Is There A Viable Business Model For EV Fast Charging?

Green Car Reports looked into it, and the numbers aren’t pretty.  From a recent study of charging station hosts in North Carolina:

Host sites were responsible for both installation and operating costs, and electric-car drivers could charge for free.

The charging stations themselves were also provided free, but applicants still had to pay $20,000 to $60,000 to install them.  That was cited as one of the reasons why–out of a pool of 16 applicants–only five sites ended up installing the fast-charging sites.

One factor that boosts costs for DC fast charging–as well as 240-Volt AC Level 2 charging–is digging a trench or otherwise connecting stations to a power source.  In addition, DC fast charging comes with far higher power requirements–sometimes enough to trigger demand fees from utility companies.

Fast charger at the Kauai Hyatt -- bought for with stimulus money but installed and operated by the hotel

Fast charger at the Kauai Hyatt — paid for with stimulus money but installed and operated by the hotel

Meanwhile, the revenue from these sites is typically not sufficient to cover costs. For example, the ideally located San Juan Capistrano fast-charging station between Los Angeles and San Diego only netted $10,000 in revenue over 18 months, with a $10-15 fee per hour of charging. That amount is not enough to cover operating costs, let alone pay back the cost of installation.

Perhaps site hosts with a retail shop can make up for it, as customers waiting to charge buy coffee or snacks like at a gas station convenience store. But you’d have to sell a lot of big gulps to break even.

To me, all of this adds up to the need for a serious look at having utilities enter the charging market, as California regulators are considering. Because otherwise, the numbers just aren’t there to encourage charging infrastructure at the scale we need.

BMW And Volkswagen Team Up For Big EV Charging Deployment On West And East Coasts

electric-vehicle-charging-station-houston-engadgetGood news for those who can’t afford a Tesla but want to or currently drive a battery electric:

The [charging] stations will be built and operated by ChargePoint, the nation’s largest charging provider, which already has about 20,000 stations in place. Prices vary, but about $.50 per kilowatt-hour is standard, which means “filling” the e-Golf will run you 12 bucks if you’ve managed to completely drain the 24 kwHr pack.

In the east, the network will let drivers go from Boston to Washington on I-95. Out west, you’ll be able to drive from Portland, Oregon, to San Diego. The stations will offer 50-kW fast chargers, which can get most EVs up to 80 percent charge in 30 minutes, and slower 24-kW Level 2 stations.

It’s great to see the automakers collaborating like this, and the charging stations will be open to any compatible EV car (unlike Tesla’s network, which only works on Tesla batteries). It’s also badly needed given the slow pace of infrastructure deployment here in California.  EVgo is using state settlement money from the “rolling blackouts” of the turn-of-the-century, but the charger rollout is slow and mostly focused within urban areas, as opposed to between them. So we need those fast chargers on key highways between major cities, or else all-battery EVs of the 80-mile range variety are basically stuck as commuter cars.

UC Berkeley / UCLA Law Report On Expanding Access To Energy Information To Boost The Clean Technology Sector

Knowledge Is Power CoverCalifornia is poised for a major energy transformation in the coming decades, with Governor Brown pledging to put the state on a path to 50% renewables and 50% less petroleum usage by 2030. Achieving this transformation will require a robust and thriving clean technology sector, including renewable energy and energy storage developers, energy efficiency contractors, smart grid hardware and software purveyors, and electric vehicle automakers, among others.

But to ensure the success of these industries, as well as a cost-effective energy transition for consumers, California must expand access to energy information. This information ranges from customer access to their long-term usage patterns in an easily-readable, standardized format, to utility statistics on distribution grid needs and pricing, to anonymized, aggregated energy usage patterns on a neighborhood scale. Customers can harness this information to use energy more efficiently, while clean technology companies can use it to improve their services, customer acquisition efforts, and competitiveness with traditional energy providers. Policy makers and nonprofit advocates could also use this information to target energy incentives to the customer groups and regions that would make the best use of them — thereby deploying limited public funds more cost-effectively.

To offer solutions for improved access to energy information, UC Berkeley and UCLA Schools of Law are today releasing the report Knowledge is Power: How Improved Energy Data Access Can Bolster Clean Energy Technologies & Save Money. The report resulted from a one-day gathering of clean technology leaders (including renewable energy developers, battery experts, smart grid suppliers, energy efficiency contractors, and electric vehicle automakers) and public officials. It is the fourteenth in the law schools’ Climate Change and Business Research Initiative, sponsored by Bank of America, which develops policies that help businesses prosper in an era of climate change.

The group identified barriers to expanded information access, from a lack of incentives and funding for utilities to collect and share data to concerns about compromising customer privacy and cybersecurity breaches. The report identifies information that would be most valuable to the clean technology sector and recommends that policy makers:

  • Establish customers’ right to improved access to their own usage information through an easily organized, standardized format, including the disclosure of historic building energy audits;
  • Develop cost-recovery mechanisms for utilities to collect and share aggregated, anonymized energy and market statistics to researchers and the private sector; and
  • Fund the development and maintenance of secure energy information centers.

Most of these and other recommendations in the report will require action from state legislators and regulators, including via existing regulatory efforts at both the California Public Utilities Commission and California Energy Commission. Ultimately, by implementing steps like these, California can ensure a smoother and more cost-effective transition to a clean, efficient, and localized energy and transportation system.

Tesla’s “Holy Shit” Factor

A Tesla driver recorded his friends’ reactions while accelerating from a stop in his new P85D model:

Make sure to watch to the end.

San Francisco Chronicle Tries And Fails To Slam Bay Bridge Design Choice
The new bridge in front of the old.

The new bridge in front of the old.

I’m all in favor of a good takedown of poor public sector decision-making. But Jaxon Van Derbeken’s attempt in the San Francisco Chronicle’s Sunday edition to criticize the Bay Bridge design selection back in 1998 is pretty weak.

Van Derbeken’s thesis (although of course he doesn’t come out and say it) is that the bridge selection committee was stacked with a bunch of non-bridge experts who, because of their ignorance and arrogance, picked the wrong design, thereby resulting in huge cost overruns and construction defects:

They were elite architects, engineers, seismologists and academics — but few had any experience building or designing bridges. After a yearlong process, 19 of them gathered in an auditorium in Oakland to choose between two alternatives: a conventional span resembling more than 100 bridges worldwide, and a daring design that had never been tried on such a scale.

But the problem is that these decision-makers appear to have been badly misled by a flawed staff report:

Both [bridge design options] would cost roughly $1.5 billion, the group was told, although the attention-grabbing span was the more expensive of the two — perhaps as much as $173 million more for a bridge that would look like no other.

“At the time, it seemed a meaningless difference” and an amount “well worth spending,” said panel member Jeffrey Heller, a high-rise architect.

It turned out, however, that the difference was much more. The final sum may not be known for decades, until the problems that cascaded from the panel’s approval of a self-anchored suspension span in 1998 — broken rods, leaks in the steel structure, cracked welds, misaligned road decks — are fixed with toll payers’ dollars.

Van Derbeken never investigates who wrote the report or why they got the cost predictions so terribly wrong.  The cost difference as presented to the decision-makers seemed relatively minimal in the grand scheme of things.  So why not go with a nicer-looking option?  Plus, a later decision to move the bridge’s lone tower closer to Yerba Buena Island, driven in part by aesthetic considerations but also seismic concerns, made the cheaper option less viable, if not unworkable.

Van Derbeken should have singled out the agency personnel for blame here.  Now perhaps a more educated group might have pushed back on the staff report, but there’s no indication that even the opponents of the ultimate design choice urged a new staff report.  At a minimum, Van Derbeken should have investigated.

But perhaps even worse, Van Derbeken fails to link the construction defects that occurred as a direct result of the bridge design.  Instead, all the defects point to shoddy workmanship that could have happened with any design:

A batch of galvanized rods needed for extra seismic strength on the unusual bridge cracked, adding more than $45 million in costs. A Chinese crane maker won the money-saving contract to make pieces of the bridge, but turned out shoddy welds and produced ill-fitting road decks at risk of premature cracking.

Connecting the self-anchored suspension span to the skyway portion of the bridge turned out to be what [MTC head Steve] Heminger called “the fabrication challenge of a lifetime,” slowed down the project by a year and added $145 million to the bill.

Lightweight steel guardrails were used instead of the usual concrete on the suspension span; holes, drilled in the deck so the barriers can be attached to the bridge, leak when it rains. Rods that hold down the tower became steeped in rainwater and could be at risk of corroding.

Now maybe these defects were more likely to occur given the extra work allegedly required by this design. But Van Derbeken doesn’t make that case explicitly — my guess is because he can’t. None of these defects are excusable, and they point to basic mismanagement and poor construction techniques. But blaming the design doesn’t make sense, at least with the evidence presented here.

My hunch — and I say this without direct knowledge — is that Caltrans may be the real culprit here, from doing a bad job preparing a crucial staff report to overseeing the entire, flawed construction process. Perhaps Van Derbeken should focus his investigation on that agency, instead of trying to make villains out of the design selection team.

“Let Us Not Seek To Satisfy Our Thirst For Freedom By Drinking From The Cup Of Bitterness And Hatred.”

On this day to remember Martin Luther King, Jr., his 1963 “I have a Dream” speech is worth watching in full:

“Captain Jack And The Modoc War” On KPOV-Radio In Bend, Oregon
Captain Jack, leader of the Modoc War.

Captain Jack, leader of the Modoc War.

In the northeastern corner of California in rural Modoc County, volcanoes have left an incredible, massive lava field. You can explore the lava tubes like subway caves underground, as well as check out rock art left by the Modoc Indians.

After traveling there in 2003 and learning about the Modoc uprising against the U.S. Army in 1872-3, I wrote the song “Captain Jack and The Modoc War” and put it on my 2006 album Tales From CaliforniaKPOV radio in Oregon is now featuring the tune as part of their “Calling All Cowboys” series, with a segment devoted exclusively to songs about Captain Jack, the Modoc leader.

Jack led the Modocs back to their ancestral homeland, after broken promises left them in a bad situation on a reservation in Oregon.  They held off the U.S. Army for months in a lava stronghold, but eventually lost after making an ill-fated decision to assassinate the general in charge of the campaign (the only general killed in an Indian war).  Jack and other leaders were hanged and the tribe was relocated to Oklahoma.

It’s a tragic story but one that should be a more prominent part of our western history. You can listen to the segment here, with my song starting around 46:40.

The “Hidden” Gas Tax That Wasn’t

Remember when oil companies cried last year about transportation fuels going under California’s cap-and-trade program in 2015?  They tried to scare everyone about the “hidden gas tax” and how prices would rise 76 cents a gallon.  As Bruce Maiman in the Sacramento Bee reminisces:

For months, the warnings were endless: Come January, gas prices would jump as much as 76 cents a gallon. “Put the brakes on the Hidden Gas Tax!” implored countless Facebook ads.

Anyone seeing pump prices skyrocketing?

Never mind that oil prices plummeted last year as a gallon of regular dropped in California from $4.13 last summer to $2.59 now – $2.48 in the Sacramento region. I’m sure most of the many thousands who hit the Facebook “like” button didn’t bother to investigate the California Drivers Alliance, or 15 other groups harping the same sky-is-falling message. A casual observer likely believed their claims of being a grass-roots group rising up against devious bureaucrats trying to sneak another tax past you.

In truth, what was hidden was the real identity of these front groups, all funded by the oil industry – the Western States Petroleum Association and the California Independent Oil Marketers Association, longtime opponents of Assembly Bill 32, California’s 2006 landmark legislation to reduce greenhouse gas emissions to 1990 levels by 2020. The cap-and-trade system expanded this year to cover vehicle fuels.

Read more here: http://www.sacbee.com/opinion/op-ed/bruce-maiman/article6132519.html#storylink=cpy

Luckily for environmental advocates, the global oil glut has kept the political pressure off this issue, allowing California to greatly expand the cap-and-trade system.

Now let’s hope that advocates can use these big price drops to finally end the subsidies for oil and gas around the country, as the Economist called for today:

The most straightforward piece of reform, pretty much everywhere, is simply to remove all the subsidies for producing or consuming fossil fuels. Last year governments around the world threw $550 billion down that rathole—on everything from holding down the price of petrol in poor countries to encouraging companies to search for oil. By one count, such handouts led to extra consumption that was responsible for 36% of global carbon emissions in 1980-2010.

Falling prices provide an opportunity to rethink this nonsense.

To paraphrase Rahm Emanuel, never let a period of cheap oil go to waste.

A Possible Financial Doomsday Scenario For California High Speed Rail

Critics of high speed rail have tried to fight the system in court and sort of at the ballot box (failed Republican gubernatorial candidate Neel Kashkari made a big deal about Governor Brown’s “crazy train”).  So far they have failed at both.

But a remaining criticism, that the state doesn’t have enough money to finish the system, still looms large.  The funding reality is especially alarming given the unfortunate starting point in San Joaquin Valley no-man’s land, far from the state’s major urban centers and thus far from a political constituency that would be motivated to fight to finish the system.

The financial doomsday scenario I can imagine is pretty straightforward.  The High Speed Rail Authority has less than $10 billion in voter-approved state bond funds and $3.5 billion in federal funds.  It will also get about $250 million a year in cap-and-trade money, at least until 2020 (totaling roughly $1.5 billion).  So that’s a grand total of approximately $14.5 billion, give or take a billion.

[UPDATE: some estimates for cap-and-trade auction revenue are as high as $8 billion by 2020, with high speed rail receiving 25 percent.  So my estimate for the total take should probably be revised upward to possibly $8 billion or so through 2020.]

How much will that money build?

B66y3qfIAAAOavHWell, it should fully fund the “initial operating segment” of Phase 1, which will connect Madera to just north of Bakersfield.  That segment will hopefully be completed around 2020 at a cost of $6 billion.  So far so good.  That leaves over $8 billion left, assuming no cost overruns (a baldly counter-historical assumption).

Then the final construction on this segment will take the line an additional 170 miles north to Merced to and south to the San Fernando Valley in Los Angeles County, where the system will connect with Metrolink sometime in the 2020s.  This link will be important for political support and ridership, as it will finally connect the system to an urban area, albeit on the outskirts and with the necessity of a transfer from the relatively slow Metrolink system.

But the problem is that this construction will cost an estimated $25.3 billion.  That leaves California about $17 billion short of getting the system to a major metropolitan area, assuming no cost overruns.  Not to mention that extending the line 110 miles north to San Jose will cost another $19.9 billion.

Where will the additional funds come from?

I think you can safely assume no more federal dollars at least until the 2020s, given expected Republican dominance of Congress until the new decade, due to state gerrymandering of congressional districts.  And the State of California is unlikely to provide additional dollars, given the shortfall in our existing transportation system and voter unwillingness to pass another bond measure on top of the 2008 one.  Perhaps private money might materialize, but that Los Angeles-to-Fresno route does not seem particularly lucrative.  (The one bright spot may be the privately funded Las Vegas-to-Victorville line, which might one day provide money and political weight to connect to a Tehachapi crossing on the state-funded system.)

All aboard, my grandkids!

Maybe it happens, maybe it doesn’t

So by the early 2020s, the California High Speed Rail Authority could conceivably have spent billions of dollars to create a separate rail right-of-way along a pretty significant portion of the southern Highway 99 corridor.  But it won’t have launched high speed service anywhere, let alone to a major population center.  And all the money will have run out.

All would not totally be lost: that right-of-way could presumably be used for improved Amtrak service, which might even earn an operating profit.  But unless the Authority has made progress on the great engineering challenge of getting the rail route over the Tehachapis to serve the politically connected Palmdale region, rather than the easier Grapevine approach, high speed rail boosters will need a renewed political push to raise the billions needed to connect the system to ‘someplace close’ to Los Angeles.

I could certainly imagine that political push happening, but it would be an uphill climb (no pun intended) against a record of billions of dollars spent without much to show for it.  To be sure, as I wrote for the groundbreaking last week, I do believe high speed rail is inevitable and badly needed.  But this doomsday scenario could put the brakes on the system for possibly decades to come.

I hope I’m wrong.  But in the meantime, California leaders may want to consider far-cheaper and quicker upgrades to statewide Amtrak service and possibly spearhead private efforts to build a viable, standalone high speed rail segment, such as within the Los Angeles-to-San Diego corridor.

Because if my fears prove true, we could be on a slow speed to high speed for quite a while to come.

Mayor Lee’s Quixotic Attempt To Help Families Stay In San Francisco

The headline in today’s San Francisco Chronicle was promising: “Mayor Lee takes steps to keep families in S.F.” But then I read the details:

Mayor Ed Lee took steps Tuesday to make San Francisco a little more family friendly and easier to get around, announcing the city would provide funding to help pay for basic preschool for all 4-year-olds in the city and substantially expand its Muni light-rail fleet.

It’s well-known to locals that San Francisco is brutal for young families, but not because of limited pre-school access or crowded Muni trains. It’s simpler than that: the public school system is painfully dysfunctional, with a convoluted lottery system keeps kids from attending their neighborhood schools and instead can send them on hour-long bus trips to far-flung neighborhoods. And on top of that, the city’s notoriously high cost of housing, due in part to local opposition to and restrictions on residential growth, is even worse for families with kids that need multiple-bedroom homes.

A typical SF family with kids: white, wealthy, and fictional

A typical San Francisco family with kids: white, wealthy, and mostly fictional

The result is evident from this Chronicle write-up of the last U.S. Census:

Just 13.4 percent of San Francisco’s 805,235 residents are younger than 18, the smallest percentage of any major city in the country. By contrast, San Jose’s percentage of children is 24.8 percent, Oakland’s is 21.3 percent, Boston’s is 16.8 percent and Seattle’s is 15.4 percent, according to Brian Cheu, director of community development for the Mayor’s Office of Housing. Even Manhattan is composed of roughly 15 percent children, according to Dan Kelly, director of planning for San Francisco’s Human Services Agency.

In 1970, children made up 22 percent of San Francisco. In 1960, they constituted 25 percent.

And so we have a city gentrifying faster than ever before, with a whiter and wealthier family base:

Families that choose to stay tend to be whiter and wealthier than ever, several city officials said. Thirty percent of families with children in San Francisco now earn at least 150 percent of the city’s median income. Those families made up 20 percent of all families with children in the city in 1990.

So while expanded pre-school access and more Muni trains sound nice, let’s not pretend it will do anything to reverse this unfortunate trend. The real action should take place on public school reform and dramatically boosting the supply of family housing in the city. Everything else is window dressing.

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