Navigant Research Blog

‘Costly’ Amtrak Payments Dwarfed by Parking Largesse

— December 16, 2014

Rail service company Amtrak posted its annual financial report on November 25, and progress was reported all around.  Revenue ($3.2 billion) and ridership (31.6 million passengers) are up over the previous year, and the operating loss of $227 million was the lowest since way back in 1973.  However, the loss would have been much greater if not for payments from states and the federal government, which pony up nearly $2 billion annually to support infrastructure upgrades and other costs.

Amtrak is profitable in the Northeast, where it is viewed as indispensable for commuting along the I-95 corridor from Boston to Washington, D.C., but runs far in the red elsewhere, especially on long-distance routes.  For fiscal year 2015, Amtrak has requested a federal grant of $1.6 billion, and the number gets higher each year to counter the tunnels, bridges, and tracks that continue to fall into disrepair.

No Free Parking

Perpetually deficit-running Amtrak is a favorite target for fiscal conservatives, such as Mitt Romney, who frequently spoke of defunding the service during the 2012 presidential election.  However, the federal government is actually funding the parking of private vehicles at a much higher level.  According to a new report by the TransitCenter and the Frontier Group, employers providing tax-free parking allowances costs the federal government $7.3 billion annually in lost revenue.

The Internal Revenue Service’s (IRS’s) tax code allows parking allowances of up to $250 per month sans taxes, which is nearly twice the amount allowable for taking public transit ($130), and more than 10 times the allowance for bicycle commuters ($20).  The study claims that the tax abatement adds approximately 820,000 commuters who would otherwise find other means of getting to work, including motorists who increase use of roads, another hidden cost to taxpayers.

The True Costs

According to Streetsblog.org, Congress is violating the IRS maximum parking allowance by providing free street parking to staffers in pricey downtown D.C.  So we have CAFE regulations aimed at reducing transportation emissions by requiring carmakers to invest billions to produce increasingly fuel efficient vehicles, while at the same time, we subsidize the use of private vehicles in congested urban areas at a cost more than 3 times the total spent to support Amtrak.  Taken together, these policies can be viewed as somewhere between inconsistent and outright contradictory.

 

New Momentum for Fuel Cell Vehicles

— December 15, 2014

Somewhat unexpectedly, fuel cell cars were in the spotlight in November, with Toyota and Honda each unveiling their fuel cell vehicles (FCVs) in Tokyo, and several FCVs displayed at the Los Angeles Auto Show.   The media responses ranged from skeptical interest to disbelief that FCVs will ever become a reality.  So let’s look at what happened and what it says about where FCVs are going.

The biggest announcement was Toyota’s presentation of the Mirai, a four-seat fuel cell coupe that will be available to Japanese consumers in early 2015 and later in the year in the United States.  Although Hyundai is first to market with a production fuel cell car, Toyota generates the most excitement, mainly because the company is assigned almost magical powers to create a market for new clean technology thanks to its launch of, and continued dominance of, the hybrid vehicle market.  Toyota is clearly swimming against the tide on zero emission technology by going with fuel cells instead of batteries, and the company’s moves attract attention.

5 Minutes or Less

Toyota’s announcements were the most positive of the recent announcements.  I’ve said before that two remaining hurdles for the fuel cell car market come down to cost (of the car) and infrastructure, as the technology has largely been proven.  Toyota demonstrated this with the Mirai, which will have a 300 mile range and will refuel in under 5 minutes.  While Audi has said it is going the plug-in hybrid fuel cell route because a pure fuel cell car would be underpowered at just 130 horsepower (hp), the Mirai will have 153 hp, in line with Toyota’s conventional vehicle line up.  Toyota announced that the sticker price for the Mirai in the United States will be around $57,000.  When tax credits are added in, the price will drop below $50,000.  That’s still a high-priced car, but at this price point, it’s at least competitive with the high end of battery vehicles.

Toyota also said that it will support infrastructure investment in the Northeastern United States.  The company is already investing in hydrogen station deployment in California, through California hydrogen infrastructure startup FirstElement.  While this move can be seen as simply supporting the introduction of zero emission vehicles (ZEVs) in the Northeast states that have adopted the ZEV mandate, it’s the first sign of real progress on U.S. infrastructure build out outside of California.

Full Speed Ahead, Slowly

Honda’s news was more mixed.  Honda unveiled a five-seater fuel cell concept car – a positive step in showing that FCVs won’t have to start small like battery vehicles did.  In addition, Honda joined Toyota in supporting FirstElement in California through a letter of intent to invest $13.8 million.  But the company took a step back by announcing that it would not release its first commercial FCV offering until 2016.  Moreover, Honda’s president, Takanobu Ito, said that his vision was of FCVs in significant numbers on the road in 30 years.

At the Los Angeles Auto Show, other OEMs that have largely stayed out of the fuel cell development path had concept vehicles on display.  The Volkswagen Group showed a hydrogen Golf and a plug-in A7 e-tron for Audi; both are still concepts so this looks more like hedging against future need for a FCV once Toyota, Honda, and Hyundai have tested the waters.

So progress continues on the two major challenges for FCVs, but it continues to be slow.  The price points are the most positive development, and may leave hydrogen infrastructure as the final obstacle for fuel cell cars.

 

With Predictive Navigation, Smart Cars Find Their Own Way

— December 15, 2014

The flood of available data from many sources – traffic updates, GPS, onboard sensors, etc. – will change the ways in which we’ll get around in the coming years.  One tangible manifestation, happening now, is predictive navigation.

From Google to Bosch to Volkswagen, a range of companies in the automotive and technology industries are starting to harness the power data to provide personalized real-time guidance and enhanced vehicle control that could lead to reduced congestion and fuel consumption – and, eventually, to hybrid powertrains that automatically adjust the balance between battery and engine output based on upcoming terrain.

Go This Way

Data about where and when we travel and how fast we go is collected through a combination of built-in systems, such as General Motors’ OnStar and Hyundai’s BlueLink, and brought-in systems, specifically smartphone apps.  Every time a driver launches a navigation app, such as Waze, Google Maps, or TomTom, information about speed and location is transmitted back to the cloud and aggregated with other factors, such as weather forecasts, construction sites, and local events, to determine where backups are occurring or are likely to occur and to provide real-time feedback.   The macro data can be combined with local data about individual driver habits to automatically provide alerts about traffic backups and alternate routes before you turn the key.

Google has provided these predictive alerts for more than 2 years as part of the Google Now functionality on Android phones.  At a recent innovation workshop at its Wolfsburg, Germany headquarters, Volkswagen showed off its own in-car solution to provide alternative route suggestions even when drivers don’t need to use the navigation for common destinations.  Other automakers, including General Motors, have been testing solutions for plug-in electric vehicles, like the Chevrolet Volt, that will automatically preserve electric power for the last portion of a drive home through a residential area or even use up some of the low-charge buffer when the system predicts it will be plugged in soon.

Shortest Is Not Necessarily Most Efficient

Mercedes-Benz is now utilizing topographic map data as an input to the plug-in hybrid powertrain available in its S500 luxury sedan.  When the system detects that the vehicle is approaching the crest of hill, it will automatically shift the power distribution away from the internal combustion engine to the electric motor and then recover energy to the battery on the downhill side.   Ford has been researching eco-routing solutions for both plug-in and traditional vehicles that will calculate routes that use less total energy even though they may cover more total distance.

Everyone that drives in urban areas is well aware of the frustrations of sitting through several cycles of a traffic light while trying to make a left turn.  For the past decade, package delivery company UPS has been using big data and electronic maps to provide its drivers with customized daily routes specifically designed to keep left-turns to a minimum.   By using right turns whenever possible, even if it means going further, UPS had saved more than 10 million gallons of gasoline and reduced carbon emissions by 100,000 metric tons by 2012.

 

Street Lights Add EV Charging

— December 11, 2014

Sometimes a solution forms at the intersection of two challenges that may not seem, at first glance, to have anything in common.  For example, cities are perpetually seeking ways to increase revenue, and many owners of electric vehicles (EVs) want access to ubiquitous charging infrastructure.

Enter the new concept of retrofitting street lights with money-saving LEDs and EV charging ports.  City managers are moving toward central control of street lights by adding a control node, which enables them to reduce cost and integrate the lights with other systems, as my colleague Jesse Foote recently wrote.  With smart street lighting technology (as covered in Navigant Research’s report, Smart Street Lighting) in place, EV charging capabilities can also be added to street lights, creating a new revenue stream for municipalities.

A Light and a Charge

Among the first pilots of this combination are occurring in the cities of Munich in Germany, Aix-en-Provence in France, and Brasov in Romania.  BMW has two such lights at its headquarters in Munich and will add a series of enhanced lights in the city next year.  A consortium called Telewatt, led by lighting manufacturer Citelum, is similarly installing LED street lights with EV charging in Aix-en-Provence.  In Romania, local company Flashnet has integrated its inteliLIGHT management platform with an EV charger.

Motorists can pay for the EV charging using a mobile phone app.  Cities that have regulations allowing them to provide EV charging services can gain revenue to help balance the books.  They can also balance the additional power demand of EVs within their overall power management system.  Placing a Level 1 or Level 2 charging outlet on a light pole reduces the installation cost of bringing power to the curb, which otherwise can be several times greater than the cost of the equipment.  Cities that install these systems will help drive demand for EVs, which has the added benefit of increasing urban air quality.

This is another example of the integration of seemingly disparate city services into a smart city.  As detailed by Navigant Research’s Smart Cities Research Service, the move toward integrating power, water, transportation, waste, and building management will yield considerable savings while improving the quality of urban life for city dwellers.

 

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