With gasoline now over $4.00 per gallon in many states and oil prices continuing to rise, the question on the minds of most consumers is how long they will have to spend an increasing share of their income on energy in general and gasoline in particular.
Our reliance on a 19th century technology (the internal combustion engine) and a single fuel for our transportation needs has brought us to a point where there don’t appear to be any good choices. However, looks can be deceiving, the next clear choice for consumers will be alternative energy.
Converting Electricity to Fuel
The problem with clean energy sources like wind and solar has always been that they can only be used to produce electricity. Until recently, covering the U.S. with wind turbines and solar panels would do little to impact the demand for oil. Oil and the fuels produced from it used to be the only practical way of powering vehicles. However, aging petroleum reserves around the world and the lack of major new discoveries have made it increasingly difficult for oil production to keep up with demand. Combine this with the additional problems of unstable sources of supply and concerns over climate change, and it’s becoming increasingly apparent the only realistic solution to these problems is to find another vehicle fuel.
Of the fuels under consideration, electricity appears to be the best alternative. The infrastructure for electricity is already in place and all we need is available from a wide variety of domestic sources. It is also the only fuel that consumers can produce themselves. Other fuels under consideration including hydrogen and ethanol have numerous problems including the lack of infrastructure and a price that will always be too high. When used to power a vehicle, driving costs of a few cents per mile will eventually make it impossible for other alternatives, including gasoline, to compete.
Hybrids – the First Step
One of the most important things hybrids have done is take the first step toward using electricity as a power source. Once a driver takes their foot off the gas, a hybrid is powered by electricity. In addition, regenerative braking is used to capture the energy used in braking to recharge the battery. By combining two power sources, hybrids offer better performance and more horsepower while also increasing fuel savings significantly. In addition to better gas mileage, hybrids have more horsepower and are more fun to drive than the original. Marketing these should be a slam dunk.
So Why Aren’t Hybrids More Popular?
Toyota currently has the state of the-art hybrid technology and this has been licensed to several other auto makers. However, their marketing department appears to have a major brain cramp when it comes to selling these. By mostly selling hybrid versions of existing vehicles with too big a differential in price, consumers can see immediately that it will take longer than most plan to own the hybrid to recover the difference in price from fuel savings. By creating this comparison, Toyota and the other hybrid manufacturers produced a huge reason not to buy a hybrid.
As mentioned previously, hybrids have more horsepower than the original because they combine an electric motor with a combustion engine. However, the environmental movement appears determined to make Americans drive ugly little underpowered cars and they seem to go into a hissy fit when auto companies try to appeal to the mass market by producing faster cars that are more fun to drive. Because of this, the one thing that might have made consumers more willing to pay the price differential wasn’t mentioned. The result is a technology that should be taking the auto industry by storm accounts for only 3-4% of the market. To reinforce this point, it’s worth noting the Prius is the only one without a non-hybrid version, and this has become their most popular hybrid.
However, rising gas prices appear to be overcoming poor marketing, and hybrid sales are picking up. Fortunately, more auto companies such as GM and Nissan/Renault are ramping up to produce hybrids and the premium may decline to $2,000 in a few years. The companies likely to be the most successful will probably be the ones that create distinct hybrids instead of trying to revamp existing models.
Better Batteries to the Rescue
To date, the battery material used in hybrids has been nickel. While this is a slight improvement over the old lead batteries, these still have poor energy density which adds too much weight to a vehicle. For perspective, 100 pounds of lead turned into a battery will produce enough power to drive a vehicle 10 miles while the same weight in nickel will increase the range to 15 miles. However, 100 pounds of lithium produces a range of 40 miles.
Because of this, lithium has become the material of choice for smaller applications including computers and cell phones. However, beginning in 2008, the world’s major battery makers are ramping up to mass produce large format lithium batteries for vehicles. By replacing nickel batteries with lithium batteries the same size, the combination of more energy density and less weight make it possible to dramatically increase the range of a vehicle powered by electricity and significantly reduce the demand for gasoline.
After Market Conversions
Even though the technology exists right now to produce a plug-in hybrid, 2010 appears to be the earliest that major automakers will bring one of these to the market. The good news is that consumers don’t have to wait. Companies are currently lining up to do after market conversions. Most are starting with the Prius because there are more of those on the road, but conversions are expected to be available for other hybrids within the next year. Current conversions are relatively expensive, priced at around $10k or more. However, with large format lithium batteries going into mass production, the price is expected to drop by 75% or more in the next few years.
A Modest Proposal
With private companies now doing what Toyota claims isn’t possible yet, the world’s largest automaker is probably a tad embarrassed. Their reaction has been to raise safety issues about lithium batteries that have been long since resolved and threaten to void the warranty on any conversions. However, this shouldn’t necessarily cause hybrid owners to wait until the warranty has expired before converting. The decision will be based on balancing the expected fuel savings against having to pay for parts no longer covered by the warranty. In this case, a vehicle that has historically needed the fewest repairs would be the best candidate for a conversion.
For those considering the purchase of a hybrid right now, I suggests a modest proposal. Dealers are currently charging a premium because of strong demand, so why not buy a used one, take the savings, and spend it on an after market conversion to a plug-in? Your range should be around 50 miles before having to use a drop of gasoline. With the first plug-in coming to market from Fisker Automotive in 2009 and priced at $80K, this might be the best way to get one for a reasonable price without having to wait.
Source: U.S. Department of Transportation, Federal Highway Administration, 1990 Nationwide Personal Transportation Survey (NTPS), Volpe National Transportation System Center, Cambridge, MA 1991
If you think driving 50 miles without using gasoline isn’t a big deal, think again. It’s huge. Approximately 80% of Americans drive 50 miles per day or less; this is the light at the end of the tunnel. Imagine going from the current situation to telling the loosely wrapped collection of despots that control world petroleum reserves, to put their oil where the sun doesn’t shine.
It won’t happen immediately, but the technology finally exists to power our vehicles with a renewable fuel that can be made from multiple domestic sources including wind and sunshine. Even better, it will reduce driving costs dramatically, and finally allow us to give the Middle East the lack of attention it deserves.
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