Electric Vehicles - How Close are They to Making Major Contributions?

AgMRC Renewable Energy Newsletter
October 2009


Dr. Robert WisnerRobert Wisner
Professor Emeritus of Economics and Energy Economist
Ag Marketing Resources Center
Iowa State University

Future greenhouse gas (GHG) emissions regulations proposed by the California Air Resources Board (CARB) rate electric vehicles as the most effective technologies in controlling GHG emissions.(1) Actual GHG reductions will vary, depending on the vehicle and energy source used to generate electricity. At least 13 other states are considering adoption of the proposed California GHG standards. As we have noted in a previous article, these standards would place ethanol at a substantial disadvantage in the California motor fuel market.(2) If these standards are adopted, electric-powered vehicles could conceivably become a significant competitor with ethanol and biodiesel, depending on the effectiveness of the technology in meeting consumers’ needs and how quickly it moves into the market place. At this writing, it appears that electric vehicles may be emerging a bit more quickly than cellulose ethanol. Cellulose ethanol has been one of the major anticipated keys to reducing GHGs and petroleum consumption. However, the electric vehicle technology is still at a very early stage and time will tell whether quality, durability, initial and maintenance costs, reliability and other features will be attractive enough to generate a large-scale national market for such vehicles. Availability of infrastructure for charging batteries of such vehicles also will influence the speed of their acceptance.

Emerging and Currently Available Electric Vehicles

At this writing, at least 27 U.S. manufacturers are either developing or already making electric-powered vehicles. A number of those firms are headquartered in California. Factors contributing to the California locations likely include that state’s concern about air quality and its reputation for having a critical mass of technology research firms that could contribute to development of the technology, especially high-efficiency batteries needed for such vehicles. Well-known manufacturers with current or soon to be released electric or gas-electric automobiles include Ford, General Motors, Toyota, Chrysler, Nissan, Honda and Renault. Most of the currently available electric vehicles from these manufacturers are hybrid gasoline-electric vehicles, in which a battery powers the vehicle for limited distances and slow speeds, with a gasoline engine providing additional power for an extended range and higher speeds. Additional changes and improvements in hybrid vehicles of these firms are likely in the next few years. If sales volumes increase, lower prices might be possible on some models. New versions of electric vehicles expected to be released soon that will run for substantial distances on electric battery power alone include the Chevrolet Volt and a Chrysler mini-van. 

There are other companies and vehicles we have missed in this article. In part because of space limitations, we have been able to focus on only a limited number of prospective all-electric or plug-in vehicles to give the reader a perspective on the emerging technology. A number of firms also make electric vehicles smaller than typical U.S. automobiles although space limitations prevent us from discussing them. Iowa State University has several such vehicles it uses for maintenance, delivery and related functions.

Heavy-Duty Electric Vehicles

Azure Dynamics Corporation of Oak Park, Michigan, has developed a version of a two-ton hybrid gasoline-electric van that is being tested by the U.S. Postal Service.(3) Balqon Corporation of Harbor City, California, makes heavy-duty all-electric trucks capable of hauling 30 to 90 tons of payload. These trucks have mileage ranges from 40 to 150 miles per charge, depending on the model and whether the truck is loaded or empty. Balqon indicates trucks with the shorter mileage range can be recharged in 30 to 45 minutes. These trucks have speeds of up to 45 kilometers per hour (about 28 miles per hour).(4) Thus, they are designed for use in harbors, warehouses and urban applications where speeds will be relatively low. In these applications, the zero emissions factor also is a strong positive feature. Because of their slow speeds and limited mileage range before requiring a recharge of batteries, these trucks would not be suitable for long-distance hauling. The company indicates maintenance costs for its trucks are more than 60% less than those of conventional trucks. Initial prices are not available to us for either of these trucks.(5)

Anticipated Features of Selected Soon-to-be-available Plug-in Electric Cars

The Chevrolet Volt is expected to begin production in late 2010. It is a small 4- to 5-passenger car with capability of having its lithium-ion battery charged by plugging it into a 110-120 volt AC electrical outlet. Company specifications indicate it will have a range of 40 miles without use of its gasoline engine. When the battery charge is low, the alternative source of power is a small 3-cylinder super-charged gasoline engine that runs a generator to charge the battery. Estimates of fuel mileage when used for longer distances are as shown below.(6) 


Distance Traveled Estimated Miles Per Gallon
Forty miles or less No fuel used
Sixty miles 150
Eighty miles 100

Actual mileage of course would vary with the terrain, traffic conditions and other factors. The car is to be powered by a lithium-ion battery with 320 to 350 volts. Acceleration is estimated at 0 to 60 mph in 8.0 to 8.5 seconds. Weight of the vehicle was not available at press time, but light-weight composite panels likely will be used for the exterior and roof. 

Economic Considerations for Consumers

The Volt’s price is yet to be determined but is currently expected to be in the $35,000 to $40,000 range.(7) That may restrict the demand. For example, driving the car for seven years at 12,000 miles per year when compared with a conventional car getting 32 miles per gallon might save a maximum of 2,625 gallons of gasoline if the car is never driven beyond 40 miles per day or is used for a longer commute but is recharged during the day before returning home. Cost of the conventional version might be in the $12,000 to $14,000 range. Using the lower end of the two price ranges, the Volt’s extra cost would be about $23,000. At that rate, a rough calculation would suggest gasoline would need to be priced at about $8.75 per gallon to justify the additional investment. 

These calculations assume maintenance costs would be about the same for the two types of vehicles. For electric vehicles, as well as hybrid gasoline-electric vehicles, a potentially important maintenance and resale value issue is the life expectancy of the battery. Information we have seen suggests the anticipated battery life may be about 10 years, although there has not been enough experience with them to know the exact life expectancy. With an expected 10-year battery life and a large potential expense to replace it, one would expect the resale value of electric vehicles to drop sharply, starting at about six to seven years of age. This could also be a factor influencing consumer acceptance.

Toyota Reported Plans for Plug-in Vehicle

Reports at this writing indicate Toyota will produce a small number of 3rd-generation Prius Hybrid cars in 2010, with 150 to be put into service in the United States for test purposes. The new version will have a lithium-ion battery, to replace its current nickel-metal hydride version. The new version is expected to significantly increase its fuel mileage per gallon. Toyota reportedly will produce only a limited number of these cars at first to make sure there are no defects in their new battery technology.(8) These same reports indicate Toyota plans to provide a plug-in version in 2011.(9) At this writing, we have not found an anticipated price range for the plug-in version of the Prius.

Mercedes Plug-in Concept Car

Mercedes has developed a concept version of a compact electric plug-in car that uses a liquid-cooled lithium-ion battery. The concept car version is called Blue Zero E Cell Plus, with the zero signifying zero emissions. Its new battery powers a 136-horsepower electric motor and provides a maximum driving range of 362 miles on a tank of fuel. The vehicle reportedly can be driven up to 62 miles on battery power alone. The gasoline power unit is a three-cylinder super-charged engine.(10)  Industry sources believe a version of this vehicle could be brought on the market within the next year.

Chrysler’s Planned Electric Mini-van and Other Vehicles

Chrysler Group LLC is planning to offer a plug-in electric-powered version of its Town and Country mini-van in 2011 that has a 40-mile all-electric driving range, with a small gasoline engine to charge the battery after that range is exceeded. The braking system also is to be used for charging the battery. Over-night charging is done by plugging into a 110-120 AC or 220-240 appliance outlet. Charging time is cut in half with 220-240 current. The total driving range per fill-up of the fuel tank is expected to be about 400 miles. 

Chrysler reports that the acceleration will be 0 to 60 miles per hour in 8 seconds, with a top speed of over 100 miles per hour. The company is planning to offer several additional electric vehicle models by 2013, some of which it expects will have an all-electric driving range of 150 to 200 miles. Its Chrysler and Dodge mini-vans will be 7-passenger vehicles, the same size as the current gasoline versions. At this writing, no estimates of likely prices are available.

Tesla Motors, A Currently Available Plug-in Electric (11)

Tesla Motors in San Carlos, California, is a young company that currently manufactures a high-end plug-in electric sports car and a more conservative sedan-roadster. At this writing, it appears that the company has produced between 700 and 1,000 vehicles, which have been marketed in the U.S. and Europe. Many of the components reportedly are manufactured outside the U.S. and assembled in the EU, although the company is headquartered in the U.S. The sports car version’s acceleration as reported by the company is from zero to 60 miles per hour in 3.9 seconds on its sports roadster model and in 5.8 seconds on another model. Tesla reports that its cars use an innovative 375-volt lithium-ion battery pack that stores enough electricity to power the vehicle for more than 200 miles on a single charge, based on the EPA’s City-Highway driving cycle. Its braking system is used to provide partial battery charging. The Tesla battery pack has numerous and extensive safety features. It consists of 2,800 individual cells, each only slightly larger than a AA battery, with the individual cells packaged into 11 battery modules. Presumably these separate battery modules would make it possible to replace individual units rather than the entire battery if a few but not all cells reached the end of their usable lives. The total battery unit weighs about 990 pounds. While that is substantial weight, it is much less than would be needed for the same power storage capability from other battery technologies.

One Tesla model that is available for delivery in 2012 is currently listed on their web site with a base price of $49,900, after a $7,500 tax credit. Other models all begin at a price over $100,000. The average car-buyer would probably find this vehicle to be very interesting but well beyond his/her price range. For the immediate future, Tesla cars are expected to serve a niche market. However, the company’s technology is very impressive. Perhaps with future modifications and a lower-end version using similar technology, a larger-volume could be manufactured at a lower price that would significantly expand its market potential.

Potential Impacts of Electric Vehicles on Biofuel Demand

Since electric vehicle technology is in its infancy, it is far too early to assess the probable future impact of these vehicles on biofuel demand. For the next few years, the impact is likely to be quite small. However, if the technology evolves rapidly to a stage that substantially reduces the up-front cost, extends battery life and reduces the expense of future battery replacements, these cars may develop a sizeable market in areas where air quality is a major concern. Another international oil crisis, brought on by war, terrorism or other events, also could quickly accelerate future demand for these vehicles. As demand grows, the need for battery recharging infrastructure will become more important. At some future time with widespread use of these vehicles in urban transportation, one could envision the need for widespread availability of re-charging facilities at parking ramps and other locations. Impacts this would have on demand for electricity and on the electrical grid are unknown at this time. However, these issues are potential areas for research and development. 

Concluding Comments

Electric vehicle technology is in its infancy but is evolving rapidly, with new manufacturers as well as long-standing car makers developing hybrid and plug-in cars. For the immediate future, electric vehicles appear unlikely to have a significant influence on the demand for biofuels. However, it will be important for the entire motor fuel industry to monitor future trends in design and production of these vehicles. If costs can be lowered, it is conceivable that the market for electric vehicles could begin to grow rapidly several years from now. Researchers and designers hope that a later generation of these cars will be able to be powered by fuel cells, thus further increasing their efficiency and reducing consumption of fossil fuels. 


1  Robert Wisner, Biofuels and Greenhouse Gas Emissions on a Collision Course, AgMRC Renewable Energy Newsletter, June 2009, and California Environmental Protection Agency, Air Resources Board, Proposed regulation to Implement the Low Carbon Fuel Standard, Volume I, March 5, 2009 with release date April 23, 2009. 
2 Ibid.
3 Azure Dynamics, “U.S. Postal Service Tests Azure Dynamics Vehicle”, Oak Park, Michigan, August 26, 2009.
4 Balqon Corporation Web Site
5 Balqon Corporation Web Site
6 Chevrolet Volt Concept Car
7 Consumers Guide Auto Web Site
8 KB Green Web Site
9 Consumers Guide Auto Web Site, Op. Cit.
10 KBB Green Web Site
11 Tesla Web Site  and Gene Berdichevsky, Kurt Kelty, JB Straubel and Erik Toomre “The Tesla Roadster Battery System”, Tesla Motors, August 16, 2006.