California's Hydrogen Highway Blueprint

CalEPA published Hydrogen Highway blueprint yesterday. The plan calls for about 10 million dollars of investment each year for the next five years (Phase 1), with about equal investment assumed on the industry side.


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While Phase 1 is supposed to be completed by 2010, time lines for phase 2 and 3 have not yet been identified. Even then, I would call this plan quite ambitious.

Automakers vs. big oil over diesel rules

From the Automotive News:

Automakers fear that petroleum companies and refiners aim to delay or relax the rules. The key provision, effective in September 2006, requires that 80 percent of highway diesel fuel contain no more than 15 parts per million of sulfur. The limit now is 500 parts per million.

Ultralow-sulfur fuel is essential for expanded use of modern, cleaner-running and more fuel-efficient diesel engines in cars and light trucks, a major goal of automakers over the next few years.

Ultra Low-Sulfur Diesel (ULSD) is critical if Diesels are to arrive in the US, but it is also somewhat costlier.

Busy Day at the Green Car Congress

Green Car Congress is a web log maintained by Mike Millikin and has regular updates in vehicle and fuel technologies that are worth paying attention to. I have been reading this web site for a few months, and I would highly recommend it.

Today, for example, Mike has posted about two interesting pieces of information:

1. Ballard has put out a technology road map relating to the performance of its PEM fuel cells

2. A battery company called Valance is showing a plug-in hybrid concept car based on the Prius next week.

Enjoy,and think about what this means in terms of reducing the rate of growth of petroleum consumption in the next ten to twenty years.

A Strategy to push hybrids

From the WSJ

Gas-electric vehicle technology leader Toyota is using the New York Show to make its most explicit statement yet about how it plans to market hybrid-propulsion systems. At the Lexus stand, Toyota is showing off not only the long-awaited RX400h gas-electric hybrid SUV, but also a gas-electric version of its recently launched GS sedan. Both of these vehicles use hybrid propulsion to achieve V-8 performance with V-6 or better fuel economy. Toyota's bet is that luxury customers, who keep buying more and more horsepower despite higher fuel prices, will be drawn to hybrid technology for guilt-free performance. In the Toyota brand, Toyota will push fuel economy.

Rivals are watching. At Ford, Mark Fields, executive vice president in charge of the auto maker's luxury brands, calls the Volvo brand a logical place for Ford to expand its own gas-electric hybrid offerings. 'We're working on a plan to see if we can get that done,' he says.

Meanwhile, Volvo will promote its 315-horsepower XC90 V-8 model with ads showing Richard Branson blasting off into space.

Toyota has recently announced three or four new hybrid cars and SUVs, and all of them if I remember correctly were in the upper end of the market, which kind of makes sense given the logic talked about here.

UPDATE: Toyota aims to sell 62,000 hybrid SUVs in 2005 (worldwide).

Chart of the Month

I have been thinking about doing a feature like chart of the month for some time. DOE's office of transportation technologies (now subsumed in the FreedomCar and vehicle technologies program) has a wonderful feature called fact of the week. Never the less, I think that I may be able to post here some of the charts related to the fuel consumption of US light-duty vehicles. For example one of the readers asked:

Do you have any data on how much of US oil consumption is for automobiles, perhaps broken down by type (cars, trucks, SUVs) etc.?

Answer: U.S. Light-Duty vehicles (which include cars and light trucks) consumed about 550 billion liters of gasoline in year 2004 (1 Gallon ~ 3.78 liters). Of this about 250 billion liters was consumed by the cars and wagons, whereas the SUVs, pickups and vans together consumed about 300 billion liters of gasoline.



Posted by Hello Click on image for a larger picture

As you can see from the picture, fuel use of passenger cars is currently at the same level as in 1970, but the light truck fuel consumption has increased from about 40 billion liters in 1970 to 300 billion liters in 2004. Some other fun numbers you may want to remember from this chart:
Fuel consumption reached about 400 billion liters in 1993.
Between 1978 to 1992, the overall fuel consumption was more or less constant at about 390 billion liters. You can, however, see the rise of the minivans and SUVs in this period that has resulted in the much higher level of fuel consumption we see today.

P.S. posting pictures with the help of Hello is painful.

Virtually Emission Free?

I think that this controversy is going to be counterproductive for everybody. Union of Concerned Scientists has come out strongly, (and I do not blame them) against what they call deceptive advertising by the Auto Alliance.

Firstly, There is no doubt that the cars and trucks on the road today are a lot cleaner than they were thirty years ago. The emissions of criteria pollutants, specially NOx and Non-methane Organic gases (NMOG), have actually been reduced by about 99% since 1970 due to stringent air pollution regulations formulated by EPA and CARB. While the automakers are to be commended upon the job they have done really done, one must remember that this would not have happened without those regulations, so a lot of credit is due to the Clean Air Act. Also, we have actually not been monitoring emissions on road, and quite frankly are not sure that all the new vehicles, when they get on the road, are meeting the pollution standards.

Secondly, as the UCS correctly points out, if emission free is what the auto alliance implies, they most certainly do not take in to account the greenhouse gas emissions. The ad does not explicitely say that, so the UCS claim is somewhat justified. This would be important if Auto Alliance were not fighting the California law on controlling greenhouse gas emissions from motor vehicles in the courts. Moreover, pretty much the same auto makers have agreed in Canada to reduce greenhouse gas emissions from motor vehicles. As I noted previously, Auto Alliance needs to get its act together and speak consistently.

One final thought on why I think this controversy is counterproductive. Sonner or later, greenhouse gas emissions regulations will come in to effect in the US. The auto industry needs to get smart and rather than fighting this effort tooth and nail needs to figure out how they could get the best deal out of this. Controversies like this do not help different parties to come together on a broader agenda items of much larger importance. UCS or other advocacy groups should also bear this fact in mind. As far as reducing the greenhouse gas emissions are concerned, any action today will be important, so they must try to work with the Auto industry to reach a sensible middle ground. The problems that the US auto companies are facing today are real, and trying to corner the industry is not going to be a very productive strategy.

Busy, busy, busy!

I don't have time to make any posts for at least a few more days, even though there are all kinds of things going on in the energy sector right now. If you are looking for information related to oil, check the Financial Times Commodities section. If you are not satisfied, see Platts Oil section or if you are crazy about the price of oil to the minute, check the NYMEX oil data link on the right.
I try not to post developments in vehicles technologies since I discovered the Green Car Congress blog.
I should be back by Wednesday of the next week (23rd) at the earliest, unless something really exciting takes place between now and then. Don't think oil is going to break the 60 dollar mark between now and then, but given the volatility in the markets, one can not be sure of that. I should leave it to that.

How Long Can G.M. Tread Water?

Asks Danny Hakim in the NYT. Very recently at a small event, GM North America President Gary Cowger was asked about the threat to GM from Toyota. He admitted that Toyota is gaining on GM worldwide with very good products. He pointed out that Chevrolet and Cadillac are doing very good business, and he hopes that picture at Pontiac will change after sales for G6 pick up and the Solstice is launched. He also admitted that the product line at Saturn needs a radical change, and there are still many problems with Buick. Overall, all is not well as it should be.

P.S. Check out also GM FastLane Blog.

Demand for Hybrid Vehicles

There is a strong debate going on over what could be a realistic expectation of hybrid vehicle sales in the next few years.
Here is an optimistic projections:

"Demand for fuel-saving hybrids could grow to as much as 10 percent of total U.S. new vehicle sales by 2010", Jim Press, Toyota's U.S. managing director, said last month.

We have seen similar optimistic projections earlier. A more pessimistic projection from J.D. Power was about 3% market share by 2010. The JD Power report talked about the hybrids "reaching a plateau" at about 3%, which I find quite difficult to accept as opposed to hybrids just hitting 3% sales in 2010 with a potential to grow in the future.

Another Honda FCX review

Honda seems to be doing a good job of putting its FCX on the road. This review from Mark Pheelan of the Detroit Free Press is qyuite good, and so was an earlier review. GM has promised to get the Sequel on the road later this year.

Some tips to save on cost of filling up

This counts as Drive Lite!

Short Term Energy Outlook and more...

EIA released its monthly update of Short Term Energy Outlook:

The projected average West Texas Intermediate (WTI) crude oil price for the first quarter of 2005 has been revised upward to about $48.70 per barrel, approximately $13 per barrel higher than in the first quarter of 2004 and $2 per barrel above the first quarter 2005 projection in the previous Outlook. EIA projects that WTI prices are likely to remain near the high-to-mid-$40’s (or higher) per barrel range throughout 2005-2006. It is emphasized that oil prices are likely to be sensitive to any incremental supply tightness that appears during periods of peak demand worldwide. Imbalances (real or perceived) in light product markets could cause light crude oil prices (such as WTI) to increase to well above $50 per barrel, as has recently occurred.
...Pump prices for regular gasoline are expected to average about $2.10 per gallon during the 2005 driving season (April through September), up 20 cents from the same period in 2004. Sustained domestic growth in gasoline demand, both seasonal and year-over-year, is expected to increase average monthly prices to about $2.15 per gallon by spring.

Honestly, I would not read much in to this report. Just keep in mind that the much of the increase in crude prices we are seeing now, and will probably see at least until the 16th of March, will show up in the higher gasoline prices with a slight lag. In spite of the fact that the inventories of gasoline in the US are at a robust level, expect a lot of hue and cry about using the Strategic Petroleum Reserve (SPR) and the perrenial favourite CAFE standards!
I hope that the administration will play cool to the demands about using SPR just like it did so last year. The battle over CAFE is going to heat up, or at least I expect so. Remember that the congress must act if the fuel economy standards for passenger cars are to be raised. They may want to wait for NHTSA to plough through the 66,000 comments on the light-truck standards. NHTSA should release its ANPRM in December 2005 for rulemaking on light trucks standards in April 2006. Overall, it is unlikely that any credible action will be taken in 2005 to raise the CAFE standards.
So, it will be interesting to see if consumers start to show some interest in fuel economy for a change. Some of the trends to watch for among others:
* Sales of hybrid vehicles, particularly hybrid Accord, Lexus RX400h, and the Mercury Mariner hybrid if it is released.
* Sales of crossover vehicles as opposed to the SUVs
* % increase in road travel around Memorial day
Overall, it is going to be an uneasy year on the fuel consumption aspect. Every year of delay in taking some action on trying to reduce the rate of growth of demand will come back to haunt us if things go awry. We are already in an unenviable position in terms of worldwide, and specially US automobile fuel consumption, and have time and again found this to be the stickiest of the issue in the energy domain.

Price Trend for Crude Oil from January 2003

Kind of fun to look at!

(click on chart for a larger version)
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P.S. I do not like the way hello and blogger bot work. Hello would not accept a gif file, and I must convert it to a jpeg before uploading it.

China and the Price of Gas

Calculated Risk comments on China and the Price of Gas in simple words.

Putting the Hydrogen Horse Before the Political Cart

An interesting article by Rex Ewing:

The current best guess for how we might logically proceed toward a hydrogen economy involves using coal and natural gas -- in clean processes that sequester carbon -- as short term hydrogen sources, while developing and implementing a renewable solar, wind and biomass infrastructure over the long haul. On the plus side, all the technologies needed to make this happen already exist, at least on a small scale. The overwhelming problem we face is in producing -- and paying for -- the sheer volume of fuel humanity consumes.

This is where politics slithers into the picture and people start getting hot under the collar. Don't get me wrong; I have no problem with political wrangling. For better or worse, it's part of the process. I'm only suggesting that political opinions will serve a greater purpose when they're buttressed by cold, hard facts.

...The point is, there is no one right way to wean ourselves from the beastly carbon cow and make the conversion to clean hydrogen fuels. The process will inevitably lead down a number of paths and will require the combined efforts of a multitude of rational, intelligent researchers, engineers, administrators and, yes, even politicians. Politicians who are obliged to listen to us, whether or not we know what we're talking about.

Very well said.

Taking Down the 'No Foreign Cars' Signs in Michigan

Danny Hakim has an excellent article in yesterday's Times about how Michigan Gov. Granholm is bending over backwards to invite a Toyota Technical Center. Michigan has been sufferring from job losses in past few years. As the article mentions, Ontario has taken over Michigan in terms of auto assembly Never the less, the Big Three have continued to loose their market share to Toyota and others.
What is really interesting in this is story is a chart which shows that Japanese car makers now employ more than 56,000 people in the US. In fact, calling Toyota, Honda or Nissan as Japanese car makers is going to be difficult. This plays out in the congress, where the Big Three, IMHO, will no longer be able to claim that they need to be protected from foreign manufacturers because of job reasons.
I am sure that the Big three, specially GM and Ford, realise that their strong hold in the light-trucks market is getting loose. As the capacity in that sector grows, the margins are going to shrink and that spells doom for GM and Ford given their healthcare costs. This is not something to dismiss easily. It is high time to shake up the operations, stop the bleeding in the form of incentives and get creative.

Oil, Oil !!!

One thing can be said about the Oil market trading in the first three days of March. It isnot a pretty picture. It seems to me that there is a lot of speculation going on in the market. This will only create pressure on OPEC to reconsider its decision to not hike production at their March 16 meeting. Remember that they are currently producing way over their agreed limits. One thing is clear, however, that the inventories of crude here in the US are in fairly good shape. OPEC would want the market to cool off a bit, but not crash.
Many things to talk about, but no time right now: China, Exchange rates, and what all of this means for automobile fuel consumption in the U.S.