Navigant Research Blog

Japanese Automakers Harness PEV Power

— February 2, 2015

Plug-in electric vehicles (PEVs) may provide far more value to their owners than just reducing gasoline costs and greenhouse gas emissions.  The significant energy and power capacities of the PEV system can be utilized to provide power during a blackout, curb commercial electricity ratepayer demand charges, power offboard equipment at work sites, and help grid operators balance supply with demand.  Each of the above uses requires, or is strengthened by, PEVs equipped with bidirectional capability – meaning the vehicle can both absorb electricity from the grid and return it.  Most PEVs available today, however, lack this capability.

This is because automakers don’t yet see a market for vehicle-to-grid integration, and they’re concerned that the use of vehicle batteries for purposes outside of motive power may shorten the batteries’ lives.  Test pilots in major PEV markets are answering some of these concerns, as well as developing the processes by which a PEV’s bidirectional potential may be harnessed.  The center of action is in Japan.

New Models

In Japan, the Nissan LEAF, Mitsubishi i-MiEV, and Mitsubishi Outlander PHEV are all sold with bidirectional capability as an option.  Each model can connect to an offboard inverter through the vehicle’s direct current (DC) charging port to enable a reverse power flow.  The offboard equipment only enables the PEV to supply power back to an owner’s home in the case of an outage, not back to the grid under normal circumstances.  Its purchase is subsidized by the Japanese government.

Though the system’s use is limited to emergency outage situations, this relatively early adoption of the technology in comparison to other large PEV markets is providing a launch point for testing other PEV power possibilities.  Nissan has already begun testing a fleet of LEAFs in curtailing commercial demand charges at one of the company’s facilities through the LEAF to Home system.  Similarly, the LEAF to Home system is also undergoing tests in grid balancing services.   A number of similar tests are underway in the United States and Europe as well; however, no vehicles have yet been made available to the mass market with bidirectional capability as they have been in Japan.

Two Ways Are Best

To date, using PEVs in grid balancing services represents the most interesting case from a revenue-generating perspective.  Though a PEV does not necessarily need to be bidirectional to service the grid, the revenue potential of a bidirectional PEV in grid services is significantly higher in comparison to that of a unidirectional PEV.  Tests and simulations in the United States indicate that the revenue potential of one bidirectional PEV can average around $5 per day of grid service.

This revenue potential provides a significant new incentive for PEV adoption.  However, it’s unlikely such a scenario will emerge unless energy companies and utilities pave the way for PEVs in grid services and automakers outside Japan offer bidirectional PEVs.  Please join Navigant Research’s webinar, Electric Vehicles and the Grid, at 2 p.m. EST on February 10 as we examine in detail the market drivers and challenges of using PEVs in grid services.  Click here to register.

 

Building Innovations Form Pivotal Spokes in the Circular Economy

— February 2, 2015

The annual World Economic Forum in Davos, Switzerland, has come and gone again, and the usual irony of 1,700 private jets delivering the global elite to discuss climate change and inequality was perfectly ridiculed by Jon Stewart last week. But, beyond the spectacle of outsized wealth, there are some valuable economic and policy projects that hold promise outside the weeklong schmooze-fest.

In particular, the Circular Economy, an ongoing project at the forum, aims to tackle the current paradigm of consumption in light of a future of constrained resources and exponential growth in demand.  The Ellen McArthur Foundation, which supports an ongoing dialog on the circular economy explains the concept as thus:  “A circular economy seeks to rebuild capital, whether this is financial, manufactured, human, social or natural. This ensures enhanced flows of goods and services.”  An important question is how the theory of the circular economy can become tangible, which was a hot topic for this year’s discussions in Davos.

Rethink, Remodel

In the run-up to this year’s event, a Forbes article explained that the circular economy “requires businesses to rethink more than just their resource footprints and energy efficiency. It demands a more radical remodelling of business models.”  Reflecting on the big ideas of the circular economy, it seems the intelligent building, smart city, and innovations in energy management could be an ideal proving ground for these concepts in action.

The intelligent building is characterized by automated and responsive systems that maximize efficiency in consumption and productivity.  Intelligent buildings offer a new sort of resource that extends beyond the walls of any single facility to support key goals of grid modernization and the development of smart cities.  The technology exists to enable this kind of facility optimization, and investment in intelligent buildings and smart cities can demonstrate the benefits of a circular economy.  The following examples highlight how companies are bringing solutions to the intelligent building and smart city marketplace that align with the opportunity of the circular economy.

  • Philips has committed to the circular economy and the company’s lighting as a service offering aims to engage cost-constrained customers and manage the end-of-life treatment of lighting and system components.
  • Schneider Electric and Autodesk have announced a new partnership to bring innovation to building lifecycle management and “drive a deep and long-term transformation in the construction industry, providing greater value to each user and contributing to solve the energy challenge.”
  • Cisco’s position is presented as an “engineering strategy around the Internet of Everything [supporting] the transition to a circular economy, with new connected devices enabling the tracking of products, components and materials for re-use and recovery; new business models through greater connection with customers; and more effective reverse logistics chains.”

While the circular economy might seem like a lofty ideal that will demand major shifts in our consumption mindset, advances like these demonstrate steps in the right direction.

 

Supercar Launches Reveal Advanced Automaker Thinking

— February 2, 2015

Ford and Honda both announced supercars at this year’s Detroit Auto Show.  It’s worth taking a look at some of the key features in each of these vehicles to gauge where automotive technology is headed.

Ford GT

Originally developed in the mid-1960s, the Ford GT won the 24 Hours of Le Mans race for 4 consecutive years from 1966 through 1969.  At the 2002 Detroit Auto Show, a concept car was shown that captured the look of the original racing car but made it practical to own and drive on regular roads.  Slightly more than 4,000 Ford GTs were produced in model years 2005 and 2006.

Now a new version has been unveiled.  Beginning production in late 2016, the GT will be available in select global markets to celebrate the 50th anniversary of Ford GT race cars placing 1-2-3 at the 1966 24 Hours of Le Mans race.  Although its predecessors all featured V8 engines, the newest version will be fitted with a twin-turbocharged EcoBoost V6, producing more than 600 hp.  Ford is keen to show that its chosen path of downsizing engines for fuel economy still offers plenty of power.

Low weight is an important factor for production vehicles as well as race cars, and the new GT has a carbon fiber passenger cell with integrated seats and aluminum front and rear chassis sub-frames encapsulated in structural carbon fiber body panels.  The exterior shape minimizes drag and optimizes downward forces.  An active rear spoiler is used for control of braking, handling, and stability at speed.  Carbon fiber is a very important material for light vehicle structures, and the new GT will give Ford some practical experience in production.  Ford also announced at the show that it has formed a joint venture with DowAksa (itself a 50:50 joint venture between Dow Chemical and acrylic fiber supplier Aksa) to develop carbon fiber for mass-market vehicle applications.

Acura NSX

The original NSX, developed by Honda (though badged as an Acura in North America) from 1989 through 2005, sold more than 18,000 vehicles over 15 years.  The model has always been a showcase for the latest Honda technology, and the company is now relaunching the NSX as a reminder of its latest technology developments.  Production is slated for summer 2015, with first deliveries before the end of the year.

Like the Ford GT, the NSX features advanced V6 engine technology (Honda has never offered a V8 engine in its consumer vehicles despite developing one for racing use in Indy cars and Formula One).  The new NSX will feature a twin-turbocharged V6 engine with a 9-speed dual clutch transmission and Honda’s Sport Hybrid system, which uses three electric motors to boost power and enhance handling – one at the rear and one at each front wheel.

Managing airflow is again a priority, and Honda engineers have carefully tuned the vents and air intakes for maximum efficiency.  The first-generation vehicle used all-aluminum construction for light weight, but the new model has a space frame design consisting of an internal aluminum frame reinforced by ultra-high strength steel, all anchored by a carbon fiber floor.  Body panels are made of a combination of aluminum and sheet molding composite.  Suspension members are all cast aluminum.

Both of these supercars come from mass-market manufacturers that want to showcase their advanced technology. As my colleague Sam Abuelsamid observes, they manage to demonstrate a combination of high performance and fuel efficiency.  When the time is right, some of the processes, design concepts, components, and materials will make their way into high-volume production.

 

Performance Dominates Detroit Auto Show, Even for Hybrids

— February 2, 2015

With gasoline prices hitting near inflation-adjusted all-time lows, performance and design once again came to the forefront at the January 2015 North American International Auto Show in Detroit – even for what once would be considered green vehicles.  From the second-generation Acura NSX and Chevrolet Volt to the Volkswagen Cross Coupe GTE concept, performance was touted nearly as much, and in some cases more, than fuel efficiency.

Navigant Research’s report, Automotive Fuel Efficiency Technologies, projects that hybrid electric vehicles will continue to be a niche, accounting for significantly less than 10% of global light duty vehicle sales by 2025.  Targeting the combination of improved performance while at the same time reducing energy consumption and emissions may be the best way to grow consumer acceptance.

Almost exactly 8 years after the debut of the original Chevrolet Volt concept in this same venue, the second-generation production model was revealed at this year’s show.  The redesigned, extended-range electric vehicle (EV) boasts a 200-lb weight reduction, a higher-capacity battery, a more compact electric drive unit, and a new, more powerful engine.  While General Motors (GM) CEO Mary Barra promoted the extended 50-mile electric range and 41 mpg combined fuel economy in hybrid mode, she also highlighted the Volt’s quicker acceleration compared to the original model.

Meanwhile, all of the new plug-in hybrid electric vehicle (PHEV) models introduced to date by Volkswagen have been given a GTE badge, indicating that these are performance-oriented PHEVs, just as GTI and GTD identify gasoline and diesel-fueled performance variants.  Each of these models, including the new crossover utility concept shown in Detroit, feature larger, more powerful internal-combustion engines than those typically found in hybrids optimized for efficiency, such as the Toyota Prius.

A Cost to Pay

“We very much want to maximize the efficiency of all of our models, but there is a cost premium involved with adding batteries and electric motors,” said Volkswagen spokesman Mark Gillies.  “So far we have found that customers are more willing to pay the price premium if we provide the technology in combination with the other capabilities they expect at that level, although as we increase production, we expect to bring plug-in hybrids to more affordable trims.”

The Cross Coupe GTE concept previews the styling direction for an upcoming seven passenger crossover utility vehicle.   The concept car is powered by a 276 hp V6 engine, along with an electric motor at each axle for on-demand all-wheel-drive.  The combined output of the propulsion system is 355 hp, for 0-60 mph acceleration of just 6.0 seconds, while the 14.1 kWh lithium ion battery provides an estimated 20 miles of emissions-free driving.

Lighter, Faster

Volkwagen’s premium sibling brand, Audi, introduced a redesigned Q7 SUV that is 700 lbs lighter than the model it replaces.  In addition to traditional gasoline and diesel engines, the Q7 will be the first production vehicle offered with a diesel-hybrid electric propulsion system.  Rather than one of the four-cylinder diesels that Audi has in its lineup, the Q7 e-tron Quattro gets a 3.0-liter V6 that combines with two electric motors for 373 hp and 516 lb-ft. of torque that should yield swift acceleration and a claimed 35 miles of electric driving range.

Honda launched the idea of a performance hybrid when it added the original Integrated Motor Assist system to the V6-powered Accord sedan a decade ago.   At that time, consumers were not yet willing to accept the idea of hybrid power as a performance enhancer, and the first Accord hybrid was a commercial flop.  Since then, we have seen the introduction of $1 million supercars, like the LaFerrari, McLaren P1, and Porsche 918 with plug-in hybrid power, and the idea has come full circle.

The all-new second-generation Acura NSX debuted in production form this year.   Acura won’t reveal full specs for the new NSX until closer to production this summer, but did tell the media in attendance that a new twin-turbocharged V6 engine and three electric motors will produce more than 550 hp for the lightweight two-seat sports car.

After debuting in fuel economy specials, like the original Toyota Prius and Honda Insight in the 1990s, hybrid power has jumped to the opposite end of the automotive spectrum – and will hopefully soon converge on the heart of the mainstream market.

 

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