Graham Palmer, author of the recent book “Energy in Australia: Peak oil, solar power and Asia’s economic growth” (reviewed on BNC here), has just done an excellent ABC radio presentation on Robyn William’s “Ockham’s Razor” show. This is Robyn’s intro:

Robyn Williams: Now I wasn’t in the room at the time, but it is claimed that George W Bush once complained about the Arabs: “Why is our oil under their sand?” Well, whether he said it or not, the question has become even more stark as the Middle East gets even more fractious. Would you really want to depend much longer on secure oil supplies from the region? As for coal: As more and more coal mines close in Australia and disasters recur from China to Turkey, you’d have to ask whether that technology is also about to hit the ashcan of history. Perhaps, but not yet, says Graham Palmer in Melbourne. He’s an engineer and has done research in the field of energy futures. And by the way, bear in mind that PV stands for photovoltaic.

You can download the audio and read the transcript (with supporting references) here.

But there’s more! Graham has just written a new analysis on electric vehicles for BNC. On this topic we can find opinions ranging from “EVs are great because they’ll mop up daytime solar!” through to “EVs are great because you can charge them cheaply on overnight off peak!”. Confusion reigns…

The take-up of electric vehicles in Australia – rethinking the battery charging model

Graham Palmer, July 2014

Between 2007 and 2013, the global motor car fleet grew by 3.6% annually, reaching 1.1 billion [1], but during the same period, the annual growth of crude oil including total liquids averaged only 0.9% [2]. Driven by demand in China, but also Russia, India, and Brazil, the growth is projected to continue indefinitely [3], but given a crude oil price of around USD$100 bbl, we have already entered a prolonged period of inelastic supply, and regardless, capital investment in the oil supply industry has tripled in the past 10 years [4].

It is obvious that there simply isn’t the ready supply of conventional liquids to accommodate the growth of motorcars. Further, any discussion of the sustainability of motorcars should encompass a broader discussion of urban planning [5], public transport, and a re-examination of the travel task [6]. Comprehensive assessments of the life-cycle analysis of EVs shows that they can be better than internal combustion engine (ICE) vehicles, but still a long way from “sustainable” [7,8]. But whether we like it or not, the egg has been scrambled, and motorcars will continue to be the primary mode of transport in Australia for the foreseeable future.

Assuming ongoing demand for motorcars, there would seem to be limited options to square the circle – improve the efficiency of the motor car fleet, reduce the distance travelled per vehicle, or shift to alternative energy sources and fuel carriers, hydrogen fuel-cells, Olah’s methanol economy, coal-to-liquids, etc. All of these broad options have been widely canvassed, but this discussion will focus on electric vehicles (EVs) and plug-in hybrid vehicles (PHEVs). The battery remains the weakest link to electrifying the car fleet, but the widespread tendency to couple EVs to a renewable energy framework is a curious trend that I will argue is a bad idea at several levels. An alternative synergistic low-emission model will be proposed.

The theory of Peak Oil emerged from the general Limits-to-Growth concerns in the 1970s. The conventional view of peak oil was that demand would eventually outstrip supply and drive a rapid and severe increase in the traded price of oil. The CSIRO Future Fuels Forum from 2008, postulated Australian petrol prices peaking at between $2.60 and $8.20 per litre by 2020 [9], and typifies the notion of dramatic oil price shocks and limited supply. In contrast, energy theorists such as Charles Hall and Carey King [10,11] prefer to describe peak oil as a macroeconomic phenomenon, which applies a brake to national economies. Taking a macroeconomic perspective, it becomes obvious that prices of $8 are implausible because national economies simply couldn’t sustain them. For net-importers of liquid fuels, including Australia, a ballooning trade deficit will be another concern. Hall and King place net-energy (EROI) at the centre of our understanding of resource depletion and the decline in resource grades.

In contrast, public advocates such as Tim Flannery [12], typify a worrying level of public discourse when he quipped “I think photovoltaics are going to be incredibly important, particularly as part of the smart grid in urban areas. I don’t think intermittency is going to be a problem if we develop smart grid and electric car technologies because the cars will be the storage for the energy.”

At face value in isolated communities, for example, the idea of using PV to charge EV batteries can seem like a good idea, although such a system is possible only because of a massive embodied energy subsidy in the form of fossil fuels. But when a comprehensive approach is taken in the context of modern grids, it is not at all obvious that EV charging and PV are particularly well suited.

The problem is that available solar supply will be inversely related to the preferred charging regime – i.e., there will be no PV power available for night time charging when the grid has spare capacity, but during the three or four hours centred on solar noon, few motorists will want to “fill their tank” at the peak daytime tariff, only to re-plug their vehicle in at night to sell back into the grid at off-peak tariffs. Further, the batteries will be the main limiting factor of EVs for the foreseeable future and are cycle limited – car manufacturers are concerned with optimising the battery for range, cost and longevity [13,14,15]. The resulting degradation from additional daily cycling to support PV will reduce the longevity of the batteries and prove uneconomic for motorists.

Turning to wind power, wind has two benefits over PV; the wind blows at night, and doesn’t suffer a dramatic seasonal drop off in power. But we need to be careful in the way we think about the purchase of Green Energy. The concept of reaching “net zero emissions” is really just a convenient elision – Green Energy is based on the measured annual energy balance and bears no relationship to the correlation between the real-time demand profile and actual supply. The notion that purchasers of wind power “own” the power makes absolutely no sense in a complex systems sense. The “net zero emissions” hypothesis only works in the world of statistics when system energy is allowed to be averaged over a year. But if power flows are analysed at sub-hourly time scales, the relationship completely breaks down.

A thought experiment which illustrates the “net zero emission” dilemma is to imagine that everybody purchased 100% Green Power. In theory, this would require a massive over-build of wind and solar power across the continent. But how would the residual system emissions be allocated? How would the costs associated with networks be allocated? How would the costs of intermittency and balancing/storage/energy spillage be allocated? Clearly, the remaining coal/gas and other emissions would need to be allocated somewhere; therefore it is clear that a comprehensive assessment would essentially invalidate the net-zero concept.

In the real world, Green Energy is a marketing tool, and it is more valid to say that Green Power is essentially a donation to reduce the system emissions below what they would otherwise be, but that the reduction is shared across all consumers rather than being “owned” by the Green Power purchasers.

So what is the alternative model for EVs?

It is difficult to imagine a more obvious synergy than that which exists between EVs, baseload power, and network businesses.

To begin with, the overwhelmingly most popular and convenient method of charging is overnight at home [16]. This aligns with an affordable off peak baseload model where spare capacity is available year-round, whilst underpinning the business model for baseload generation. The improved utilisation of the distribution network would drive the per-unit network tariff downwards and provide a tariff reduction for all consumers whether they owned EVs or not. This is in sharp contrast to the regressive solar PV feed-in tariff model – our socialised energy-based tariffs lead to an under-charging of the fixed network costs for PV consumers, thereby leading to a wealth transfer from non-PV households including renters, pensioners and others.

If the owners of the EV batteries (whether they be the vehicle owner, lease company or other third party) were able to capture the avoided network investment costs of providing critical peak demand support through advanced vehicle-to-grid (V2G), once again, all consumers would benefit. Such a strategy would require regulatory reform since the current arrangements do not allow for such incentives.

The year-round, predictable, and controllable load of EVs will present a “gold plated” demand profile for baseload generation, and afford certainty of demand for investors. In contrast, the current market distortions induced by the RET and other climate policies reduce certainty for all investors, and undermine the business case for conventional generators. Hence the notional linkage between EVs and wind/solar is undermining the very synergy between baseload and EVs that will accelerate their deployment.

For a back-of-the-envelope estimate of the load due to EV charging, we take the Victorian passenger vehicle fleet from 2012:

If we divide the annual electricity consumption by 365 days and average the daily load over 6 night-time hours, the averaged demand equates to 3.6 GW. This is less than the headroom between the typical overnight baseload demand and annual peak demand, suggesting that the Victorian system already possesses sufficient capacity to accommodate a significant shift to electric with no additional generation or network capacity. Hence the marginal cost of energising the entire motorcar fleet is extremely low.

This example highlights the enormous benefits of improving the load factor and maximising the system efficiency. The load factor of the Victorian network in 2010, as a ratio of average demand to peak demand, was 59%. Shifting EV charging would raise the load factor to above 70%. This can be contrasted, for example, with the Budischak et al. [18] renewables simulation in the US, which resulted in an adjusted load factor of 9% [13] due to the requirement for a massive overbuild and redundancy.

Turning to the emission intensity of motorcars, we use the Nissan Leaf EV and Nissan Pulsar 1.6 litre petrol for comparison, and assume the electricity is derived from baseload in Victoria as a worst-case emissions scenario. It is interesting that, even assuming lignite baseload, the much better drivetrain efficiency of the EV gives the Leaf a comparable emission intensity to the 1.6 litre petrol Pulsar. If the comparison were done for the other states, the EV would rate better, or in the case of Tasmania, much better.

In practice, the primary driver of the mass uptake of EVs and PHEVs will be fuel-efficiency economics. The average fuel economy of the Australian motorcar fleet is 11.1 l/100km, which is around 50% higher than the EU and Japan. On top of this, the IEA [23] notes that a 25% improvement in efficiency could be achieved if technologies already commercially available were more widely applied.

In a meta-review of technological improvements, the IEA [23] concludes that there is scope for a 28% improvement in efficiency in diesel vehicle by 2020, rising to 50% by 2035 due to vehicle, engine and transmission improvements. Features such as the widespread use of dual-clutch transmissions, improvements in auxiliaries (air conditioning, power steering etc), thermodynamic cycle improvements, and weight reduction provide scope for the largest gains. Hybridisation and downsizing offers further significant gains in efficiency. Hence EVs will be chasing a moving target, while batteries still have some way to go to meet “specific energy density” and cost targets.

My personal view is that the mass take up of EVs is still some way off, possibly by the mid-2020s. In 2013, global sales of EVs and PHEV totalled 0.26 million, or around 0.3% of car sales [24]. The average age of the Australian fleet is 10 years, so there is already significant inertia in the fleet, even with a shift in new car sales.

Nonetheless, the application of a synergistic model, possibly one in which generators and network business take a stake in leasing EV batteries to motorists, will optimise their potential, and provide broader economic benefits to Australians. As the baseload fleet retires over the next 10 to 30 years, there will be the opportunity to build a new fleet of pollution-free, near-zero generation that will power an increasingly electrified society, and be supplying baseload power into the twenty-second century.

References

[1] International Organization of Motor Vehicle Manufacturers. (2014) Motorisation rate

[2] BP. (2014) BP Statistical Review of World Energy

[3] International Organization of Motor Vehicle Manufacturers. (2014) Sales Statistics

[4] EIA, World petroleum and other liquid fuels

[5] Newman, Peter WG. “Sustainability and cities: extending the metabolism model.” Landscape and urban planning 44.4 (1999): 219-226.

[6] Moriarty, Patrick, and Damon Honnery. “Low-mobility: The future of transport.”Futures 40.10 (2008): 865-872.

[7] Crist P. Electric vehicles revisited: costs, subsidies and prospects. Discussion paper No. 2012-03; 2012.

[8] PE International. Life cycle CO2e assessment of low carbon cars 2020–2030. Low Carbon Vehicle Partnership: 2012.

[9] Graham, Paul, Luke Reedman, and Franzi Poldy. Modelling of the future of transport fuels in Australia: a report to the Future Fuels Forum. No. IR 1046. 2008.

[10] King, Carey W., and Charles AS Hall. “Relating financial and energy return on investment.” Sustainability 3.10 (2011): 1810-1832.

[11] King, Carey W., 2014, On relating US and UK energy expenditures (net energy), debt, and interest rates. USAEE

[12] Robertson, Sarah. (2009) Flannery’s sustainable future, ecogeneration

[13] Palmer, Graham (2014) Energy in Australia: Peak Oil, Solar Power, and Asia’s Economic Growth, Springer.

[14] Trainer, T. (2013) 100% Renewable supply? Comments on the reply by Jacobson and Delucchi to the critique. Energy Policy 2013.

[15] Trainer, T. (2012) A critique of Jacobson and Delucci’s proposals for a world renewable energy supply. Energy Policy 2012, 44, 476-481.

[16] Transport Victoria. (2013), Creating a Market: Victorian Electric Vehicle Trial Mid-term Report

[17] ABS. (2012) Survey of Motor Vehicle Use

[18] Budischak, C., Sewell, D., Thomson, H., Mach, L., Veron, D. E., & Kempton, W. (2012). Cost-minimized combinations of wind power, solar power and electrochemical storage, powering the grid up to 99.9% of the time. Journal of Power Sources.

[19] Australian Government (2014) Green Vehicle Guide

[20] ACIL Tasman. (2009). Fuel resource, new entry and generation costs in the NEM, 0419-0035.

[21] Invest Victoria. (2009) HRL propose $750m dual gas power plant for Victoria

[22] Warner, Ethan S., and Garvin A. Heath. (2012) ”Life cycle greenhouse gas emissions of nuclear electricity generation.” Journal of Industrial Ecology 16.s1 : S73-S92.

[23] IEA (2012) Technology Roadmap – Fuel Economy of Road Vehicles

[24] Shahan, Zachary. (2014) World Electrified Vehicle Sales (2013 Report)