Big Utilities vs. Big Oil

By John Addison (4/17/07) Question: What could be more American than healthy competition? Answer: Healthy competition that reduces our dependency on foreign oil. By 2010 you may be filling your “tank” by plugging-in to your electric and natural gas utility. Today fleets turn to utilities to power everything from light electric vehicles to heavy natural gas and hydrogen vehicles.

At the recent Alternative Fuels and Vehicles Institute (AVFi) National Conference, major utilities were there with exciting presentations and demonstrations. Major California utilities included Sempra Energy (SRE), Southern California Edison (EIX), and PG&E (PCG). Major automotive and truck manufacturers showed their latest alt-fuel vehicles. Globally there are over 30 million electric vehicles and over 5 million natural gas vehicles.

Vehicles give utilities added markets for electricity and natural gas, the opportunity to use excess off-peak electricity that is now wasted, and long-term opportunities to capture electricity from vehicles (V2G) when electricity is in peak demand.

Southern California Edison provides electricity to over 13 million customers. Edison’s Gordon Smith presented the ability for 70% of U.S. vehicles to be powered with off-peak electricity. Edison provides electricity to customers with thousands of electric vehicles, forklifts, sweepers, scrubbers, airport equipment, truck stop electrification, ship port electrification, and plug-in hybrids. Over 300 of Edison’s own fleet are electric vehicles. Some of its 240 Toyota RAV-4 EVs have achieved a life of up to 150,000 miles. Edison Programs

Running a utility requires large fleets including vans and trucks. Edison is aggressively testing hybrids and plug-in hybrids. SCE now is testing a DaimlerChrysler (DCX) plug-in hybrid-electric Sprinter vans with a 20 to 30-mile all-electric range through a partnership with the Electric Power Research Institute (EPRI), the South Coast Air Quality Management District and DaimlerChrysler.

SCE is partnering with EPRI, other utilities and Eaton Corporation (ETN) to establish a program for Class 5 plug-in hybrid troubleman trucks using the Ford (F) F550. They will offer the ability to drive in an all-electric mode, and to operate in a stationary mode (without idling). The electric mode is perfect for the hours that these trucks are used at work sites and when running hydraulic lifts. The electric mode eliminates emissions, fuel cost and noise.

SCE is also working with other fleet operators through the Hybrid Truck Users Forum to place prototype heavy-duty hybrid trucks in operation, with a goal of leading to production commitments and expanded purchases. Based on initial testing of the trucks at an independent facility, these vehicles are projected to cut air emissions by up to 50%, and use 40% to 60% less fuel, compared to similar diesel-powered trucks. These trucks are likely to become a standard Class 6 offering by International, using an Eaton hybrid drive system.

AVFi presented the “Industry Pioneer” award to the Southern California Gas Company, a Sempra utility. Sempra is the nation’s largest natural gas utility, serving 29 million customers. The Gas Company owns and operates a fleet of 1,100 natural gas vehicles. It operates 26 natural gas stations. It helped LAMTA create the world’s largest fleet of natural gas buses (over 2,200). LAMTA is also expanding into buses running on hydrogen blended with CNG and battery-electric buses.

PG&E provides electricity and natural gas to over 5 million customers in California. With revenues exceeding $12 billion, PG&E has an opportunity to increase revenues one billion dollars if there is a shift from vehicles with gasoline engines to vehicles using electric propulsion.

As part of its larger environmental leadership strategy, PG&E owns and operates a clean fuel fleet of electric and fuel cell vehicles, and more than 1,100 natural gas vehicles. PG&E’s clean fuel fleet consists of service and crew trucks, meter reader vehicles and pool cars that run either entirely on compressed natural gas or have bi-fuel capabilities. Over the last 15 years, PG&E’s clean fuel fleet has displaced over 2.7 million gallons of gasoline and diesel, and helped to avoid 5,000 tons of carbon dioxide from entering the atmosphere.

PG&E is actively field testing both battery electric vehicles (BEV) and plug-in hybrid vehicles (PHEV).

PG&E has ordered four Phoenix Motorcars ( all-electric sport utility trucks (SUTs) for June delivery. PG&E has given Phoenix a conditional order to buy 200. The Phoenix trucks have an impressive 130 mile range using Altair Nano (OTCBB: ALTI) batteries with their unique lithium titanate spinel oxide (LTO) electrode materials. Both Phoenix and Altair were on display at the AFVi Conference. Altair has claimed a breakthrough in several areas: specific power, battery life of over 10,000 charge cycles, “zero explosions and safety issues” test results, and fast charge capability. Altair Nano Batteries:

“PG&E is firmly committed to reducing our carbon foot print by using innovative alternative-fuel technologies,” said Bob Howard, PG&E vice president of gas transmission and distribution. “By adding the Phoenix Motorcars SUTs to our leading clean fuel fleet, we are taking an important step in developing a proven and necessary electric vehicle market. Electric vehicles provide a practical solution to help us reduce our dependency on petroleum-based fuels, keep California’s air clean, and meet the challenges associated with climate change.” PG&E News

Along with Edison, PG&E’s fleet was one of 14 in the country chosen to test the plug-in hybrid pilot project for a Ford F550 Super Duty Field Response Truck. PG&E currently has 350 Field Response Trucks on the road. PG&E, partnering with the Bay Area Air Quality Management District, also recently placed into service a prototype Plug-in Toyota Prius to demonstrate the benefits of light-duty plug-in hybrid vehicles.

PG&E owns and operates 34 compressed natural gas (CNG) fueling stations, through which they supply natural gas to more than 200 commercial and private fleets throughout the PG&E system. This includes transit districts, private refuse haulers, school districts, municipalities, air/seaports, and other miscellaneous operators including taxi, package delivery, military, and private fleets.

Construction of a hydrogen fueling station in San Carlos, California is also scheduled to begin this summer. Pacific Gas and Electric Company (PG&E) was awarded a California Air Resources Board (CARB) grant for the project. GTI will serve as a partner on the project, providing a mobile hydrogen unit (MHU) that uses GTI’s patented reformer technology. This self-contained unit will produce hydrogen from natural gas and condition it to serve the on-site dispenser during the development of a hydrogen fueling network in California. The hydrogen fueling station will be co-located with a publicly accessible compressed natural gas station to allow for 24/7 availability. Once sufficient demand is established, the MHU can be replaced with permanent facilities, and the unit can then be relocated.

The relationship between big oil and big utilities are complex. Oil refineries are among the world’s largest users of electricity. Oil companies are transforming into integrated energy providers that sell large quantities of natural gas to major utilities, making the utility a distribution channel for the natural gas producer. Some energy giants are expanding into wind, solar and other renewable energy.

Edison and BP have a joint venture to build a large scale electric plant that will not run on coal, not on nuclear, not on natural gas. The Carson plant will run on hydrogen and output 500 MW of electricity. By products will include enough hydrogen to inexpensively fuel thousands of vehicles in Southern California. Another byproduct will be CO2 that will be sequestered as part of increasing oil production. Hydrogen power plant details:

Edison also has an existing hydrogen fueling station in partnership with Chevron.

Currently, fleets are taking the lead with electric vehicles and plug-in hybrids that are developed by system integrators and specialty companies. DaimlerChrysler was at the AVFI conference with its 25 mph GEM. 40,000 have been sold. Rumors are flying that in 2008 Toyota (NYSE:TM) will begin fleet tests of its new plug-in hybrid using lithium batteries. Consumer sales may start in 2009. By 2010, Mitsubishi (MSBHY) will start selling an EV to consumers in Japan. Drivers will increasingly use electric power.

Today, utilities are powering vehicles with electricity, natural gas and hydrogen. In a few years, electric vehicles will also power homes with vehicle-to-home (V2H). Large batteries and fuel cells provide many times the electricity demand of a home. In a few more years, smart grids and intelligent power management will allow peak electricity demands to be met by utilities buying power from vehicles with vehicle-to-grid (V2G). U.C. Davis and PG&E have demonstrated V2H and V2G already.

Healthy competition is leading America to cleaner electricity and cleaner vehicles. Innovative utilities are taking an important role in the transition.

John Addison is the author of the upcoming book Save Gas, Save the Planet and publishes the Clean Fleet Report http:// This article is copyright John Addison with permission to publish or excerpt with attribution. John owns stock in ALTI.

4 replies
  1. Anonymous
    Anonymous says:

    How very clever – generating electricity FROM hydrogen. Just one question – WHERE DOES THE HYDROGEN COME FROM? It wouldn't be from greenhouse gas producing fossil fuels by any chance?Carlos

  2. Anonymous
    Anonymous says:

    Natural gas the article says. That's the big flaw with hydrogen. It's merely a conduit, not a source of energy. You still need to "make" the hydrogen from coal or oil or solar. —– So the question becomes: Why not just burn the coal/oil/solar directly?

  3. Joseph M.
    Joseph M. says:

    I'd much rather fill up at home(plug-in), my Prius Hybrid, rather than going to a gas station. Gasoline stinky dirty, Electricity clean. I like Plug-In. Toyota, I'm ready for my Plug-In!

  4. Anonymous
    Anonymous says:

    Let's have some plug-in hybrids without costly fuel cells. I really hope the third generation Prius is technically like GM's Volt. 40 mile electric at highway speeds then on gas/diesel for many more miles. The 40 mile electric is what I'm really looking for. The gas/diesel engine would very rarely run. After getting the car, the next step would be to get some photovoltaics for the house. Interesting the power companies don't push congress to give tax rebates/credits for consumers to put up solar cells. It would certainly help the power grid on hot sunny days in the summer during peak draw.

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