In his 2011 State of the Union address, President Obama calls for one million electric vehicles (EVs) on the road by 2015, repeating a target set in his 2008 election promise.
Incentives are crucial to reach this target. The Recovery Act established tax credits for purchases of EVs and conversion kits. President Obama now calls for these tax credits to be transformed into rebates, which was backed up earlier this week by a bill (S:298) by Senator Debbie Stabenow.
I agree. As I said in a comment last year, tax credits only help people who are eligible for tax. The poor, who pay little or no tax, would be better off with rebates which can also be made available immediately, at the point of sale. So, I'm glad that the debate as to what are better incentives, tax credits or rebates, has now finally been settled in favor of rebates.
At the same time, what's also important is how such incentives are funded. A recent opinion piece in USAtoday describes subsidies as a form of "wealth transfer [that] is highly regressive, robbing from the poor to help a few greenies burnish their green credentials." In another piece, the same author says that support for EVs is "taking money from the poor and middle class to subsidize well-off environmentalists who want to drive a green vanity car".
Of course, this argument sounds rather disingenuous coming from an organization calling itself the American Enterprise Institute, the more so since the car used to illustrate the argument is made by an American company (Fisker Automotive, based in Irvine, California, with batteries from A123 Systems). Nonetheless, a government that doesn't raise specific revenues to finance such incentives risks accusations that the incentives will be funded from general government funds, i.e. money that would otherwise be used for social welfare, health, education, etc.
And that still sounds unfair toward the poor, as well as toward those who take efforts to reduce transport emissions in other ways, such as by walking or cycling to work, using public transport, avoiding travel to remote holiday destinations, homeschooling or working from home, etc.
The best policy is to combine rebates with fees on fossil fuel or on polluting vehicles. Feebates can use the revenues of such fees exclusively to fund local rebates on clean alternatives, thus helping those alternatives in two ways and making feebates most effective in helping EVs and reducing emissions accordingly.
There's no doubt that a rapid shift to EVs can benefit America in many ways, as I discussed before. The beauty of feebates is that they can be implemented without posing stress on the budget. Feebates can be budget-neutral, which should make them more acceptable to those concerned about deficits, i.e. budget deficits and trade deficits.
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Comments: 58 ( 3 removed by Sam Carana )
But the crucial incentives will be the rebates and they are best implemented in the form of feebates. A well-known type of feebate levies fees on polluting cars to fund rebates on the cleanest cars. Another feebate could levy fees on gasoline and diesel, to fund rebates on electric vehicles as well as on clean electricity.
The problem with levying fees on gasoline and diesel is that it would increase inflationary pressures and slow the economy. That is, it would increase prices and reduce spending on other things. "Stagflation" I think the word was back in the late 1970s. We already dump huge amounts of money into subsidies for the energy companies. Perhaps if we just stopped those subsidies and diverted the funds into such things as electric vehicles and renewable energy sources both problems would be solved. That is, the increased spending in these other areas would compensate for the increase in gas prices and thus keep economic activity up. It would also let the market forces more accurately reflect our situation.
Yes, perverse subsidies for fossil fuel should also be ended. In his State of the Union Address 2011, Obama plans to achieve cleaner production of electricity through standards and extra funding, paid for by ending subsidies for fossil fuels. However, Obama did not specify how to obtain funding for EV rebates. Rather than merely ending subsidies for fossil fuel, I would also like to see fees imposed, in order to fund both EV rebates and cleaner production of electricity.
You noticed that, too? I'll bet the oil gives out before the coal and tar sands.
However, a White House press briefing on the budget says that the planned $148 billion funding on R&D "supports our goal of putting a million electric vehicles on the road by 2015, doubling our share of electricity from clean energy by 2035, and reducing energy use in buildings by 20 percent by 2020. In part we pay for this by eliminating 12 tax breaks that now go to oil, gas and coal companies, which will raise $46 billion over 10 years."
Mind you, I welcome initiatives that make the fossil fuel industry pay for transport electrification and clean energy, but this $46 billion doesn't even pay for a third of the planned R&D funding. And there are further new expenses, such as a planned $53 billion over the next six years to continue construction of a national high-speed and intercity passenger rail network.
This means other programs have to be cut, such as a planned cut of nearly $70 million in DOE's hydrogen technology program. As the briefing says, referring to the $2.5 billion cut in the Low Income Home Energy Assistance Program (from $5 billion), "we’ve had tough tradeoffs."
The point is that, as long as polluters are NOT made to pay for the clean up, then much of the clean up will have to be financed from cuts in health, education and social welfare, and from taxing the poor, who typically pollute less, as they don't fly to far-away holiday destinations and often lack the money to buy cars, air-conditioners, central heating, etc.
I believe it's better to make polluters pay, through fees imposed on fossil fuel, polluting vehicles, flights, etc. Revenues of such fees are best spent locally, on clean energy, transport electrification and other programs that can help combat global warming, improve our health and create numerous local clean job and investment opportunities at the same time. Each area can best decide which programs should receive funding, as long as the necessary targets are met.
One disadvantage of such mandates is that carmakers will only make a minimal effort to comply (e.g. GM's EV1), while putting their money into polluting cars (e.g. GM's Hummer). Feebates get around this problem by making a market correction, but otherwise leaving market mechanisms intact. Furthermore, feebate attack the problem at both ends, i.e. they both discourage polluting cars and encourage clean cars.
We could also think of some of Obama's other election promises:
- Within one year of becoming President, the entire White House fleet will be converted to plug?ins as security permits -- the White House is now apparently making efforts to install chargers for plug-in hybrid and electric vehicles;
- half of all cars purchased by the federal government will be plug?in
hybrids or all?electric by 2012 -- progress is made with this.
In his 2011 State of the Union address, Obama pledges further funding for R&D (e.g. in EV batteries), EV infrastructure (e.g. chargers) and High Speed Rail.
Further incentives were also discussed in an earlier post. Does anyone else have any further good ideas?
fees on transport fuels. Vehicle registration fees in Canberra already depend on how polluting the vehicle is.
* Provide a corporation business tax credit or a gross income tax deduction for the purchase and installation of electric vehicle charging stations (A-3650).
* Provide a corporation business tax credit or a gross income tax deduction for the purchase of an electric vehicle or plug-in hybrid electric vehicle and a corporation business tax credit for the purchase of an electric truck or electric bus (A-3651).
* Require owners of shopping center developments to provide, during operating hours of the shopping center, electric vehicle charging stations for plug-in electric vehicles (A-3647).
* Direct the New Jersey Turnpike Authority and the South Jersey Turnpike Authority to equip service areas with electric vehicle charging stations that would charge plug-in electric vehicles (A-3648).
* Prohibit the Commissioner of Environmental Protection from issuing any permit or other approval under state or federal law for a shopping center development unless at least five percent of its parking spaces are to be equipped with electric vehicle charging stations (A-3649).
* Urge the U.S. Congress and the President to provide financial support and other incentives to the states to promote and incentivize the purchase of electric and hybrid electric automobiles (AR-133).
This ethanol support means squandering close to $6 billion a year in taxpayers money, while denying people access to cheaper and better alternatives. Not only does this divert billions of dollars from better alternatives, in many respects it makes the transition more difficult to electric cars that are genuinely clean.
Back in 2007, I wrote about a study led by Nobel prize-winning chemist Paul Crutzen that found that commonly-grown biofuel crops raised rather than lowered greenhouse gas emissions. The findings followed a 2007 OECD report that concluded that growing biofuel crops threatens to cause food shortages and damage biodiversity, with only limited benefits in terms of global warming. Furthermore, as this Searchinger 2007 study pointed out, biofuel causes other land to be converted into cropland, resulting in net increases of greenhouse gases.
Such concerns were confirmed in more recent studies: This European study concludes that, once land use impacts are included, the extra biofuels that will come to the EU market will be on average 81% to 167% worse for the climate than fossil fuels. This study finds that rivers and streams are the source of three times as much human-caused nitrous oxide emissions as previously estimated by the IPCC.
Instead of using cropland to grow biofuel, it's better to look at pyrolysis of organic waste and growing algae in floating bags and in greenhouses.
Yet, despite the fact that this information has been freely available for years, the European Commission, after a two-year investigation, is still ducking the issue and has just given itself an extension until July 2011 to come up with possible legislation on how to reduce transport emissions.
Study after study has pointed out that there's only very limited scope for biofuel (e.g. in aviation) -- instead, we should shift to electric vehicles, possibly complemented by hydrogen.
Meanwhile, East Asian countries, who have to import much of their energy, know that the clean economy will provide many domestic job and investment opportunities, for generations to come, so rather than sending money abroad or pouring it into moribund industries, they are investing heavily into the clean industries of the future, using the revenues from their already substantial exports, as well as the revenues of taxes on cars and gasoline, which are much higher than in the U.S.
We can and should adopt an effective policy to facilitate this shift, preferably by implementing local feebates, such as fees on fossil fuel that each time fund local rebates on genuinely clean energy and on electrification of transport.
Because more people can fully benefit from rebates, the overall success of the policy increases, so the policy is not only fairer, it also helps EVs more.
I do agree with Sam that feebates are even better, i.e. rebates financed from fees on transport fuels or on polluting vehicles. Such fees are fairer, as they make the polluters pay, rather than the people who already use cleaner ways of transport. Feebates are also more effective, as they work in two ways, i.e. by both discouraging polluting vehciles and by helping EVs. Such fees could fund rebates that are even higher than the proposed rebates, thus further contributing to an even swifter shift to EVs. Furthermore, the fact that feebates can be budget-neutral should make them more easily acceptable.
Blessings to you,
Rene
I chose the image because it depicts President Obama not just by means of a photo, but also as someone who represents and who stands for the many millions of people who want to see change, which is particularly applicable to cars.
Cheers, Sam Carana
The White House adds the following notes on this: Look at it this way: in dense, highly populated regions like the Northeast Corridor, building just one mile of one lane of highway costs $40 to $50 million. And it doesn’t get any easier when you look at airports; adding a single extra runway at Atlanta’s Hartsfield-Jackson Airport recently cost $1.3 billion. Worse yet, many of the airports in our most congested areas are surrounded by development and can’t be expanded, which makes it almost impossible to add more flights in and out of cities like New York.
And beyond the dollar costs of highways and airports, you have to consider their environmental cost in terms of increased carbon emissions: an Amtrak train between Philadelphia and New York can carry up to 500 passengers, and if those folks drove instead, they would use more than 1,900 gallons of gas. Not only is that roughly double the energy used by that train, but most of it comes from foreign oil.
But most important of all are the human costs of our aging transportation system. As the Vice President said today, “Think about the difference rail travel makes in people’s lives. I know, because when I was in the senate, it made an incredible difference in mine. Every minute you’re not stuck in traffic, or working your way through airport security, is a minute more that you can spend with your families.â€
Billions of hours were wasted last year in congestion on American highways. And in our airports, the percentage of flights landing at least two hours late has more than doubled since 1990. Even on the Acela Express – the fastest train in the Northeast Corridor, which the Vice President rode today – it takes 2 hours and 45 minutes to get to New York City. That’s only about 45 minutes faster than in the 1940s.
We want to change that. Through our investments in high-speed rail, we’re hoping to cut the time for that trip to just 96 minutes. Over the next 25 years, our goal is to build high-speed and intercity passenger rail capacity equivalent to 1,900 miles of new highway, but with trains zipping along at up to 220 miles per hour in our most densely populated corridors. And we’re proposing to expand faster rail service to emerging and regional corridors as well, so that we can ultimately give 80 percent of Americans access to these core high-speed rail lines.
Much of what I said in that post similarly applies to other countries. In the case of North America, I would recommend the U.S. and Canada to combine efforts in a joint approach to build a transcontinental network.
At the same time, I also advocate local feebates. As Sam said, it's best to make polluters pay for this, through fees on fossil fuel, polluting vehicles, flights, etc, and with revenues spent locally, on clean energy, transport electrification and other programs that can help combat global warming, improve our health and create numerous local clean job and investment opportunities at the same time. Each area can best decide which programs should receive funding, as long as the necessary targets are met.
As said, I see no problems for America to get one million EVs on the road by 2015. The question is whether America will be the first country to achieve this milestone.
According to a report in the Guardian, China aims to put more than a million electric vehicles onto the road each year by 2015. China's Ministry of Industry and Information Technology has pledged to invest more than 100 billion yuan over the next 10 years to support new energy vehicle production.
Furthermore, the report adds, the Indian government has extended support for EVs through subsidies worth 20% of each EV sold to Indian customers.
Europe, Japan and South Korea are also supporting their industries with a rapid transition to EVs, so I'd like America to aim even higher than 1 million EVs by 2015.
We're not even talking about CO2 yet, just about short-lived pollutants such as soot and precursors to ozone, which have a dramatic impact on global warming as well. Measures to reduce such pollutants, as proposed in a recent UNEP report, could reduce warming in the Arctic in the next 30 years by two-thirds, as well as avoid 2.4 million premature deaths and result in 1% to 4% higher crop yield.
Such figures support a rapid shift to clean energy, with the promise of a huge global clean energy economy. Sadly, it appears that America does not fully embrace clean energy yet. The longer America waits, the harder it will be to produce a share of the global market for components of high speed rail, electric vehicles, rechargers, smart meters, wind and solar power facilities, high voltage transmission, LED-lights, etc.
As I pointed out in a recent post, America does have plenty of scope to get into clean energy, and this is best done through feebates that impose fees on polluting products while using the revenues to help local transport electrification and clean energy programs.
London Mayor Boris Johnson had pledged to make London the EV capital of Europe, ordering 1,600 chargepoints to be installed by mid-2011 with a target of 25,000 set for 2015. Sadly, this has been revised down to 1,300 publicly accessible charging points by 2013.
France plans to have 700,000 EVs and 1.3 million plug-in hybrids in 2020, 4 million private charge points, 340,000 public recharging points for normal recharging and 60,000 fast charge points. France plans to invest 2.5 billion euros over 10 years in research, subsidies and infrastructure development for EVs.
By 2015, France plans to install 75,000 public recharging points in 14 cities by 2015, including 15,000 fast recharging bays. In parallel, 13 French towns are installing rechargers this year and next year in public areas, such as shopping centres, hypermarkets, supermarkets and car parks. For more, see this post.
And while Republicans want subsidies for oil companies to continue, oil prices keep rising. As the image shows, crude oil prices on the New York Mercantile Exchange rose to $105.44 a barrel on March 7, 2001. On the International Commodities Exchange in London, Brent crude oil for April delivery was even higher, at more than $115 a barrel.
It makes much more sense to stop subsidizing pollution, and to instead impose fees on polluting products, while using the revenues locally to help clean energy and transport electrification programs.
As said, it makes much more sense to stop subsidizing pollution, and to instead impose fees on polluting products, while using the revenues locally to help clean energy and transport electrification programs.
I'm not really sure what you mean here, but anyway have a look at Myth 4 on travel distance and this post on EV charging infrastructure.
Steve S.: ". . batteries add too much to the cost of new vehicles, and America doesn't presently have anything near the power-generation or distribution infrastructure necessary for a serious shift to electric transportation."
While the upfront cost of batteries is still high, EVs are already competitive when including all costs and benefits. Further incentives for EVs and infrastructure can and should accelerate the shift, preferably in combination with fees on fossil fuel and on vehicles that use fossil fuel.
Also see Myth 7 which shows that, back in 2007, DOE had already calculated that the U.S. grid could supply 73% of the energy needs of today's cars, SUVs, pickup trucks and vans, without adding generation or transmission, if vehicles are charged at off peak hours.
The Tesla can be charged – from empty to full – in under 4 hours from a wall connector, or part-charged at 56 miles per hour. Such charging typically takes place at night, or at times that one doesn't need to drive the car. A full recharge – from empty to full – can also be done from nearly any outlet in less than 6 hours, in the absence of a wall connector. By contrast, the refueling, servicing and maintenance of gasoline cars is arguably less convenient, and more costly and time-consuming for the owner.
Recharging the Nissan LEAF takes ~7 hours at 220/240V (depending on amperage) when starting from a depleted battery. Just topping up the battery takes significantly less time. Charging from a 110/120V outlet (from empty) can also be done, but would take about 20 hours and it's highly recommended to install an outlet with higher voltage. Quick-charging takes about ~30 minutes to 80% at a 480 volt station.
The Nissan LEAF battery comes with an 8 years/100,000 miles warranty, while back in 2009 this Engadget report announced Tesla's battery replacement program and the new extended warranty for the Roadster, while also mentioning that a Roadster was privately sold for $160,000 making that it, despite a list price of ~ $109,000, was an excellent investment.
Steve S.: "an up front investment of $35,000 (not including efficient charging infrastructure) is just far too much for most people."
The Nissan LEAF has a $32,780 base price, while Federal and state tax credits and rebates, combined with local rebates such as San Joaquin Valley's $3000 rebate, could bring this price down to $14,280. Similarly, there are incentives available for chargers. A proposed Act could add a further $2,000 in incentives, thus bringing down the price for a Nissan Leaf to $12,280. Then, there are all the benefits of EVs, such as driving at a cost of $561 a year in electricity for the Nissan LEAF, compared to, say, a 2011 Cadillac CTS Wagon, which will cost $4081 in gasoline alone a year. Furthermore, feeding electricity back into the grid can earn EV-owners thousands of dollars a year. Leasing is an alternative for those who don't want to make such a (relatively low) upfront investment.
As I said, back in 2007, DOE had already calculated that there's enough idle capacity in the U.S. grid to supply 73% of the energy needs of today's cars, SUVs, pickup trucks and vans, without adding generation or transmission, if vehicles are charged at off peak hours.
Accordingly, it would indeed require more capacity to recharge the entire national fleet, if the entire national fleet was magically electrified overnight and plugged in all at once, but since it will take years for full electrification to be achieved, there's no problem. Demand for electricity is increasing and grid capacity is expanding accordingly, creating additional idle capacity to recharge ever more EVs.
EVs can also feed their own surplus energy back into the grid at times of high demand, thus helping the grid at times of peak demand and helping avoid outages, rather than constituting a burden.
The in-wheel motors and the aerodynamic design of the light-weight monocoque body contribute to its impressive performance stats. The prototype has a standing start acceleration of 0 to 62 miles per hour (0-100km/h) in 4.8 seconds and can drive 207 miles (333km) on a single charge in JC-08 mode (i.e. general Japanese urban traffic conditions) with a 24.5kWh battery (i.e. about the same capacity as the Nissan Leaf, which has a 100 miles or 160 km range). Top speed is 93mph (150km/h).
The new release adds that such high efficiency allowed all vehicles currently in operation to be replaced by electrical vehicles to be charged at night without the need for additional power generation plant and while using surplus electricity. Moreover, the vehicles' surplus power could in turn be used for domestic household power needs, to help tackle peak demand for electricity during the day.
The SIM-LEI's commercial launch is tentatively scheduled for 2013.
Back in May 2011, the Close Big Oil Tax Loopholes Act was proposed to end $21 billion in projected taxpayer subsidies for the five largest integrated oil companies.
Also, Senators Merkley, Carper, Udall, and Bennet recently introduced the Oil Independence for a Stronger America Act of 2011, similar to last year's bill.
To promote electric vehicle use, Senator Merkley, along with Senators Dorgan and Alexander, also introduced the Electric Vehicle Deployment Act, while US Reps. Judy Biggert, Markey, McNerney, and Eshoo introduced the Electric Drive Vehicle Deployment Act, similar to last year's bill.
I am more thrilled with this vehicle than with any other I've ever owned.