By on March 17, 2011

President Obama’s goal of having a million plug-in vehicles sold in the US by 2015, like almost every other political goal these days, has become a divisive issue. For ever American who sees it as a courageous step away from oil addiction or ecological disaster, another sees it as market manipulation or a fool’s errand. But like most political debates, the row over government encouragement for plug-in vehicles serves more as a venue for other political cold wars (typically global warming and fiscal policy) than as a way to move towards a sane, equitable strategy. And, argue to the authors of a report that points out the poor chances of success for Obama’s goal, the political discussion over EV subsidies will stay stuck there until we figure out a lot more about who buys EVs and why. The problem: there is no national demonstration program to collect the data on which a real conversation about EV subsidies could be based.

Now, for anyone versed in the language of Washington DC, “demonstration program” sounds a lot like a synonym for “symbol.” But, as John D. Graham and Natalie Messer argue in Yale Environment 360,

At first glance, the market outlook for electric vehicles seems bright; when compared on an energy-equivalent basis, electricity prices are 60 to 80 percent lower than gasoline prices. Yet the future of electric vehicles is far from assured. Will the high price of batteries come down sufficiently as economies of scale kick in? Will oil prices fall again as new reserves and drilling technologies are discovered, as has happened with natural gas? Will other technologies — such as hybrid cars or vehicles powered by natural gas, ethanol, or hydrogen — win the competition against electric cars?

Such questions may not be answered in the near future, but a well-planned national demonstration program for electric vehicles can help determine the promise, limitations, and costs of this technology. And once the demonstration is over and the facts gathered and disseminated, electric cars should be forced to compete in a technology-neutral marketplace where other promising alternatives are also considered.

The old chestnut about “shooting first and asking questions later” seems germane here. Why spend billions on subsidies if there’s no proof that the industry can even be weaned off government support? The case of ethanol seems instructive here, as ramping-up government blending mandates are requiring around $6b per year in additional blending subsidies simply because the market won’t support the mandated volumes. The dangers of creating a large but inevitably subsidy-dependent “alternative” energy sector are fairly clear. But, according to Graham and Messer, there’s more to demonstration programs than just the data to make intelligent stimulus possible.

As a nation, we do not need to use more taxpayer dollars to persuade technological enthusiasts and green consumers that they should buy an electric car. Tens of thousands of them will purchase a Leaf or Volt, despite the high price and a shortage of public recharging stations. But for sales of electric cars to achieve critical mass in any single community, the sales must expand to fleet buyers and mainstream retail purchasers. In the absence of government incentives, these buyers are unlikely to be convinced that the benefits of electric cars justify changing their driving behavior and paying a high sticker price. So instead of expending more public money in all communities, the existing public commitments need to be concentrated in a few.

A national demonstration program, coupled with community information programs, can reduce the risk to manufacturers and suppliers of making high-volume production commitments. The demonstration will also let the public see how this technology operates in the real world — its benefits, costs, and complications. Once the demonstration is over, all public subsidy of electric vehicles — except for basic R&D into new battery chemistries — should be terminated.

And as eminently sensible as this already sounds, there’s another reason why this localized approach makes sense: EVs make relatively more or less sense, from both a cost and environmental perspective, depending on where you happen to live. As I wrote a month ago,

natural gas cars are a viable option in many areas, and they highlight the real issue with federal EV credits: they don’t recognize the importance of locality. Here on the banks of the dam-draped  Columbia, the electric car makes a far more compelling “green” case for itself than the natural gas car; in Oklahoma, Wyoming or Texas, the calculation might be quite different.

If a national demonstration for EVs is based in communities with the most potential for success, it’s only appropriate to test natural gas vehicles too, in the areas where they make the most sense. Ultimately, the move away from oil will create more localized markets for transportation, each with their own unique needs and opportunities. The better governments understands which technologies make the most sense in which areas, the more likely we are to not only get sane clean-car stimulus policies, but also develop the diversity of alternatives required to replace as ubiquitous an energy source as gasoline. Whether we get a million plug-in cars on the road in the process doesn’t even matter.

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18 Comments on “EV Stimulus: Knowledge Is Power And We Don’t Know Squat...”

  • avatar


  • avatar

    Having lived in England and France, I assure you the ultimate answer is public transportation. Have you seen the new London busses?
    I drive about 1500 miles a year, and yet a plug in vehicle would not work. I could not get to my favorite beach, (Siesta) or my dentist in Venice.
    If we had natural gas here, I would try it, but we do not.

    • 0 avatar

      You obviously don’t know this country. We aren’t suited for widespread mass transit in any but a few urban areas. Those cities that have mass transit all operate them at a loss and subsidize them heavily with money from taxpayers who don’t use the systems.

    • 0 avatar

      Public transport simply doesn’t work.

      For me to get to work it takes twice as long and costs twice as much as my parking + gasoline.

      It also doesn’t run 24/7 (which I need since I’m part of an on call rotation).

      I live 35 miles outside of Chicago. The rest of the country has it worse.

      Public transport simply won’t work for a lot of people here due to many factors including schedule, cost and time.

    • 0 avatar

      I respectfully disagree with those who think the US isn’t suited for mass transit or public transportation.  It simply isn’t built out or scaled properly – and there’s nobody to lobby for it.  Cars have automakers, road contractors, AAA, and oil companies all invested in keeping us in cars and on oil.  And that old adage that mass transit often operates at a loss doesn’t hold water – when’s the last time a road made money?  And for those who indicate mass transit costs more than commuting by train will have to change their calculation when gas hits $5/gal again.  The reason we are a car culture is because we have been a cheap gas culture.  That has every likelihood of changing.

  • avatar

    As a nation, we do not need to use more taxpayer dollars to persuade technological enthusiasts and green consumers that they should buy an electric car.

    I think we need these subsidies so that we’ll be better able to deal with the current and next bout of Middle East (and North African) political instability.

  • avatar

    Look at the situation in Japan. If you own a Leaf and you’re in the grid impacted by rolling blackouts of 3 to 6 hours a day, and that is happening during your charing window – you’re completely screwed. The rolling blackout situation in Japan could last for months as the capacity lost is greater than the Grand Coulee Dam in the United States going offline forever.

    Pure play plug-in EV’s, despite coming so far in the last 10 to 20 years are still not the answer.

    I agree with willima442 – I would go CNG if offered up. Too much damn money to convert my cars – I’d rather see a $7.5K incentive to convert my vehicle than a $7.5K government handout for a Leaf or a Volt.

    • 0 avatar

      But is gasoline any more plentiful at the moment?  Seems like they’re screwed either way.

    • 0 avatar

      I see NHK reporting huge gas lines all over Japan due to the stoppage of 3 of 5 main refineries.  A reporter estimated one gas line contained as many as 1000 cars.   Better to have 18 hours of power vs. waiting hours in line for gas.

    • 0 avatar

      Points well taken, but if I drive an A segment car in Japan that gets say 60 odd MPG in US equivalent numbers having a full tank of gas on a 10 gallon tank = 8-1/2 full charges on a Leaf.  That is a LOT of range on a more reliable source. I can look around for a gas station with a shorter line (and the Japanese are incredibly patient) I can’t do a damn thing when my power is switched off.

      Secondly, refinery capacity is far more easily repaired than nuclear power plants can be replaced.  The gasoline shortage issue will be addressed WAY WAY before the rolling power outage issue is solved.

      In this scenario where you’re screwed gas or electric, a Volt suddenly looks very good (gas line too long, plug it in, no electricity, fill it up)

      I’m still partial to CNG personally, just wish the conversion didn’t cost north of $10K.

  • avatar

    There are so many other things the government could do to nudge us towards electric cars that don’t involve spending tax $$ – gas taxes, CAFE rules. Why we are spending billions to force a less effective mode of transportation is beyond me.
    Then there’s this: we get 45% of our electricity from coal. Which is cleaner – a modern gasoline engine or a coal fired power plant?

    • 0 avatar

      “There are so many other things the government could do to nudge us towards electric cars that don’t involve spending tax $$ – gas taxes, CAFE rules. Why we are spending billions to force a less effective mode of transportation is beyond me.”

      In the US, it is much safer politically to give (subsidies) than it is to take (taxes). Political power is gained and maintained thru spending, and it is lost thru asking voters to pay for spending.

  • avatar

    There is far more government subsidies for oil based industries than for renewables like electric cars.  it’s not even in the same galaxy as far as spending goes.

  • avatar

    Does she have a third 110VAC grounded female connector on her a…

    Never mind. I won’t go there.

  • avatar

    That’s a very well written, nicely balanced article. I would have to agree with many of your points, especially your observations about EV’s having variable viability depending on region (as highlighted in the effects of climate on battery life and so on).
    Still, don’t forget that individual preferences and buying choices are not static things, but can be shaped, altered and so on through shifts in accepted cultural norms (which happens all the time), marketing, and other social and environmental forces. As a result, it may be short-sighted to project future preferences and buying choices relating to EV’s based solely on currently accepted norms, practices, and purchasing decisions.

  • avatar
    DC Bruce

    I agree with your overall point, but I don’t think lumping the Leaf and the Volt together makes much sense.  Personally, I find the Leaf a whole lot more questionable — from every perspective.  From an environmental perspective, depending upon where it’s operated, the Leaf could be much dirtier than a gasoline-powered car.  Here in metro DC, electricity is generated by burning coal, for example.  The Leaf’s ability to operate in other than ideal weather environments (i.e. coastal California) is untested.  Battery efficiency is affected by weather — either hot or cold; and non-mild weather will require the battery to power climate control for the cabin as well as propulsion.  Being a limited-range vehicle, the Leaf will always have to be a second car.  I could not even use a Leaf to visit my father for a weekend dinner in Annapolis, 40 miles away.  And, of course, the cost of the Leaf has to include the cost of building a 220V charging station, so the thing can be fully charged overnight . . . as well as requiring the owner to have off-street parking and own his own dwelling.  Apartment owners, renters, condominium residents need not apply.
    The Volt actually makes a lot of sense for the way I use a car, which is mostly a short commute to work, and driving around town.  It looks like my typical use would require very little use of the gasoline engine.  And I could drive the Volt to have dinner with my father in Annapolis, although it probably would use as much gasoline doing that job as any number of conventional gasoline cars, and more than, say a Prius or perhaps a VW TDI.
    But, at $40,000, the Volt is $15,000 too expensive, because for $25,000 or less, I could get a Prius, which doesn’t cost that much more to operate for a guy who drives 6,000 miles a year.
    Which is probably why Volt unit sales are well under 1,000/month.

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