Navigant Research Blog

States’ Roles in the Clean Power Plan

— June 25, 2015

The U.S. Environmental Protection Agency (EPA) plans to finalize the Clean Power Plan (CPP) this summer. As part of the plan, states will have 1 to 3 years to submit State Implementation Plans (SIPs) to the EPA for review. Some states are already starting the planning process to develop an SIP, and most are beginning with stakeholder meetings that include utilities and other major players in their state. Other states are waiting to see the final regulation before they begin.

States face a complicated web of decisions when crafting SIPs. The figure below shows a simplified hierarchy of the paths that they may take. States are unlikely to go through the decision process in a linear fashion; instead, they will need to consider all options and narrow them down based on their existing policies, resources, and stakeholder goals, among other factors.

SIP Example Decision Process

 

CPP Decision Tree - Recreated

(Source: Navigant Consulting)

SIP or FIP?

The first decision a state needs to make is whether to submit an SIP. If a state does not submit an SIP, the EPA will impose a Federal Implementation Plan (FIP). The EPA has indicated that it may include insights on what an FIP will look like when it releases the final rule this summer. Some states have passed legislation limiting their state agencies from submitting an SIP without legislative approval, which could impede those states from submitting an SIP at all.

A decision that will need to be made early in the process is whether or not a state wants to work with other states to submit a regional plan. There have been proposals, for instance, from Duke Nicholas Institute, that individual plans could be crafted to be standalone and still allow trading of credits with other states, similar to the way that renewable energy credits (RECs) can be traded among states even though Renewable Portfolio Standard (RPS) policies were not coordinated prior to implementation. However, many states are already in discussions about coordination efforts—for example, 14 Midcontinent states submitted comments to the EPA on its proposal and held a stakeholder event on June 5.

If states do work together on regional implementation plans, under the proposed rule they would have an additional year before their plan is due to the EPA. This allows additional time to coordinate among the many players involved across all coordinating states, but narrows the amount of time between when the implementation plan is approved by the EPA and compliance begins—potentially as little as 1 year.

Targets and Policies

Another decision that states must weigh in on is whether or not to use the rate-based target laid out by the EPA or to convert it to a mass-based target. This decision is interrelated with the kind of policy regime a state chooses to include in its SIP. A rate-based target may be more appealing to states that impose individual unit obligations on fossil units in their state, as it eliminates the uncertainty surrounding future load growth. Conversely, a mass-based target may be easier to implement in the northeast, where a mass-based cap-and-trade system already exists.

States will also need to determine how to integrate existing renewable and energy efficiency policies into their SIPs and decide if new policies are needed. These include RPSs, energy efficiency standards, and updates to building codes and can be combined with cap-and-trade, as in California, or standalone.

There are many additional considerations for states to take into account as they craft implementation plans. For the best overall outcome, it is recommended that states start early, have meaningful stakeholder involvement throughout the process, and leverage modeling and analytical tools where possible.

 

Turbocharger Suppliers Have a New Market to Pursue

— June 25, 2015

The recent Navigant Research report, Automotive Fuel Efficiency Technologies, concluded that one of the main approaches to delivering better fuel economy for cars is to downsize existing engines but coax more power out of them. The principle of increasing air pressure at an internal combustion engine intake to produce extra power is well-established and is known generically as forced induction. The two main mechanical types of forced induction are usually defined as:

• Turbocharging, where the compressor is driven by exhaust gases
• Supercharging, where the compressor is driven directly off the engine crankshaft

Turbochargers are well known for being a relatively simple way to get more power from a small engine, but also have the disadvantage of lag because the maximum boost is not available until the engine speed is high. Superchargers can be set up to provide boost at low engine speeds, but they also use power when they are not needed, and so they can adversely affect fuel economy under normal driving conditions.

A third variant, electric turbochargers, now looks set to hit the market. An electric turbocharger offers an engine boost on demand without the lag of an exhaust-driven component or the physical drag that a supercharger places on the engine. The technology operates from electrical energy that is recovered by regenerative braking and takes advantage of the fact that electric motors develop their maximum torque immediately from a stationary position.

The concept has been under development for some years, and the biggest challenge so far is to get enough usable power from a 12V electric motor. However, with the imminent rollout of 48V electrical subsystems for advanced stop-start systems (as discussed in detail in the Navigant Research report, 48-Volt Systems for Automotive Applications), it will become practical to implement an electric turbocharger for the first time. Audi is the only manufacturer to announce a planned launch so far, but most other manufacturers are thought to be working on similar concepts.

Other Suppliers

French Tier One supplier Valeo is one of the first to offer a production-ready electric turbocharger. The company acquired the switched reluctance motor technology from U.K.-based Controlled Power Technologies in 2011. The motor is liquid-cooled and the 48V system needs additional power electronics and a bigger battery than normal, so there are additional costs to consider. Benefits include improved performance as well as better fuel economy, so manufacturers are expected to be able to charge a premium.

Conventional turbocharger suppliers are also developing electric products. BorgWarner offers electric turbocharging in its eBOOSTER system, which has been tested on both gasoline and diesel engines. Honeywell is another well-established supplier of conventional turbochargers, and it is thought to be developing an electric version for introduction in a couple of years’ time. As is often the case, emerging technology stimulates innovation from brand new companies as well as established suppliers; one example is U.K.-based Aeristech.

Fuel efficiency is a key focus for automotive manufacturers that want to avoid financial penalties for missing emissions targets in the coming years in many countries around the world. Incremental improvements of 1%–2% may not be enough, so investing in technology that has the potential to deliver significant fuel economy increases without sacrificing performance or drivability may be money well spent. Electric turbocharging looks likely to be the first application that will launch 48V systems into series production. And this shift brings many other benefits of electrification that will challenge hybrid technology at a much lower price point.

 

Big Tech Players Take Next Steps in the Smart IoT Home Space

— June 24, 2015

No matter what it’s called—the smart home, connected home, or Internet of Things (IoT) home—many companies are moving forward with a variety of products to enhance comfort, convenience, and energy efficiency in the home. In particular, tech giants Apple and Google (Nest) have generated significant buzz lately and are poised to remain driving forces as the market continues to evolve.

Apple, Google, and More

Apple’s vision for its HomeKit platform is starting to become more visible, with some of the first devices entering the market that can be controlled via Siri through iPhones, iPads, and Apple Watches, according to a recent story on the MacRumors website. When HomeKit was announced a year ago, it was more of a vision of the possible. But now companies like Lutron (smart lighting kit) and Insteon (home automation hub) are selling HomeKit-enabled products. In addition, ecobee (smart thermostat) and Elgato (Eve sensing system) are prepared to launch HomeKit-enabled devices in a matter of weeks. Other manufacturers are expected to follow suit.

Meanwhile, Google has forged ahead with its own platform with the announcement of Brillo, its IoT operating system based on Android. Brillo has a communication layer called Weave that is designed to enable IoT devices to talk to one another and the cloud. Weave will also be used by Nest and Nest ecosystem devices so they can interoperate. Brillo is expected to be available in the third quarter of this year, and Weave will be offered in the fourth quarter.

It is not just Apple and Google shaping the IoT and smart home space, however. Industry groups are active as well, aiming to set standards across multiple operating systems and network protocols. For instance, the AllSeen Alliance and the Open Interconnect Consortium (OIC) are two groups working on open-source standards for the IoT that will include the home as well as other industry verticals.

Multiyear Competition

A few things to remember in this chaotic space: It is still early days as the smart IoT home market takes shape and the players jockey for position. Also, this is a multiyear competition, with no clear winners at this point. It is easy to see Apple and Google setting the stage to dominate given their strong brands among consumers. But companies like Samsung, ADT, Bosch, Qualcomm, and Honeywell, to name just a few, see opportunities as well and are focusing on the growing market possibilities that are expected to eventually include billions of new devices and billions of dollars in potential revenue. What’s more, there is room for startups to emerge or new partnerships to form that take the market in a new direction. For instance, ComEd has joined with Comcast and Nest Labs for a demand response program involving smart thermostats. For some guidance on what lies ahead, Navigant Research has a new report called IoT (Internet of Things) for Residential Customers that discusses these issues and challenges facing stakeholders.

 

High-Accuracy Mapping: An Opportunity for the Post Office?

— June 23, 2015

Synergy is one of the most overused and abused words in business. Whenever this word is uttered, it’s time to break out a big hunk of salt. However, at the recent TU-Automotive Detroit conference in Detroit, an actual synergistic opportunity popped up in the course of discussion. The U.S. Postal Service (USPS)—and by extension, other postal services globally—could play an important role in the future of automated driving. According to Navigant Research’s Autonomous Vehicles report, nearly 95 million vehicles with some autonomous capability will be on the world’s roads by 2035.

High-Resolution and High-Accuracy Mapping

One of the most common topics to arise during the 2-day gathering of people involved in automated driving and connectivity was the need for high-resolution and high-accuracy mapping data. Alain De Taeye, management board member at TomTom, gave a keynote presentation on the requirements for highly automated driving systems. While sensors including a global positioning system (GPS) that can detect the immediate surroundings are clearly a critical component, they are insufficient for robust automated control. Maps can help extend visibility well beyond the line of sight of either the driver or sensor system.

More importantly, the combination of high-definition 3D maps and sensors enables greater capability than either on its own. For example, GPS sensors are notoriously unreliable in the urban canyons where automated vehicles offer some of their most important potential benefits. As satellite signals bounce around off tall buildings set closely together, a GPS-only system often places the user far from their actual location. On the other hand, cameras and LIDAR sensors can contribute to a fused real-time map of the surroundings that can be correlated with stored maps for validation and provide more accurate and precise location information.

De Taeye discussed the sources of data used by TomTom and other map providers, including HERE and Google. By blending data from satellite imagery, government data, real-time crowdsourced information, and fleets of vehicles that traverse the actual roads, maps are constantly updated. De Taeye emphasized the need for continuous updates on road information to ensure accuracy as well as precision, which is where the USPS could come to the rescue. Even companies as large as Google have practical limits on how frequently they can drive down each road.

Capturing Data with Future USPS Vehicles

Ryan Simpson, an electrical engineer with the USPS, attended the conference to learn about some of the new technologies that could potentially be put to use in future service vehicles. With more than 150,000 daily delivery vehicles and another 100,000 vehicles of various form factors, the USPS has the largest commercial vehicle fleet in the world. Those 150,000 delivery vehicles traverse a huge proportion of the roads in the United States 6 days a week, 52 weeks a year. The USPS is currently in the process of defining a next-generation delivery vehicle to replace its rapidly aging fleet. If the new vehicles were equipped with some cameras and sensors, they could capture data with much higher frequency than any of the existing mapping companies. Real world data about everything, including road construction, bridge problems, and even potholes, could be updated daily.

Given the persistent financial difficulties of the USPS, providing fresh and reliable navigational data to mapping companies could provide a significant revenue stream that helps support a very important service to the U.S. population. At the same time, such data would also help to enable automated driving systems. This would be genuine synergy.

 

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