GM Defends Chevy Volt; Calls Critical Study Faulty
March 03, 2009
By Bill Visnic
A study by engineers from Carnegie Mellon University examining the economics of electricity-intensive "plug-in" hybrid-electric vehicles - a coming class of high-efficiency models typified by General Motors Corp.'s 2011 Chevrolet Volt - bases its primary argument on an outdated assumption, said one of GM's highest-ranking engineers.
The Carnegie Mellon study concluded that plug-in hybrid-electric vehicles (PHEVs) using large, high-capacity battery packs to enable propulsion for comparatively long distances solely on electric power are not the most economically viable path to higher-efficiency vehicles. It said PHEVs with more modest and less-costly battery capacity are the optimum approach.
GM's highly publicized Chevrolet Volt is categorized by the company as an "extended-range" electric vehicle, but in effect is a PHEV with the kind of large-capacity battery capability the Carnegie Mellon study said is not a cost-efficient solution.
Jon Lauckner, GM vice president-global program management and a high-level engineer with deep involvement in the Volt's development, told AutoObserver in an interview Monday that there are valid points in the Carnegie Mellon study - but its dismantling of extended-range PHEVs because of high cost is mistaken because the researchers are ill-informed about the cost of new-age hybrid batteries.
Battery Cost Mistake 'Jumps Off The Page'
The mistake in the study that "jumps of the page," Lauckner told AutoObserver, is the
assumed baseline cost of the lithium-ion batteries used by the Volt and, most likely, other future PHEVs: $1,000 per kilowatt-hour.
"That's very high compared to the cost we're paying today," said Lauckner of the Volt's prototype lithium-ion batteries developed by Korean battery expert LG Chem. "And very, very high compared to the (battery cost) in the near future," once even modest engineering improvements and economies of scale kick in, Lauckner added.
"For me, the conclusion they draw is very much dependent on what they think longterm battery costs may be," he said. And the researchers' battery-cost forecast, ignorant of the latest battery developments, is seriously pessimistic.
He said using the Carnegie Mellon formula, the Volt's battery pack alone, planned with a capacity of some 16 kWh, would cost $16,000.
"I won't tell you what that battery pack is going to cost," when the Volt goes into production in December 2010, said Lauckner - but he insists it's nothing near the $1,000 per kilowatt-hour on which much of the Carnegie Mellon study's cost-benefit equation is based.
Batteries Will Cost Less - Maybe A Lot Less
He said university researchers do acknowledge that in their methodology, battery cost plays
prominently in determining whether PHEVs with large battery capacity - and proportionately lenghty electric-only driving distances - make economic sense when compared to less-capable PHEVs or conventional hybrids.
The Carnegie Mellon engineers do indicate in the study that a significant reduction of battery cost would change the playing field, acknowledging, "Cheap battery costs of $250 per kWh would significantly increase competitiveness of PHEVs, making them similar to or less expensive than HEVs and (conventional vehicles) across all distances driven."
Lauckner said a chart presented in the study proves the point that battery cost of significantly less than the study's "baseline" of $1,000 per kWh improves the overall cost-competitiveness of PHEVS: when battery cost is assumed to be $250 per kWh and battery recharges occur close to the 40-mile intervals for which a PHEV such as the Volt is designed, the PHEVs are almost equal in cost with less battery-intensive PHEVs and even conventional hybrids (note "low battery cost" segment of chart).
"We're definitely not as high as $1,000 per kilowatt-hour," he insists. "That's way high."
Customer Incentives Reduce Cost
Lauckner said the researchers also fail to take into account another factor: the "already legislated" consumer incentives for plug-in hybrids indexed to their battery capacity. The Chevy Volt is in line to deliver a $7,500 tax incentive to customers. The amount that comes directly off the buyer's federal tax owed will be much less for the PHEVs with just seven to ten miles worth of electric-only battery capacity the study claims is ideal.
In discussing "cost," he allows that the Carnegie Mellon engineers may be talking broadly about the various hybrids' societal costs, but said the fact remains that buyers' out-of-pocket costs for all PHEVs will be markedly reduced by the tax incentive.
Where's The Recharging?
Lauckner lobs one final volley at the Carnegie Mellon research, which said the lower-capacity PHEVs are the most cost-efficient relying, in part, on the assumption they can be recharged after approximately every seven miles of electric-only driving.
That assumption is invalid, said Lauckner, because it does not reflect either the reality of a widely available recharging infrastructure - which is all but nonexistent at this moment - or applicability to real-world commuting, which would require low-capacity PHEVs to use their combustion engines much more extensively than PHEVs with large battery reserves.
"How many people are going to stop every ten miles or less and recharge for a half-hour?" Lauckner asked. He added that even if they would, there is no definitively plan for an extensive recharging infrastructure anywhere in the nation - much less funds earmarked to pay for it.
He said use of smaller-battery PHEVs in the most optimal fashion envisioned in the study "absolutely requires (recharging) infrastructure. It may be what the numbers tell you - but it's not practical."
Photos by GM
1 - GM introduced the 2011 Chevrolet Volt at its 100th birthday celebration.
2 - GM Vice President Jon Lauckner
3 - GM engineers test batteries for Chevrolet Volt
Posted by Michelle Krebs at 5:36 AM under Featured , GM , Technology | Comments (3) | digg this | Seed Newsvine
as well commented by readers of the study on your sister site, Green Car Advisor -
By danmosquedaAuthor Profile Page on February 26, 2009 6:13 PM
The problem with this analysis is that it misses out entirely on the point of a plug-in electric: fuel savings. That's not the same as determining a cost-benefit analysis. The idea is to use less fuel to serve the purpose of meeting national security needs, i.e. reducing the need for foreign oil. Eventually, the technology will progress further and meet the cost-benefit analysis too. Or we could just keep kicking the can down the road. Fortunately, this Ivory Tower dweller will have little or no impact on whether or not the Volt and other plug-ins are introduced.
By caroftheweekAuthor Profile Page on February 26, 2009 6:20 PM
[from article]..if an owner hopes to recoup ownership costs from fuel savings, a rechargeable hybrid vehicle capable of that much all-electric range isn't the answer. "Forty miles might be a sweet spot for making sure a lot of people get to work without using gasoline, but you're doing it at a cost that will never be repaid in fuel savings"..
To which I must ask, when /will/ it become "the answer"? Never say "never", Mr. Michalek.
GM's analysis resulted in the easily understood benchmark of a 40 mile range to keep most commuters on pure electric drive. That variable won't change significantly over time. However, the costs of the resources needed to build and operate a plug-in hybrid car will change. At some point in the future, batteries will become cheap enough, and gas expensive enough, that the Volt will be the answer. But where in the battery vs. gas cost equation is that break-even point? THAT would be useful information.
By caroftheweekAuthor Profile Page on February 26, 2009 6:26 PM
A couple more things to consider.
Assertion 1: The vast majority of hybrid vehicle owners have not run the ROI calculation for the added cost of the hybrid drivetrain. Just like anyone else who pays a premium for extreme performance, they bought the car as a form of self expression. And, yes, fuel mileage /is/ a performance criteria. The Prius has been a success because, in addition to having the performance numbers on paper, you can SEE the performance in the shape of the car.
Assertion 2: Every ROI calculation I've read about allocates $0 to the resale value of the hybrid drivetrain. Example: "At current gas prices, driving 15,000 miles a year, you’ll need to own the InsertHybridCarHere for 15 years to recoup the added cost of the hybrid drive system vs. its standard drive counterpart." Or some such thing. Who cares?! What matters is that they saved money on gas while they owned the car, they enjoyed the distinction, and they were also able to sell it on the used car market for a premium over the standard model. Ultimately, if we really want to split hairs about the ROI of hybrid systems, it must be done in the context of the expected life of the vehicle, which could be 300K miles or more, rather than the expected ownership period of the poor sap that drove it off the dealer lot with only 5 mi on the odo. Will a hybrid car go 15 yr x 15,000 mi/yr = 225,000 mi before croaking? Probably. Will all of it’s owners feel better for using fewer non-renewable resources? Absolutely.
Posted by: uponfurtherrev | March 03, 2009 at 1:13 PM
If they used 7 miles for the comparison on the Prius type vehicle they should look at a Volt with the same battery range. Cut down the cost by 2/3 and then assume charging every 7 miles. I guess that is what they feel is their "sweet spot" so it would be easy enough to put in battery options and let the buyers decide.
Posted by: 62vetteefp | March 03, 2009 at 3:01 PM
Interesting idea, battery options, 62vetteefp. I have two LiIon batteries for my camcorder, one large the other lower capacity. the lower capacity battery lasts about a third less than the hi-cap, but charges from stone dead fully in a little over half the time it takes the hi-cap.
It could work for a Volt, I suppose. Offer it standard with a 250-300kWh stack with a 800-1000kWh optional. Engineer the car and stack(s) to be easily changed out or piggybacked when more range is desired and changed back when it isn't.
But every silver lining has a cloud attached. Bolivia, which has the world's largest reserves of lithium, is expected to nationalize their industry; and the USA & others have rather prickly relations with them.
Here's some good background though a little dated:
http://climateerinvest.blogspot.com/2007/10/lithium-ion-batteries-and-bolivian.html
Posted by: fulcrumb | March 03, 2009 at 8:31 PM