Navigant Research Blog

Is the Gogoro E-Scooter Priced Too High?

— July 1, 2015

Taiwan-based electric scooter (e-scooter) battery swap company Gogoro has finally unveiled pricing for the most ambitious e-scooter program in the world. Gogoro’s e-scooter, called the Smartscooter,  and access to a battery swap network will cost consumers $4,100 and about $30 per month, respectively. For the company’s first deployment in Taipei, it is offering 2 years of free maintenance, 1 year of theft insurance, and 2 years of free battery swapping. The Gogoro Smartscooter became available for pre-order in Taipei on June 27.

There are several ways to interpret the pricing announced by Gogoro. On one hand, for an exceptional looking and performing e-scooter, the price seems fair. Gogoro’s Smartscooter has a range of 60 miles and a top speed of 60 mph (going from 0 mph to 31 mph in 4.2 seconds). Advanced features, such as smartphone integration, light-emitting diode (LED) headlights and tail lights, an intelligent security system, a digital dashboard, and an overall sleek design, make this scooter far more attractive than most other electric models. On the other hand, many consumers in Asian megacities, including Taipei, are accustomed to paying $500 or less for low-end gasoline-powered scooters. A higher-end, more comparable 125cc gas scooter costs roughly $2,600, which is still considerably less than Gogoro’s Smartscooter.

Lack of Battery Ownership Remains an Issue

Gogoro CEO Horace Luke had previously stated that the company’s e-scooter would be in the $2,000 to $3,000 price range. The Smartscooter was expected to cost about the same amount as a comparable gasoline scooter since consumers of the Smartscooter won’t actually own the batteries used in the vehicles (which constitutes a large portion of the overall cost and value of the e-scooter). Removing the battery from the purchase price was meant to drastically reduce the cost of the vehicle, using more of a leasing-style mobile phone business model, where the initial purchase price of the e-scooter is reduced to encourage early adoption and subscription fees for the use of the company’s battery swapping network will eventually make up the difference over time. It is somewhat surprising that even without consumers having to pay for a battery, the e-scooter is still more expensive to buy than a gasoline equivalent.

Taiwan Subsidies a Factor

Nevertheless, Gogoro claims that when government subsidies and the cost savings of using the battery swap network instead of gas are considered, the overall cost of owning a Smartscooter will be less than its gas counterpart after 2 years. E-scooters do receive subsidies in Taiwan, with the amount ranging from TWD21,000 ($663) to TWD34,000 ($1,074) in most regions. These subsidies should help narrow the gap in price differential and encourage larger adoption of the e-scooters.

While it remains to be seen if Gogoro can win over thousands of customers to support its battery swap network, if successful, a network like Gogoro’s could become the most impactful development in electric transportation since Tesla introduced the Model S. Nearby, enormous scooter markets such as China, India, and Indonesia could see battery swap networks in their megacities sooner rather than later if Gogoro is successful in Taiwan.

For more information on electric scooters, see Navigant Research’s Electric Motorcycles and Scooters report, which forecasts global cumulative sales of electric scooters will total over 42 million units from 2015 to 2024.

 

SunEdison, Green Charge Networks Team Up for Solar Plus Energy Storage Project

— July 1, 2015

On June 24, SunEdison, a leading solar panel manufacturer, project developer, and residential leasing provider, announced that it had joined forces with Green Charge Networks to deliver a solar plus energy storage system (ESS) to the municipal utility Silicon Valley Power. Green Charge, the largest provider of commercial energy storage in the United States, will work with SunEdison to install the ESS in the Tasman Drive parking structure next to the San Francisco 49ers’ new football stadium. The ESS will be added to the solar modules that were installed at the end of 2014.

In California, commercial customers have to pay for the total electricity consumed and for the load consumed at any time. The Tasman Drive parking structure’s solar array has allowed Silicon Valley Power to reduce its electricity consumption by 1.18 GWh, reducing its energy-related part of the bill.  However, the utility has been less successful in trimming costs on the demand side of the bill due to the difference in the solar irradiation daily pattern and peak load of the utility. Silicon Valley Power hopes that the system will allow it to reduce both of these costs by time-shifting the electricity produced by the solar array to times when the utility’s load is peaking, therefore reducing peak load costs.

Pros and Cons

Current regulatory frameworks around the world are based on feed-in tariffs and net metering, and the tariff structures used for small and medium electricity consumers (residential and some commercial users) play against systems like this. In addition, the cost of an ESS is still relatively high compared to the equivalent service provided by the grid.

But, as solar economic incentives are reduced and new tariff structures that take into account the grid-associated costs are set into place, Navigant Research expects that solar plus ESSs will become commonplace. This is projected as both solar and ESS costs are expected to fall significantly in the next few years. These topics will be covered in Navigant Research’s forthcoming report, Distributed Solar Energy Generation.



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Longer-Range LEAF Aims to Alleviate Anxiety

— July 1, 2015

At Nissan’s recent annual shareholder meeting, CEO Carlos Ghosn announced that the driving range of the LEAF battery electric vehicle (BEV) would be extended to 125 miles (200 km). The update is expected to reinvigorate sales of the LEAF in the United States, which fell by 25.5% during the first 5 months of 2015, according to hybridcars.com.

That BEVs have a shorter driving range than internal combustion engine (ICE) vehicles is one of the factors that has limited sales, as drivers on longer trips don’t want to have to worry about having enough juice to get to their destination. If the U.S. Environmental Protection Agency (EPA) gives the LEAF the proposed 125-mile range rating, that would be a boost of nearly 50% over the current 84-mile range. Since 125 miles is well beyond the range of most daily round trip commutes, more car shoppers would likely consider switching to a LEAF.

Ghosn also said the company has a prototype battery that could give the LEAF up to 310 miles of range, which would make it much more competitive with ICEs. Other BEV manufacturers, including Ford and General Motors (GM) are targeting a minimum of 200 miles of range for their next-generation BEVs to battle the upcoming Tesla Model 3.

According to Navigant Research’s Electric Vehicle Geographic Forecasts report, by 2018 (when several 200-mile range BEVs priced under $50,000 are expected to be available), annual sales of all plug-in electric vehicles (PEVs) are expected to have grown by 168% over 2015 sales.

Decoding the Data

The U.S. Department of Energy (DOE) is conducting a study to see how households with both LEAFs and ICE vehicles  apportion their driving miles. As previewed during the DOE’s Annual Merit Review meeting, the study will survey 37,000 consumers and study in depth the driving habits of 144 households. According to preliminary data from the study, 60% of LEAF households drive the BEV more than their ICE car, and the study looks to understand factors such as greater range or access to charging infrastructure that could increase electric miles driven.

BEVs are suitable for two-car (or more) households where the ICE is used for longer trips. However, the share of households with multiple cars (currently at 57%) is expected to steadily fall in the future as carsharing programs and other mobility services remove the need for a second car. According to the recently published Navigant Research report Urban Mobility in Smart Cities, participants in North American carsharing programs are expected to grow by 10% annually to more than 4 million by 2021.

 

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