Transportation's Role in Reducing U.S. Greenhouse Gas Emissions ...

Transportation’s Role in Reducing U.S. Greenhouse Gas Emissions: Volume 2
overall costs and cost-effectiveness for BEVs. First, electricity costs vary across the United
States depending on location, type of generation, and time of use. The average cost of
residential electricity in 2010 is estimated at 9.8 cents per kWh, projected to increase to 11.8
cents per kWh by 2030. 42 A charging price of 10 cents per kWh is used for this analysis
(Kammen). The additional electricity demand from charging of BEVs in the near term is
not expected to have a significant impact on overall electricity use or prices. 43
Assuming 10 cents per kWh, and a 0.26 kWh/mi efficiency, BEV operation costs would be
approximately 2 cents per mile, compared to a conventional gasoline LDV in 2010 at about
8 cents per mile (or 12.2 cents per mile in 2030 pretax, using AEO Reference case
assumptions). The resulting cost differentials are used to develop the estimated cost and
cost-effectiveness estimates for BEVs, as shown in 2.15. Due to the extremely high
incremental costs associated with current BEVs, a near-term scenario is not considered.
This analysis also assumes that battery replacement will not be required over the useful
life of the BEV.
2-72
Details
regarding potential impacts of increased charging demand on electricity generation in the
medium to long term are discussed in Section 3.2.4.
Table 2.15 BEV per Vehicle Cost and Cost-Effectiveness Range
2030
Lifetime Discounted Net Avg. GHG
Range Incremental kWh/ Gallons Fuel Discounted Reduction Dollars/Tonne
(Mile) Vehicle Cost mi Saved Savingsa Cost/Savings (Tonnes/Year) Calculated Literature
100 $6,000 0.26 6,500 $11,300 -$3,500 3.1-3.7 -$90 to -
$106
200 $10,200 0.26 6,500 $11,300 -$1,100 3.1-3.7 -$19 to -
$22
$100 to
$343
a Using pretax AEO price projections for gasoline and typical electricity estimate – $3.43 and 10 cents/kWh,
respectively.
The above cost-effectiveness assessment is not consistent with the values found in the
literature. Estimates from Bandivadekar et al. (which utilize the same incremental vehicle
cost ranges, but higher gasoline costs and lower BEV efficiency assumptions), estimated
42 AEO Table 8.
43 For example, an increase of 10,000 BEVs in California would only result in an increase of roughly
0.06 percent of the state’s total power demand (CARB, 2003).