GM, Ford Working Out Logistics on Plug-In Cars

Some encouraging news about American auto companies getting on board with the need to transform our transportation sector!

GM, Ford, power companies work out logistics of plug-in cars (07/24/2008)

Colin Sullivan, ClimateWire reporter

SAN JOSE, Calif. -- Executives from U.S. auto manufacturers and major electric utilities convened here yesterday to announce and discuss a landmark deal meant to address how plug-in vehicles would connect to the power grid without overtaxing energy supplies.

General Motors Corp. signed an agreement yesterday with Los Angeles-based Southern California Edison Co. (SCE) and dozens of other utilities to work through the logistics for plug-in electrics (Greenwire, July 22). The idea is to collaborate on how power companies would cope with the potential emergence of hybrid and pure electric cars that are bound to drain the grid during peak demand periods.

Edward Kjaer, director of electric transportation at SCE, said utilities should view electric cars as the future of the U.S. market as companies like GM bank their development plans on smaller and more efficient models like the Chevrolet Volt and other plug-ins. Given that shifting marketplace, Kjaer thinks it's essential for utilities to plan now for an industry already adjusting rapidly to renewable energy in a carbon-constrained environment.

"How are we going to connect these cars to a changing grid?" he said. "This is not going to be an easy task at all because we're blazing totally new ground."

A computer-generated image of the Chevy Volt, a plug-in hybrid that GM hopes to get into showrooms by 2010. Photo courtesy of GM.

Kjaer told attendees at a plug-in conference that he expects "the sweet spot" for this new market to emerge in the 2010-12 time frame. He also anticipates just as much focus on the pure battery-electric car as on the plug-in hybrid as consumers tire of high gas prices, assuming oil prices don't bottom out in the years ahead.

"There's a whole bunch of vehicles in development," said Kjaer, citing not only GM's plans but new design efforts at Ford Motor Co. and Toyota Motor Corp., among others. "It says there's a lot of heat and a lot of light in this space."

'An appliance on wheels'

To prepare for the convergence of electricity and cars, SCE wants to start a $3 million residential pilot program under which consumers would experience the garage of the future, which could be powered by solar panels or wind energy and equipped to charge electric vehicles.

"What we're trying to do is take all this theory out of the theory and put it into the practical," Kjaer said.

The primary obstacles in the real world are changing "the passive relationship with the customer" and developing reliable storage systems, he added. Customers in California, for instance, would need better information about when to charge their cars to avoid draining peak summer supplies when air conditioners go full throttle.

Power customers are used to simply turning their lights on and getting a bill 30 days later. But Kjaer believes the future consumer will "have to be much more informed" about real-time energy management to pursue intelligent charging and more efficient control of resources.

SCE therefore envisions smart meters and identification numbers for vehicles that would allow drivers to refuel (or repower) their vehicles at remote charging stations. The typical driver in this scenario would register his or her car with the utility to manage and access the energy bank.

In other words, SCE views the future car as "an appliance on wheels" that could charge both at home and on the road, with a bill still waiting at the end of the month.

'Millions' of plug-in vehicles?

Dan Sperling, a board member at the California Air Resources Board, said it's a mistake to assume all drivers would charge their cars during off-peak times. If electricity is 1 or 2 cents a mile, or even 3 or 4 cents a mile, Sperling said, consumers could use that power "whenever they get a chance."

"We talk about peak rates and smart grids and all this, but what we really don't know is how the consumer is going to respond," he said. "It's hard to say."

The Tesla electric roadster, already being sold in California. Photo by Debra Kahn.

Even so, Sperling, who also directs the Institute of Transportation Studies at University of California, Davis, predicts a bright future for electric utilities, given all the pressure on automakers to produce more-efficient cars. A regulation like California's low-carbon fuel standard, for one, could benefit power companies because the rule has been designed as a performance-based approach meant to prod carmakers toward biofuels and more fuel-efficiency.

In Sperling's view, a credit-trading environment under the low-carbon fuel standard would (in theory) push carmakers toward developing and selling more electric cars. This, combined with the state's stalled greenhouse gas emissions standards for cars and a mandate for more zero-emissions models, could mean a boom for electrics, especially if the federal government funds research and development into new batteries, he said.

"If we do all this, I think we'll see millions of plug-in vehicles on the road in the near future," Sperling said.

Sperling also supports establishing a price floor for gasoline at $4.00 a gallon, but admitted the concept might not fly politically.

Battery capacity and supply remain problematic

Nancy Gioia, director of the hybrid vehicle program at Ford, said this is all well and good from a utility standpoint as power companies position themselves to potentially replace gasoline distributors. But from the auto manufacturing perspective, engineers are still coping with a fundamental concern: storage.

Gioia has overseen development of the Ford Escape Hybrid and other more efficient models -- including hybrid versions of the Ford Fusion and the Mercury Milan -- and she believes in plug-in cars. Yet she also sees a technical problem yet to be resolved in terms of battery development.

"The biggest challenge remains the battery," she said.

Electric-battery technology, she points out, is still unproven and has limited range. Add to this concerns over the spiraling cost of steel, copper, aluminum and lithium carbonite, plus the likely dominance of battery manufacturing by China and Japan, and you've got some steep market challenges for U.S. companies.

Echoing this concern was Jonathan Lauckner, vice president of global program management at GM. Lauckner said U.S. corporations will have to decide whether they view battery manufacturing and R&D as priorities to bring down the cost of components at home. Otherwise, Japan and China will rule this side of the market.

"All of the battery capacity is located in Asia," he said. "It's not cheap shipping batteries all the way from Asia. There's a very sizable logistics cost."

Ford's Gioia also views the component market as a major issue and appeared to signal support for the emergence of U.S. suppliers.

"Without domestic or regional supply around the world, it just becomes another issue of ... potential instability," she said.