Valuing Plug-in Vehicle Air Emission and
Oil Consumption Benefits
Jeremy J. Michalek, Paulina Jaramillo, Mikhail Chester, Costa Samaras, C.-S. Norman Shiau
and Lester B. Lave
Vehicle electrification
Conventional
HybridElectric
Plug-in
Hybrid
Electric
Battery
Electric
CV
HEV
PHEV
BEV
Power
Convertor
Engine
Engine &
Motor
Engine &
Motor
Motor
Battery
Pack
-
Small
Medium
Large



Gasoline
Electricity

CMU EPP Advisory Board Meeting | 3-14-2011
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
Jeremy J. Michalek
Associate Professor Jeremy Michalek
EPP and Mechanical Eng.
Vehicle design and life cycle implications
Dr. Constantine Samaras
RAND Corporation (EPP Alum)
Policy assessment
Assistant Professor Jay Whitacre
EPP and Material Science and Eng.
Battery technology
Grace Heckmann
Market demand for alternative vehicles
Orkun Karabasoglu
Life cycle implications of driving cycles
Professor Chris Hendrickson
Civil & Environmental Eng.
Transportation and life cycle assessment
Assistant Professor Shawn Litster
Mechanical Eng.
Fuel cells
Scott Peterson
Life cycle air emissions, battery life, vehicle
to grid
Professor Francis McMichael
EPP and Civil & Environmental Eng.
Battery technology, life cycle assessment
Apurba Sakti
Battery design and cost modeling
Associate Professor Illah Nourbakhsh
Robotics Institute
Electric vehicle conversions
Elizabeth Traut
Plug-in vehicle design and charging
infrastructure optimization
Gregg Podnar
Robotics Institute
Electric vehicle conversions
Tugce Yuksel
Battery degradation and thermal
management
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Benefits of PHEVs
1. Greenhouse gas emissions
 28% of GHG emissions from transportation (EPA)
2. Air pollution
 22,000-52,000 deaths per year from air pollution
(JAMA)
3. Oil dependency
 Cost U.S. economy ~$0.5 trillion in 2008 (Greene)
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
How much can xEVs help?
xEVs offset gasoline use
 Reduces oil dependency
xEVs change emissions profile
 Fewer emissions associated with gasoline production and
combustion
 More emissions associated with battery and electricity
production
xEVs change location of emissions
 Location doesn’t matter for GHGs, but…
 Damage done by air pollution highly depends on where it
is released (population density, etc.)
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Jeremy J. Michalek
Location drives air pollution damage
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Jeremy J. Michalek
Data
Cohon et al. 2010 NRC study “The Hidden Costs of
Energy”
 Quantify externality damages to human health, crops,
buildings, etc.
 $6M value of statistical life
 Morbidity also accounted for
Argonne National Labs (GREET)
 Vehicle efficiency, emissions, and design
 Life cycle emissions from refineries, factories, etc.
National Household Travel Survey (NHTS)
 Distribution of driving patterns in the U.S.
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Lifetime emissions damages
Emissions damage reduction potential of plug-in vehicles
 Optimistic: $1000 damage reduction over the life
Lifetime
Damages
fromincrease
Life Cycleover
Emissions
 Pessimistic:
$6000
damage
the life
$10,000
$8,000
$6,000
$4,000
$2,000
$0
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
VOC
SO2
PM2.5
PM10
NOx
CO
GHG
BASE CASE
U.S. Avg.
Grid Mix
OPTIMISTIC
Zero-Emission
Power Plant
PESSIMISTIC
Coal Fired
Power Plant
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Ownership costs
Base Case
Best Case for
Electrification
Worst Case for
Electrification
Vehicle costs
ANL 2015 literature
review
DOE 2030 program
goals**
ANL 2015 literature
review
Gasoline prices
Average
(2008-2010)
Max
(2008-2010)
Min
(2008-2010)
Electricity prices
Average
(2008-2010)
Min
(2008-2010)
Max
(2008-2010)
Battery Life
12 years
(life of vehicle)
12 years
(life of vehicle)
6 years
** ANL calls DOE program goals “very optimistic”
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Net life cycle costs
Optimistic: Plug-in vehicles slightly less expensive over
the life. Costs drive comparison, not damages
Pessimistic: Plug-in vehicles could cost much more while
causing more
damage
Lifetime
Costs and Emissions Damages
$80,000
Damages
$60,000
Electricity
Gasoline
$40,000
Batt. Rplc.
$20,000
Battery
Base Vehicle
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
$0
BASE CASE
ANL 2015 Costs
Avg. Gas Price
12 yr. Battery
Avg. Grid
OPTIMISTIC
DOE 2030 Goals
High Gas Price
12 yr. Battery
Hydroelectric
PESSIMISTIC
ANL 2015 Costs
Low Gas Price
6 yr. Battery
Coal Electricity
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Oil dependency
Oil Supply Disruption
Military spending:
 Externalities estimated at
$0.11/gal (Brown and
Huntington)
 $75-$90 billion in 2009
(RAND) : $0.24-$0.28/gal
 But…
 Not enough to change
trends
 Spending is nonlinear:
Marginal reductions may
have near-zero effect on
military spending
Market Power
 Less than half of each bbl oil
produced is used to make
gasoline – large reductions
require coordination
 US Monopsony effect:
$0.22/gal (Leiby)
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Cost of oil consumption
Total Externalities + Monopsony Premium
Externality
Damages
(Base
Case)by Type
$7,000
Petrol
$6,000
VOC
$5,000
SO2
$4,000
PM2.5
PM10
$3,000
NOx
$2,000
CO
$1,000
GHG
$0
CV
CMU EPP Advisory Board Meeting | 3-14-2011
HEV
PHEV20
12
PHEV60
BEV240
Jeremy J. Michalek
Other externalities
Rebound effect
 Lower operating costs may encourage more driving
 Higher congestion costs
 Higher accident rates
 These externalities have higher associated costs than emissions
(Delucchi)
 Will range issues combat rebound effect?
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Take away
Emissions damage
reduction potential of
plug-in vehicles
Oil dependency
 Externalities, monopsony
effect, and marginal
security spending not
enough to tip the balance
 Upper bound: Hydro electricity
 BEV reduces damages $1000
over HEV
Small is Beautiful
 Lower bound: Coal electricity
 More batteries  more
green
 BEV increases damages $6000
over HEV
 Large packs are
underutilized
Worth the cost?
 Extra emissions from
production, weight
 Damage reductions are small
compared to ownership costs
 HEVs and PHEVs with
small battery packs are
most efficient and robust
 Across most scenarios,
electrification is better only
when it saves consumers money
 If it’s cheaper, market will drive
adoption
 Offer a good solution
across a wide range of
scenarios
 If it’s not, emissions benefits
don’t justify the extra cost
 Reduce more GHGs per
dollar spent
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Decisionmakers
Federal Decisionmakers
 U.S. House and Senate
 EPA
 DOE
 NHTSA
State and Local Decisionmakers
 California CEC and ARB
 Other states interested in Evs
Private Decisionmakers
 Automotive manufacturers
 Utilities
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Acknowledgements
Co-authors
Carnegie Mellon
 Prof. Chris Hendrickson (CMU)
 Green Design Institute
Civil & Environmental Engineering
 Prof. H. Scott Matthews (CMU)
 Vehicle Electrification Group
Civil & Environmental Engineering
Engineering & Public Policy
 Design Decisions Lab
 Prof. Jay Whitacre (CMU)
Support
Material Science & Engineering
Engineering & Public Policy
 Dr. Mikhail Chester (UC Berkeley)
 NSF CAREER Grant #0747911
 Dr. Paulina Jamarillo (CMU)
 NSF MUSES Grant #0628084
Civil & Environmental Engineering
Engineering & Public Policy
Tepper School of Business
 Ford Motor Company
 Toyota Motor Corp
 Dr. Constantine Samaras (RAND)
 Dr. Ching-Shin Norman Shiau
(CMU/Dell)
 CMU Climate Decision
Making Center, NSF SES
Grant #0345798
Mechanical Engineering
 Scott Peterson (CMU)
Engineering & Public Policy
 Teresa Heinz Scholars for
Environmental Research
Program
 Nikhil Kaushal (CMU)
Mechanical Engineering
 Richard Hauffe (Lockheed Martin)
CMU EPP Advisory Board Meeting | 3-14-2011
 Steinbrenner Institute
16
Jeremy J. Michalek
Questions &
Discussion
jmichalek@cmu.edu
whitacre@andrew.cmu.edu
Backup
Slides
Breakdown of emissions damages
Breakdown of Externality Damages
$4,000
Petrol
VOC
$3,000
SO2
PM2.5
$2,000
PM10
NOx
CO
$1,000
GHGs
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
$0
Vehicle
Production
CMU EPP Advisory Board Meeting | 3-14-2011
Battery
Production
Gasoline
Production
19
Electricity
Production
Vehicle
Operation
Jeremy J. Michalek
Sensitivity
Extensive sensitivity analysis on emissions and costs
Lifetime Emissions Damages w/ Sensitivity Analysis
$12,000
VOC
SO2
PM2.5
PM10
NOx
CO
GHGs
Base Case
Low Case
High Case
$10,000
$8,000
$6,000
$4,000
$2,000
Base
Case
Grid Mix
Cases
Elec. Upstream Cases
Oil Refining
Cases
Oil Upstream
Cases
Oil Source
Cases
Assembly
Cases
Manuf. Upstream Cases
Manuf. Elec.
Cases
Vehicle Data
Cases
Li-ion Batt.
Life Cases
Driving Location Cases
GHG Value
Cases
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
CV
PHEV20
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
BEV240
PHEV20
CV
$0
Oil Premium
Cases
NPV of Lifetime Costs w/ Sensitivity Analysis
$80,000
Damages
Electricity
Gasoline
Batt. Rplc.
Battery
Base Vehicle
Base Case
Low Case
High Case
$60,000
$40,000
$20,000
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
CV
HEV
PHEV20
PHEV60
BEV240
$0
Base
Case
Grid Mix
Cases
Elec. Upstream Cases
Oil Refining
Cases
Oil Upstream
Cases
Oil Source
Cases
Assembly
Cases
Manuf. Upstream Cases
Manuf. Elec.
Cases
Vehicle Data
Cases
Li-ion Batt.
Life Cases
Driving Location Cases
Vehicle
Cost Cases
Gasoline
Price Cases
Electricity
Price Cases
GHG Value
Cases
Oil Premium
Cases
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek
Research direction
1. Regional Assessment: Where is better to electrify (grid
mix, temperature, terrain, driving style, driving distance,
etc.)
2. Battery Thermal Management: When worth paying
the cost and energy to gain battery performance and life?
3. Infrastructure: Assess technical, economic and
environmental implications of battery charging and
swapping stations
4. Cell & System Design: Thin vs. thick electrode cells for
different applications, combination on same bus?
5. Consumer Preferences: Willingness to pay for PHEV
attributes
6. On Road: Hymotion Prius with sensors for road testing
and validation, ChargeCar project, Toyota PHEV fleet
CMU EPP Advisory Board Meeting | 3-14-2011
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Jeremy J. Michalek