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

Transportations Role in Reducing U.S. Greenhouse Gas Emissions: Volume 2
$250/kWh (Vyas et al., 2007). The U.S. Advanced Battery Consortium has adopted a longterm
goal of $200/kWh (Samaras, 2009). The $250 and $200 values are adopted in this
analysis for medium- and long-term battery costs, respectively.
Table 3.2T presents expected battery energy needs and associated incremental costs for a
variety of PHEV AER levels, relative to a conventional gasoline vehicle. While the
PHEV10 and 60 entries are intended to bracket the cost analysis, the PHEV40 value may
provide a more realistic point of reference for the future PHEV market. Note these
estimates assume a $2,100 incremental cost associated with an HEV technology package
(for CS mode operation), in addition to the incremental PHEV battery costs. 31
Table 3.2J Projected Incremental PHEV Costs by AER and Time Period
AER Range (mi)
3-50
Battery Energy
Requirement (kWh) a
Incremental Vehicle Cost
(Medium-Term)
Incremental Vehicle Cost
(Long-Term)
PHEV10 4 $3,100 $2,900
PHEV40 16 $6,100 $5,300
PHEV60 24 $8,100 $6,900
a Average values derived from Kalhammer et al., 2009.
The future year estimates in Table 3.2S for PHEV10 and PHEV60 vehicles are used for
estimating PHEV cost-effectiveness below.
The effect of future electricity prices also must be taken into account for the purposes of
estimating the cost-effectiveness of PHEVs relative to conventional vehicles and HEVs.
National average residential electricity rates are estimated to be 10 cents per kWh
(Kammen et al., 2008), although peak rates can be substantially higher. 32
Combined with
the future efficiency of CD mode operation (0.26 kWh/mile), such low electricity rates
lead to particularly low operation costs, on the order of 2 cents per mile, about one-fifth of
conventional gasoline vehicle operating costs. Thus, while PHEVs entail a substantial
incremental vehicle cost, fuel cost savings will offset at least some of this increase.
The PHEV cost-effectiveness values found in the literature for the medium term vary over
an extremely wide range, from as low as -$149/tonne for a PHEV30 light truck at $5.00 per
gallon gasoline (Bandivadekar et al., 2008), to $588/tonne for a PHEV50 with $4.00 per
31 $2,100 is net of projected HEV battery costs, estimated assuming $600/kWh x 1.5 kWh (Kammen
et al., 2008).
32 Most PHEVs and BEVs are expected to recharge overnight, during off-peak rates. See Section
3.D.9 for a more detailed discussion of battery charging practices, as well as electricity and BEV
costs and benefits in general.