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Plug In Drivers Not Missin' the Piston

This is the Kodak Moment for the Auto Industry. Electric vehicles are here to stay. Their market acceptance and growth will continue....

Saturday, April 27, 2013

Time for Gallons of Sunshine - Time of Use rate for EVs

How do electric vehicle (EV) charging, solar photovoltaic panels (PV), and time-of-use (TOU) electricity rates play together.

EV+PV+TOU=???

It is not possible to give a blanket answer to whether TOU will work for everyone, but I can use my example as a case-study that may help you determine if it might work for you.

I live in Beaverton Oregon. My electric company is Portland General Electric (PGE), not to be confused with Pacific Gas & Electric (PG&E) of California. Portland General offers a time of use billing rate and they are encouraging EV drivers to use this plan. With standard service, you pay the same amount for a kilowatt-hour no matter what time of day it is. With time-of-use, there are three different rates depending on the time of day: Peak, Mid-peak, and Off-peak.

Electricity is relatively cheap here so I was not sure I could save much. Reading their website, they said if you can shift 50% or more of your use to off-peak, then you would generally save money. I didn't want to worry about what time it was when I turned on the TV or anything else. Electricity is a convenience, I don't want the inconvenience of waiting until 10PM to start the laundry. So if this was going to work, it had to work with the routine that my family and I have currently.

PGE's website had some good "usage shift" suggestions such as using a programmable thermostat for heating and cooling and using a timer on your water heater. We already have a Nest thermostat and our water-heater is tankless, so none of these would help us shift our usage any more than we already have.

There were two items that I thought would help make TOU work for us: one, we have a 4kW solar array on roof and two, I drive an electric car that charges up overnight.

The solar panels produce electricity during the day, thereby reducing our peak demand. The electric car can be programed to charge up at any time you'd like. I have it set to start charging at 3AM. This allows it to be fully charged by 6AM when the rates go up.

Note: of all my rate quotes, I am including any charge, tax, or fee that is scaled per kWh. All flat fees are ignored since they are fixed and must be paid (assuming I want electrical service).

Even with these two items, I was concerned. The standard rate for electricity is 6.778¢ per kilowatt-hour (kWh). With TOU, during peak, I would be paying 13.266¢. That is about twice as much! PGE had a clause that alleviated this concern. After one year on TOU, they would evaluate your past year of bills and if you did not save money with TOU, you would only have to pay, at most, 10% more than the standard rate.

This limited the risk and allowed me to sign up knowing that even if things went far differently than I expected, it wouldn't add much if any to our annual bill. We gave it a shot.

So here we are 12 months later. We have been on TOU for one year now. I received what I expected to be my year-in-review notice. However, I was disappointed to see that the letter, rather, just told me how to use their online calculator to do my own annual analysis. So I followed the directions, and 36 copy and pastes later each month's data was computed. I made my own spreadsheet of the results below:


Month Peak%Mid-Peak%Off-Peak%ToU Savings

April 201325%20%55%$2.63

March 201325%23%52%$1.64

Feb 201327%26%46%-$1.76

Jan 201322%30%49%$4.00

Dec 201221%30%49%$4.31

Nov 201219%34%47%$3.96

Oct 2012 14%33%54%$7.13

Sept 201219%40%41%$2.42

Aug 201215%36%49%$9.18

July 2012 14%33%53%$9.40

June 201212%31%57%$11.20

May 201213%28%59%$11.14

As you can see in the table, TOU saved us money nearly every month. The one exception was Feb 2013. Our solar panels don't make much in the winter months. The panels are west facing. Combine that with our location (north of the 45 parallel) and you'll see an exaggerated seasonal variation for our solar output.

This one outlier was more than compensated for by other months. The best months are in the spring when it is sunny, but not so hot as to require the air conditioner. We saved over $11 in each May and June.

For our one year on TOU, we saved a total of $65.24.

Conclusion
In the beginning I asked: EV+PV+TOU=???

I can now tell you that for us, without changing any of our usage patterns, it equaled enough saving to fuel more than 3500 miles of EV driving.

Time-of-use allows our solar panels pay off faster, because now they are offsetting a ~13¢ rate rather than a ~7¢ rate.

TOU also made it cheaper to charge up the car. The car is now being fueled with electricity at the off-peak rate of 4.422¢ per kWh rather than the standard 6.778¢ rate. That is a 35% reduction in fuel cost. I think most people would be happy with a 35% reduction in prices at the pump. I just happen to be using an electron pump. 

$65 annually is not a lot, but if the utility ask me if I would want an annual $65 reduction on my bill, the answer would be 'yes'. When we get a second plug-in vehicle, it will get even better. Now that I know we are going to stay on the TOU program, maybe I will go get a timer for our koi pond and take another look at the list of tips to shift energy usage.

Sunday, April 14, 2013

EVs for Everyone, Part 1: Better Batteries - F, GM, TSLA - Foolish Blogging Network

EVs for Everyone, Part 1: Better Batteries - F, GM, TSLA - Foolish Blogging Network: "now there is a growing demand for electric car batteries. With GM’s Volt, Nissan’s Leaf, Ford’s Focus Electric, and Tesla’s Model S hitting production, battery usage in electric cars could begin to drive a meaningful segment of the battery market. As a result, a number of improved battery designs are being developed in laboratories, involving silicon, graphene, and a zinc-air composition, to name a few."

Friday, April 12, 2013

EV charging station bill passes Oregon Senate; reasons to (ahem) think cars are too easy to drive: Commuting roundup | OregonLive.com

EV charging station bill passes Oregon Senate; reasons to (ahem) think cars are too easy to drive: Commuting roundup | OregonLive.com: "promoting the use of electric vehicles "leads to less air pollution, less reliance on foreign oil, and advancement towards our environmental goals," said state Sen. Jackie Dingfelder in a statement on the bill's passage."

Misconceptions Continue to Hinder Electric Vehicle Sales | PluginCars.com

Misconceptions Continue to Hinder Electric Vehicle Sales | PluginCars.com: "Over the past two years, sale of plug-in vehicle have been on a steady growth pattern. And as more models continue to enter the segment, that growth is expected to accelerate. Of course, that doesn't mean common misconceptions about plug-in electric vehicles will disappear overnight."

Sunday, April 7, 2013

Calling Ahead - The March of Mobile Phone Progress on EV Tech

Motorola then-CEO Ed Zander jokingly introduces the '80s-era Motorola DynaTAC 8000, the first commercially available hand-held mobile phone, during a keynote address at the 2007 International Consumer Electronics Show in Las Vegas
Photo by Ethan Miller/Getty Images
Looking at the incredible smartphones that many of us carry around today, it might be hard to imagine a time when mobile phones were big, clunky, and didn't have Internet access.

Forty years of innovation took phones that were mocked for their short talk times and made them an indispensable part of our lives.

What will 40 years of incremental progress look like for electric vehicles? In just the few years that the Nissan Leaf has been on the market, we have seen improvements: heated seats, more efficient cooling, lighter weight, better aerodynamics... These are minor improvements, but they compound over time. Imagine a decade of improvements applied to Motor Trend's Car of the Year 2013, the Tesla Model S.


One of the major factors that made mobile phones better is battery improvements. This directly applies to electric cars as well. Energy density of batteries has been improving by about 8 percent per year since we landed on the moon and used battery powered lunar rovers to explore the lunarscape. And it doesn't show any signs of slowing down. There are many new technologies under development that will continue the gradual march forward including Lithium-air, Zinc-air, graphene, and ultracapacitors, to name a few.

There is, of course, no guarantee that battery technology will continue at this rate. Each advancement is hard fought and the result of many R&D dollars and toiling engineers.

Let's assume this advancement rate continues. Today the 2012 Nissan Leaf is EPA rated with a range of 75 miles. If this range were to increase 8 percent per year, it would hit 150 miles in 10 years, 200 miles in 14 years, 300 miles in 19 years, 500 miles in 26 years, and 1000 miles after 35 years. Apply this same improvement scale to the 85 kWh Tesla Model S and in 40 years, you have a 5000 mile vehicle.


This is not a prediction, it's just a demonstration of the potential. Many of the advancements will be used to reduce prices rather than increase the range.

Here is what I will predict: Forty years from now, the majority of cars on the road will be, at least partially, electrically propelled. Like the '80s mobile phone, in 2053 we'll be able to look at today's plug-in vehicles as a quaint start. The occasional 2050 sighting of a purely gas-powered car will be as anachronous as a rotary phone is today.

From Bell to Tesla, let the future ring  

Monday, April 1, 2013

Investing in the Future

Wall Street Journal Letter to the Editor by David Friedman of Union of Concerned Scientists -re the relative success of electric vehicle technology companies and skewed reporting on the subject.

While Kimberley Strassel claims the president's proposed Energy Security Trust ("Obama's Energy Security Trap," March 22) is merely a pivot after a supposed "string of taxpayer-funded bankruptcies," the evidence shows that the federal government's current track record on supporting clean tech is actually an enviable one, with far more winners than losers. 

Of the 30 firms that manufacture electric-vehicle battery and drive components that received stimulus funding in 2009, 28 continue to deliver, while 23 of the 26 renewable energy companies that have received taxpayer loans are still on track. That's more than 90% of the federally supported clean tech companies that continue to perform, which is much better than the market does on its own. In fact, a Sept. 19, 2012, article in the Journal cited research showing that 30% to 40% of venture capital-funded companies from 2004 to 2010 completely failed and were liquidated. 

Any emerging technology has its starts and stops. But despite the critics' naysaying prophecies, clean tech is on the rise nationwide, in large part due to federal investment that will save consumers money on oil, cut pollution, and create American jobs.

David Friedman 
Union of Concerned Scientists 
Washington

Tesla Scraps 40 kWh Battery Pack

Tesla recently released a statement about their Q1 2013 performance and it was good news. They are making and selling cars faster than they had projected. Great news for investors and anyone waiting a Model S.

Among the production details, there was an item worthy of discussion. Tesla said "Only four percent of customers chose the 40 kWh battery pack, which is not enough to justify production of that version." The Model S was originally planned to have 40, 60, and 85 kWh battery options. These are also known as the 160, 230, and 300 mile range battery packs.

Hmm, if they are not going to make the 40 kWh pack, what happens to those 4 percent of current orders and future orders that want the small pack? Are they going to be expected to pay $10,000 to upgrade to the 60 kWh pack? Tesla answered this with: "Customers who ordered this option will instead receive the 60 kWh pack, but range will be software limited to 40 kWh."

So there will be 70 miles worth of range there that is locked off by software. If Tesla ever wanted to encourage people to hack their car's software, they have just found a carrot to dangle. Find the magic bit to flip and you have a $10,000 upgrade.

Every iPhone that has come out has been "jail-broken". Will Tesla be any better at preventing their products from being hacked? And what is the legality of an owner modifying the software of their vehicle? In the world of smartphones, rooting/jail-breaking has danced back and forth on the line of legality and end-user licenses.

It's not a perfect analogy but imagine this: an auto dealer sells you a new car and says "We put the 6 cylinder motor in there because they were selling better. You only wanted a 4-cylinder, so we pulled 2 spark plugs out and you better NOT put them back in." How many people would stop at the auto parts store on their way home and would it be illegal for them to replace the two missing spark plugs?

Tesla has been unafraid to try innovative ways to make cars, to sell cars, and now to software control their abilities. It will be interesting to see how this plays out.

Tesla press release is below:


TESLA MODEL S SALES EXCEED TARGET

PROFITABILITY GUIDANCE AMENDED UPWARD; 40 KWH BATTERY CANCELLED

SUNDAY, MARCH 31, 2013
Tesla Motors announced today that sales of its Model S vehicle exceeded the target provided in the mid-February shareholder letter. As customers who note their Model S serial number this weekend will realize, vehicle deliveries (sales) exceeded 4,750 units vs. the 4,500 unit prior outlook. As a result, Tesla is amending its Q1 guidance to full profitability, both GAAP and non-GAAP.
“I am incredibly proud of the Tesla team for their outstanding work. There have been many car startups over the past several decades, but profitability is what makes a company real. Tesla is here to stay and keep fighting for the electric car revolution,” said Elon Musk, Tesla Motors co-founder and CEO. “I would also like to thank our customers for their passionate support of the company and the car. Without them, we would not be here.”
Also being announced today is that the small battery option for the Model S will not enter production, due to lack of demand. Only four percent of customers chose the 40 kWh battery pack, which is not enough to justify production of that version. Customers are voting with their wallet that they want a car that gives them the freedom to travel long distances when needed.
The customers who ordered this option will instead receive the 60 kWh pack, but range will be software limited to 40 kWh. It will still have the improved acceleration and top speed of the bigger pack, so will be a better product than originally ordered, and can be upgraded to the range of the 60 kWh upon request by the original or a future owner.
Tesla is also revealing a small Easter egg today: all 60 kWh cars have been and will be built with Supercharger hardware included. Tesla is taking a slight cost risk that ultimately all customers will want to buy the Supercharger upgrade and receive unlimited, free long distance travel for life. Even for those that never drive long distances, this will improve the resale value of their car to people that do.

ABOUT TESLA

Tesla Motors' (NASDAQ: TSLA) goal is to accelerate the world’s transition to electric mobility with a full range of increasingly affordable electric cars. California-based Tesla designs and manufactures EVs, as well as EV powertrain components for partners such as Toyota and Daimler. Tesla has delivered almost 10,000 electric vehicles to customers in 31 countries.
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Forward-Looking Statement
Certain statements in this press release, including statements regarding the expected profitability of the company, the availability of vehicle features and options and the Supercharger network, are “forward-looking statements” that are subject to risks and uncertainties. These forward-looking statements are based on management’s current expectations, and as a result of certain risks and uncertainties, actual results may differ materially from those projected. Various important factors could cause actual results to differ materially from those in the forward-looking statements, including the risks and uncertainties identified under the sections captioned “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results Of Operations” in Tesla’s Form 10-K filed on March 7, 2013. Tesla disclaims any obligation to update information contained in these forward-looking statements.
Press Contact
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