NREL/JA-540-40969 Posted with permission. WEVA-2006-053 Cost-Benefit Analysis of Plug-In Hybrid Electric Vehicle Technology* Tony Markel** and Andrew Simpson*** Plug-in hybrid electric vehicles (PHEVs) have emerged as a promising technology that uses electricity to displace petroleum consumption in the vehicle fleet. This paper presents a comparison of the costs (vehicle purchase costs and energy costs) and benefits (reduced petroleum consumption) of PHEVs relative to hybrid electric and conventional vehicles. A detailed simulation model is used to predict petroleum reductions and costs of PHEV designs compared to a baseline midsize sedan. The analysis finds that petroleum reductions exceeding 45% per vehicle can be achieved by PHEVs equipped with 20 mi (32 km) or more of energy storage. However, the long-term incremental costs of these vehicles are projected to exceed US$8,000. A simple economic analysis is used to show that high petroleum prices and low battery costs are needed to make a compelling business case for PHEVs in the absence of other incentives. However, the large petroleum reduction potential of PHEVs provides strong justification for governmental support to accelerate the deployment of PHEV technology. Keywords: Plug-In Hybrid; Hybrid Electric Vehicles; Battery, Modeling, Simulation; Energy Security. provide a fair comparison between vehicles [2]. By this 1. INTRODUCTION TO PLUG-IN HYBRID definition, a PHEV20 can drive 20 mi (32 km) ELECTRIC VEHICLES all-electrically on the test cycle before the first engine Plug-in hybrid electric vehicles have recently turn-on. However, this all-electric definition discounts emerged as a promising alternative that uses electricity PHEVs that might continue to operate in CD-mode after to displace a significant fraction of fleet petroleum the first engine turn-on. Therefore, the authors use a consumption [1]. A plug-in hybrid electric vehicle definition of PHEVx that is more appropriately related (PHEV) is a hybrid electric vehicle (HEV) with the to petroleum displacement. By this definition, a ability to recharge its electrochemical energy storage PHEV20 contains enough useable energy storage in its with electricity from an off-board source (such as the battery to displace 20 mi (32 km) of petroleum electric utility grid). The vehicle can then drive in a consumption on the standard test cycle. Note that this charge-depleting (CD) mode that reduces the system’s definition does not imply all-electric capability since state-of-charge (SOC), thereby using electricity to the vehicle operation will ultimately be determined by displace liquid fuel that would otherwise have been component power ratings and their control strategy, as consumed. This liquid fuel is typically petroleum well as the actual in-use driving cycle. (gasoline or diesel), although PHEVs can also use alternatives such as biofuels or hydrogen. PHEV 1.2 Plug-In Hybrid Electric Vehicle Potential batteries typically have larger capacity than those in The potential for PHEVs to displace fleet petroleum HEVs so as to increase the potential for petroleum consumption derives from several factors. First, PHEVs displacement. are potentially well-matched to motorists’ driving habits—in particular, the distribution of distances 1.1 Plug-In Hybrid Electric Vehicle Terminology traveled each day. Fig. 1 shows the US vehicle daily Plug-in hybrid electric vehicles are characterized by mileage distribution based on data collected in the 1995 a “PHEVx” notation, where “x” typically denotes the National Personal Transportation Survey (NPTS) [3]. vehicle’s all-electric range (AER) – defined as the Clearly, the majority of daily mileages are relatively distance in miles that a fully-charged PHEV can drive short, with 50% of days being less than 30 mi (48 km). before needing to operate its engine. The California Air Fig. 1 also shows the Utility Factor (UF) curve for the Resources Board uses the Urban Dynamometer Driving 1995 NPTS data. For a certain distance D, the UF is the Schedule (UDDS) to measure the AER of PHEVs and fraction of total vehicle-miles-traveled (VMT) that occurs within the first D miles of daily travel. For a ** National Renewable Energy Laboratory, 1617 Cole Blvd. distance of 30 mi (48 km), the UF is approximately Golden, CO 80401, e-mail:[email protected] 40%. This means that an all-electric PHEV30 can *** Tesla Motors (formerly at NREL), 1050 Bing Street, San Carlos CA 94070, e-mail:[email protected] displace petroleum consumption equivalent to 40% of *This work has been authored by an employee or employees of the Midwest Research Institute under Contract No. DE-AC36-99GO10337 with the U.S. Department of Energy. The United States Government retains and the publisher, by accepting the article for publication, acknowledges that the United States Government retains a non-exclusive, paid-up, irrevocable, worldwide license to publish or reproduce the published form of this work, or allow others to do so, for United States Government purposes WEVA Journal, Vol.1, 2006 1 VMT, (assuming the vehicle is fully recharged each 2. MODELING PHEV PETROLEUM day). Similarly, an all-electric PHEV60 can displace CONSUMPTION AND COST about 60%. This low-daily-mileage characteristic is why PHEVs have potential to displace a large fraction The reduction of per-vehicle petroleum consumption of per-vehicle petroleum consumption. in a PHEV results from two factors: 1. CD-mode petroleum displacement due to battery 100 energy capacity of the vehicle Daily Distance Distribution 2. Charge-sustaining (CS)-mode fuel-efficiency Utility Factor 80 improvement due to hybridization or battery power capability of the vehicle. 60 HEVs do not have a CD-mode and are only able to 40 realize savings via the CS-mode. For a PHEVx, these Probability (%) two factors can be combined mathematically as 20 follows:. FC FC 0 PHEVx []1−= ()xUF CS (1) 0 20 40 60 80 100 FC FC Daily Distance (mi) CV CV Fig. 1: Daily mileage distribution for US motorists based where FCPHEVx is the UF-weighted fuel consumption of on the 1995 National Personal Travel Survey the PHEVx, FCCV is the fuel consumption of the reference conventional (non-hybrid) vehicle, and FCCS However, for PHEVs to displace fleet petroleum is the PHEVx’s CS-mode fuel consumption. Note that consumption, they must penetrate the market and this expression becomes approximate for PHEVs extrapolate these savings to the fleet level. PHEVs are without all-electric capability because use of the utility very marketable in that they combine the beneficial factor in this way assumes that no petroleum is attributes of HEVs and battery electric vehicles (BEVs) consumed in the first x miles of travel. while mitigating their disadvantages. Production HEVs 100% PHEV60 achieve high fuel economy, but they are still designed 90% PHEV40 for petroleum fuels and do not enable fuel 80% PHEV20 HEV substitution/flexibility. PHEVs, however, are true 70% fuel-flexible vehicles that can run on petroleum or 60% electrical energy. BEVs do not require any petroleum, 50% but are constrained by battery technologies resulting in Prius (Corolla) 40% Escape limited driving ranges, significant battery costs, and Civic Consumption (%) 30% Highlander Challenging Region lengthy recharging times. PHEVs have a smaller battery Accord 20% for HEV Technology which mitigates battery cost and recharging time while Total Reduction in Petroleum Vue the onboard petroleum fuel tank provides driving range 10% equivalent to conventional and hybrid vehicles. This 0% 0% 20% 40% 60% 80% 100% combination of attributes is building a strong demand Reduction in CS-mode Petroleum Consumption (%) for PHEVs, as evidenced by the recently launched Plug-In Partners Campaign [4]. Fig. 2: Potential per-vehicle reduction of petroleum consumption in PHEVs PHEVs have the potential to come to market, penetrate the fleet, and achieve meaningful petroleum Fig. 2 uses Eq. 1 to compare the petroleum reduction displacement relatively quickly. Few competing of various PHEV designs. We see there are a variety of technologies offer this potential combined rate and ways to achieve a target level of petroleum reduction. timing of reduction in fleet petroleum consumption [5]. For example, a 50% reduction is achieved by an HEV However, PHEV technology is not without its with 50% reduced fuel consumption, a PHEV20 with challenges. Energy storage system cost, volume, and 30% CS-mode reduction, and by a PHEV40 with 0% life are major obstacles that must be overcome for these CS-mode reduction (this last example is unlikely, since vehicles to succeed. Given that HEVs are succeeding in PHEVs will show CS-mode improvement due to the market, the question relevant to PHEVs is, “What hybridization, notwithstanding the increase in vehicle incremental petroleum reductions can be achieved at mass from the larger battery). To demonstrate the what incremental costs?” These factors will critically feasible range of CS-mode reduction, Fig. 2 compares affect the marketability of PHEVs through their several contemporary HEVs to their conventional purchase price and cost of ownership. This paper counterparts. The “mild” HEV Saturn Vue achieves a presents the results of a study designed to evaluate this modest reduction of less than 20%. The “full” HEV cost-benefit tradeoff. Toyota Prius (relative to Corolla) achieves the highest percentage reduction (40%) of all HEVs currently on the market although, in addition to the platform 2 WEVA Journal, Vol.1, 2006 Cost-Benefit Analysis of Plug-In Hybrid Electric Vehicle Technology enhancements employed in production hybrids, it also vehicles (CVs) and HEVs (including PHEVs) so that uses an advanced (Atkinson-cycle) engine technology. side-by-side comparisons can be made. The Note that none of the production HEVs achieve the 50% performance and energy-use models were validated for reduction discussed in the above example, suggesting a Toyota Camry sedan and Honda Civic hybrid. In both that there is an upper limit on the benefit of cases, errors of less than 5% were observed in the hybridization alone.