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"Shocking" New Study About Charging EVs - Bias and Misunderstanding

01/15/11

  01:31:55 pm, by Jim Jenal - Founder & CEO   , 739 words  
Categories: Solar Economics, SCE, Electric Cars that Run on Sun

"Shocking" New Study About Charging EVs - Bias and Misunderstanding

A new study out of Purdue University, and widely reported in the mainstream media (like this article in the Los Angeles Times - Electric car utility bills can shock) suggests that Californians who purchase electric vehicles or plug-in hybrid vehicles are in for a shock based on the high-cost of electricity for recharging their vehicles. The study’s authors claim that because California’s largest utilities (such as SCE) use a “tiered” rate structure, someone purchasing a plug-in hybrid could pay as much as 60% more in annual electricity costs than they would otherwise.  For that to be economical, the cost of oil would have to rise to between $171 to $254 per barrel, the authors concluded.

Wow! Shocking indeed - if it were true. Fortunately, it is not.

First and foremost, most utilities, including SCE, already offer special rate structures for EV/PHEV owners that are “time-of-use” rates.  Indeed, SCE has two specific time-of-use rates that are applicable to EV/PHEV charging and which can bring electric rates for vehicle charging down from the roughly thirty cents/kWh assumed by the authors to as low as eleven cents/kWh.  These rate options include the ability to have a separate meter solely to monitor the energy used to recharge the vehicle.  Since both the Nissan Leaf and the Chevy Volt allow the owner to program the start time for charging, it would seem to be pretty simple for these owners to take advantage of the cheapest electricity rates available. (Of course, if you are generating energy from solar during the day and recharging during the night, you would save even more!)

The Purdue authors claim to have developed a “model that would simulate energy use by Californians…. [that] closely aligned with actual energy use in California.” So how is it that they overlooked these existing rate options, to say nothing of the solar PV-EV connection?

Maybe, just maybe, the problem lies in the lead author’s true area of expertise - agricultural economics.  Indeed, Professor Wallace “Wally” Tyner’s primary area of research appears to be in biofuels, particularly involving that great scam, corn-based ethanol.  Here’s the description of his research from the Purdue website:

Professor Tyner’s research interests are in the area of energy, agricultural, and natural resource policy analysis and structural and sectoral adjustment in developing economies. His work in energy economics has encompassed oil, natural gas, coal, oil shale, biomass, ethanol from agricultural sources, and solar energy. Most of his recent work has focused on economic and policy analysis for biofuels.

Why is it then, that mainstream media accounts of this very “scary” report  fail to mention the bias of the lead researcher?

The actual math here, even assuming worst case factors, still tilts heavily toward the adoption of EVs.  Take a Nissan Leaf that has a 24kWh battery pack and claims 100 miles per charge.  Ok, we are all skeptics here, so let’s assume 80 miles per charge.  What is the cost per mile to drive your new Leaf? Our “skeptical” range estimate yields a range per kWh of 80 miles/24 kWh = 3.33 miles/kWh.  If we assume that charging occurs in the top tier of SCE’s tiered rate structure, the cost is roughly $0.30/kWh.  So, at $0.30/kWh and 3.33 miles/kWh we get $0.09/mile.

What is the cost per mile for a typical American passenger car?  According to the Bureau of Transportation Statistics, in 2008 (latest data available) the average US passenger car got 22.6 mpg. If we assume an average fuel price of $3.00/gallon (don’t you wish), then the cost per mile for the average US passenger car today is $0.133/mile.  If you are keeping score - the Leaf, even given a host of assumptions intended to favor the conventional car, is four cents/mile cheaper.  For the average passenger car in the US that travels roughly 12,000 miles/year, that works out to an annual “fuel” savings of $511/year.  Let the price of gasoline go up, or make electricity cheaper, and the savings are even greater.  If charging costs $0.12/kWh and gasoline costs $3.50/gallon, the savings shoot up to $1,425/year!

But as we already noted (but the authors ignored), there are rate options available now that make electricity cheaper.  And if you offset your highest time-of-use energy usage with the energy from your own solar power system - while you charge your EV with the extremely cheap energy in the off-peak time block - you get the best of both worlds!

Solar PV and EVs are a match made in heaven - despite those “shocking” stories coming from the thinly-disguised Ethanol lobby.

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Comment from: Tig Bitties [Visitor]
Tig BittiesYou need to add another ~25% to the cost per mile for the nissan leaf. That’s because charging a battery is not 100% efficient. So to fully charge a 24kWh battery takes roughly 30kWh of electricity. I’ve included a link to a summary of a very similar discussion of cost-of-electricity for the Tesla Roadster that touches on charging efficiency.
01/16/11 @ 01:19
Comment from: Jim Jenal - Founder & CEO [Member]  
Tig - I think the jury is still out on what the “waste” value will be in recharging the Nissan Leaf. While the experience with the Roadster is informative, it is by no means determinative here. We will simply need to see what the numbers look like from actual use (as the 26% number appears derived from one Tesla owner’s experience). But your larger point is well taken - there will be losses in the recharge process and we will need to factor them into the overall economic picture. Thanks… Jim
01/16/11 @ 06:59
Comment from: Rick [Visitor]  
3 stars
RickYour first paragraph isn’t quite correct. The $171 to $269/barrel includes the price difference between a $41,000 Volt and a $16,000 Cobalt, not just the electrical use. And the other charging models–including time-of-use and flat-rate–are included. The numbers the media are citing are the worse-case ones. The study does have several flaws. For one, the ONLY vehicles cited are those two plus a $24,000 Prius. They also include $12,000 and $3000 for replacing the Volt and Prius battery packs after 7 years. As far as I can tell, they include the cost of the electricity, but don’t discount the gasoline you don’t have to buy, instead rating the Volt at a flat 50mpg. To make a more unbiased study, I’d like to use their methodology to compare the Volt, a $32,000 Nissan Leaf and a $39,000 Lexus GS 300. To be fair, they did discover about $5200 in savings, over 10 years, between the worst-case California tiered power rates and time-of-use/flat rate. Still, that $43/month is hardly likely to sway a potential Volt buyer.
01/25/11 @ 12:09
Comment from: Jim Jenal - Founder & CEO [Member]  
Rick - From what I have seen, the media was simply taking the high points from the press release put out by the University - here it is: http://www.purdue.edu/newsroom/research/2011/110113TynerHybrids.html Thanks for your comments! Jim
01/25/11 @ 12:20
Comment from: John [Visitor]
3 stars
JohnSo you’re saying that the California utilities will continue to screw us consumers who are moving heaven and earth to get into a semi-affordable tier (including investing in $30K of solar PV gear), but will give a “free pass” to anyone who wants to suck as much juice as they want so they can charge their CAR?!? Thanks a lot, California.
02/17/11 @ 07:45
Comment from: Jim Jenal - Founder & CEO [Member]  
Hi John - I don’t think I would characterize it that way - the special time-of-use rates that SCE has for EVs are designed to take advantage of off-peak capacity. That actually makes the grid more efficient, and if it encourages more folks to purchase EVs or PHEVs, which will cut pollution and lower our dependence on foreign oil - those are all very good things which I firmly endorse. Actually, SCE has had a number of time-of-use rates for residential customers apart from the rates mentioned above for EV charging, although some of them have now closed to new participation. You can see all of SCE’s rates here: http://www.sce.com/AboutSCE/Regulatory/tariffbooks/ratespricing/residentialrates.htm As this article makes clear, I’m no apologist for SCE (or any other utility), but I think your characterization is simplistic and unfair. Jim
02/17/11 @ 11:14
Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
In addition, Run on Sun offers solar consulting services, working with consumers, utilities and municipalities to help them make solar power affordable and reliable.

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