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Tesla, First Solar, Better Place and Comments on a Weird Quarter in Cleantech

Wow.  This has been a really interesting few months in cleantech.

First Solar announced a $0.99 cent/Wp target within 4 years for installed with trackers utility scale in its investor deck.  That equates to around $4-5 henry hub gas price in a new combined cycle gas plant.

The scary thing is that best utility scale PV solar is already approaching the $1.50/Wp range in the LAST quarter, equating to $7-8 Henry Hub.

The Top 5 PV manufacturers announced module costs all south of $0.65/Wp.  First Solar says <$0.40/Wp in 4 years. Greentech Media says the best Chinese C-Si plants will do $0.42 within 3 years.  Screw the EU and US dumping  trade wars.  That my friends, is grid parity for a massive swath of the electricity market wholesale AND retail.

These companies are learning to work on GP margins of sub 10%.  They are getting lean, and mean and good.

 

Better Place finally went bust with a whimper.  $850 mm in venture money gone.  As we predicted, battery changing for electric cars is a really bad idea.  But this time, unlike the billion that Solyndra took down, nobody noticed.  Maybe because EVs are being rolled out right and left.

Why was it a bad idea? Well, 1) they would make car companies have to change their fleets, and effectively COMPETES not leverages what the rest of EV and battery world was doing, 2) it implicitly assumes fast charging and better cheaper batteries were not coming, so we needed a work around – meaning if the industry succeeds, Better Place has no advantage, if the industry fails, Better Place has no leverage, a really bad bet for an EV lover, 3) it assumes the costs of the swappable battery car and changing stations were not high, and could come down as fast or faster than conventional EVs and battery technology, 4) it means basically all fillups are full service, which I consider a really dumb idea.  We stopped that in the US in 1980s?

 

Tesla got profitable, sort of.  Announced a positive EBITDA.  Well, ok, but a big loss if you excluded emissions credits that are expected to be a 2013 only event –  about 12% of revenue.  Exclude those and the car manufacturing business had <6% gross profit margins and still loses a lot of money.  But a huge step forward.  Especially as the Model S is now the best selling EV.  Oh, and seriously, even GETTING GPs to positive this fast is a big deal as well as EBITDA positive under ANY circumstances this fast.  Kudos!

This is huge, because as we reported last year, Tesla by itself holds up the venture returns in the cleantech sector.

An analysis of Stifel’s monthly report on EVs and Hybrids shows the Leaf, Volt and Model S making progress, still young and small and choppy sales, but EVs as a group outpacing sales of the HEVs at the same point in their lifecycle.  EVs + HEVs is now consistently at 4% of new US sales. Not half the market, but definitely real.

 

But somehow, nobody’s making much profits.  This industry is looking like profits will always be elusive and come either in the bubbles, or only to the #1 or 2 player.  2013-2014 are looking like set up years for cleantech.  Our prediction? By 2015 NO ONE will question whether cleantech sectors are viable.  It will be about how fast they erode other people’s profits.

Honda Fit Hybrid Challenges Toyota Prius Leadership

Honda Fit Outsells Prius

In January, the Honda Fit outsold the Prius in Japan. Prius had been the number one selling car in Japan for 20 months. Half of the Fits sold were the new Fit Hybrid, which delivers 71 miles per gallon (MPG) using the Japanese JC08 test cycle. In 2012, both the Fit Hybrid and new Fit EV are expected to start selling in the U.S.

The Honda Fit has been a popular small hatchback, with over 3.5 million sold globally. With five doors, seating for five, and flexible cargo space it is big enough for most, yet small enough to fit in those precious city parking spaces. Drivers like the sport fill and handling. Starting at around $15,000, the Honda Fit delivers 31 mpg, the mileage of many hybrids.

Honda Fit Hybrid 71 MPG

The Fit Hybrid removes pain at the pump with the 71 mpg in the Japanese test cycle which emphasises slow city driving at 16 mpg; by comparison the Prius is 77 mpg. Power is delivered from the IMA electric motor and from an efficient 1.3-liter i-VTEC engine. The battery for the hybrid system is located under the rear cargo and enables the Fit to share the same flexible seating configurations as the rest of the lineup without sacrificing interior comfort that is unique to Fit.

The Fit offers more room than outward appearances suggest. It has a B-segment exterior, but a larger C-segment interior. In the back is 20.6 cubic feet of cargo, but drop the back seat and you have 50.7 cubic feet. If that still is not enough for your ladder, home project, or surfboard, then you can flatten the front seat for added feet. In Japan, the passenger seat can even rotate for easy in-and-out or socializing with others.

Bigger and Better – Honda Fit Shuttle versus Toyota Prius

Toyota has no intention of letting Honda hold the number one spot in Japan, the U.S., or anywhere else. Toyota has expanded the popular Prius into a family of four models:

* 2011 Prius – world’s best selling hybrid
* 2012 Prius v –midsized wagon with 40 mpg goes on sale Summer 2011
* 2012 Prius c Concept – city car hybrid goes on sale by Summer 2012
* 2012 Prius Plug-in Hybrid – best mileage of any Prius goes on sale by Summer 2012

If you’ve been looking for great mileage from an SUV, crossover, or wagon, take a look at the new Prius v. It will share the current generation Prius’ platform and Hybrid Synergy Drive technology. Featuring a compact exterior yet spacious interior, the Prius v will feature over 50-percent more interior cargo space than the current Prius, while being almost as aerodynamic. The Prius v will compete with new crossover hybrids like the Ford C-MAX Hybrid. The Prius v will use NiMH batteries, just as the 2011 Prius. Next year, Ford will start delivering lithium batteries in all hybrids and electric cars.

Honda has countered by unveiling a longer Honda Fit Shuttle available with the current efficient ICE drive system and the new hybrid drive system. This compact wagon can be examined on Honda’s new Fit Shuttle Japanese website.  The wagon is expected to be unveiled at the Geneva Auto Show next month. Unfortunately, Honda is unlikely to offer this larger Fit in the U.S., at least for now.

Honda Fit EV

Honda unveiled the all-new Fit EV Concept electric vehicle at the LA Auto Show in November. In 2011 the Fit EV will be in fleet trials at at Google, Stanford University, and possibly others. In 2012, the car will no longer be a concept as customers go to dealers and buy the Fit EV. The Fit EV will compete with the larger Nissan LEAF, the Ford Focus Electric, and the Toyota FT-EV.

The Fit EV is designed to meet the daily driving needs of the average metropolitan commuter and utilizes the same 5-passenger layout found in the popular Fit hatchback. When the Fit EV production model is introduced, it will be powered by a lithium-ion battery and coaxial electric motor.

The high-density motor, derived from the FCX Clarity fuel cell electric vehicle, delivers excellent efficiency and power while remaining quiet at high speeds. The Fit EV will have a top speed of 90 mph.

The Fit EV will achieve an estimated 100-mile driving range per charge using the US EPA LA4* city cycle (70 miles when applying EPA’s adjustment factor). Driving range can be maximized by use of an innovative 3-mode electric drive system, adapted from the 2011 Honda CR-Z sport hybrid. The system allows the driver to select between Econ, Normal, and Sport to instantly and seamlessly change the driving experience to maximize efficiency or improve acceleration. While in Econ mode, practical driving range can increase by as much as 17 percent compared to driving in Normal mode, and up to 25 percent compared to driving in Sport mode. Acceleration improves significantly when in Sport mode, generating performance similar to a vehicle equipped with a 2.0-liter gasoline engine.

Hybrid and Electric Car Battle with Toyota and Ford

In their battle for hybrid and electric car leadership, both Honda and Toyota are learning a lesson from Ford – price matters and therefore manufacturing cost matters. Ford is offering 10 to 14 new models on a global C-car platform  with many chassis and components being common across a range of cars, SUVs, and crossovers. Ford will lower manufacturing costs, use high-volume common parts, and improve efficiency. Ford will increasingly enable customers to select a vehicle, such as the Focus, with powertrain options ranging from efficient engine to hybrid to plug-in hybrid to pure battery electric.

C-MAX Energi and C-MAX Hybrid are two of 10 to 14 new models that Ford will launch around the world based on its new global C-car platform – Ford’s first truly global One Ford platform. Ford’s new generation of C-segment vehicles will be sold in more than 120 markets and will account for more than 2 million units annually. The C-segment accounts for one in four cars sold worldwide today and, in conjunction with the B-segment, Ford expects it to rise to 50 percent of all cars sold globally by 2013.

Honda is wise to expand its popular Fit into a family that includes a larger wagon, a 71-mpg hybrid, and an exciting electric car with the potential to become the EV price leader. In a growing battle for fuel-efficient family offerings with Toyota and Ford there will be one clear winner – the customer.

Cleantech and the Future of GM

Jon Lauckner, President GM Ventures, said that GM now has a straightforward vision, “Design, build and sell the world’s best vehicles.” I took notes as he gave his keynote speech at the Clean Tech Investors Conference and asked him about GM’s investment priorities. To achieve GM’s vision, focus is now placed on four strategies: (1) a culture that is more aggressive and flexible, (2) customer focus, (3) Team GM, and (4) technology.

Mr. Lauckner is focused on investing in innovative and early stage companies. He has been busy since GM Ventures was established last June and he was promoted from head of GM global product planning. GM Ventures has invested in Bright Automotive, which has designed an advanced plug-in hybrid delivery van with much greater cargo space than Ford’s Transit Connect Electric. GM has invested in two advanced next generation biofuel corporations – Mascoma and Coskata. Given the success of the Amyris IPO, these investments could should a high return for GM.

GM has the potential to drive down lithium battery cost and weight with its strategic partner LG Chem, supplier for the Volt. The two corporations recently licensed cathode technology from Argonne National Lab that can lead to better energy density and make future cars like the Chevrolet Volt even more cost effective.

GM is also looking beyond today’s lithium technology. GM Ventures has invested in SAKTI3, which has developed a rechargeable solid-state battery with the potential to lower the cost of manufacturing batteries.

All of these innovators are creating offerings that could accelerate GM offering a wider range of vehicles, lower the carbon footprint of GM vehicles, and make electric cars less expensive than gasoline powered in this decade. So far, all of these innovators are U.S. based and already creating hundreds of new jobs. GM is open to investing globally and often partners with venture capitalists such as Khosla Ventures, corporate private equity such as Itochu Technology Ventures, and public economic development such as the Michigan Economic Development Corporation.

The technology will not necessarily become a GM offering, but that is a potential value-added in partnering with GM Ventures. For example, Powermat is not only receiving a $5 million investment from GM Ventures, Powermat will be offered in many 2012 GM cars. Powermat solves that problem of trying to keep many mobile electronic devices charged. Forget using the cigarette lighter. Powermat’s technology allows electronic devices – smart phones, MP3 players and gaming devices – to be charged inductively by just placing them on the Powermat.

What will be the next General Motors investment? Speaking to over 400 executives at the Clean-Tech Investor Summit,  co-produced by International Business Forum and Clean Edge with CleantechBlog as a media sponsor, Jon Lauckner said that GM Ventures is looking for promising innovation in these areas:

Automotive Cleantech

  • EV
  • Fuel cell
  • Charging
  • Emission controls
  • Motors
  • Smart grid
  • Energy efficiency for vehicles
  • Biofuels

Infotainment

  • Vehicle HMI
  • Voice recognition technologies
  • In-vehicle advertising
  • Cloud services
  • Personal device integration

Smart Materials

  • Cost
  • Mass
  • Lightweight materials
  • Eco-friendly materials

Automotive-Related Technologies

  • Innovations for unmet consumer needs
  • Advanced sensors for autonomous driving
  • Safety features

Value Chain / Business Model

  • New automotive business models
  • Leverage GM technology and assets for upstream and downstream revenue

I asked Jon Lauckner about alternatives to rare earth elements. Currently, the motors in electric cars and hybrids are permanent magnet motors. To improve weight, efficiency and heat resistance, rare earth elements such as neodymium and dysprosium are used in these permanent magnets. Such rare earths are currently mined in China, but the big money is not in the mining, it is in the final products. China is restricting rare earth exports, and giving priority to using rare earths in its own manufacturing of turbines and motors for products ranging from military systems to high-speed rail to electric cars.

Toyota Motors is developing inductive car motors that do not use rare earths. Although Lauckner was carefully non-committal about whether GM is also working on inductive automotive electric motors, he did say that he would be “very interested” in such motors requiring no rare earths. Smart materials, nanotechnology, and advanced powertrain components are all strategic to the future of GM.

In one decade, transportation will be very different from today. With GM Ventures, General Motors is positioned to invest, integrate, and deliver to global customers better cars and services that include innovations in cleantech, infotainment, materials, autonomous driving, and new business models.

2010 Cars Deliver Performance and Fuel Economy

This is my first time to drive on a race track and I’m wondering if these are my final moments on planet earth. Here at the Mazda Raceway Laguna Seca I take the Andretti Hairpin and learn to accelerate in successive turns. After accelerating uphill, I enter “The Corkscrew” where I cannot see the sharp downhill turn to the left until I am in the middle of it. As I get into this sharp turn, I need to prepare for the sequence of curves that immediately follow. Yes, it’s a corkscrew.

I try to remember the coaching that I received. Hold the steering wheel with something less than a death grip. Breathe. Look ahead – but looking ahead at the top of the Corkscrew I only see blue sky. Looking ahead to my future, I only see darkness.

The 2009 BMW 335d that I am driving handles beautifully, offers more turbodiesel acceleration than I care to try, and I guarantee you that the brakes work.

After three laps, I exit the track, park the BMW, remove my helmet as I leave the car, and resist kissing the ground in front of real drivers. I have been invited to test drive new vehicles with the Western Automotive Journalists, even though I write about green cars and clean transportation. I long for yesterday.

Yesterday, I tested cars with good fuel economy on streets with posted speed limits. Drives included three cars that made the list of Top 10 Low Carbon Footprint Cars. Yesterday, the 20 mile test drives were along the ocean in Monterey and on beautiful tree lined roads where I could easily see the next turn.

The 2010 Ford (F) Fusion Hybrid easily seats five, has plenty of trunk storage, and actually delivers better mileage than the MINI due to Ford’s impressive hybrid drive system. The new Ford midsized sedan that I drove has an EPA certified 41 mpg rating in the city and 36 mpg on the highway. The base suggested price is $27,995.

It may prove to be popular with anyone considering the Toyota (TM) Camry Hybrid; Ford delivers equal room, safety, and comfort with better rated mileage. Although the Fusion Hybrid has a better mileage rating than the Camry Hybrid, that advantage is not always delivered in real world driving. Edmonds Test Drive

In theory, the Ford Fusion Hybrid can travel up to 47 miles per hour in electric mode; I could only sustain the engine-off mode when gliding downhill. Even on flat roads driving 25 mph, the engine would engage.

Ford does a nice job of encouraging drivers to get better fuel economy. The SmartGage had a display section that filled with green leaves as I drove with a light touch that reduced demands on the 2.5L engine. The Ford Fusion Hybrid delivered the smoothest driving experience of any hybrid which I have driven. I did not notice the transitions from gas to electric mode. The transitions were seamless.

Even better mileage was delivered by the 2010 Honda (HMC) Insight EX which I drove in Monterey. It is rated 43 mpg highway and 40 mpg city. The Insight’s combined EPA rating of 41 contrasts with the 2010 Prius expected rating of at least 50 mpg. The Honda Insight has an aerodynamic body similar to the Prius. Although the two five-door hatchbacks look similar, the Prius is a longer midsized car. In theory, the Honda Insight pricing starts at $19,800 which has pressured Toyota to offer a Prius with a base price only $2,000 higher. The 2010 Insight that I drove included upgrades such as a navigation system and six speaker audio system. The vehicle price, including pre-delivery service, was $23,770.

I started the Insight, and then touched the ECO button. Even in that mode, I had enough acceleration to get on any freeway in a hurry. The ECO mode helped me minimize demands on the 1.3L gasoline engine as I navigated the roads hugging Monterey’s dramatic coast. Like the Ford Fusion Hybrid, I was rewarded with a display of green leaves for my eco-driving behavior. Handling was smooth and a bit sporty.

Driving the Honda Insight was smooth and quiet even when I went up a sustained 16 percent grade, demonstrating that its electric motor is quite effective in blending power with the 98 hp engine.

Price will definitely be a factor in buyers deciding between the Honda Insight and the Toyota Prius. In some markets, such as California, another factor may be the ability to get an HOV sticker with the Insight. For my money, if I could get a larger more fuel efficient Prius for only $2,000 more, then I would get the Prius. On the other hand, if there was a $5,000 price differential at the dealer, then I would go with the Insight. All in all, both are wonderful cars.

If you want great fuel economy, few compromises, and driving pleasure, test drive the latest hybrids from automakers like Toyota, Honda, and Ford. The intensified competition between them is bringing better performance and safety and economy.

Complete Article including MINI Cooper test drive.

John Addison publishes the Clean Fleet Report and is the author of Save Gas, Save the Planet.

The Energy Policy Act of 2008

by Richard T. Stuebi

Betcha didn’t know that there was an Energy Policy Act of 2008, did you? Well, you won’t find any bill of that name. But, the passage of last week’s appropriately titled “Emergency Economic Stabilization Act of 2008″ is almost tantamount to an energy bill.

The Senate prepared a nice summary of the energy-related provisions that were stuffed into the bill during the chaotic process to get something passed promptly that would reassure the financial markets. I have yet to review all of the provisions, but it’s clear that many of them have favorable implications for a variety of clean energy technologies, inluding wind, solar, energy efficiency, hybrid vehicles, biofuels, and smart grid.

It’s nice that there has been at least one small silver lining to the dark cloud of financial implosions in the past few weeks.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Fall Brings School, Pretty Leaves, And A New Prius

by Cristina Foung

My favorite green product of the week: 2009 Toyota Prius Hybrid Car

What is it?
For a lot of folks, “hybrid” is synonymous with “Prius.” Well, 2009 will see some changes to the car more people say they’d buy again.

This version is 3-4 inches longer and 1 inch wider than previous generations. It’s also heavier, faster, and more powerful (it’s moving from a 1.5 liter engine to a 1.8 liter). Not to mention, the top of the car will have a few solar panels on it to provide some power for the air conditioning unit.

Why is it better?
Fuel economy is expected to exceed 50 mpg (remember that the 2007 Prius was rated at 60 MPG but the EPA did recently change their fuel economy testing methods), which is not too shabby (although yes, being bigger and faster does detract from the efficiency gains the car would have had otherwise…but maybe it will appeal to a broader crowd). While the solar panels are primarily symbolic, it’s still nice to see Toyota supporting solar technology.

And while this generation isn’t a plug-in, hopefully the Prius line will have some new additions to the family (rumors are floating around that there may be a sub-compact version, a wagon, and a convertible spin-off on the way).

The only thing is…I’m not so keen on the styling changes they’ve made (thanks to Next Autos for the photo at the top – check out their gallery for more images of a Prius in tests).

Where can you find it?
Well, it’s not available quite yet. But keep tabs at your local Toyota dealership. The base model will be starting at $22,000 and the touring version at $24, 270.

Besides her green products column on Cleantech Blog, Cristina is a passionate advocate for green living at the Green Home Huddle at Huddler.com, which focuses on electric cars, energy efficient appliances, and other green products.

Press Release:
Toyota And Scion Announce Prices On Select 2009 Models July 25, 2008 – Torrance, CA – Toyota Motor Sales (TMS), U.S.A., Inc., announced new manufacturer’s suggested retail prices (MSRP) today for 13 select 2009 Toyota and Scion vehicles. The overall average MSRP for the 13 models increases by $181, or 0.81 percent. Toyota The 2009 Avalon full-size sedan adds to its value with additional standard equipment that includes driver and front passenger active headrests, Brake Assist, traction control, Vehicle Stability Control (VSC), and a satellite radio ready color-keyed SDARS antenna and prewire. The base MSRP for Avalon will range from $27,845 for the XL grade to $35,185 for the premium Limited grade. Overall, Avalon prices will increase $520, or 1.7 percent. The 2009 FJ Cruiser Sport Utility Vehicle (SUV) adds driver and front passenger active headrests, roll-sensing curtain airbags, a VSC cut-off switch, front map light, and a driver-side vanity mirror as standard equipment. The FJ also adds three new colors – – non-metallic Black, Silver, and Iceberg White with all-white monochromatic finish. The base MSRP for the FJ Cruiser will range from $23,320 for the 4×2 V6 with a five-speed automatic transmission to $24,910 for the 4×4 V6 automatic. Overall, the price of the 2009 FJ Cruiser increases by $275, or 1.1 percent. For 2009, the Land Cruiser full-size SUV adds factory privacy glass on the rear side and quarter windows as standard equipment. The base MSRP for the Land Cruiser will be $64,755, representing an increase of $655, or 1.0 percent. The base MSRP for the 2009 4Runner SUV will range from $28,640 for the 4×2 SR5 V6 to $39,360 for the 4×4 Limited V8. On average the MSRP for the 2009 4Runner increases by $225, or 0.7 percent. The base MSRP for the 2009 Highlander mid-size SUV will range from $27,600 for the Base front-wheel-drive model with a V6 engine and five-speed automatic transmission to $34,520 for the Limited four-wheel-drive V6 with a five-speed automatic. The overall average MSRP for Highlander will increase by $47, or 0.2 percent. The base MSRP for the gas-electric Highlander Hybrid will range from $34,700 for the two-row, four-wheel-drive with intelligence base model to $41,020 for the three-row, four-wheel-drive with intelligence Limited. The overall average MSRP for the Highlander Hybrid increases by $518, or 1.4 percent. The base MSRP for the 2009 Sienna van will range from $24,540 for the seven-passenger front-wheel-drive CE grade to $37,865 for the all-wheel-drive XLE Limited. The average base MSRP for Sienna will increase $100, or 0.4 percent. The base MSRP gas-electric Prius Hybrid will range from $22,000 for the Standard grade to $24,270 for the Touring grade. The overall average price for Prius will increase $500, or 2.2 percent. The 2009 Corolla sedan will receive a price adjustment increase of $100, or 0.6 percent. The base MSRP will range from $15,350 for the Base grade with a five-speed manual transmission to $20,050 for the XRS grade with a five-speed automatic transmission. A price adjustment for the 2009 Matrix will increase its MSRP by $100, or 0.5 percent. The base MSRP will range from $16,290 for the 4×2 Standard grade with a five-speed manual transmission to $21,950 for the 4×2 XRS with a five-speed automatic. The 2009 Camry sedan will receive an MSRP adjustment reflecting an increase of $225, or 1.0 percent. The base MSRP will range from $19,145 for the Camry four-cylinder with a five-speed manual transmission to $28,695 for the XLE V6 with a six-speed automatic. The gas-electric Camry Hybrid will receive a price adjustment increase of $500, or 1.9 percent. The new MSRP will be $26,150.

Volt-Face for GM

by Richard T. Stuebi

Fascinating article in this month’s Atlantic profiling the herculean efforts apparently being undertaken by General Motors (NYSE: GM) to launch its plug-in hybrid vehicle, the Chevy Volt, by the incredibly ambitious deadline of 2010.

I took away the following thoughts from the article:

1. GM seems to actually recognize that they really didn’t give it the full college try with their previous electric vehicle work, the EV1 program, whose demise was profiled so blisteringly in the documentary, Who Killed the Electric Car?.

2. While GM is using the Volt program as a way to reinvent and redefine itself as a nimble company responsive to customer preferences, it must be noted that GM tried this with the new Saturn line twenty years ago too — and look where GM is now.

3. Bob Lutz — the GM Vice Chairman who is on record for stating his opinion that global warming is a “total crock of s**t” — is the key person within the kingdom who seized on the need for the Volt, being amazed at the gall of tiny start-up Tesla Motors daring to build an electric vehicle.

4. GM is being pretty gutsy by deciding to house the Volt within its core brand — Chevrolet — rather than insulate it in its own brand in case the project/car failed.

5. The Volt program appears to be pretty much “open source”, allowing the public in to see its progress. My guess is that this is to better manage the public’s expectations along the way, minimizing the potential for any bad surprises.

6. The project was launched without a business plan or any marketing/cost projections — no doubt from the huge public frenzy spawned by the concept car’s unveiling just 18 months ago in January 2007 — and still seems to run under a “damn-the-torpedos” philosophy, almost akin to NASA’s Apollo program of the 1960’s.

Within a couple of years, we’ll see what ultimately emerges from the Volt program, but no-one can doubt its audacity — which is a word I thought I’d never use in connection with GM.

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Turbo Diesels Take on Hybrids

By John Addison (6/17/08). Last week, I test drove of the new Volkswagen Jetta TDI Diesel. It accelerated on to the freeway faster than my Toyota Prius. Driving freeways and stop-go city, I wondered which would be the bigger seller, the new European turbodiesels or the Japanese Hybrids.

For Detroit, May was the cruelest month, as they were outsold by Asia for the first time. Fuel economy is in; gas guzzling is being punished. General Motors, Ford Motor and Chrysler combined for a record low market share of 44.4 percent, compared with 48.1 percent for 10 Asian brands, according to the Autodata Corporation, the industry statistics firm. Toyota and Honda continued to gain market share. In the months ahead, Detroit will also lose share to the new fuel efficient diesels from Europe where diesel vehicles outsell gasoline alternatives.

The VW Jetta TDI Diesel has an EPA rated mileage on 41 mpg highway and 30 city with a 6-speed stick; 40/29 with an automatic. With 140 horsepower, the Jetta has plenty of performance. The diesel Jetta has a combined EPA rating of 33, compared with 25 for its gasoline cousin. In other words, diesel delivers over 30 percent better mileage, making a real difference to the pocket book even with diesel fuel’s higher prices, and to reduced greenhouse gas emissions.

Over 1.5 million Toyota Priuses are now on the road. The 2008 Priuses has an EPA rated mileage of 48 city and 45 highway. Notice that this hybrid with regenerative braking actually gets better mileage in stop and go than on freeways where there is added wind resistance. The Prius computer automatically disengages the engine most of the time when stopped and going slowly, making it more quiet than diesels. The Prius has a bit more passenger room than the Jetta. Both have the same trunk space.

Using both an electric motor and an engine, the Prius has always delivered more performance than I’ve needed, whether accelerating on a freeway or climbing a steep and icy mountain road. With its powerful electric motor, the Prius has plenty of torque and good acceleration.

Honda is not happy with Toyota’s success in selling four hybrids for everyone that Honda has sold. In John Murphy’s interview with Honda about their green image, Honda CEO Mr. Fukui stated that “Honda’s image was better but has evened out with [Toyota] because of the strong image of one single model, the Prius, which Honda feels is a problem. Next year, we will come up with a dedicated hybrid vehicle. We feel this model will have to overwhelm and overtake Prius.” It is rumored that the new Honda hybrid will be priced well under $20,000 and reach a broader market. Wall Street Journal Interview

In the next two years, Honda is also likely to bring diesels to the U.S. including the Acura, the Odyssey minivan, and the CR-V SUV,.

In the USA, many prefer SUVs to sedans. SUVs have more cargo space. Some can seat more than five people, but not the more fuel efficient SUVs. They ride higher. Some drivers feel safer, although sedans like the Prius and Jetta score better than some SUVs in front and rear collisions and are loaded with air bags and advanced vehicle controls.

The Ford Escape Hybrid is the most fuel efficient SUV on the market with an EPA rating of 34 mpg highway and 30 city. The VW Tiguan is a somewhat comparable compact SUV, but less fuel efficient with 26 mpg highway and 19 city using a six-speed shift; and only 24/18 with an automatic. The Tiguan is a light-duty vehicle that is roomy with 95 cubic feet for passengers and 24 for cargo. Drop the back seat and you have 56 for cargo.

The new VW Jetta Sportswagen offers many SUV lovers with an appealing alternative. It achieves the same mileage as the Jetta sedan of 41 mpg highway and 30 city with a 6-speed stick; 40/29 with an automatic. With 33 cargo cubic feet, it beats SUVs like the Escape and Tiguan. Drop the back seat and you have 67 cubic feet. Watch VW take market share from SUVs that get half the miles per gallon of this new turbo diesel.

The Prius, Jetta, Jetta Sportswagen, Tiguan and Escape all seat five people. All have ways to accommodate a fair amount of cargo when the back seat is dropped. The four-door sedans offer much better fuel economy. In the new era of $4 per gallon gas prices, sedans are gaining market share at the expense of SUVs and light trucks, like the once best selling Ford F150.

For those who enjoy both performance and luxury, Mercedes and BMW have new turbo diesel cars with about 30% better fuel economy than their gasoline counterparts. Last summer when I was treated to test drives of the Mercedes E320 Bluetec and the BMW 535D. I was impressed with the quiet, smooth, performance of these larger sedans and with the roomy luxurious experience. Mercedes and BMW are also bringing concept hybrid diesels to auto shows.

The new turbo diesels are not your diesels of the past. They are quiet. I could smell no emissions. Emissions are far lower than those of the previous decade, meeting the tough new 50 state requirements including using ultra-low sulfur diesel.

Forget putting B100 biodiesel in these new engines with common rail and very high pressure injection. Don’t think about home brewed vegetable oil or recycled restaurant grease. Even B20 voids the warranty in the U.S., although not in Europe where biodiesel quality is better. B5 is the limit in the U.S. Biodiesel’s Future

For the moment gasoline hybrids give most people better fuel economy than the new turbo diesels in the U.S. The diesel hybrids being developed by VW, Audi, Mercedes, and BMW could change the game. Most significant are diesel plug-in hybrids. The VW Golf TDI Hybrid concept is demonstrating 69 mpg. The full-hybrid supports an all-electric mode.

Volkswagen is serious about hybrids and electric drive systems. In announcing a new lithium-ion venture with Sanyo, Prof. Martin Winterkorn, CEO of the Volkswagen Group stated that VW’s future “will be directed more strongly at making electrically powered automobiles alongside ones driven by more efficient combustion engines.” Volkswagen’s Audi is also demonstrating a plug-in hybrid concept Quattro.

Toyota is well aware of the success of diesel in Europe. Toyota is developing an advanced diesel engine in both the Tundra and Sequoia. Toyota plans to expand its use of hybrids in a wide-range of vehicles. Currently Toyota is constrained by trying to increase battery manufacturing enough to meet its current exploding demand for hybrids. Toyota also plans a plug-in hybrid by the end of 2010.

General Motors does not intend to watch Asia and European rivals take all its market share. In late 2010, it plans to offer both gasoline and diesel plug-in hybrids that will give the average driver over 100 miles per gallon. In the USA it will introduce the Chevy Volt gasoline plug-in hybrid. In Europe, GM will sell a diesel plug-in hybrid under the Opel brand.

Are there other offerings of hybrids, diesels, and other fuel efficient alternatives? Yes. A good starting point to compare vehicles is at the EPA’s Fuel Economy site.

Different people need different types of vehicles. Hybrids benefit everyone who spends part of their driving in cities and/or stop-go traffic. The new turbo diesels tend to get thirty percent better performance than their gasoline counterparts. Two long-term trends are converging – the expanded use of more fuel-efficient diesel engines and the expanded use of electric drive systems for hybrids, plug-in hybrids and for electric vehicles.

Cleaner vehicles, however, are not the whole solution. When gasoline hit $4 per gallon, Marcia and Christian convinced a car dealer to take their two vehicles as trade-in, including a large SUV, for one more fuel efficient SUV. Living and working in a city, only one vehicle was needed because both could use public transportation and car pool with friends. They save over $5,000 per year by sharing one vehicle. Now that is a real solution to save at the pump and help all of us by saving emissions.

John Addison publishes the Clean Fleet Report.

UC San Diego Saves Millions with Transportation Demand Management

By John Addison (3/26/08). Like all great universities, the University of California at San Diego, must either spend millions for car parking or spend millions for improved transportation. Using transportation demand management, UC San Diego is spending millions less in both areas.

27,500 students attend the university. “We encourage commuters to use alternate forms of transportation,” said Brian d’Autremont, TPS director. “Approximately 43 percent of UC San Diego commuters use some form of alternative transportation, including, bikes, buses, trains and vanpools.” In addition, last fall UC San Diego reduced the number of single occupancy vehicles on campus by 800 cars.

UC San Diego uses AlterNetRides as a platform, making it easy for staff and students to be matched with the van pool or carpool that best meets their destinations and schedules. Use of HOV lanes and access to preferred parking make shared rides considerably faster. Zipcar on campus makes cars available by the hour, helping students avoid the need for owning a car.

In 2006, UC San Diego doubled the number of people riding buses on campus. A key to this growth was establishing the best routes and schedules. UC San Diego uses realtime tracking and demand management software to do this. The University uses a hosted customized application from Syncromatics, which performs realtime tracking with GPS and cellular communication to determine the location and speed of each bus.

The system develops a database showing the number of passengers at any stop at anytime. By querying the database, routes and schedules can easily be adjusted. UC San Diego’s Director Brian d’Autremont summarized, “Syncromatics’ system has saved us over one million dollars in fiscal year 2006, after being installed for just a little over 6 months. We typically buy 5 buses each summer, this year we were able to increase the effectiveness of our system enough that we didn’t have to buy any. The system paid for itself several times over in bus, fuel and driver costs, while increasing our ridership and improving customer service ratings dramatically.

Another big payoff of UC San Diego’s alternative transportation is a reduction in needed parking spaces. Each spot in a parking structure costs the university $22,000 to $29,000.

More people will ride on transit if they know how to get to their destination and if long waits are not necessary. The Syncromatics realtime tracking system which integrates with Google Maps to show actual bus locations on an LCD in the student lounge, on arrival signage, on mobile devices, and even in text messages. Ridership continues to grow. Realtime Display

Information technology is becoming invaluable in making transportation efficient as well as appealing to more riders. Fleet managers can now implement custom applications and realtime services without investing in hardware, software, and hiring specialized technologists. Hosted applications such as Syncromatics and AlterNetRides are run by the service provider. Middleware such as XML and Java allow these applications to be integrated with databases, billing systems, and other fleet applications.

UC San Diego is supporting energy independence and climate solutions by encouraging clean transportation. The university fleet also is becoming more fuel efficient. Over time, the university’s 50-plus buses will be converted to hybrid CNG, reducing their emissions. UC San Diego Article The University is also purchasing 225 electric vehicles and 32 hybrid vehicles for its fleet.

The importance of climate solutions is integral to the institution. UC San Diego evolved from the Scripps Institute of Oceanography under the leadership of Roger Revelle, who with Charles Keeling first measured the growing atmospheric concentration of CO2. Revelle College is one of six of the university’s colleges. The National Academy of Sciences recognizes UC San Diego as one of the top ten science universities in the nation. Professors include Nobel Laureates Paul Crutzen and Mario Molina whose chemistry research with Sherwood Rowland lead to the discovery of the ozone hole and the Montreal Protocol.

Universities and Colleges are leading in many areas of transportation demand management. An encyclopedia of best practices is available at the Victoria Institute.

John Addison speaks at conferences and publishes the Clean Fleet Report.

FedEx’s Absolutely, Positively, Cleaner Fleet

By John Addison (3/4/08). When something must absolutely, positively, arrive the next day, people increasingly turn to FedEx. Shipped is everything from million dollar loan documents to birthday presents. FedEx is also integral to the just-in-time supply chain that allows businesses to grow, even as they shrink inventory. FedEx generates over $35 billion annually.

FedEx uses 48,000 vehicles global to deliver our goods. Fed Ex probably utilizes another 30,000 vehicles at its airport operations. At the heart of FedEx operations is a hub-spoke private fleet of jets. Fed Ex has made Memphis, Tennessee, the busiest freight airport in the world.

I valued talking with FedEx Chief Engineer of Hybrid & Alt-Fuel Fleet, Sam Snyder, after he presented at the WestStart Clean Heavy-Duty Vehicle Conference. He discussed a number of areas of fuel savings. The volume and weight of an average package is now less. People are shipping more iPods; less big stereos. This allows FedEx to expand its deployment of Sprinter Vans, and reduce its need for the larger 16,000 pound (GVWR) vans. Sam Snyder stated that FedEx uses, “The right truck for the right route, saving millions of gallons of fuel.”

With oil topping $100 per barrel, FedEx is evaluating alt-fuel, and electric vehicles while continuing its investment in hybrids. FedEx hybrids have accumulated more than 2,000,000 miles in revenue service.95 diesel hybrids are in service globally, primarily in the U.S; 77 more hybrids will be added in 2008. The hybrids are an excellent investment with a 42% improvement in fuel economy. FedEx Hybrids

FedEx is making a bigger investment in hybrids than its major competitor UPS. UPS Clean Fleet

An indicator of the future is the 48 FedEx E700 Eaton hybrids in New York. In Milan, ten Iveco, a Fiat Group company, diesel hybrids will be used in a van similar in size to the Sprinter; a Bosch electric motor and Johnson Controls batteries are used. Green Car Congress

In May 2008, 20 Azure gasoline parallel hybrids (Ford E450 chassis and Utilimaster body) will be placed in service in LA and Sacramento. WestStart is managing this program.

Also being hybridized are the traditional FedEx 16,000 pound vans with a cargo capacity of approximately 670 cubic feet. Eaton’s hybrid electric system has been placed in the standard white FedEx Express W700 delivery truck, which utilizes a Freightliner chassis and an Utilimaster body, and designated E700.

FedEx would like to move towards more fuel-efficient 4-cylinder diesel hybrids, but it may not see an EPA certification until 2010 or later. Until then, FedEx may forge ahead with the less fuel-efficient 6-cylinder diesels. EPA continues to certify based on engine emissions, rather than more efficient hybrid duty cycle.

Hybrids are just one way that FedEx is becoming less oil dependent. Currently, FedEx Freight is actively testing hydrogen fuel cell forklifts, hybrid electric Class 7 trucks, and alternative fuels.

FedEx Express and FedEx Freight are members of the U.S. Environmental Protection Agency’s SmartWay Transport Partnership with fuel efficiency strategies such as:

* Instituting policies and technologies to reduce or prevent vehicle idling
* Locating FedEx facilities in order to eliminate idling from overnight trips
* Installation of tractor/trailer/van aerodynamic packages
* Use of advanced, low-friction synthetic oils and lubricants
* Introducing automatic tire inflation devices to increase fuel economy
* Introducing wide-based tires to increase fuel economy through reduced road friction

As one of the world’s largest private air carriers, FedEx is a major user of oil-refined jet fuel and a major emitter of greenhouse gases. To improve its carbon footprint, FedEx Express is replacing the B727 model aircrafts in its fleet with the Boeing 757 model. It has 20% greater payload capacity, but it also uses 36 percent less fuel. FedEx Express also plans to acquire Boeing 777 model aircraft, with a greater payload capacity, and 18% reduction in fuel use.

FedEx also saves annually over 5.5 million gallons of aviation fuel by using in-gate aircraft auxiliary power units, eliminating more than one hour of fuel usage per flight throughout the fleet.

FedEx is also taking a leading role in using renewable energy at its facilities. At the FedEx hub in Oakland, California, 80% of the facility’s electricity and is provided by a 904 kilowatt Sharp solar rooftop system that over its 25-year life cycle this plant will offset 10,800 tons of carbon dioxide – the equivalent of removing 2,100 cars from the road. Another 550kW will be added at its Fontana and Whittier facilities.

FedEx Kinko’s, Inc. purchases renewable energy at more than 520 branches in 26 states, for an estimated 69 million kWh per year. FedEx Kinko’s, Inc. is procuring its power from a wide variety of sources, including wind, geothermal, landfill gas, solar, and small hydro.

This year, Fed Ex was recognized as #6 on FORTUNE’s list of the World’s Most Admired Companies and #7 on FORTUNE’s list of America’s Most Admired Companies. For the seventh consecutive year, Fed Ex has been part of this prestigious list. Fed Ex’s leadership in clean transportation helps keep it at the top.

John Addison publishes the Clean Fleet Report and speaks at cleantech conferences.

Heavy-Duty Vehicle Trends for 2008

By John Addison (2/8/08). Most oil consumption and greenhouse gas emissions from transportation are not from passenger vehicles; they are from the heavy-duty vehicles, ships, and planes that move all our goods, serve public transit, and provide the infrastructure that keeps cities running. Heavy-duty operators have often been years ahead of passenger vehicle owners in using advanced technology to do more with less fuel.

Hybrids. Wal-Mart operates 7,000 trucks that in 2005 drove 872 million miles to make 900,000 deliveries to its 6,600 stores. Wal-Mart has set a goal of doubling the fuel efficiency of its new heavy-duty trucks from 6.5 to 13 miles per gallon by 2015. 26 billion pounds less of carbon dioxide would be emitted over 15 years as a result. Demand for oil is also reduced with over one billion less gallons of diesel required over that 15 year period.

Wal-Mart is defying the conventional wisdom that hybrid technology is of little help for large trucks that already have efficient diesel engines. Wal-Mart delivers goods from regional warehouses on an optimized route to its stores. Routes often involve heavy stop-go city driving. With hybrid technology, every touch of the brakes causes energy to be captured. Where trucks previously idled with engines running, hybrids can run all auxiliary power with the engine off, using large battery stacks for the electricity.

Wal-Mart has more than 100 hybrid light-duty vehicles. Now Wal-Mart sees bigger potential savings in heavy-duty Class 8 trucks. Wal-Mart plans to replace Peterbilt 386 big-rigs with hybrid versions of the same truck by 2009. Wal-Mart Clean Fleet Report

Plug-in Hybrids. PG&E is one of 14 utilities in the nation participating in the pilot truck program, sponsored by WestStart‘s Hybrid Truck Users Forum (HTUF), a hybrid commercialization project bringing together truck fleet users, truck makers, technology companies, and the U.S. military, to field-test utility trucks with an integrated hybrid power-train solution.

This new Class 6/7 hybrid truck is built by International incorporating the Eaton (ETN) hybrid drive system with a 44kW electric motor. Eaton has produced more than 220 drive systems for medium and heavy hybrid-powered vehicles. Vehicle configurations include package delivery vans, medium-duty delivery trucks, beverage haulers, city buses and utility repair trucks – each of which has generated significant fuel economy gains and emission reductions. Fleet customers for Eaton hybrid power have included FedEx Express, UPS, Coca-Cola Enterprises, The Pepsi Bottling Group, and the 14 public utility fleets into which were placed 24 hybrid-powered repair trucks.

Idle-off. In many heavy-duty fleets, engines idle 40% of the time at stops for many auxiliary needs including air conditioning, heating, running electronics inside the cab and more. These auxiliary functions can now be powered with the batteries in hybrid powertrains, with auxiliary power units such as fuel cells, and with truck-stop electrification. Heavy-vehicles can now be programmed to automatically idle-off after a prescribed amount of stop time, such as California’s five-minute law. Idle-off is possible by GPS location, such as specific bus stops. Wal-Mart alone estimates savings of $25 million with idle-off and APUs for its 7,000 trucks. Transit operators save millions of gallons of fuel and keep passengers happy with electronic air conditioning without diesel fumes.

Natural Gas. There are about five million natural gas vehicles in operation globally. These vehicles consume 238 million gasoline gallon equivalents. That amount has doubled in only five years. CNG vehicles are popular in fleets that carry lots of people: buses, shuttles and taxis. Natural gas fleets are likely to double again in the next five years. Los Angeles County Metropolitan Transportation Authority (LAMTA) serves over ten million people with the nation’s largest natural gas fleet, comprised of over 2,000 CNG buses. A growing number of riders enjoy higher-speed service with LAMTA’s bus rapid transit.

To help clear Southern California air, the Ports of Los Angeles and Long Beach established a $1.6 billion Clean Truck Superfund to purchase 5,300 alt-fuel trucks by 2010 out of a total fleet of 16,800 Class 8 trucks. All are likely to be Westport LNG systems installed in Kenworth T800 trucks.

Hydrogen Fuel Cells. Many passenger cars have the potential to meet all driver needs by plugging in for a nightly recharge of batteries in electric vehicles. Buses running 16 hours daily and climbing 12% grades can also be electric, but most need the added electricity provided by hydrogen fuel cells. Over 3,000,000 people have ridden these vehicles in Europe and the U.S.

Energy Security. The Army’s NAC is pursuing hybrid truck technology to significantly reduce the Army’s fuel consumption and logistics needs, to provide field-generation of power and to provide quiet, stealth operations. The U.S. Army has a fleet of over 246,000 vehicles with a goal to reduce fuel consumption by 75% by 2010.

Green Supply Chains. ConAgra has contracted with Nova Biosource Fuels to convert food processing waste into biofuel, greatly helping with waste regulations. This provides Nova Biosource Fuels with a low-cost feedstock for high-quality biodiesel. ConAgra has guaranteed the purchase of 130 million gallons per year. California-based State Logistics, has grown its business by providing more-sustainable shipping options for companies like Clif Bar. Prologis will only build USGBC LEED certified distribution centers.

On February 20, fleet managers, vehicle technology leaders, government leaders, other experts and stakeholders will gather in San Diego to discuss their success in all of these areas at the Clean Heavy-Duty Vehicle Conference 2008.

“Clean Heavy Duty Vehicle 2008 highlights the vehicles and fuels that will actually cut our greenhouse gases and reduce our dependence on oil,” said John Boesel, President and CEO of WestStart-CALSTART, a leader in spurring green tech in transportation. “The conference brings together the key business and political leaders helping bridge the technological and financial gaps to bring clean transportation solutions to market.”

Stay tuned for more exciting progress in 2008.

John Addison publishes the Clean Fleet Report.

What About Diesel Hybrids?

by Richard T. Stuebi

My good friend Gerrit visited me last week from Canada, driving down his prized Mercedes diesel. We talked about diesel autos, and how they were likely to be an increasing part of the energy/environmental solution.

Gerrit told me that he had been hearing that auto manufacturers were losing enthusiasm for hybrids, coming to the realization that most Americans drive lots of highway miles, for which diesels are simpler, cheaper and more efficient than hybrids.

Certainly, diesel hybrid designs are beginning to show up for commercial vehicles, such as delivery vans and garbage trucks. For instance, Eaton (NYSE: ETN) announced earlier this year a pilot program for UPS (NYSE: UPS) involving a diesel delivery truck with a hydraulic (not battery) motive augmentation system.

But what about diesel hybrid autos? Is anyone doing anything interesting in that field? If not, why not?

Richard T. Stuebi is the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and is also the Founder and President of NextWave Energy, Inc.

Electric cars and hybrids: Silicon Valley vs Detroit

As consumers, we generally like choices. In the world of cleaner cars, those choices have been few and far between, but slowly that is changing.

I had a chance recently to test drive two of the cars whose creators are bent on changing the way we view transportation, a converted all electric Scion eBox by Silicon Valley startup AC Propulsion, and a Saturn Vue Greenline hybrid. Both were highly enjoyable. The first, with a $70,000 price tag and a $10,000 deposit, is clearly an EV targeted at Conspicuous Sustainability consumers. I guess then, that the Saturn Vue Greenline with a $24,000 price tag, is perhaps the hybrid for the rest of us.

One of my friends, who was considering buying an eBox invited me to take it for a spin up and down some of the San Francisco hills with him while he was test driving. I have to admit, coming down California Street into downtown, one of the City’s steeper hills, is an entertaining way to get used to the feel of regenerative braking on a true EV. I highly recommend it. For most of the drive I never touched the brakes. To stop you simply take your foot off the accelerator. And for those who have not driven an EV before the acceleration itself is phenomenal. Touch, and Go. Of course, with a $55,000 price tag for the EV conversion (you provide the Scion), limited range, and few electric charging stations, a purchase would be a hard call for me to make. The payback on fuel savings, many times the useful life of the car.

In contrast, General Motors (NYSE:GM) had given me a 2007 Saturn Vue to drive around for a week, to get the feel of it. If anything, GM is not known as an innovator of clean technologies. They are still tarred with the who killed the electric car brush by many environmentalists. That has only made it harder for GM to get out the message on things like its massive R&D effort in fuel cell cars, its push into flex fuel and ethanol with the Live Green Go Yellow campaign, and now hybrids. Having been to a number of their press luncheons on some of the new technologies they have been developing, I had some idea what to expect, but had not written about it before. The Vue is what is known as a mild hybrid, and its lack of bleeding edge, ultra green technology compared to a Prius had a few of my greener friends turning their noses up at it. But this didn’t really phase me after I drove it. As a car and SUV, I found it quite impressive. It handled wonderfully, was extremely quiet, and quite comfortable. You can feel the regenerative braking, but only as a slight tug, so besides the lack of noise, it is like driving any other SUV. Saturn bills it as getting the best highway gas mileage of any SUV, and the cheapest hybrid SUV on the market (not to mention a little quicker than the conventional Vue). Like all hybrids today, the payback is real, but not so great. At the average miles driven per year for most Americans we are talking 9 to 11 years or so compared to the standard Vue, according to my conversation with the Saturn people. If you happen to a real heavy commuter 25,000 to 30,000 miles per year type of thing, the payback may be down towards 5 or 6 years. In short, despite the c. 20 percent fuel savings, a consumer is looking at 120,000 to 150,000 plus miles before reaching a payback, depending on your assumptions, for this or almost any hybrid. The real payback, as always, comes from just buying a smaller car, hybrid or not.

What I love is that the Vue Greenline is really just the first in the Saturn line of hybrids and cleaner fueled cars. GM is basically planning on making virtually the entire Saturn line as green as can be. It is rolling out something like 8 new hybrids or hybrid versions of existing Saturn makes as we speak over the next couple of years. And at a $24,000 price tag, I could actually see buying one of these.

So whether you have the pocket books to look for full EV conversion or just a mild hybrid to make a small difference like the rest of us, the choice is there.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog, a Contributing Author for Inside Greentech, and a Contributing Editor to Alt Energy Stocks, and a blogger for CNET’s Green tech blog.

Gas Misers or Corn Guzzlers

By John Addison (5/15/07)

People buying new cars are asking if they should get a high mileage hybrid that runs on gasoline, or a flex-fuel vehicle that could run on E85 ethanol. The United States DOE’s and EPA’s fueleconomy.gov, made it easy for car buyers to compare choices.

When you drive, there is most likely ethanol in your fuel tank. Ethanol is a fuel from a plant source that is normally mixed with gasoline. The percentage varies widely. All current U.S. vehicles can run on a blend of up to 10% ethanol (E10).

GM launched a national campaign, “Live Green Go Yellow.” GM and Ford (F) have sold millions of flex fuel vehicles (FFV) on the road. GM is prepared to make up to half its vehicles ethanol capable by 2012.

Although FFVs are hot sellers in the USA, most have never had a drop of E85 in their tank. They are only fueled with standard gasoline blends. There are over 6 million vehicles on the U.S. streets that could run E85. Most never have.

Most FFVs are fuel guzzlers; fueled with E85, they are corn guzzlers. In 2007 the best rated car running on E85 was the Chevrolet Impala, with a United States EPA mileage rating of 16 miles per gallon in the city and 23 on the highway when fueled with E85. For a typical U.S. year of driving, the annual fuel cost would be at $1,657 and 6 tons of CO2 would be emitted by this FFV when running on E85.

By contrast, the EPA rating for a Toyota (TM) Prius running on gasoline was 60 miles per gallon in the city and 51 on the highway. The Prius would have an annual fuel cost of $833 and only emit 3.4 tons of CO2, compared to 6 tons from the most fuel efficient E85 offering.

A big problem is that ethanol cuts miles per gallon by about 27%. The energy content of E85 is 83,000 BTU/gallon, instead of 114,000 BTU/gallon for gasoline. Even by 2030, the U.S. Energy Information Administration (EIA) projects that only 1.4% of ethanol use will be E85. The vast majority will be for small percentage blending with gasoline.

The EIA forecasts that ethanol use will grow from 4 billion gallons in 2005 to 14.6 billion gallons in 2030 (about 8 percent of total gasoline consumption vs. today’s 2%). Ethanol use for gasoline blending grows to 14.4 billion gallons and E85 consumption to only 0.2 billion gallons in 2030. In other words, agriculture will be a big winner without any need to spend millions of tax dollars funding E85 stations.

There is a heated debate about whether ethanol helps the environment. In the U.S., the vast majority of ethanol is processed from corn. There is no current environmental benefit if the source-to-wheels use of ethanol includes diesel farm equipment, fertilizer from fossil fuel, coal produced electricity, diesel delivery trucks hauling ethanol over 1,000 miles to refineries, and then fueling a vehicle with poor mileage.

The amount of U.S. corn that became ethanol exceeds 20 percent. The Corn Growers Association says that by 2015 a third of all the corn grown – or 5.5 billion bushels – likely will be for ethanol. Food prices have increased.

World Watch Institute warns “Conventional biofuels will be limited by their land requirements: producing half of U.S. automotive fuel from corn-based ethanol, for example, would require 80 percent of the country’s cropland.” Thus, large-scale reliance on ethanol fuel will require new conversion technologies and feedstock.

A broad coalition is more enthusiastic about cellulosic rather than corn ethanol. Ethanol and other biofuels can be made from a wide range of plant fiber and waste. Currently corn kernels are more easily processed into fuel than cellulosic corn stover, but new enzyme technology can change that. Future stalk for ethanol may include prairie grasses, Miscanthus, Poplar, Willow and algae. Cellulosic sources could produce ten times the yield per acre of corn.

Cellulosic ethanol could account for all 14.6 billion of forecasted consumption, and even more, without needing special E85 pumps. It could all be blended with existing gasoline and fueled into current and future gasoline vehicles. Such blended cellulosic ethanol creates major opportunities for farmers in the United States and the world. It is incremental business, rather than business that competes with existing food business.

The Natural Resources Defense Council has concluded that with “an aggressive plan to develop cellulosic biofuels between now and 2015, America could produce the equivalent of nearly 7.9 billion barrels of oil per day by 2050. That is equal to more than 50 percent of our current total oil use in the transportation sector and more than three times as much as we import from the Persian Gulf alone.”

Increasingly biofuel will not be made from food; rather it will be made from sources such as waste, grasses, fast growth trees, algae, and biotechnology.

Fueling all current high-mileage cars with E10 helps reduce global warming when the ethanol is from cellulosic sources. Putting E85 ethanol in a vehicle with poor mileage does not help. It does not even help the nation with energy independence.

Until flex-fuel vehicles offer the same high mileage as many current cars, do not buy a FFV. The FFV will not help your pocketbook, the nation’s energy security, nor will it help the environment. When you buy your next vehicle, get high miles per gallon.

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

Cleantech: The Problem and Solution

Two interesting cleantech reports came out in the last couple of days. One talking about the problem, the other the solution.

On the problem side, as reported in USA Today, a team of researchers working at Texas A&M found that increased pollution in Asia, primarily from the rise of industrialism in China over the last 10 years, is affecting weather patterns over the Pacific and even into the US West Coast.

I guess the last 10 years of environmentalists harping over the growth in “dirty Chinese coal plants” had some real merit.

On the solution side, the 2007 Clean Energy Trends report authored by Clean Edge, came out this week.

The highlights from my review of their document:

$2.4 Billion in clean energy (as distinct from cleantech) venture capital investment in 2006, up 2.4x from 2005.

They project $220 Billion in market for Clean Energy by 2016.

Their 5 Trends to Watch:

  • Carbon Finally Has a Price…and a Market – They note the major advances including California’s GHG law push. We agree. But like wind and solar, we pioneered it, but Europe is leading it today.
  • Biorefineries Begin to Close the Loop – They are big on the advances of cellulosic ethanol. We remain cautious here.
  • Advanced Battery Makers Take Charge – They note the coming rise of lithium ion in the automotive sector. We agree.
  • Wal-Mart Becomes a Clean Energy Market Maker – They note major moves by Wal-Mart to go green. Long a shareholder of Wal-Mart myself, I definitely agree. We have been saying for a while that when it comes to cleantech, startups talk the talk, the big boys walk the walk.
  • Utilities Get Enlightened – They note that utilities are getting on the climate change band wagon. We would add that corporate venture is back, in a new and possibly smarter form.

You can download their report from the Clean Edge website. We have written on each of these topics before. Onwards and upwards in cleantech.

Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is founding contributor of Cleantech Blog and a Contributing Editor to Alt Energy Stocks.

Could Solvent-Free Manufacturing Technology Help Make Lithium Polymer Batteries a Reality?

I had a chance to chat with Dr. Klaus Brandt, EVP of Lithium Technology Corporation (Ticker symbol LTHU.PK). LTC has been in the business of Lion battery development for over 10 years. They are focused on large energy content / high power applications, primarily using lithium polymer technologies.

The Company was formed 4 years ago through a merger of a German battery startup called and LTC. Dr. Brandt is the Executive Vice President of LTC and Managing Director of their GAIA GmbH subsidiary, joining GAIA in April, 2005. A 25 year battery industry veteran, Gaia is his 5th battery company. He previously worked for Duracell (US) and VARTA (Germany), Moli Energy & Ionity. He holds a PhD, Physics from Tech Inst of Munich.

They haven’t disclosed much on their customers, but are focused on the military markets (especially for unmanned vehicles, like UAVs, they have one announced participation with Phoenix), and in niche industrial markets like robotics. The holy grail opportunity, of course is the EV, HEV and Plug-in hybrid automotive markets, where LiOn technology has an opportunity to displace NiMh, if it can drive costs down far enough. So far LTC has been working on early demonstrator projects in this area, but doesn’t appear to have hit the big one yet.

A quote from a recent press release on some of LTC’s activities in the plug-in hybrid sector.

“LTC has powered a project in conjunction with Innosys Engineering in which a four passenger Daihatsu Cuore was converted into an electric car using the lithium-ion batteries and a three-phase asynchronous electric motor. The battery, built with cells manufactured by LTC subsidiary GAIA, has a capacity of 25 kWh and an approximate highway range of 180-200km (100-125 miles) at 90-100km/hr (56-60 mph). These results are similar to the expected performance of the recently announced Volt slated to be made available by General Motors in 2010. “The technology is here today. LTC has it, and we’ve demonstrated it,” says Dr. Brandt. “Price is the biggest factor holding back the production of these more environmentally friendly, fuel efficient vehicles. By committing to work together, the auto manufactures and battery companies can bring the cost down and make cars like the Volt an affordable reality for the consumer.” LTC’s technology was recently highlighted in a video produced by Plug-In Partners, a national grass-roots initiative to demonstrate to automakers that a market for flexible-fuel PHEVs exists today. The full video discussing the economic and environmental benefits of PHEVs can be viewed on the Plug-In Partners website.

The piece featured a project in which LTC provided cells to the University of California, Davis Hybrid Electric Vehicle Group for the conversion of a Chevy Equinox to a PHEV as part of the Challenge X: Crossover to Sustainable Mobility engineering competition. The lithium-ion battery has the same capacity as the original metal hydride battery but with half the weight. The battery can be charged by either the internal combustion engine (ICE) or a standard AC household electrical socket and can drive over 40 miles on the overnight electrical charge. The converted vehicle has a fuel economy of 36 mpg in the city, and 38 mpg on the highway, as compared to the original Chevy Equinox range of 19 mpg city and 25 mpg highway.”

As a result of the merger with Gaia, Arch Hill Ventures, NV, the venture capital firm behind Gaia, now has a dominant stake in the company. I couldn’t find much information on Arch easily available, though.

The company trades over the counter in the US, and has struggled financially (revenues are around $2 mm/year), and it loses money, and the stock price for the last several years has reflected this. Of course, it doesn’t help that the company doesn’t seem to have filed a 10-K or 10-Q since May of 2006. In December the company earned a reprieve raised $3 mm in a Series C Preferred Stock at a valuation on the order of $23 mm, and converted about $2.4 mm in debt.

In Germany the company is manufacturing cylindrical cells, and packaging them into batteries, and doing some prod development, along with EU sales. In the US Dr. Bradnt says they do a limited production of flat cells, the US sales and marketing, as well engineering and assembly of batteries for American customers.

But aside from all that, I asked Dr. Brandt to give me a summary walk through of the technology, what makes it neat, and what the cost and performance advantages are.

The brief from their website:

“LTC’s unique technology allows for the production of very large cells with a high capacity and high power capability.

LTC’s wholly owed affiliate GAIA Akkumulatorenwerke in Nordhausen, Germany employs a unique patented extrusion process for producing electrodes for lithium ion cells. This process is environmentally friendly (no solvent) and eliminates the need for expensive explosion proof coating and solvent recovery equipment. Using high speed winding and a unique assembly technology, large cylindrical cells are manufactured. In our Plymouth Meeting facility, we have the capability to build large footprint flat cells and stack them to form large batteries. Our proprietary technology includes critical composition, processing, and packaging aspects of the battery. Our coating, lamination and extrusion know-how enables us to achieve uniformity and consistency through a range of application techniques. Batteries for the consumer, transportation, and industrial markets require different electro-chemical systems that we believe can be easily accommodated by our extrusion process.”

According to my conversation with Dr. Brandt, LTC has two core technologies. The first is this extrusion process for a part of the cell manufacturing for either LiOn or Lithium Polymer batteries. The uniqueness is a way to avoid the use of large amounts of solvents in the process of manufacturing electrodes from electrode powders.

Normally, you make electrodes by a coating process. Taking electrode powders and mixing them in an organic solvent with has a binder and any additives dissolved in it. This results in a fairly viscous slurry with typically more than half organic solvents . Then battery manufacturers typically use a coating process (usually a printing type roller process or some sort of foil through narrow slit, controlling deposition quality mechanically) to coat the slurry onto a current collector, usually a thin metal foil, and in a post process step heat the electrode to evaporate the solvent, which by volume is often greater than the active material.
Typically the make-up of the solvents used is key intellectual property for the battery manufacturer, but most are highly volatile and toxic chemicals, and need to be recycled in some sort of a closed loop system that is generally equipment and energy intensive (read costly, and not very green).

The LTC process is different. LTC runs an extrusion process as follows – make the electrode powders into mixture of powder materials directly with a special polymer binder, which flows under some pressure and temperature, and extrude the mixture into a film sheet. The process runs in the range from 200-300F up to 350-400F, and uses off the shelf plastic extrusion equipment. As second step, LTC then laminates the film to the foil. The lamination allows good control of all kinds of properties. The whole thing is roughly similar to low temperature polymer membrane construction process.

The trick is the mix of the polymers. If mix isn’t right you can’t keep mechanical consistency or can’t control thickness of the film and uniform distribution of the components. The polymer mix also affects the binding properties.

They claim the process does not really affect the cell manufacturing or the electrolyte relative to other processes. And Dr. Brandt says it has applicability for lithium ion as well as lithium polymer.

The advantage – no solvent extraction, cleaning, and recycling process equipment, and reduced energy use. Basically a more efficient, greener, cleaner process. LTC estimates their process can reduce a cost structure on the order of 5-10% improvement over conventional technology, a big improvement in battery manufacturing techniques.

The main challenges are those similar to all lithium ion and lithium polymer battery manufacturers. In the area of automotive and HEVs, they need to address cost. Scale of production is obviously a main cost down concern for LTC at this point, but materials costs are a close second. Like all lithium polymer technologies, the materials in general are still quite high.

On the performance side, Dr. Brandt walked through another interesting technology development.

They are able to build relatively large systems at a similar power density and power rate to smaller systems compared to other manufacturers, especially useful in areas like submarine and UAV batteries.

They also get high power and excellent charge/discharge rates – on some cell types up to 80% of the energy in 2 – 3 minutes.

The trick here is LTC’s technology to manage the thermal issues in the way they make the electrical connections between electrodes and terminals in the wound cells. LTC essentially makes electrical connections at every turn of a wound cell, directly connecting each cell to the terminal, using massive (relatively) terminals. They do it with a special trick they have developed to easily allow a large number of the multiple connections.

All in all, a fascinating story. One I will have to follow closely and see how well the company pulls through its recent financial straits.

Author Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is the founding contributor of Cleantech Blog, and a Contributing Editor to AltEnergyStocks.com.