May
1

Overcoming Barriers to Electric Vehicle Adoption

 

Last week, the National Academies of Sciences (NAS) released a long-awaited report exploring how policy can be used to address barriers to adoption for electric vehicles. In addition to providing a wealth of useful background information about the state of the electric vehicle market so far, the report contains a suite of recommendations for policymakers, highlighting the challenges facing the technology and what the federal and state governments can do to encourage adoption. Those recommendations are as follows.
  • NAS identifies the large number of competing charging infrastructure providers as a legitimate obstacle for drivers of plug-in electric vehicles, and argues that access to public charging should be as simple and universally accessible as filling a car at a gas station. The federal government and proactive states should use their incentives and regulatory powers to eliminate the proliferation of different plugs and communication protocols for DC fast chargers, and ensure all PEV drivers can charge their vehicles and pay at all public charging stations using a universally accepted payment method.
  • The NAS recognizes that consumers are generally misinformed about electric vehicles, and while motorists typically turn to automotive dealerships for information about potential purchases, many are ill-equipped to address consumer questions and concerns. NAS recommends that the federal government use its Ad Council program to provide accurate information about federal tax credits, the total cost of ownership, and functionality of electric vehicles.
  • Regarding purchase incentives, the federal government should extend the tax credit beyond the current production limits, as manufacturers and consumers continue to learn more about the technology. This should only be reevaluated after five years have passed, to create clear conditions for the marketplace. NAS also recommends that the federal government consider changing the incentive structure from a tax credit to a point-of-sale rebate to increase the appeal to consumers.
  • More research is needed to support automotive batteries and the public charging sites that are needed to properly supplement home and workplace charging. NAS recommends the federal government provide stable funding for research for both.
  • Plug-in vehicles should remain exempt from any special roadway or registration surcharges in the near-medium term at both the state and federal level.
  • Local governments should actively encourage workplace charging and consider investments in public charging infrastructure.
  • Increased EV adoption should accelerate in tandem with more electricity production from low-carbon sources.
  • The federal government should fund a comprehensive review of the variety of non-financial purchase incentives that have been offered by states, such as free access to HOV lanes, to determine the impact of these policies on promoting plug-in vehicles.
NAS groups plug-in vehicles into four categories. The first is long-range battery electric vehicles (BEVs), such as the Tesla Model S. The second is plug-in hybrids (PHEVs) with moderate electric range, such as the Chevy Volt. The third is standard battery electric vehicles with roughly 100 miles of range, which NAS identifies as unsuitable for long journeys but more than adequate to meet the daily driving and commuting needs of most of the population, such as the Nissan LEAF. The fourth is plug-in hybrids with short electric ranges lower than the average American’s driving requirements, such as the Toyota Prius Plug-In, which NAS identifies as “essentially conventional hybrid vehicles.” Regarding NAS’s first recommendation, one of the most important steps to improve the electric vehicle value equation for consumers is to standardize charging such that every public charger is accessible to every vehicle. For all four types of vehicles, home charging is seen as a virtual necessity, and workplace charging is almost always a helpful addition. For owners of both long- and mid-range EVs (types 1 and 3), it increases consumer confidence and vehicle utility. For owners of mid and short-range PHEVs (types 2 and 4), it increases the number of electric miles they can reasonably travel, and thus the cost effectiveness of those cars. However, in contrast to these chargers that are universally useful, most kinds of fast chargers only benefit one of the four types of vehicle owners. For example, intracity DC fast chargers only benefit the drivers of mid-range BEVs, since these chargers are not generally needed by owners of long-range BEVs, and plug-in hybrid vehicles are not equipped for fast charging. Meanwhile, the presence of interstate DC fast chargers is only applicable towards long-range BEVs, but mid-range BEVs are generally not capable of making such long trips so such infrastructure is not of great use, and again, both types of PHEVs are not equipped. This finding on the narrow assessment contradicts the widespread belief that the solution to “range anxiety” is the widespread proliferation of fast-charge station, but rather that fast chargers sometimes only benefit one of four types of vehicles—and possibly even less if they are part of a proprietary charging system. In terms of the government role in supporting vehicle electrification, there’s abundant discussion about tax incentives and state based ZEV-mandates. In an era of hyper-partisanship, such policy measures can be controversial at best. However, without spending taxpayer dollars or imposing sales mandates, government can completely transform the EV ecosystem by encouraging or requiring compatibility across platforms, making fuelling every plug-in vehicle at every charging station as easy as filling every conventional car at every gas station. This common-sense measure could ultimately be a game changer for a young yet important industry.
May
1

Oil Security Index: Three New Countries, Spotlight on Saudi Arabia

 

Earlier this week, Securing America’s Future Energy (SAFE) released the second quarterly installment of its Oil Security Index for 2015, measuring the oil security of sixteen countries around the world. Countries are measured on key indicators, such as their structural dependence on oil, economic exposure to the global oil market, and capacity to respond to oil supply disruptions. ​ This latest Index update ...

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Apr
24

Oil Spill +5: Deepwater Conditions Test Industry’s Capabilities

 

Five years after the Deepwater Horizon oil spill—widely regarded as the most significant in American history—the petroleum industry has pushed forward on new technologies to prevent future environmental catastrophes. Development has returned to the Gulf of Mexico. Analysts predict output from the region’s offshore rigs to reach a high of 1.5 million barrels of oil per day by 2016, but ...

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Apr
17

What to Know: Annual Energy Outlook 2015

 

For the first time in several decades, the United States will become a net energy exporter, the U.S. Energy Information Administration (EIA) announced this week, as energy sent abroad begins to exceed consumption at home. Net natural gas exports could begin as soon as 2017, Administrator Adam Sieminski told a gathering of industry experts, regulators, and journalists Tuesday, with net ...

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Apr
15

Crude Prices, Hedging, and Missing the Forest for the Trees

 

John Dizard has written an important opinion piece for the Financial Times, entitled “Much of the investing public will be sacrificed to the oil-money gods.” As headlines go, this one may be a challenge to parse. But the piece is well worth reading, as it articulates some disconcerting assessments of what the oil price collapse could mean for energy markets ...

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