EV, PHEV Adoption Likely To Be Constrained by Costs, Hybrid Popularity

EV, PHEV Adoption Likely To Be Constrained by Costs, Hybrid Popularity

By John O'Dell December 18, 2009

Report is Second This Week to Caution Against Hope for Rapid EV Growth

By Danny King, Contributor

It's hardly news by now that only a die-hard core enthusiast group sees battery electric and plug-in hybrid cars becoming a significant part of the personal transportation fleet in this country much before the quarter-century mark.

But some apparently think that the message needs to be pounded home. So in the second such report this week, Colorado consulting group Pike Research and enthusiast site HybridCars.com have pooled their resources to come up with 10 not-so happy predictions for electrified vehicles in the next few years.

The list of reasons why all the electric transportation excitement evidenced in seemingly daily announcements of pilot and demonstration programs by automakers testing the EV waters will fade to a slow buzz follows a report released Monday by the National Research Council that says battery costs will keep a lid on rechargeable battery vehicles for the foreseeable future by making them too expensive to compete freely in the market.

With HybridCars.com as a cosponsor, it is perhaps not surprising that the report finds that conventional hybrid vehicle sales are likely to keep growing at a pace that outdistances cars with rechargeable batteries. but the authors' arguments for a slow-growth scenario for EVs and PHEVs have lots of traction.

Expensive lithium-ion batteries, improving performance-to-price ratios for conventional hybrid-electric cars, lower-then-expected resale values for expensive EV batteries and the financial challenges of installing electric charging stations outside of the home or office may prevent the rapid adoption of EVs and PHEVs in the near future, the report says.

Additionally, convenience-enhancing initiatives such as privately owned stations that allow for battery swapping or battery charging - a la Better Place - aren't likely to proliferate, the authors insist. The low price of electricity will limit returns on investment for EV service station owners while auto makers will resist standardizing battery packs - a necessity for the success of battery exchange programs.

Further hampering widespread acceptance of EVs and plug-in hybrids is the likelihood - with which many utility companies agree - that proliferation in some older neighborhoods of rechargeable vehicles may overload area electrical infrastructure.

And the concept of an EV or PHEV battery pack with excess juice returning power to the grid in times of high demand is more or less a pipe dream in the near-term because of the high costs of installing meters that permit such two-way flow of electrons.

The report says 2012 may well be the tipping point that decides the pace of EV and PHEV acceptance. The first such cars will be on the road by then - vehicles such as the Nissan Leaf battery-electric and the Chevrolet Volt extended-range plug-in - and the core enthusiasts will have made their purchases, leaving the market to buyers as concerned with cost and conveniences as with environmental benefits and technology.

Even if the present $7,500 federal tax credit for cars such as the Volt and Leaf still remains in effect by then, the cars will have to compete on price, performance and utility and may not fare all that well at first, the report says.

Outside the U.S. the picture may be a little different, with the Asia-Pacific region accounting for half the EV market in 2015, up from 30 percent next year, as China, Japan and Korea boost battery-production capacity and the Chinese government invests in EV production, the Pike report says.

Meantime, back in the states, annual sales of conventional hybrid-electric vehicles will jump about 65% to 1.1 million units in 2015 from about 675,000 vehicles in 2010 as stop-start technology, ultracapacitors that store energy more efficiently than lithium-ion batteries and cheaper and more powerful lithium-ion batteries become more commonplace.

John O'Dell:  is an AutoObserver Senior Editor. Follow @AutoObserver on Twitter.