Why More Hybrids Could Revolutionize… Our Electric Utilities?

It was the best quote of a two-day conference, and it came toward the end, from the always-pithy Ed Kjaer of Southern California Edison. Speakers had waxed effusive over not just more hybrids, but plug-in hybrids, fully electric vehicles—and that was just for starters.

Imagine, they said, using vehicles with large-capacity batteries as adjuncts to the power grid for “ancillary services” like load balancing vehicle-to-grid services, then extending that so that cars become “cash-back hybrids” that would, in theory, actually make money for their owners in that capacity … and so forth.

Before thinking about other such uses for the battery packs in hybrid vehicles, Kjaer all but begged, “Let’s just get the batteries driving the wheels first!”

Which only underscores the challenges of integrating new and different forms of energy storage and motive power into a global ecosystem built around vehicles that have used only petroleum for 100 years. The conference, “Developing the Market and Infrastructure for Electric and Plug-In Hybrid Vehicles,” was held in late May in Troy, Michigan.

But then Kjaer veered in a different direction. Perhaps, he told us, the biggest initial impact of large Li-ion battery packs for hybrids and plug-in hybrids wouldn’t really be the cars; perhaps it might actually be on the world’s utilities. After all, remember: Today, there are only about 2 million hybrids in the “global car park” of 820 million vehicles—or far less than 1 percent. And there are fewer than 200 plug-in hybrids. But forecasts predict far greater numbers, and that requires one thing: Mass production of high-capacity battery packs.

“Energy storage is the game changer,” he said—and widespread availability of lithium-ion battery packs of 10kW or more might just lead to what he called “Electric Utilities 2.0”.

The mass production of large-format Li-ion cells and packs for vehicles could provide, he suggested, for local energy storage—both for homeowners and at power generation facilities. After all, aside from dams—effectively huge energy storage devices—the power that utilities produce has to be consumed within fractions of a second, because there are few cost-effective ways to store it. But battery packs might change that.

Imagine, Kjaer said, a home energy storage and management system with a 1.5kW photovoltaic array added to a 10-kWh battery pack. Right now, 3kW of PVs costs about $27,000. If you cut that in half, but add a $5,000 battery, a home can not only create but store power from the sun, and for that matter, from the power company, for less than $20,000. (For perspective: A 10kW battery pack costs several times $5,000 today, but the price is not unreasonable looking out a few years, after production builds and costs decline.)

With smart meters and demand-variable power pricing, the home could remove itself from the grid whenever power gets too costly—or, in emergencies, at the utility’s request—and possibly even feed power to the grid, known as reverse metering.

At a larger scale, the same principle applies for 1- to 2-MW energy storage substations at wind farms. The challenge to renewable energy like wind, of course, is that the power isn’t always produced when it’s most needed. Wind power, for example, tends to be most prolific after dark—when it’s least needed. Already, two utilities are testing large battery packs racked into experimental storage facilities to see whether they can raise the utilities’ compliance with increasingly stringent mandates for their Renewable Portfolio Standard.

A final wrinkle: Orders from utilities for large-format Li-ion packs might hasten the ramp-up of full-scale manufacturing—which would lower costs for carmakers faster than their own demand alone ever could. With each full-scale lithium-ion cell manufacturing plant costing a few hundred million dollars, capital investment won’t come until the market demand is there. Utilities could help.

With their long amortization horizons—in some cases, decades—could utilities can play a major role in hastening affordable battery packs for hybrids and plug-ins? Watch your utility bill for new offers on new home energy-storage solutions.


  • Paul Rivers

    I keep seeing articles on this concept, but it’s never going to happen without some ridiculously gigantic leap in battery technology (making much much longer lasting batteries). Just think about it – you buy an electric car. Do you want to prematurely wear out the $10k or $20k battery pack so you can save a little money on your electric bill?

  • AP

    To Paul’s point, I think you’d risk the vehicle manufacturer’s battery warranty being voided if the battery is drained and filled for other purposes than running the vehicle. This may be feasible, but it seems like abuse of the vehicle.

  • MilwaukeeT

    What about using the technology we have now? The so-called off the shelf stuff? If PHEVs were made available using the best technology currently available, they could replace half of the cars around the world NOW. Not in 5 years, or in 10 years. Say 100+ mile range, 100+ mpg. Average size car. I’m just not willing to shell out 50K USD for a new Prius, converted to a PHEV. But 25K? In a heartbeat.

    There have been so many “announcements” and “sneak peeks” from the auto makers over the last 10-20 years and NOTHING has really changed…. It’s getting old…

  • Peter Vernon

    Paul. The quote I got for a new battery pack for a Prius last November was “under $4K – dealer installed”, and not the $10-20K you are speaking about. Perhaps you can reconsider your needlessly negative statement…..

  • Shines

    I like the idea of a battery pack maybe installed in my attick above the circuit breaker – separate from my car. During a brownout or utility failure, the battery kicks in providing emergency power when it’s needed. If the power companies are serious about reducing energy needs during the day, then they could offer discounts on the battery packs or on power pricing – by offering lower prices at night. I know this is Hybrid Cars.com but there are other ways to take advantage of hybrid technology besides cars…

  • Anonymous

    As long as the American car companies continue to sleep with the oil companies, this technology will never exist. Keep dreaming……..

  • Need2Change

    I concur with comments from Paul and others. A plug-In hybrid requires a battery more than twice the size of the current Prius, and may cost about $10-15K.

    Not sure if it is worth it to continually go through charge/recharge cycles and earn an extra dollar or so for each cycle. This has to reduce the battery life.

    I also wonder what would happen if the utility just drained my battery, and I get in to drive it.

    Still, it’s a good concept to pursue.

  • kballs

    Car charges at night, then I drive it to work, where feeding power back to the grid SAVES MY EMPLOYER MONEY (not me), and then the battery is dead when I go to drive home (so I have to burn gasoline instead of using cheap grid electricity from the previous night). That’s not a good thing, and that’s on top of the shortened battery lifetime, and the fact that I would be hauling big batteries around for grid purposes instead of driving (would be far more efficient to use stationary batteries (and flywheels or thermal storage for that matter) for grid leveling purposes).

  • Hal Howell

    Personally, I think its a stupid idea. The purpose of having an electric car or my current Prius is to get me to work and back home, not provide power to the electric company.

  • Wei

    I am shock that they are still thinking to use the Li-ion battery. There is a secretive company in texas name Eestor which is testing its ultracapacitor might totally change the convention view of EV. The ultracapacitor it produce can keep the car running fo 400 km and it only take 5-10 minutes to recharge. The Canadian EV company ZENN is expected to see the car at the end of 2009. US military company Lockhead already sign contract for its military application. Pls google Eestor and ZNEE(Zero emission no noise!) and you will find out more information.

  • Collin Burnell

    Haven’t you guys (and gals) seen the Hymotion Plug-In conversion? http://www.hymotion.com

    To MilwaukeeT – I can’t make sense of what your saying… how do you replace 800 million vehicles now??? 5 to 10 years is optimistic!!! And to say NOTHING has really changed??? Were you frozen for the last 10 years? Can you be more specific?

    Remember: Lithium (based batteries) is roughly a 200% improvement (3X) in weight to power ratio over existing Nickel (based batteries).

    This whole model, described in the article, will happen because its a Win-Win-Win-Win situation. It will save the home/PHEV owner money. It will save the utilities from expensive expansion and allow them to meet their Renewable Energy Portfolio Standards. It will mean companies that generate green electricity can balance out their output (that is a HUGE challenge in the Wind and Solar Industry) and it’s all good for the Planet. Count me in!!!

  • Collin Burnell

    Yes! ultracapacitors could play a MAJOR roll in this… I have a hunch that future electric vehicles will use some combination of both Lithium based batteries and Ultracapacitors.

  • tw8s

    The significance of this article is in the last EIGHT paragraphs, not the first FOUR. Development of stationary power storage technologies for small to mid-sized wind and solar applicatons ramps up production and lowers costs of storage packs suitable for hybrid/plug-in/all-electric vehicles. The shared goals of greater energy density and reliability along with lower costs benefit both sectors. (And, your vehicle’s purple flux capacitor doesn’t have to be deep-cycled by the power grid to accrue this benefit.)

  • Collin Burnell

    Yea!

    I was going to say that!

    :-)

  • Paul Rivers

    “Paul. The quote I got for a new battery pack for a Prius last November was “under $4K – dealer installed”, and not the $10-20K you are speaking about. Perhaps you can reconsider your needlessly negative statement…..”

    I’m commenting on the vehicles mentioned in the article, not on the current Prius’s battery pack. The vehicles in the article are actual plug-in electric cars which will require much larger (and thus more expensive) battery packs than the Prius. Not that it matters as spending $4,000 on a battery pack in order to save a little on your electric bill isn’t real appealing either.

  • jvoelcker

    Paul (and many others) … read carefully, please!

    This is not about so-called vehicle-to-grid (V2G) technology, using a hybrid or electric CAR as a backup power source.

    It’s about utilities (or third parties) buying large-capacity batteries that use the same basic cells, packaging them with photovoltaics, and providing home energy storage.

    Entirely separate from the car.

  • Jon

    I’ve seen various calculations in this regard and never have I seen them take into account the added wear and tear the cycling the batteries for grid usage would cause. This is a interesting theory but what happens when the manufacturer voids your warranty for unauthorized use/abuse.

  • MilwaukeeT

    Sure, Collin Burnell I can be more specific. By “NOTHING has changed” I mean drive by your local Walmart or Post Office dealer and tell me what has changed from 10-20 years ago? (I mean in Kansas and Ohio, not San Francisco!) Maybe you’ll see a hybrid or two, but probably that’s it. Otherwise Americans still have minivans and SUVs. My point was, yes, the technology seems to be advancing, (based on headlines in the media) but certainly not what’s in production and consequently not what the average American has in their driveway! It’s not about changing all of the cars at once, but I want to see the possibility that things might be different in a decade or two. Right now I don’t.

    In short I am tired of the hype by industry and the media, I want products in the dealerships and on the road!

  • Collin Burnell

    Hmmm. In some way’s I do agree with you… The majority of Americans still have a mild (at best) commitment towards protecting the planet… and the Automakers cater to that… but… Many Automakers now offer at least one Hybrid and (with the exception of some of the GM products) they did their homework and produced a decent first attempt. I have the Nissan Altima Hybrid and I love it. The Toyota’s and Honda’s are solid and even the Ford Escape is quite good. Hype and Vaporware seem to be part of the game in the Auto industry. I really hate it when the prototype looks awesome and the final product looks ‘lame’ (Ford Fusion / Mercury Milan).

    I think what I found odd is to say NOTHING has changed. Things have certainly changed. A huge effort has been made and (it looks like that) will continue. I think we have to stop and realize how daunting a task it is to bring new product to market. It’s not just engineering and testing the vehicle but building the factory to assemble them and getting all the supply ‘chains’ in place…

  • reginab

    Auto Repair and Maintenance costs a lot. And with freaking gas prices… We all need an alternative to gas. Hopefully the battery technology will improve and we have more choices when it comes to cars.

  • Brian Childs

    Just thought I would throw in my two-cents to this invigorating conversation:

    I am currently sitting in Iraq on my third deployment. There is a lot of wonderful discussion taking place about whether these technologies are worth the effort, or if the average American consumer is capable of producing demand for electric vehicles sufficiently so that manufacturers will respond.

    I think like any investment or plan, there are pitfalls on each side of the arguments discussed here. High fuel prices have the potential of making the kind of sustained demand for hybrids to capture more market share. But, indeed, this might be a slow process… and only the result of financial pain at the pump.

    My hope is that in these discussions, when people talk about a drastic alteration in the way we use energy, are given the proper framework. Where I am now is a function of the depravity we are willing to go in order to sustain our current paradigm. $8-12 billion monthly “invested” in stabilizing a region where our reserves come from. Lives, sacrifices, economic fragility… these are all aspects of the way we have been heading. And that doesn’t count the often intangible threat against our lives when you consider how this part of the world is reacting to our presence here.

    I welcome you to learn about the IED. I welcome you to learn about the Madrid bombings and the London Underground bombings. I welcome you to learn about what kind of hostility the paradigm we have been living in has created. The problems inherent in our current energy dependence ALONE is the impetus for change.

    The saddest thing I have seen… far beyond the rubble of the WTC… is the reluctance our population has shown to alter our course and attack the roots of these problems… something we have known about since the beginning: that dependence of foreign sources of energy for our infrastructure is an endgame we should never have started playing. Hybrid vehicles and smart grids such as proposed by Gridpoint in Virgina… those are the way to fight terrorism. Those are the ways the stimulate the economy. Those are the ways to protect the environment.

    Discuss. Argue. invest. Do whatever makes you feel good… but for God’s sake… wake up. We are sleeping with the enemy right now.

  • Brian Childs

    Just thought I would throw in my two-cents to this invigorating conversation:

    I am currently sitting in Iraq on my third deployment. There is a lot of wonderful discussion taking place about whether these technologies are worth the effort, or if the average American consumer is capable of producing demand for electric vehicles sufficiently so that manufacturers will respond.

    I think like any investment or plan, there are pitfalls on each side of the arguments discussed here. High fuel prices have the potential of making the kind of sustained demand for hybrids to capture more market share. But, indeed, this might be a slow process… and only the result of financial pain at the pump.

    My hope is that in these discussions, when people talk about a drastic alteration in the way we use energy, are given the proper framework. Where I am now is a function of the depravity we are willing to go in order to sustain our current paradigm. $8-12 billion monthly “invested” in stabilizing a region where our reserves come from. Lives, sacrifices, economic fragility… these are all aspects of the way we have been heading. And that doesn’t count the often intangible threat against our lives when you consider how this part of the world is reacting to our presence here.

    I welcome you to learn about the IED. I welcome you to learn about the Madrid bombings and the London Underground bombings. I welcome you to learn about what kind of hostility the paradigm we have been living in has created. The problems inherent in our current energy dependence ALONE is the impetus for change.

    The saddest thing I have seen… far beyond the rubble of the WTC… is the reluctance our population has shown to alter our course and attack the roots of these problems… something we have known about since the beginning: that dependence of foreign sources of energy for our infrastructure is an endgame we should never have started playing. Hybrid vehicles and smart grids such as proposed by Gridpoint in Virgina… those are the way to fight terrorism. Those are the ways the stimulate the economy. Those are the ways to protect the environment.

    Discuss. Argue. invest. Do whatever makes you feel good… but for God’s sake… wake up. We are sleeping with the enemy right now.

  • Craig

    “This is not about so-called vehicle-to-grid (V2G) technology, using a hybrid or electric CAR as a backup power source.

    It’s about utilities (or third parties) buying large-capacity batteries that use the same basic cells, packaging them with photovoltaics, and providing home energy storage. “

    Just to add on to that thought because I don’t think the meaning is obvious to everyone. The reason it is significant that utilities might use this same battery technology is that would move us up the economy-of-scale curve much more quickly if some utilities go in this direction.

    We will eventually see a 100-mile battery pack for about $1000. The sooner we get there, the better.

  • Lothan

    A Multi-Billion dollar push to encourage MASS PRODUCTION of leading edge battery technology and electric cars will do more to combat terrorism and make America safer than anything else we could do right now. If you can’t grasp how, then I suggest you must have been a 2-time Bush voter and thus are in desperate need of a massive dose of intelligence and logic.

  • John K.

    Flybrid Systems’ or some one else’s flywheel storage system can do the same thing right now and without the need for major breakthroughs and without having to be replaced every 5 – 10 yrs w/new storage units.