ERMUSR MISC MEMO 08-12-2008 - Laserfiche WebLink

Home Browse Search

~~ ._ The Tesla electric roadster, already being sold in California. Photo by Debra Kahn. new batteries, he said. Even so, Sperling, who also directs the Institute of Transportation Studies at University of California, Davis, predicts a bright future for electric utilities, given all the pressure on automakers to produce more-efficient cars. A regulation like California's low-carbon fuel standard, for one, could benefit power companies because the rule has been designed as a performance-based approach meant to prod carmakers toward biofuels and more fuel-efficiency. In Sperling's view, acredit-trading environment under the low-carbon fuel standard would (in theory) push carmakers toward developing and selling more electric cars. This, combined with the state's stalled greenhouse gas emissions standards for cars and a mandate for more zero-emissions models, could mean a boom for electrics, especially if the federal government funds research and development into "If we do all this, I think we'll see millions of plug-in vehicles on the road in the near future," Sperling said. Sperling also supports establishing a price floor for gasoline at $4.00 a gallon, but he admitted the concept might not fly politically. Battery capacity and supply remain problematic i~lancy Gioia, director of the hybrid vehicle program at Ford, said this is all well and good from a utility standpoint as power companies position themselves to potentially replace gasoline distributors. But from the auto manufacturing perspective, engineers are still coping with a fundamental concern: storage. Gioia has overseen development of the Ford Escape Hybrid and other more efficient models -- including hybrid versions of the Ford Fusion and the Mercury Milan -- and she believes in plug-in cars. Yet she also sees a technical problem yet to be resolved in terms of battery development. "The biggest challenge remains the battery," she said. Electric-battery technology, she points out, is still unproven and has limited range. Add to this concerns over the spiraling cost of steel, copper, aluminum and lithium carbonate, plus the likely dominance of battery manufacturing by China and Japan, and you've got some steep market challenges for U.S. companies. Echoing this concern was Jonathan Lauckner, vice president of global program management at GM. Lauckner said U.S. corporations will have to decide whether they view battery manufacturing and R&D as priorities to bring down the cost of components at home. Otherwise, Japan and China will rule this side of the market. "All of the battery capacity is located in Asia," he said. "It's not cheap shipping batteries all the way from Asia. There's a very sizable logistics cost." ,ord's Gioia also views the component market as a major issue and appeared to signal support for the emergence of U.S. suppliers. "Without domestic or regional supply around the world, it just becomes another issue of ... potential instability," she said.