A year or so ago the Pacific Northwest National Laboratory, a federal energy lab, found that 73% of the nation’s light vehicles could be recharged with the existing utility infrastructure if the vehicles were plugged in overnight. Such a shift from gasoline to electricity as a primary transportation fuel could displace an estimated 6.2 million barrels of oil a day, about 52% of current oil imports.

Then the Electric Power Research Institute, a utility-funded research group, and the Natural Resources Defense Council, an environmental group, concluded that if 60% of U.S. light vehicles were electrified by 2050, it would increase national electricity consumption by less than 8%. But it would cut total U.S. carbon-dioxide emissions by 450 million metric tons annually, equivalent to taking 82 million cars off the road.

So a few reports are out about utilities considering ordering thousands of vehicles of the series hybrid type to support their industry and to support the U.S. automobile manufacturers who they worry could be lost to their current financial trauma. The targets are cars recharged off the grid overnight that run primarily on electricity with gasoline generator sets to extend range.

Utilities stand to gain by selling electricity and their purchasing power numbering in the tens of thousands of units for their fleets could be a solid jump off point for new vehicle markets. The idea under discussion involves putting in a substantial order to put weight behind development and, perhaps, persuade Congress to give the auto industry the assistance it needs.

Some people in the industry are concerned about the stresses such new cars could put on the nation’s electric grid. If utilities become early plug-in-car adopters, they’d have a prime opportunity to make sure recharging happens in a way that optimizes grid use or strengthens the electric grid, rather than weakens it. What they want to avoid is a repeat of what happened when air conditioners became popular. While starting small, air conditioning eventually became the major factor in pushing up summer electricity demand. Many utility systems that historically peaked in winter now reach even higher peaks in the summer – a new usage pattern that took the utilities by surprise.

Bill Johnson, chief executive of Progress Energy Inc. said, “Our industry is interested in reducing carbon-dioxide emissions, and it seems like a good idea for auto makers and us to pull together,” and that the idea is in a formative stage and is “gaining momentum.”

Talks with automakers have occurred individually and through the electric industry’s primary trade organization, the Edison Electric Institute. Participating utilities include Xcel Energy Inc., Progress Energy, PG&E Corp., Edison International, Wisconsin Energy Corp. and others unnamed.

The exploratory discussions are being conducted at top levels and among firms regarded as among the most earnest concerning climate issues. They see electric cars as “transformative” for the way energy is used in the U.S.

Dick Kelly, chief executive of Xcel Energy in Minneapolis said, “If we get enough of us together, we could put in a very large order and maybe a big down payment.”

“I would do it,” says Gale Klappa, CEO of Wisconsin Energy, adding that his utility has about 3,000 vehicles in its fleet and replaces 20% each year.

General Motors Corp. spokesman said the company “welcomes the interest” of utilities.

Mark Duvall, a researcher at the Electric Power Research Institute, the utility-funded group suggests that what might be best for automakers is multiyear orders. That’s because early models may be money losers, so multiyear orders would help automakers achieve profitable production. He estimates fuel savings, for utilities, at $10,000 to $15,000 per car.

You might want to pass this along to your electric utility provider with some encouragement. It has got to be cheaper than Congressional bailouts and it would start the investment in the transition to more electric drive vehicles. Even if Congress has to bail them out, the payoff should make it back to consumers in more choices and reduced fuel expenses. I might even be in the market for a used one someday myself.

Hat Tip to Rebecca Smith at the Wall Street Journal.


1 Comment so far

  1. Robert Speirs on December 4, 2008 8:57 PM

    Where’s the proof that increasing carbon dioxide levels mean increasing temperatures? The record of the last twenty years is enough to disprove that theory, even though it could not wean some people from their quasi-religious fundamentalist fanaticism that we are all doomed!

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