insignificant in comparison to the numerous alternative car choices.  According to Navigant Research’s report, Transportation Forecast: Medium and Heavy Duty Vehicles, alternative vehicles (which also include buses) are expected to represent just 3.3% of all new large vehicle sales in 2014.

PEV Gap

Because of the surge in fuel production and the low price, natural gas vehicle development and sales have the greatest momentum among alternative fuel trucks.  Global truck and bus manufacturer MAN will be adding compressed natural gas (CNG) trucks to its offerings, while GM is adding a CNG bi-fuel option for its 2015 Silverado and Sierra pickup trucks.  Westport recently launched an enhanced spark-ignited (ESI) natural gas system that the company claims offers a 10% improvement in power and torque over a baseline diesel engine.  For the conversions market, Skygo Fuel Systems now offers a bi-fuel system that continuously blends natural gas and diesel based on performance requirements.

Natural gas has the advantage over full electrification in the truck market, as it can provide similar driving range to diesel without being weighed down by batteries, and the bi-fuel option provides a safeguard if a natural gas refueling station isn’t conveniently accessible.

A significant draw for electrification of utility vehicles is the ability to provide exportable power. Pacific Gas and Electric, which is one of the largest truck fleet operators in the United States, has partnered with EDI to develop a Class 5 utility truck that can be used to provide temporary power when an outage occurs.  Electric power takeoff (ePTO) trucks can operate equipment throughout the day without having to run the diesel engine, which can result in much greater reductions in fuel savings than using battery power when the vehicles are in motion.

The gaping hole in the truck lineup is in the lack of hybrid and plug-in pickup trucks. Truck manufacturers such as Ford are focused on lightweighting via aluminum rather than electrifying the drive train.  Nissan created a pickup version of its LEAF battery electric vehicle (BEV) but has no intention of commercializing it.

 

California Reaffirms EV Leadership

— October 13, 2014

California Governor Jerry Brown has doubled down on the Golden State’s commitment to electric vehicles (EVs) by enacting six laws aimed at promoting EVs.  The package of legislation includes two laws aimed at making EVs available to a broader audience of individuals – one for people who live in multi-unit dwellings and another with incentives for getting EVs into carshare programs.

Landlords in California now cannot block the installation of EV charging equipment through restrictive leases if renters agree to pay the costs.  This law will help California’s large renter population join the EV crowd and could help the state reach its goal of 1 million EVs on the road by 2023.  Most purchasers of EVs to date live in single-family homes, and this law removes one potential obstacle for broader adoption.

According to Navigant Research’s report, EV Geographic Forecasts, which was produced before these new laws were passed, California was likely to have approximately 820,000 light duty EVs on the road by 2023.

PEVs on the Road, California and the United States: 2014-2023

(Source: Navigant Research)

Smoggy and Dry

California is home to 7 of the 10 cities in the United States with the worst air quality, including smoggy Bakersfield, and has endured 3 consecutive years of drought, which is motivating Governor Brown to continue efforts to promote emissions-free driving in the state.  Some of those afflicted communities might breathe a little easier in future years, as another of the new laws targets incentives for placing EVs in carsharing programs in lower income areas with air quality problems.  EVs make sense in carshare and rental programs, as users don’t have to refuel the vehicles, and motorists who have a good experience could later become EV purchasers.  However, even after federal and state incentives, higher priced EVs are still out of reach of many consumers.

Incentives for plug-in vehicle drivers, such as HOV access, have proven critical in increasing EV adoption.  States such as California, Georgia, Oregon, and Washington that offer financial and other incentives are also the top sellers in EVs per capita.  According to HybridCars.com, sales of plug-in hybrids are up 44% over last year, while sales of battery electric vehicles are up 20%.

 

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