Wednesday, April 19, 2006

PHEV: Never Visit the Gas Pump Again (Almost)

The front page of a major newspaper yesterday reported “By next week: $3 gas!”. And hurricane season doesn’t even start until June 1. After reading that headline, I rushed home after class and filled up at the cheapest gas station I could find - $2.799. To fill up my ’95 Stratus cost me almost $35!!!

Most guys my age (24) dream of sports cars with turbo-charges engines that go 0-60 in 5 seconds. I dream of a car that will go 0-60 miles without using a single drop of gasoline.

I used to believe strongly in Fuel Cell powered cars – they’re very cool. There are several problems, though, which I plan to discuss in a future posting.

In the meantime, we have technology available now that can allow people to break their weekly ritual of praying to the gas pump god. It’s known as Plug-in Hybrid Electric Vehicles or PHEVs.

What are PHEVs?
PHEVs are really nothing more than a standard hybrid-electric vehicle – the most famous is the Toyota Prius – with an extra-large battery, a voltage inverter, and a standard 110V plug. Basically, you plug your car in at night and it charges the extra-large battery for several hours. The battery provides enough juice to keep your car going for an estimated 60 miles or so without having to turn the gasoline engine on. If you run out of battery or forget to plug in, no problem, your gasoline engine is there as backup – same goes for trips longer than 60 miles (how many of those does the average person take in a year - 5, 10, 20?)

There are a few issues that arise when switching to PHEVs:
1) What are cost savings and conversion costs
2) switching one dirty fuel (gasoline) for another (electricity from coal)
3) batteries issues
4) extra load on the electric grid

Cost savings and Cost of Conversion
As reported by major news organizations, the price of gasoline is not going down anytime soon. Once it goes above $3/gallon, it’s bound to stay there, if not higher – don’t hold your breath waiting for it to come back down again. PHEVs are estimated to cost an equivalent of under $1 per gallon. We haven’t seen $1/gal gas for what seems like forever. Even if this estimate is off by a factor of two ($2/gal equivalent instead of $1), that is still going to about half of the estimated cost of gasoline.

Initially, conversion is going to be rather costly. According to EDrive Sytems the first wave of installations will cost about $10,000-$12,000 in addition to the cost of a Toyota Prius ($21,000). That’s a lot of money – but I have seen guys my age and younger easily spending thousands of dollars to “pimp their ride” with decorations, LCD screens, rims, stereo systems, you name it!

The way I figure, you’ll probably save about $1000 per year for small cars to $2000 per year for SUVs by driving a PHEV, depending on price of gas, your current car’s mph, and price of electricity. Being optimistic, it will take about 5-10 years to make up the price of the conversion kit – about the lifetime of the car. Of course, gas prices could get much more expensive in a short time (how quickly we forget Katrina). Dare we forget the hidden cost of using gasoline – defense of oil, global warming, air pollution and health problems. It may not be the best investment in the world, but at least the money is being spent on technological advancement and is not going into the hands of greedy corporations and questionable governments.

If you think of it, though, $31,000 is not that expensive for a car. It’s a little above average, but it is by no means near the top. A quick search on AutoBytel will reveal that there are 49 passenger cars, 36 sports cars, and 58 SUVs that are within the $30,000-$35,000 range. People do buy cars in this price range, so why not buy a car for a good reason instead of just looks?

Switching one dirty fuel for another
The idea of PHEVs is to plug the car into an electrical socket at night and have it charge for about 10 hours (assuming fully depleted). Well, that electricity is coming from somewhere. Currently, about 60% of our electricity comes from dirty coal (btw, “clean coal” is an oxymoron if I ever heard one). It varies by region and more and more regions are looking at switching to renewables (hurray!).

The obvious answer would be to install a renewable energy system in your home – solar or wind. Add a little extra capacity to make up for your PHEV’s usage. With state and federal incentives, you could potentially have the best of both worlds – cheap, clean electricity and very low gasoline costs.

Let’s assume for a moment that renewables are not a significant source of electricity and coal remains dominant. Here is what EDrive says on their website:

“One thing that is often overlooked when electric power plant pollution is discussed, is the upstream pollution required to extract oil, transport it, refine it, distribute the gasoline then refuel a vehicle (vapor emissions). Comparing the national electrical grid to the average gallon of refined gasoline shows that the upstream pollution for gasoline production on average is much higher than that of the average electricity source.”
http://www.edrivesystems.com/faq.html


Look at the graph from a presentation given by EPRI. The reduction in Greenhouse Gas emission is huge – 50% across the board.

If you don’t have the resources for a renewable energy system (or it just isn’t practical), the next best thing is to buy renewable energy in the form of Renewable Energy Credits (RECs) or Green Tags. Green Tags represent the “environmental benefits” of producing renewable energy. When you buy a Green Tag, it is a promise from that company to produce the equivalent electricity using renewable energy – solar, wind, or biomass. They are inexpensive and make a big difference. You can buy them from many organizations, even your local utility, but be careful! Some organizations play tricks and try to sell you renewable energy that has already been generated. I suggest Krystal Planet since their Green Tags go directly into building new wind farm. There are other reputable companies out there as well.

Battery Issues
Batteries still remain a major hurdle. However, the technology is constantly improving and prices are constantly falling. New technologies, such as lithium , nanotechnology and even viruses, are significantly improving the price-performance of batteries.

Extra load on the electric grid
If everybody were to switch to PHEVs and got their power from the electric grid, chances are the grid won’t take it. The reality is that it will be a slow roll-out and will probably not stress the grid too much. Even if PHEVs became a significant part of America’s fleet and a load on the grid, it would be during the night when utility companies rev down or even turn off some power stations. In fact, utility companies would love to be able to sell more electricity during off-peak – it increases their return-on-investment because otherwise the power plants would be just sitting their idle.

There is even talk of integrating PHEVs into the power grid to help store energy during the night and feeding it back into the grid during peak hours to help stabilize the grid. This is another topic for another post.

Conclusion
For now, PHEVs remain a novel technology for the bold and environmentally conscience. I think they can seriously put a dent in our “oil addiction”. There is always room for improvements. Car makers should seize the opportunity and offer PHEVs as an option – much like they do leather or navigation systems. Car makers have a way of reducing the costs like nobody else, making the technology all the more attractive

It will be a few years until I can afford to get a new car. Hopefully by then, PHEVs will be a proven technology and ready for prime-time. Personally, I want to get one to do my part to save the environment and so I don’t need to stop at the pump and watch my hard-earned money go into lining unscrupulous pockets.

If gas prices get too high, I think I’ll take my bike to the University.

8 Comments:

At 3:01 PM, Blogger Abdullah said...

A horse! a horse! my kingdom for a horse! All what I need is a horse.

 
At 12:35 AM, Blogger C. Scott Miller, EDP said...

What would be better is if the PHEV was made flex-fuel so that it could run on ethanol, gasoline, or any blend in between. Effectively, we could quadruple our miles per gallon of gasoline if we have replaced the fuel with 85% ethanol. 150 mpg anyone? Wouldn't that put a dent in the oil producers' industry!

 
At 5:43 PM, Anonymous Anonymous said...

TROY HELMING AND ALYSIA CARLSON HELMING RUNS SCAM AND ARE SLICK CON-ARTIST!
THEY WORK UNDER THE FOLLOWING COMPANY NAMES:
KRYSTAL ENERGY
KRYSTAL PLANET
PRISTINE POWER
SAVE THE PLANET USA
KCBIOFUELS
AND OTHERS.
http://www.sos.mo.gov/news.asp?id=482http://straighttalk.ourfuture.org/dsp_fact_story.cfm?blog_ID=1&bge_id=2718
http://www.green-e.org/pdf/Krystal_Planet_Market_Advisory_3.01.06.pdf
http://www.securities.state.ks.us/proceed/synops02/kansaswind.html
http://www.kansascity.bbb.org/commonreport.html?bid=99125299
BEWARE!

 
At 1:54 PM, Blogger CaptnSaj said...

In response to accusations against Krystal Planet:
First off, I was involved with Kyrstal Planet for a while but didn't have the time to spend to make use of what they offer. I still keep a close eye on developments from Krystal Planet because I think they have a great idea and great potential.

My guess is that "anonymous" had a bad experience with them - I wish he would share it with us.

Krystal Planet has not been as successful as they were hoping to be and have been plagued with growing pains. I think they got most of the problems sorted out.

I am doubtful that they are con-artists, though. Especially considering that they actually deliver products that you buy (I know this from personal experience). Also, if you check out their news section and read the materials, its hard to believe that all those companies and partners have been scammed. Krystal Planet has even been approved as an Energy Star partner.

I read the links "anonymous" provided, and most of the accusations refer to a program Krystal Planet tried to start where a person could be a direct investor in their large-scale wind turbine program. I guess that was considered to be like a security and was illegal.

From what I know, Kyrstal Planet's green tag program cannot be Green-e certified because they are selling renewable energy that has not been generated yet, hence the "FutureWind" name. Every document from Krystal Planet I have read regaurding Green-e has specifically stated they are not certified by them.

Krystal Planet has announced to its members that it is trying to purchase its first large wind turbine, but the manufacturers are all back-ordered.

I guess only time will tell if they are phony or legit.

 
At 2:42 PM, Anonymous Anonymous said...

Think about it. Troy Helming is using an MLM business structure as the staging ground for Krystal Planet. MLM start-ups already have reputations as "Pyramid Schemes" and most startup MLMs fail. It appears Troy Helming has been ordered to cease and desist from selling securities in two states. He was a Double Diamond in the Tax People before it was busted by federal agents. Check the link below for some additional details in a new article.

http://www.pitch.com/issues/2005-02-17/news/feature.html

Just the number of companies he has been involved in should send up red flags about this crook. Thats how you stay ahead of the law.

He is selling products, but his big push has been for “Green Tags” or in Troy Helming’s case “Future Wind” which is energy that has not been created yet. “Future Wind”, sort of like futures in grain. But there is no large scale wind generating facilities as of yet that are owned by this company, nor will Krystal Planet’s customers reap any profits generated from any of these wind power plants if built. In my opinion this thing stinks. Invest some money into companies that are actually building large scale Wind Farms.

Don’t waste your time and hard work selling future wind for a few at the top of a pyramid who might get rich. Besides, if you try selling future wind to your friends, you’ll soon have No Friends Left. You will become a member of the NFL. That’s actually a marketing term in MLMs that means after you have sold your friends and family, who do you sell to next. MLMers don’t care about your family or your friends they just care about keeping the pyramid going. Eventually when these schemes start failing and the pyramid gets full of holes, it crashes hard, leaving a whole pyramid of friends and families mad at one another.

 
At 11:50 PM, Blogger pseudoanon987324 said...

I was looking for opportunities to invest in wind power in Kansas at one point, and found Helming's offer (via his then-company, Kansas Windpower--not to be confused with the company at http://kansaswindpower.net) to sell "co-op" shares--in a scheme which I understood to violate the definition of a "co-op", with return projections that are never legal to include in an investment offer, and if I recall correctly MLM elements as well (those were on the website, of which I unfortunately didn't save a copy). Unfortunately, to get more information about the investment, I'd have had to sign an agreement saying I wouldn't talk to anyone about the investment, and I wouldn't try to get any more information (except by the most circuitous means) about the company's operations except as expressly approved by Helming. When I did some more research and found out about Helming's prior association with Renaissance / The Tax People (the MLM whose "guy at the top" fled to Mexico to get out of the feds' reach after being charged with promoting tax fraud), and saw that most of the board members of Kansas Windpower (don't confuse that with the company at http://www.kansaswindpower.net/) were people who he named as associates in The Tax People, I decided I wanted nothing to do with this man or his company.

The below post, harvested from (if I recall correctly) the Kansas City Star's discussion forums--a thread, incidentally, which appears to have disappeared from the Net--did much to convince me I didn't want to do business with Helming. Google for "renaissance tax people" (w/o quotes) for more information about the "TTP" to which he refers. The man's narcissism and, IMO, his ethics are nauseating. In this case, I think I'd go w/ Buffett's observation that "you can't do good business with bad people."

All text below the dashed line is from the mentioned post.

---------------------

I joined TTP last June (seemed like a good idea at the time) never made any sales, spent a butt-load of money attending 'TTP University', buying sales aids, etc. When all the legal stuff came about in October I decided to withhold my $100 a month and see what happened, as if this panned out I could still jump back into it.

I still receive email from my 'upline'. For those of you wondering why you can't access the TTP site, thetaxpeople.net has closed. Renaissance, The Tax People go bye-bye. Here is an email that Ren/TTP 'Double-Diamond' Troy Helming sent out to his 'team':
**********
Team -

PAIN:
The last seven months have been very difficult for all of us. I personally
had to adjust from what was about to be a near-six-figure-per-month-income to
zero income, and losing a piece of myself since TTP was such a big part of my
life. It has been tough on me. What is much worse, however, is having to
witness all the financial and emotional pain all my friends in TTP have
endured the last seven months. All of you mean so much to me, personally and
in business, so these seven months have been the hardest of my life.

FINAL CHAPTER:
Well, it's over. Finally, we can all begin healing our wounds and move on.
TheTaxPeople.net officially closed its doors forever on Friday, May 20th,
2001.

LOYALTY:
I felt it was my duty and obligation to support TTP until the bitter end:
either a hoped-for victory or a humbling defeat. Although I emphatically
opposed some of the decisions made by TTP over the last year, I had to be
totally supportive of everything until the ship went down, with me on board.
I do not believe in resigning (a.k.a., quitting) until the last bell tolled.
Well the fat lady belted out a sad one on Friday, and now she has walked off
the stage for good. I believe in always doing the right thing, and hope none
of you are upset with me for waiting until we knew for sure what the outcome
would be.

REFLECTIONS:
I may never fully understand how we possibly could have lost, because our
case was so strong and our company was so right. Mike Cooper was always very
good to me and has a tremendously generous and giving heart. But
unfortunately for him and Mary, he has become a target for the state of
Kansas and now other governmental agencies. They would have continued to
target our company until either Mike was gone or the company went down with
him. That is why the he and Board decided NOT to continue fighting while the
field waited. It was politically impossible to win. So, we forfeit. Who
wins? Not the helpless consumers of Kansas who need protection. Only the
government wins. Who loses? Not just Mike Cooper and his family. Not just
the 100+ employees of TTP in Topeka. Not just the thousands of IMAs who
relied on income from this company to support their families. Not just the
tens of thousands of satisfied customers who loved our tax products and
services. But also, the millions of residents in Kansas and every other
state who pay taxes and now have fewer tax companies to choose from to
provide such services. The input of myself and many other talented Diamonds
(Jim Beach, Bill Fox, Brad Hager, Lars Lynge, Johnny Mac, Bob Schaffer, and
Greg Warford just to name a few) was often not considered seriously by TTP.
Many mistakes were made, but none that would cause us to deserve this.
I have no wish to point blame, just to hope that we can all learn from our
mistakes and if we ever do business again together, remember those mistakes.

NEXT STEP:
Now that TTP is dead, we must all move on. I have several options available
to me, some of which I've been evaluating for some time now. One gentlemen I
respect a great deal has evaluated over 300 different MLM opportunities to
find the best. And, it appears that some of the former employees and/or
field reps of TTP will be starting a new tax company that sounds intriguing
(I'll know more about this option in a few days) and should be in pre-launch
next week, official launch in early July. I plan to keep my options open by
NOT cross-recruiting or burning any bridges, in case that option looks
promising. In fact, I may even sell my interest in any other companies I'm
working with at the time to go full-force with a new start-up tax company.
That remains to be seen, and will require a thorough evaluation at that time
by myself and my own legal advisors. I will not tell you in this email what
the details of these choices are. If you want to know, simply reply back and
ask for info. All I will say is that it has been very difficult to let go of
my dream with TTP, and that any new company I go to will have to have (among
other things): 1) a tax program, 2) a compensation plan that allows brand new
people to make money quickly, 3) excellent legal advice, and 4) be totally
web-based for enrollments, commission check tracking and back office
administration (preferably in real time). The options I'm considering have
all these and more.

For all of you that have been hurt by TTP, I offer you my most sincere and
heartfelt apology. I am so sorry. I wish I could have done more.

All I can do now is offer to make it up to you. The best way I know how (the
sweetest revenge is massive success) is to help build a huge organization
under you. I WILL make it my mission in life to make it up to each of you,
because whether you were in my downline or not, we were all family together
with TTP. I love each and every one of you, and want you to know it was a
pleasure and a privilege working with each of you.

Troy Helming
**********

 
At 2:55 PM, Blogger EV Plug said...

Petrol market is a very fluctuant one because it is negotiated as a real raw material and as a financial product.
Producing countries (Russia, Saudi Arabia, Venezuela, etc…) are very different than the consuming countries (USA, Germany, Japan, China, etc…) and because petrol is exchanged in US dollars but bought with US dollar, European Euro, Chinese Yuan and Japanese Yen, these big consuming countries have to prevent petrol fluctuation AND monetary fluctuations, therefore, a 1% correction on the dollar automatically brings a 3 to 4% correction on petrol and populations don’t have time to adapt themselves and their way of life to these fluctuations.
On the contrary, Project Green Leaf’s CEO Jay PATEL states that electricity is produced locally and isn’t affected by the international geopolitical situation.
Therefore, the EVPlug infrastructure is a perfect complement to the actual gas stations. It gives the consumer the same liberty to recharge their batteries as they would refuel the genuine car and helps make the decision to buy an EV or PHEV which will allow us to reduce our gas emission and our dependency on foreign oil.

 
At 2:56 PM, Blogger EV Plug said...

Petrol market is a very fluctuant one because it is negotiated as a real raw material and as a financial product.
Producing countries (Russia, Saudi Arabia, Venezuela, etc…) are very different than the consuming countries (USA, Germany, Japan, China, etc…) and because petrol is exchanged in US dollars but bought with US dollar, European Euro, Chinese Yuan and Japanese Yen, these big consuming countries have to prevent petrol fluctuation AND monetary fluctuations, therefore, a 1% correction on the dollar automatically brings a 3 to 4% correction on petrol and populations don’t have time to adapt themselves and their way of life to these fluctuations.
On the contrary, Project Green Leaf’s CEO Jay PATEL states that electricity is produced locally and isn’t affected by the international geopolitical situation.
Therefore, the EVPlug infrastructure is a perfect complement to the actual gas stations. It gives the consumer the same liberty to recharge their batteries as they would refuel the genuine car and helps make the decision to buy an EV or PHEV which will allow us to reduce our gas emission and our dependency on foreign oil.

 

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