[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]



                   HYBRID TECHNOLOGIES FOR MEDIUM- TO
                      HEAVY-DUTY COMMERCIAL TRUCKS

=======================================================================

                                HEARING

                               BEFORE THE

                       SUBCOMMITTEE ON ENERGY AND
                              ENVIRONMENT

                  COMMITTEE ON SCIENCE AND TECHNOLOGY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                             JUNE 10, 2008

                               __________

                           Serial No. 110-107

                               __________

     Printed for the use of the Committee on Science and Technology


     Available via the World Wide Web: http://www.science.house.gov

                                 ______


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42-802 PDF                  WASHINGTON : 2008
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                  COMMITTEE ON SCIENCE AND TECHNOLOGY

                 HON. BART GORDON, Tennessee, Chairman
JERRY F. COSTELLO, Illinois          RALPH M. HALL, Texas
EDDIE BERNICE JOHNSON, Texas         F. JAMES SENSENBRENNER JR., 
LYNN C. WOOLSEY, California              Wisconsin
MARK UDALL, Colorado                 LAMAR S. SMITH, Texas
DAVID WU, Oregon                     DANA ROHRABACHER, California
BRIAN BAIRD, Washington              ROSCOE G. BARTLETT, Maryland
BRAD MILLER, North Carolina          VERNON J. EHLERS, Michigan
DANIEL LIPINSKI, Illinois            FRANK D. LUCAS, Oklahoma
NICK LAMPSON, Texas                  JUDY BIGGERT, Illinois
GABRIELLE GIFFORDS, Arizona          W. TODD AKIN, Missouri
JERRY MCNERNEY, California           JO BONNER, Alabama
LAURA RICHARDSON, California         TOM FEENEY, Florida
PAUL KANJORSKI, Pennsylvania         RANDY NEUGEBAUER, Texas
STEVEN R. ROTHMAN, New Jersey        BOB INGLIS, South Carolina
JIM MATHESON, Utah                   DAVID G. REICHERT, Washington
MIKE ROSS, Arkansas                  MICHAEL T. MCCAUL, Texas
BEN CHANDLER, Kentucky               MARIO DIAZ-BALART, Florida
RUSS CARNAHAN, Missouri              PHIL GINGREY, Georgia
CHARLIE MELANCON, Louisiana          BRIAN P. BILBRAY, California
BARON P. HILL, Indiana               ADRIAN SMITH, Nebraska
HARRY E. MITCHELL, Arizona           PAUL C. BROUN, Georgia
CHARLES A. WILSON, Ohio
ANDRE CARSON, Indiana
                                 ------                                

                 Subcommittee on Energy and Environment

                   HON. NICK LAMPSON, Texas, Chairman
JERRY F. COSTELLO, Illinois          BOB INGLIS, South Carolina
LYNN C. WOOLSEY, California          ROSCOE G. BARTLETT, Maryland
DANIEL LIPINSKI, Illinois            JUDY BIGGERT, Illinois
GABRIELLE GIFFORDS, Arizona          W. TODD AKIN, Missouri
JERRY MCNERNEY, California           RANDY NEUGEBAUER, Texas
MARK UDALL, Colorado                 MICHAEL T. MCCAUL, Texas
BRIAN BAIRD, Washington              MARIO DIAZ-BALART, Florida
PAUL KANJORSKI, Pennsylvania             
BART GORDON, Tennessee               RALPH M. HALL, Texas
                  JEAN FRUCI Democratic Staff Director
            CHRIS KING Democratic Professional Staff Member
        MICHELLE DALLAFIOR Democratic Professional Staff Member
         SHIMERE WILLIAMS Democratic Professional Staff Member
      ELAINE PAULIONIS PHELEN Democratic Professional Staff Member
          ADAM ROSENBERG Democratic Professional Staff Member
          ELIZABETH STACK Republican Professional Staff Member
          TARA ROTHSCHILD Republican Professional Staff Member
                    STACEY STEEP Research Assistant










                            C O N T E N T S

                             June 10, 2008

                                                                   Page
Witness List.....................................................     2

Hearing Charter..................................................     3

                           Opening Statements

Statement by Representative Nick Lampson, Chairman, Subcommittee 
  on Energy and Environment, Committee on Science and Technology, 
  U.S. House of Representatives..................................     5
    Written Statement............................................     5

Statement by Representative Bob Inglis, Ranking Minority Member, 
  Subcommittee on Energy and Environment, Committee on Science 
  and Technology, U.S. House of Representatives..................     6
    Written Statement............................................     7

Prepared Statement by Representative Jerry F. Costello, Member, 
  Subcommittee on Energy and Environment, Committee on Science 
  and Technology, U.S. House of Representatives..................     9

Statement by Representative F. James Sensenbrenner, Ranking 
  Minority Member, Subcommittee on Investigations and Oversight, 
  Committee on Science and Technology, U.S. House of 
  Representatives................................................     7
    Written Statement............................................     8

                               Witnesses:

Mr. Terry Penney, Technology Manager, Advanced Vehicle 
  Technologies, National Renewable Energy Laboratory, Golden, 
  Colorado
    Oral Statement...............................................    10
    Written Statement............................................    12
    Biography....................................................    17

Mr. Eric M. Smith, Chief Engineer, Medium Duty Hybrid Electric 
  Powertrains, Eaton Corporation
    Oral Statement...............................................    18
    Written Statement............................................    19
    Biography....................................................    23

Mr. Joseph T. Dalum, Vice President, DUECO
    Oral Statement...............................................    23
    Written Statement............................................    25
    Biography....................................................    31

Ms. Jill M. Egbert, Manager, Clean Air Transportation, Pacific 
  Gas & Electric Company
    Oral Statement...............................................    32
    Written Statement............................................    33
    Biography....................................................    35

Mr. Richard C. Parish, Senior Program Manager, CALSTART Hybrid 
  Truck Users Forum (HTUF), Denver, Colorado
    Oral Statement...............................................    35
    Written Statement............................................    38
    Biography....................................................    45

Discussion
  The Federal Government's Role in Promoting Heavy Hybrid 
    Technologies.................................................    46
  Pricing........................................................    47
  The 21st Century Truck Partnership.............................    47
  Scientific and Economic Barriers to Deployment.................    48
  Battery Technology and Disposal................................    50
  Department of Defense Hybrid Efforts...........................    52
  Competitive Grants.............................................    54
  Hybridizing Off-road Work Equipment............................    55
  More on Scientific and Economic Barriers to Deployment.........    58
  Role for the DOE National Laboratories.........................    59

 
    HYBRID TECHNOLOGIES FOR MEDIUM- TO HEAVY-DUTY COMMERCIAL TRUCKS

                              ----------                              


                         TUESDAY, JUNE 10, 2008

                  House of Representatives,
            Subcommittee on Energy and Environment,
                       Committee on Science and Technology,
                                                    Washington, DC.

    The Subcommittee met, pursuant to call, at 10:06 a.m., in 
Room 2318 of the Rayburn House Office Building, Hon. Nick 
Lampson [Chairman of the Subcommittee] presiding.



                            hearing charter

                 SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

                  COMMITTEE ON SCIENCE AND TECHNOLOGY

                     U.S. HOUSE OF REPRESENTATIVES

                   Hybrid Technologies for Medium- to

                      Heavy-Duty Commercial Trucks

                         tuesday, june 10, 2008
                         10:00 a.m.-12:00 p.m.
                   2318 rayburn house office building

Purpose

    On Tuesday, June 10 the Subcommittee on Energy and Environment of 
the Committee on Science and Technology will hold a hearing to receive 
testimony on the state of development of hybrid electric technologies 
for medium- to heavy-duty commercial vehicle applications and the role 
of the Department of Energy (DOE) in supporting research and 
development of these systems. The Committee will also receive testimony 
on a discussion draft of legislation to be introduced by Rep. 
Sensenbrenner.

Witnesses

Mr. Terry Penney, Technology Manager, Advanced Vehicle and Fuel 
Technologies, National Renewable Energy Laboratory

Mr. Eric M. Smith, Chief Engineer, Hybrid Medium Duty Truck, Eaton 
Corporation

Mr. Joseph Dalum, Vice President, Dueco Inc.

Ms. Jill Egbert, Manager, Clean Air Transportation, Pacific Gas & 
Electric Company (PG&E)

Mr. Richard Parish, Senior Program Manager, CALSTART Hybrid Truck Users 
Forum (HTUF)

    The witnesses will discuss the considerable potential for energy 
savings and emissions reductions through deployment of hybrid electric 
systems in heavy duty trucks, the range of hybrid heavy truck 
technologies and applications, the major technical and market barriers 
in deploying these technologies, and their experience with the federal 
energy research programs.
    The witnesses will also offer their views on the draft legislation 
to authorize a federal research and demonstration program on hybrid 
technologies for heavy-duty vehicles.

Background

    There are significant potential economic and environmental benefits 
from improving medium- to heavy-duty vehicles through the 
electrification of drive trains and auxiliary power systems. Hybrid 
technologies (ex: battery and hydraulic) are being developed for a wide 
range of commercial vehicle platforms such as package delivery vans, 
refuse collection trucks, large utility ``bucket trucks,'' military and 
construction vehicles, and even long-haul tractor trailer trucks. 
Conventional large truck models share the common characteristics of 
relatively low fuel efficiency and high emissions profiles since they 
must rely solely on a diesel or gasoline internal combustion engine for 
power. These inefficiencies are especially evident in trucks that 
require frequent starts and stops, or long periods of non-drive time 
engine idling in order to provide power for auxiliary systems such as 
bucket lifters and other work-related equipment, off-board power tools, 
air conditioning, and refrigeration. By switching some driving and 
auxiliary loads to hybrid systems large trucks stand to save a 
considerable amount of fuel and greatly reduce their emissions.
    For defense applications, hybrid systems provide the added benefit 
of generating very little noise, providing power for radar and weapons 
systems, reducing overall weight and maintenance requirements, and 
allowing vehicles to run much longer between fueling. In fact, military 
requirements have been a major driver of innovation in hybrid 
technologies for heavy vehicles.
    The power demands on heavy duty trucks are as varied as the 
applications. While several truck companies are testing hybrid models, 
significant technical hurdles remain, and there is no one-size-fits-all 
hybrid solution for the entire sector. Through the course of an average 
drive cycle the charging and discharging of a hybrid electric or 
hydraulic system on a trash truck, with its frequent starts and stops, 
dumpster lifting, and trash compaction, will be considerably different 
than that of a utility truck which may idle in one place for several 
hours in order to operate the bucket lifting boom and other equipment. 
Long haul tractor trailer rigs (Class 8) may prove even more 
challenging since they seldom brake during a drive cycle, providing 
little opportunities for battery systems to recharge. The next 
generation of trucks may also include plug-in hybrid electric models 
which can charge larger banks of batteries through direct connection to 
the electricity grid.
    While the total number of these vehicles is small compared to 
passenger vehicles, their fuel consumption and emissions justify the 
high costs of development of hybrid models. According to figures by the 
Oshkosh Truck Corporation there are approximately 90,000 refuse 
collection trucks in the U.S. but their collective fuel consumption is 
roughly equivalent to 2.5 million passenger vehicles (based on 10,000 
gallons/year per truck). Estimates done by the Eaton Corporation show 
that as little as 10,000 hybrid electric trucks could reduce diesel 
fuel usage by 7.2 million gallons/year (approx. one million barrels of 
oil), reduce NOX emissions by the amount equivalent to removing New 
York City's passenger cars for 25 days, and reduce carbon dioxide 
emissions by 83,000 tons.
    The energy storage options for hybrid trucks generally include 
batteries, hybrid hydraulic systems, and ultracapacitors. Batteries 
receive the most attention and research funding because of their 
applicability throughout the transportation sector. To expand the use 
of electricity in the vehicles sector batteries must be smaller, 
lighter, cheaper, and more powerful. Vehicle batteries typically fall 
into one of three families of technologies: lead-acid, nickel metal 
hydride (NiMH), and lithium-ion (Li-Ion). Lead-acid batteries have many 
advantages including their relative simplicity and low cost, wide-scale 
availability, domestic manufacturing capacity, and established 
recycling infrastructure. NiMH batteries are found in the current 
generation of hybrid vehicles and will be the battery of choice for 
many of the first generation heavy hybrid trucks. However, high weight 
and low power density are significant issues for both lead-acid and 
NiMH batteries, and they may not be optimal for future plug-in hybrid 
applications. Many in the industry believe the future of hybrids 
depends on breakthroughs in new battery technologies, such as the 
lithium ion (Li-ion) batteries with their low weight and high power 
density. But, in addition to solving remaining technical issues such as 
heat management, the costs of manufacturing Li-ion batteries remain 
prohibitively high for large-scale deployment in vehicles. There is 
also concern that the U.S. is falling behind in the race to develop and 
manufacture batteries, and a significant effort is underway to build up 
a domestic supply chain.
    The Department of Energy has funded research in this area over the 
years, most recently through the 21st Century Truck Partnership which 
conducts R&D through public-private efforts with the trucking industry. 
Other federal agencies involved in the 21st Century Truck Partnership 
include the Department of Defense, the Department of Transportation, 
and the Environmental Protection Agency. Federal research capabilities 
exist in DOE laboratories such as the National Renewable Energy 
Laboratory and Argonne National Laboratory, the EPA's National Vehicle 
and Fuel Emissions Laboratory, and the Army's National Automotive 
Center. Despite the potential economic and environmental benefits of 
hybrid trucks and the considerable technical hurdles that remain, the 
21st Century Truck Partnership is facing decreased funding as the 
Administration chooses to shift the focus of federal research to the 
passenger vehicle market.

Draft Legislation

    Representative James Sensenbrenner will have draft legislation 
available for the Committee and witnesses to review. Specifically, the 
draft legislation would accelerate research of plug-in hybrid 
technology in trucks by creating grants for manufacturers to build, 
test, and ultimately sell plug-in hybrid utility and delivery trucks. 
The Act would also encourage DOE to expand its research in advanced 
energy storage technologies to include heavy hybrid trucks as well as 
passenger vehicles.
    Chairman Lampson. The hearing will come to order. I want to 
welcome the Members of the Subcommittee and our distinguished 
panelists to today's hearing on hybrid technologies for medium- 
to heavy-duty commercial trucks.
    With concerns about our over-reliance on foreign oil, the 
skyrocketing costs of fuels, and the effects of our 
transportation sector on air quality and carbon emissions, 
technological strides in the commercial truck market stand to 
offer tremendous benefits to our economic and environmental 
health.
    Though it is easy to overlook, these vehicles are pervasive 
throughout our economy. From school buses to trash collectors, 
utility trucks to delivery vans, long-haul tractor trailers to 
road work equipment, one would be hard pressed to identify an 
aspect of our daily lives that didn't at some point depend on 
medium-to-heavy trucks, heavy-duty trucks. They also represent 
a substantial portion of the U.S. fuel consumption and 
emissions.
    The truck industry is due for a major technological shift. 
But advances in this sector don't come easily, and there is no 
one-size-fits-all solution. The demands on these vehicles are 
as varied as their uses. Consequently, there remains a need for 
a robust federal program to partner with industry and develop 
this wide range of hybrid platforms.
    The focus for hybrid vehicle technology development has 
largely been on passenger vehicles. Passenger vehicles have 
paved the way both in terms of advancing the technologies and 
expanding public awareness of capabilities of hybrid systems. 
You need only to visit your local dealership and see the 
waiting lines and lists for hybrid models to know that the 
general public is serious about saving fuel and reducing 
emissions.
    But there is a larger market for hybrids beyond the family 
automobile. Reducing fuel costs and meeting environmental 
regulations is vital to the bottom line of any company that 
relies on heavy trucks. Yet the Administration has chosen to 
shift resources to the passenger automobile and away from its 
21st Century Truck Program. Given the significant gains to be 
made in the commercial truck sector and its indispensable role 
in our economy, we should ensure that federal research and 
development programs continue to address the need to improve 
fuel efficiency of heavy-duty vehicles.
    We are joined by our colleague, Mr. Sensenbrenner, Ranking 
Republican Member of the Investigations and Oversight 
Subcommittee, who will soon introduce legislation to enhance 
the federal role in the development of heavy hybrid vehicles. I 
would like to thank him for elevating this subject to the level 
that it deserves, and I look forward to the opportunity to 
consider his legislation at the appropriate time.
    And at this time I would yield to my distinguished 
colleague from South Carolina, our Ranking Member, Mr. Inglis, 
for an opening statement.
    [The prepared statement of Chairman Lampson follows:]
              Prepared Statement of Chairman Nick Lampson
    I want to welcome Members of the Subcommittee and our distinguished 
panelists to today's hearing on hybrid technologies for medium- to 
heavy-duty commercial trucks.
    With concerns about our over-reliance on foreign oil, the 
skyrocketing costs of fuels, and the effects of our transportation 
sector on air quality and carbon emissions, technological strides in 
the commercial truck market stand to offer tremendous benefits to our 
economic and environmental health.
    Though it is easy to overlook, these vehicles are pervasive 
throughout our economy. From school buses to trash collectors, utility 
trucks to delivery vans, long-haul tractor trailers to road work 
equipment, one would be hard pressed to identify an aspect of our daily 
life that did not at some point depend on medium- to heavy-duty trucks.
    They also represent a substantial portion of the U.S. fuel 
consumption and emissions.
    The truck industry is due for a major technology shift. But, 
advances in this sector don't come easy, and there is no one-size-fits 
all solution. The demands on these vehicles are as varied as their 
uses. Consequently, there remains a need for a robust federal program 
to partner with industry and develop this wide range of hybrid 
platforms.
    The focus for hybrid vehicle technology development has largely 
been on passenger vehicles. Passenger vehicles have paved the way both 
in terms of advancing the technologies and expanding public awareness 
of the capabilities of hybrid systems. You need only to visit your 
local dealership and see the waiting lists for hybrid models to know 
that the general public is serious about saving fuel and reducing 
emissions.
    But there is a larger market for hybrids beyond the family 
automobile. Reducing fuel costs and meeting environmental regulations 
is vital to the bottom line of any company that relies on heavy trucks. 
Yet, the Administration has chosen to shift resources to the passenger 
automobile and away from its 21st Century Truck Program. Given the 
significant gains to be made in the commercial truck sector, and its 
indispensable role in our economy, we should ensure that federal 
research and development programs continue to address the need to 
improve fuel efficiency of heavy-duty vehicles.
    We are joined by our colleague Mr. Sensenbrenner, Ranking 
Republican Member of the Investigations and Oversight Subcommittee, who 
will soon introduce legislation to enhance the federal role in the 
development of heavy hybrid vehicles. I would like to thank him for 
elevating this subject to the level it deserves, and I look forward to 
the opportunity to consider his legislation.
    At this point I will turn to the distinguished Ranking Member of 
this subcommittee, Mr. Inglis for his opening statement.

    Mr. Inglis. Thank you, Mr. Chairman. Thank you for holding 
this hearing.
    Transportation needs innovation. The transportation sector 
is our primary consumer of oil and exhales more carbon dioxide 
emissions than any other source. The more we pay at the pump 
each week, the easier it is to realize the obvious benefits of 
alternatives to oil. It seems that rising oil prices rouse our 
attention to ways that we could ``do energy'' a different way. 
This hearing is a case in point.
    In previous hearings of this subcommittee we have talked 
about reinventing the car. We have heard the economic, 
environmental, and national security benefits that will accrue 
to pursuing hybrid, battery, and hydrogen technologies to power 
tomorrow's cars.
    Today we will hear from a number of experts about the 
medium- and heavy-duty commercial truck market and its needs 
for the same innovative focus. Applications such as hybrid 
engines and battery-powered auxiliary systems promise a 
significant reduction in oil consumption and greenhouse gas 
emissions, but technological hurdles stand in the way of 
realizing those benefits.
    I join with the Chairman in thanking Mr. Sensenbrenner for 
introducing this draft legislation that would steer federal 
dollars toward research, development, and demonstration in the 
areas of commercial truck hybrid technologies. I would be 
interested to hear from our witnesses as to whether current oil 
prices are enough incentive for heavy truck companies to invest 
in these technologies, or if there is a necessary role for the 
Federal Government to assist in overcoming these technological 
hurdles.
    Thank you again, Mr. Chairman. I look forward to hearing 
from our witnesses on their perspectives in this, on their 
perspectives in this legislation and suggestions as to ways we 
might improve it.
    [The prepared statement of Mr. Inglis follows:]
            Prepared Statement of Representative Bob Inglis
    Thank you for holding this hearing, Mr. Chairman.
    Transportation needs innovation. The transportation sector is our 
primary consumer of oil, and exhales more carbon dioxide emissions than 
any other source. The more we pay at the pump each week, the easier it 
is to realize the obvious benefits of alternatives to oil. It seems 
that rising oil prices rouse our attention to ways we could ``do 
energy'' a different way. This hearing is a case in point.
    In previous hearings of this subcommittee, we've talked about 
reinventing the car. We've heard the economic, environmental, and 
national security benefits that will come from pursuing hybrid, 
battery, and hydrogen technologies to power tomorrow's cars.
    Today, we'll hear from several experts that the medium- and heavy-
duty commercial truck market needs the same innovative focus. 
Applications such as hybrid engines and battery-powered auxiliary 
systems promise a significant reduction in oil consumption and 
greenhouse gas emissions, but technological hurdles stand in the way of 
realizing those benefits.
    I'd also like to thank Mr. Sensenbrenner for introducing draft 
legislation that would steer federal dollars toward research, 
development, and demonstration in the area of commercial truck hybrid 
technologies. I'd be interested to hear from our witnesses as to 
whether current oil prices are enough incentive for heavy truck 
companies to invest in these technologies, or if there's still a 
necessary role for the Federal Government to assist in overcoming these 
technological hurdles.
    Thank you again, Mr. Chairman. I look forward to hearing from our 
witnesses on their perspectives of this legislation and any suggestions 
they may have to improve it.

    Chairman Lampson. Thank you, Mr. Inglis.
    And now I would like to recognize Mr. Sensenbrenner for a 
statement.
    Mr. Sensenbrenner. Thank you very much, Mr. Chairman.
    New taxes are not the only solution to climate change. We 
need to focus our economy as we work to reduce our emissions. 
We can over regulate our businesses, cripple our economic 
development, and watch as China and India race past us, 
sputtering greenhouse gases along the way. Or Congress can 
create incentives that encourage the development of new 
technologies that will reduce our emissions, foster economic 
development, and allow U.S. manufacturers to export their 
energy-saving technologies worldwide.
    A honking motorcade of trucks around the Capitol last month 
flashed signs that read, ``When Trucks Stop, America Stops.'' 
Commercial traffic is truly vital to the American economy, and 
the fuel costs for trucks directly affects costs for all 
Americans. The additional price of their fuel raises the price 
of our food, health care, manufacturing, retail, waste removal, 
and other goods and services. And while our economy would not 
survive without them, trucks consume huge quantities of oil, 
which raises the cost of their businesses and raises our 
dependence on oil and injects greenhouse gases into the 
environment.
    The answer is not to burden these businesses already 
strained by high fuel costs with additional taxes for the 
CO2 they release. Instead, we need to encourage the 
development and introduction of technologies that will reduce 
their fuel consumption.
    The technologies we need already exist. Everybody has seen 
hybrid cars. This technology, which combines gas and electric 
motors for a powerful and efficient engine, is even more 
practical in trucks. Even though there are fewer trucks on the 
road, trucks use more fuel.
    Utility trucks, for example, typically drive short 
distances to and from a work site, but sit idle for hours while 
on site. A plug-in hybrid truck would use less fuel getting to 
and from the site and would operate without any fuel on the 
site. Ultimately, a plug-in hybrid engine in a utility truck 
could use up to 60 percent less fuel.
    Delivery trucks constantly stop and go. Hybrid engines 
excel at this type of driving because the engine can 
essentially turn off during short accelerations, while coasting 
and while it is at a stop.
    Developing these technologies will have benefits beyond 
fuel savings. By making our trucks more efficient, we will make 
our goods and services more affordable and then become leaders 
in these new technologies. Like America, Asia is faced with 
rising fuel costs. Their trucking fleets, like ours, are 
currently powered by diesel. In Europe the price of diesel has 
risen to nearly $9 a gallon. This has led to a strike. Spanish 
truckers are currently holding a ``snail protest,'' essentially 
blockading the highways of Spain and Southern France by inching 
along the road. Anti-protest demonstrators, fearing that food 
and other goods could become scarce, have rebelled violently by 
slashing truck tires and smashing their windshields. If 
America's companies are the first to develop and commercialize 
products such as the topic of the hearing today, not only can 
we avoid a similar fate, but we can export these technologies 
worldwide.
    By helping American manufacturers research and 
commercialize new technologies, we can strengthen our economy, 
reduce our dependence on foreign oil, and lower our emissions. 
The legislation we will discuss today is a narrow example of 
how technology, and not taxes or carbon offset credits, can 
help solve our energy crisis. The legislation would accelerate 
research of plug-in hybrid technology in trucks by creating 
grants for manufacturers to build, test, and sell plug-in 
hybrid utility and delivery trucks. The Act would also 
encourage the Department of Energy to expand its research in 
advanced energy storage technologies to include heavy hybrid 
trucks as well as passenger vehicles. This bill will put plug-
in hybrid trucks on the road and help advance research and 
accelerate commercialization of this important technology.
    I thank the Chairman for holding this hearing and the 
witnesses for lending their expertise to this effort, and yield 
back the balance of my time.
    [The prepared statement of Mr. Sensenbrenner follows:]
    Prepared Statement of Representative F. James Sensenbrenner Jr.
    New taxes are not the only solution to climate change. We need to 
focus on our economy as we work to reduce our emissions. We can over-
regulate our businesses, cripple our economic development, and watch as 
China and India race past us--sputtering greenhouse gases along the 
way--or Congress can create incentives that encourage the development 
of new technologies that will reduce our emissions, foster economic 
development, and allow U.S. manufacturers to export their energy-saving 
technologies worldwide.
    A honking motorcade of trucks around the Capitol last month flashed 
signs that read, ``When Trucks Stop, America Stops.'' Commercial 
traffic is truly vital to the American economy, and the fuel costs for 
trucks directly affect costs for all Americans. The additional price of 
their fuel raises the price of our food, health care, manufacturing, 
retail, waste removal, and other the goods and services. While our 
economy would not survive without them, trucks consume huge quantities 
of oil, which raises the cost of their business, increases our 
dependence on oil, and injects greenhouse gases into our environment.
    The answer is not to burden these businesses, already strained by 
high fuel costs, with additional taxes for the carbon dioxide they 
release. Instead, we need to encourage the development and introduction 
of technologies that will reduce their fuel consumption.
    The technologies we need already exist. Everyone has seen hybrid 
cars. This technology, which combines gas and electric motors for a 
powerful and efficient engine, is even more practical in trucks. Even 
though there are fewer trucks on the road, trucks use more fuel.
    Utility trucks, for example, typically drive short distances to and 
from a work site, but sit idle for hours while on site. A plug-in 
hybrid truck would use less fuel getting to and from the site, and 
could operate without any fuel while on site. Ultimately a plug-in 
hybrid engine in a utility truck could use up to 60 percent less fuel.
    Delivery trucks constantly stop and go. Hybrid engines excel at 
this type of driving because the engine can essentially turn off during 
short accelerations, while coasting, and when it is at a stop.
    Developing these technologies will have benefits beyond fuel 
savings. By making our trucks more efficient, we will make our goods 
and services more affordable and become leaders in these new 
technologies. Like America, Asia is faced with rising fuel costs. Their 
trucking fleets, like ours, are currently powered by diesel. In Europe, 
the price of diesel has risen to nearly $9 per gallon. This has lead to 
a strike. Spanish trucks are currently holding a ``snail protest,'' 
essentially blockading the highways of Spain and Southern France by 
inching along the road. Anti-protest demonstrators, fearing that food 
and other good could become scarce, have rebelled violently by slashing 
truck's tires and smashing their windshields. If American companies are 
the first to develop and commercialize these products, not only can we 
avoid a similar fate, we can export these technologies worldwide.
    By helping American manufacturers research and commercialize new 
technologies, we can strengthen our economy, reduce our dependence on 
foreign oil, and lower our emissions. The legislation we will to 
discuss today is a narrow example of how technology, not taxes, can 
solve our energy crisis. The legislation would accelerate research of 
plug-in hybrid technology in trucks by creating grants for 
manufacturers to build, test, and sell plug-in hybrid utility and 
delivery trucks. The Act would also encourage the Department of Energy 
to expand its research in advanced energy storage technologies to 
include heavy hybrid trucks as well as passenger vehicles. This bill 
will put plug-in hybrid trucks on the road and help advance research 
and accelerate commercialization of an important technology. I thank 
the Chairman for holding this hearing and the witnesses for lending 
their expertise to this effort.

    Chairman Lampson. Thank you, Mr. Sensenbrenner.
    I ask unanimous consent that all additional opening 
statements submitted by the Committee Members be included in 
the record.
    Without objection, so ordered.
    [The prepared statement of Mr. Costello follows:]
         Prepared Statement of Representative Jerry F. Costello
    Mr. Chairman, I appreciate the Subcommittee giving attention to 
this matter, it is particularly salient topic as gas and diesel prices 
continue to rise every day.
    Hybrid technology for passenger cars has received an increasing 
amount of media and consumer attention recently as gas prices continue 
to soar. As alternative fuel technologies advance for passenger 
vehicles, I am pleased that this committee has turned its attention to 
the status of renewable technologies for medium- and heavy-duty trucks.
    There are many benefits to hybrid technologies for heavy-duty 
trucks, and variety of electric vehicles systems currently exist to 
serve in various capacities. The cross-country shipping industry, the 
military, utility companies and the construction industry can all 
benefit from the expansion of hybrid technologies. A manufacturer in my 
district in Southern Illinois, BNSF Railway and Vehicle Projects LLC, 
are developing a switch locomotive powered by a hydrogen fuel cell. 
This technology can help these industries to not only to lower their 
carbon footprints, but to also reduce their expenses by decreasing the 
amount of gasoline for their fleets of medium- and heavy-duty trucks.
    At this critical time when Congress will embark upon major climate 
change legislation in the near future, we must ensure that funding is 
dedicated to overcoming the existing challenges that face this 
developing technology. Although the Department of Energy once funded a 
program to develop and test early heavy hybrid technologies that 
yielded encouraging results, the Bush Administration has since 
terminated the funding.
    As we will hear today, many utility companies currently use hybrid 
trucks in their fleet today. If additional funding is invested, the 
foundation of technology exists to launch hybrid technologies into the 
mass-consumer level. With the proper resources, the United States can 
take advantage of the opportunity to become a leader in hybrid 
technology.
    Thank you, Mr. Chairman, for my time; I look forward to hearing 
from our witnesses today. I yield back.

    Chairman Lampson. It is my pleasure to introduce our 
witnesses this morning. Terry Penney is the Technology Manager 
for Advanced Vehicle Technologies and the Renewable Fuels 
Science and Technology Directorate at the National Renewable 
Energy Laboratory. Mr. Eric Smith is the Chief Engineer for 
Medium-Duty Hybrid Electric Powertrains for the Eaton 
Corporation. Joseph Dalum is the Vice President of Dueco, and 
Ms. Jill Egbert is the Manager of the Clean Air Transportation 
Department at the Pacific Gas and Electric Company, PG&E. Mr. 
Richard Parish is the Senior Program Manager of the Hybrid 
Truck Users Forum at CALSTART.
    You will each have five minutes for your spoken testimony. 
Your written testimony will be included in the record for the 
hearing. When you all complete your testimony, we will begin 
with our rounds of questions. Each Member will have five 
minutes to question the panel.
    Mr. Penney, would you please begin.

  STATEMENT OF MR. TERRY PENNEY, TECHNOLOGY MANAGER, ADVANCED 
  VEHICLE TECHNOLOGIES, NATIONAL RENEWABLE ENERGY LABORATORY, 
                        GOLDEN, COLORADO

    Mr. Penney. Thank you, Mr. Chairman, and other Members for 
this opportunity to talk about the status and potential of 
heavy hybrid trucks.
    NREL has been working for the last 15 years with partners 
in government, other national labs, and industry on both light 
and heavy-duty hybrids. Despite the tremendous progress that 
has been made, I believe that targeted R&D and purchase 
incentives are still needed so these trucks can grow in volume 
and play a prominent role in the marketplace.
    Primarily, because of escalating fuel prices and tougher 
emission standards, the cost in operating and producing heavy-
duty vehicles are rising at alarming rates. But there are 
reasons to be optimistic. Despite the fact that more fuel is 
being used by our light-duty car fleet, and we are working hard 
on those vehicles too, we should not ignore advanced heavy 
truck technologies across many applications that can also 
significantly reduce their fuel use and subsequent emissions.
    To frame the opportunity, first a little background. About 
80 percent of all our goods are transported by truck, and last 
year Class one through Class eight trucks consumed about 40 
billion gallons of diesel fuel. The good news, hybrid trucks in 
various forms from research prototypes to recent early 
commercialization products have demonstrated the potential to 
reduce fuel costs anywhere from a few percent to 50 to 60 
percent.
    Original equipment manufacturers, OEMs, and truck owners 
are learning that their exact savings depend on three things: 
the application, the duty cycle, and the way it is driven, and 
of course, the distance it travels between stop and go.
    For example, a typical delivery truck using a hybrid drive 
system could save more than a thousand gallons of fuel per year 
in comparison to a conventional truck. We believe almost every 
truck application can benefit from hybrid drive of some sort 
and other system improvements.
    In addition to NREL's fleet testing, we have shown that 
hybrids' overall operating and maintenance costs per mile can 
be lower, too, in part because of fewer brake replacements and 
less downtime, which help lower the cost differential between 
conventional and hybrid drive trains.
    Let us quickly review the potential for hybrids and or 
perhaps plug-in hybrid truck applications by class, and if you 
have my testimony in front of you, take a look at page two and 
page three, where I describe the classes one through eight, and 
you will see that classes one through four are your typical 
minivans, utility vans, pickup trucks, five includes a shuttle 
or city delivery and a bucket truck. Class six is a beverage or 
a school bus. Class seven is refuse haulers, furniture 
delivery, city transit buses, for example, and of course, Class 
eight is dump trucks, cement trucks, and line haul semis.
    Of course, military vehicles of all classes and sizes could 
also benefit from hybridization, and several have already been 
demonstrated as you are well aware.
    I would like to draw your attention to the Class eight 
trucks. They use, and this is on page three, you will notice 
that they use as much diesel fuel as all other truck classes 
combined, and until recently many believed there was little 
hope in hybridizing line haul semis because they don't have 
much stop and go, which is classic of the hybrid cycle. 
However, even in this class, truck OEMs are finding 
opportunities for fuel savings, even if only in the single 
digits, because hybridization and other system improvements can 
yield tremendous savings.
    Today hybrid trucks are just starting to hit the market in 
various service applications, most notably transit buses, 
though for most applications it is tough, it is a tough sell. 
This is probably because the cost premiums which result from 
limited current production quantities and the need for further 
improvement and establish the system reliability, economics, 
and performance of various truck components.
    Along with continuing credits and incentives, we need to 
continue our R&D programs to improve the performance and 
economics of these hybrid systems. The National Academy of 
Sciences recently completed a detailed examination of the 21st 
Century Truck Partnership Projects in this area, and that 
report is expected to be delivered to the Department of Energy 
in the next few weeks. I would encourage you to review its 
findings.
    There are approximately 18 million commercial vehicles on 
the road, every kind of vehicle represents a different set of 
demands, and these, in turn, determine vehicle size, 
configuration, and each with a different duty cycle. As a 
result, there are many unique powertrain solutions. A hybrid is 
not just a hybrid. Today there are a handful of demonstration 
hybrid trucks, many supported by federal and State cost-sharing 
programs and are shedding life on both opportunities and 
challenges, but production volumes are still very low and not 
very high since system costs from drive trains through energy 
storage systems to power electronics must be continued to be 
reduced.
    So with these considerations in mind, what needs to be 
done? First, we must understand the unique duty cycle of the 
hybrid vehicle. Then we need to understand how these new 
powertrain topologies can boost miles per gallon or ton miles 
delivered. We must take an overall systems approach to greater 
efficiency. We also need to work on advanced combustion, heat 
recovery, energy storage technology, especially batteries and 
ultracapacitors, to improve the cost, performance, and life and 
thermal abuse tolerance. Finally, we need to improve the 
overall performance and costs associated with the power of 
electronics module and electric drive motor, improving 
performance, life, and reliability issues through advanced 
thermal control.
    Despite a limited DOE budget, the DOE Vehicle Technology 
Program is actively engaged in pursuing many of these technical 
areas. With DOE's support of NREL, we employ heavy hybrid 
vehicle R&D testing, analysis to understand and solve many 
technical issues and overcome these barriers while working with 
OEMs and their suppliers.
    For example, NREL's ReFUEL lab tests advanced fuels and 
double, and heavy-duty engines for advanced heavy hybrid 
vehicles and is home, unique testing, and measurement 
equipment. With industry partners we also conduct field 
evaluations of transit buses, trucks, idle-reduction 
technologies. We design test plans, gather on-site data, and 
publish our results. Education, getting the word out, helping 
industry and fleet owners learn about what actually works and 
what doesn't, has been a hallmark of our efforts.
    The government's commitment to funding, finding solutions 
for supporting advanced R&D and government industry 
partnerships and by encouraging incentives is absolute key.
    Thank you so much.
    [The prepared statement of Mr. Penney follows:]
                   Prepared Statement of Terry Penney
    Mr. Chairman, I want to thank you for providing this opportunity to 
talk about the status and potential of heavy-duty hybrid trucks in the 
United States, and the research and development and policy support that 
is needed to give them a more prominent role in the marketplace. As 
groups like the Hybrid Truck Users Forum have recently noted, hybrid 
trucks are right ``on the cusp'' of production in medium- and heavy-
duty commercial markets, and there is much we can do to tip the balance 
in their favor, and in ours, in terms of achieving greater energy 
security and lessening our reliance on imported fuels.
    I am the Technology Manager for Advanced Vehicle Technologies in 
the Renewable Fuels Science and Technology directorate at the National 
Renewable Energy Laboratory in Golden, Colorado. NREL is the U.S. 
Department of Energy's primary laboratory for R&D in renewable energy 
and energy efficiency technologies, and we are dedicated to helping the 
Nation develop a full portfolio of technologies that can meet our 
energy needs.
    It is an honor to be here and to speak with you today. I want to 
commend the Committee for its interest in exploring ways to reduce the 
use of imported petroleum in the commercial sector, curb emissions 
associated with burning fossil fuels for transportation, and increase 
the competitiveness of U.S. manufacturers and truck fleets through 
greater use of hybrid trucks.
    Despite the progress we have achieved in fuel efficiency and 
emissions reductions over recent years, the costs associated with 
producing and operating our heavy-duty fleets have risen at alarming 
rates. There exists today great potential from several heavy-duty 
hybrid truck technologies to significantly reduce fuel consumption and 
emissions. This should in turn improve the economic picture for U.S. 
truck manufacturers, suppliers, fleets, and customers alike.
    First, a little background. Approximately 80 percent of all the 
goods transported in the United States today are moved by truck. In 
all, the United States consumed about 140 billion gallons of gasoline 
and about 40 billion gallons of diesel fuel for on-road transportation 
in 2004, according to the Department of Energy. The U.S. now imports 
more than 60 percent of the crude oil it uses. Retail gasoline and 
diesel fuel prices have reached record highs in recent months, and the 
retail price of diesel is well over $4 per gallon in most parts of the 
Nation.
    Given the current situation, we see considerable potential for 
hybrid trucks to reduce fuel use, and thus costs, from five percent at 
minimum, to as much as 50 percent to 60 percent at the high end. 
Although exact reductions depend on the actual use of the truck--and 
specifically, the way it's driven and the distance traveled between 
stops--there is virtually no truck application that cannot benefit from 
a hybrid drive train and related system improvements. Potential 
applications include shuttle and school buses, military vehicles, 
utility trucks, bucket trucks, beverage delivery and parcel delivery 
trucks, refuse haulers, and some large Class 8 vehicles. Because trucks 
generally use much more fuel per year than passenger vehicles, the 
overall savings potential is very significant (see illustrations that 
follow).
    Plug-in hybrid trucks are on the horizon, as well. Plug-in hybrid 
systems could benefit not only industry and the environment, they 
perhaps could alter the nature of our utility grids, by providing 
stored energy and a form of mobile distributed energy generation. 
Before we can begin to realize these benefits widely, however, we must 
address some remaining issues surrounding hybrid and plug-in hybrid 
technologies.




Heavy-Duty Hybrid Trucks: Some Major Issues

    An article in the April 27, 2008, edition of the New York Times 
noted that commercial vehicles, particularly those making frequent 
stops, should be the ``killer'' application for hybrid technologies, 
because hybrids often work best in the kind of stop-and-go conditions 
that delivery trucks and refuse haulers experience. Despite this 
potential, there remain relatively few hybrid trucks on the road. The 
primary reasons for this are the costs of the hybrid systems, the 
limited commercial production to date, and the need to further improve 
the economics and performance of energy storage, power electronics, 
auxiliary loads and engine idling systems.
    Light-duty hybrid-electric vehicles (HEVs), such as the Toyota 
Prius and Ford Escape Hybrid, have gained public attention and some 
market momentum in recent years. The added price of hybrid systems have 
been somewhat offset by tax policies at the federal and the State 
levels. It should be noted that light duty and heavy duty applications 
can be much different in overall design and individual components. The 
price premium for hybrid systems will be proportionally greater for 
large commercial vehicles, because of their size and complexities. 
These higher costs have slowed widespread acceptance of these 
technologies, potential fuel savings notwithstanding.
    Hybrid technologies improve fuel economy, primarily by turning off 
the engine when idling, such as when coasting or at a stop. They use 
batteries and electric motors for short accelerations, recharge the 
batteries by recovering the energy used in braking, and use batteries 
for auxiliary loads such as cabin cooling. The combustion engines in 
HEVs can thus be smaller than those in conventional heavy vehicles. Our 
fleet testing has shown how overall maintenance and operating costs per 
mile can also be lower for hybrids, in part because of a decrease in 
brake replacement costs.
    The energy storage system is the most critical component for 
hybridization and electric vehicles generally. The energy storage 
system must be affordable, safe, and durable enough to last through the 
major portion of the vehicle's life. Since vehicles operate at many 
different climates and temperatures, energy storage systems must be 
able to perform well at low temperatures and not quickly degrade at 
high temperatures. Current commercial light duty and heavy duty 
vehicles use Nickel Metal Hydride (NiMH) batteries, mostly from 
Japanese manufacturers. Research and development on advanced energy 
storage systems, such as lithium ion batteries and ultracapacitors, is 
expanding, with hybrid electric vehicle systems being seen as a primary 
use.
    One major concern is the domestic production of batteries. Relying 
on a few foreign sources of battery production (Japan, Korea, China, 
and France) could increase costs and create new energy security 
concerns. Domestic production of energy storage materials and U.S.-
based manufacturing of energy storage systems should be encouraged.
    To increase market acceptance, energy storage systems must be 
improved to reduce their weight and size. Enhanced power and storage 
capacity are two other key goals of current R&D.
    Improving a hybrid's power electronics system likewise is 
essential. In some vehicle systems, the power electronics module costs 
as much as the energy storage system. Boosting the performance and 
cutting the cost of this system will lead to more favorable economics 
for hybrid trucks.
    Other issues include improving the efficiency and cost-
effectiveness of idling reduction technologies. For long-haul trucks 
especially, there exists considerable opportunity to decrease the 
effects of aerodynamic drag on the vehicle, primarily through use of 
lightweight yet strong materials for the truck body, and development of 
heavy-duty tires with low rolling resistance. Government and industry 
groups working together through the 21st Century Truck Partnership (21 
CT) have found that aerodynamic drag resistance, rolling resistance, 
drive-train losses, and auxiliary load losses represent fully 40 
percent of the total fuel energy used to move a heavy-duty vehicle.

Potential for Fuel Savings and Emission Reductions

    Commercial vehicles running on diesel fuel can easily tally 75,000 
miles in a year and, at $4-plus per gallon, pay $1,000 for just one 
fill-up. Thus, a relatively modest increase in fuel efficiency--even 
five percent--can have a major financial impact over time. Urban hybrid 
trucks that make frequent stops and starts could see and up to 60 
percent savings in fuels costs, depending on the way the truck is 
driven and which hybrid system is used. The Environmental Protection 
Agency (EPA) estimates that a typical delivery truck using a hybrid 
drive train system could save more than 1,000 gallons of fuel per year 
in comparison to the fuel used by a similar conventional truck.
    Energy recovery is a major benefit of hybridization. By converting 
the vehicle's dynamic energy into electrical energy during braking, 
less fuel is spent overall. The benefits of energy recovery will be 
greatest for urban vehicles with repeated start-and-stop cycles. The 
hybrid's control system effectively allows for separation of the engine 
speed from the speed of auxiliary or ancillary devices, which offers 
many advantages.
    Electrification of a truck's auxiliary systems, like heating, air 
conditioning and entertainment systems, allows the engine to be shut 
down instead of idling. Again, potential fuel savings is significant, 
as U.S. trucks idle an average of 1,830 hours per year.
    In addition, modern long haul trucks are increasingly equipped with 
automated gearboxes to control the engine speed and save fuel. This has 
opened up the possibility of introducing ``Eco-roll.'' When no engine 
power is needed, the gearbox goes into neutral and the engine runs on 
idle, saving one percent to two percent of fuel. With electrification, 
we can shut the engine off during coasting for an additional one 
percent savings. Blending the use of gasoline engine and electric 
systems allows for added fuel savings.
    Another feature is the ability for low-speed moving of the vehicle 
in electric-only mode. This is useful when going in and out of docks, 
in harbors, in traffic jams, and so on. Considering projected increases 
for traffic congestion, this feature could be even more valuable in the 
future.
    Future trucks need to be much more efficient than they are today. 
Electrification of a truck enables waste heat recovery systems, in 
which heat can be converted back to energy. Waste heat recovery systems 
are estimated to reduce fuel consumption about six percent to eight 
percent. Also, using an electric motor for torque assist can help 
downspeed the engine, or downsize it, with both alternatives saving 
fuel.
    Fuel savings provide emission reductions as well. A recent study by 
the CALSTART partnership evaluated the increases in fuel economy and 
reductions in emissions obtained for a hybrid truck during four driving 
cycles, compared to a conventional vehicle. The study found that in one 
driving cycle of 70 miles, lasting 1.5 hours, the hybrid truck showed a 
68 percent increase in fuel economy and a 58 percent reduction in 
hydrocarbons, on a gallons-per-mile basis. A 50 percent decrease in 
carbon monoxide, a 34 percent reduction in oxides of nitrogen and a 25 
percent decrease in particulate matter were also reported. This is 
significant, because to meet current and upcoming EPA regulations, 
conventional trucks can lose as much as five to ten percent in fuel 
economy. This is a result of the use of fuel by advanced emission 
control systems and also from aggressive exhaust gas recovery 
strategies for lower oxide of nitrogen emissions. Hybrid trucks offer 
the potential to reduce the overall emission reduction requirements and 
therefore reduce the accompanying emission control fuel economy 
penalty.

Applications for Hybrid Technologies

    Hybrid electric powertrains can be used in many, if not most, of 
the Nation's approximately 18 million commercial vehicles. Stop-and-go 
short-haul commercial vehicles are well-suited for systems that capture 
braking energy, assist the engine during frequent accelerations, and 
turn off the engine during coasting and stops. However, each kind of 
commercial vehicle presents a different set of demands, which in turn 
determine the vehicle size, configuration, and duty cycles. As a 
result, each type is likely to have a different hybrid power-train 
solution. For example, the duty cycle of a refuse hauler usually 
consists of a long drive to a neighborhood, followed by repeated short 
starts and stops and ending with a long drive to a waste site. Rather 
than using batteries, this application might be ideal for 
ultracapacitors--devices with enough power to move heavy loads over 
short distances--while the engine is used to and from the waste site.
    Hybrid transit buses are in use today and have demonstrated an 
average 27 percent reduction in fuel use. Depending on the climate, 
about 25 percent of the fuel used for transit buses is for heating and 
cooling passengers. School buses can double the fuel economy with 
hybridization, but today cost twice the $70,000 price tag of a 
conventional bus. Postal delivery vehicles could benefit significantly 
from plug-in operation if they could use the engine to reach a 
neighborhood, then go to all-electric mode while making mailbox-to-
mailbox stops.
    Many commercial vehicles idle for extended periods during package 
deliveries, refuse collection, or to operate necessary equipment like 
fans, extension buckets, backhoes, and related equipment. Altogether, 
idling of commercial vehicles is estimated to consume more than two 
billion gallons of fuel annually, while producing unwanted emissions.
    Long-haul trucks, which operate at fairly constant speeds, have 
challenges all their own. Long-haul trucks consume nearly 16 billion 
gallons of diesel fuel annually, with opportunities for increasing fuel 
economy in this truck class centering around development of more 
efficient engines, reduction of aerodynamic drag, and use of low-
rolling-resistance tires. Biofuels may offer advantages as well. 
Another promising method of cutting fuel consumption and emissions is 
to use batteries, or plug in directly to electricity sources, at truck 
stops. Off-board service to the truck can provide heating and cooling, 
and electricity for lighting, entertainment and ancillary equipment 
during mandatory driver rest periods. Such needs today are largely met 
through idling of the truck's main engine.
    In addition, long-haul trucks are being studied in order to 
determine the benefits of some form of hybridization as well, 
especially when their routes involve climbing and descending hills. 
Such applications could ultimately deliver huge fuel savings, despite 
their relatively small gains in efficiency.

Today's Market Issues

    Promising developments are on the horizon for hybrid trucks, as 
early prototypes and demonstration vehicles shed new light on both 
opportunities and challenges.
    For example, one delivery service is creating a fleet of 100 hybrid 
vans that will offer an estimated 57 percent improvement in fuel 
economy and significantly lower emissions. Other planned new delivery 
vans can travel up to 20 miles on electricity alone. At a recent Hybrid 
Truck Users Forum meeting, at least 15 truck manufacturers announced 
plans to build or demonstrate new vehicles. They will be used in refuse 
hauling, delivery, shuttle bus, school bus, bucket truck, heavy truck 
applications and more.
    Industry and deployment groups are finding that the applications 
are quickly expanding for trucks built on a core hybrid chassis and 
then customized for particular uses. However, because the overall 
production volume of these trucks is still not high, they are available 
only at premium prices. This means that system costs, for drive-trains 
through energy storage systems to power electronics, must continue to 
be reduced. Consequently, support for continued R&D and for policy 
incentives remains vital.

Current Federal Programs and Policies

    The Department of Energy's Vehicle Technologies Program supports 
the development of advanced combustion and engines design, durable and 
affordable advanced batteries covering the full range of vehicle 
applications, from start/stop to full-power hybrid electric, electric, 
and fuel cell vehicles. NREL's extensive testing and analysis 
capabilities are being used to understand and solve energy storage 
thermal issues in both light- and heavy-duty hybrid applications.
    The Department of Energy is also the lead federal agency in the 
21st Century Truck Partnership, established to develop the heavy-duty 
vehicles of the future. The partnership also includes the Departments 
of Defense and Transportation, the EPA, as well as numerous industry 
members. Groups such as CALSTART and the Hybrid Truck Users Forum are 
also doing much to support and promote the greater use and availability 
of hybrid commercial trucks.
    Recently the National Academy of Sciences conducted a thorough 
review of the 21st Century Truck Partnership program. Their final 
report will be delivered to the Partnership in a few weeks. Their 
conclusions and recommendation should be valuable to the Committee as 
it evaluates the opportunities in heavy hybrids.
    Along with automotive companies and their suppliers, NREL has been 
developing and evaluating new technologies that reduce climate control 
loads as well as analyzing and evaluating the thermal performance of 
advanced lithium-ion batteries and ultracapacitors for energy storage. 
NREL is conducting research to develop thermal control technologies 
that enable high power density solutions for reducing the overall cost 
of the power electronics system. Our research includes experimental and 
numerical modeling focused on developing advanced thermal interface 
materials, single-phase liquid, and two-phase jet and spray cooling 
technology, surface enhancements for advanced heat exchangers, air 
cooling, and thermal system integration.
    NREL's Renewable Fuels and Lubricants (ReFUEL) Research Laboratory, 
a test facility for advanced fuels in heavy-duty engines and advanced 
heavy hybrid vehicles, houses unique testing and measurement equipment. 
These include a heavy-duty vehicle chassis dynamometer for testing 
hybrid trucks and buses, with a road load simulation capability from 
8,000 pounds to 80,000 pounds; a heavy-duty engine transient test cell 
(up to 400 hp) for fuels research and development; and an emissions 
measurement capability sensitive enough to be compliant with federal 
certification procedures required in 2007. NREL has performed both 
electric and hydraulic hybrid vehicle test projects with manufacturers 
including Eaton/International, Oshkosh, and Allison GM, for hybrid 
buses, refuse haulers, and step vans.
    In addition, DOE's Advanced Vehicle Testing activities benchmark 
and validate the performance of light-, medium-, and heavy-duty 
vehicles that feature one or more advanced technologies, including 
internal combustion engines burning advanced fuels, such as 100 percent 
hydrogen and hydrogen/compressed natural gas-blended fuels; hybrid 
electric, pure electric, and hydraulic drive systems; advanced 
batteries and engines; and advanced climate control, power electronic, 
and other ancillary systems. The NREL team has conducted medium- and 
heavy-duty vehicle evaluations, including evaluations of transit buses, 
trucks, and idle reduction technologies. Tasks include identifying 
fleets to evaluate, designing test plans, gathering on-site data, 
preparing technical reports, and communicating the results. This work 
is funded by the Department's Vehicle Technologies Program.
    Numerous other partnership opportunities and incentives help 
manufacturers to develop and fleets to purchase hybrid trucks in the 
United States, at both the federal and the State level. The 
Environmental Defense Fund has compiled an online resource of tax 
credits and other incentives: www.edf.org/page.cfm?tagID+1124

Summary

    This testimony shows that there is no single hybrid truck design or 
system that will meet all our commercial transportation needs. 
Different solutions are needed both to improve the fuel economy of 
heavy-duty vehicles and to reduce associated emissions. Specific 
technologies and systems for achieving those objectives in heavy-duty 
hybrid vehicles will differ, depending on the vehicle's application and 
duty cycle.
    As we move toward a future in which advanced vehicle technologies 
play a larger role, we understand the corresponding need to create a 
U.S. manufacturing base for heavy-duty hybrids, and their components. 
Otherwise, we might be trading our dependence on imported petroleum for 
a dependence on imported batteries and other components, a potentially 
serious issue for U.S. competitiveness.
    Thus, a portfolio of energy-saving and environmental solutions will 
serve to meet our nation's economic, energy, and transportation 
challenges as well as enhance our energy security. A strong federal R&D 
and policy role is essential to development of these solutions.
    Thank you.

                       Biography for Terry Penney
    Terry Penney joined the National Renewable Energy Laboratory in 
1979. Prior to joining NREL, he worked for Concentration, Heat and 
Momentum (CHAM) a consulting group headed by Prof. Brain Spalding based 
in London developing unique finite element computational codes for 
multi-phase heat and mass transfer problems. He also worked Von Karmen 
Facility at the Arnold Engineering Development Center in middle 
Tennessee where he worked on the Space Shuttle program. At NREL he has 
worked on Ocean Energy, Buildings research, Optical and Thermal Fluid 
Science. More recently, he launched the Hybrid Vehicle program in 1992, 
which grew into a $300M Partnership for New Generation Vehicles (PNGV) 
between the government and GM, Ford and DaimlerChyrsler. Currently he 
is NREL's Technology Manager for Advanced Vehicle and Fuel Technologies 
responsible for both alternative fuels and advanced vehicles projects 
in both light and heavy-duty hybrid platforms.
    He has more than 50 technical publications to his credit, including 
energy-related articles in Scientific American and the Encyclopedia 
Britannica. Terry has worked on computational fluid dynamics problems 
for a variety of applications and has pushed math-based analysis, which 
has evolved simultaneous multi-physics based tools with optimization 
including six-sigma, optimization and virtual proving ground. He has 35 
years experience in testing and analysis in aerodynamics, heated mass 
transfer components, and advanced thermodynamic cycles, including gas 
turbines. He is an SAE member, a Baldridge team competition examiner, 
National Science Bowl scientific judge and winner of the Van Morris 
Award for performance. His undergraduate degree was from Purdue 
University in Aeronautical Engineering and Engineering Science and his 
graduate work was at the University of Tennessee in Mechanical 
Engineering. He received the MRI President's Award in 1992 for 
exceptional performance and the Van Morris award in 1996 for inspired 
leadership and forging links to industry.

    Chairman Lampson. Thank you, Mr. Penney.
    Mr. Smith, you are recognized for five minutes.

  STATEMENT OF MR. ERIC M. SMITH, CHIEF ENGINEER, MEDIUM DUTY 
         HYBRID ELECTRIC POWERTRAINS, EATON CORPORATION

    Mr. Smith. Chairman Lampson, Ranking Member Inglis, thank 
you for the opportunity to appear today. My name is Eric Smith, 
and I am the Chief Engineer for Medium-Duty Hybrid Electric 
Powertrains for the Eaton Corporation. Eaton is headquartered 
in Cleveland, Ohio. We have over 79,000 employees worldwide, 
including over 28,000 employees in more than 40 states.
    A little bit of background on the Eaton hybrid power 
system. Following years of successful development and extensive 
real-world testing, Eaton is currently offering production 
hybrid electric products for commercial vehicle applications, 
and our first hybrid hydraulic products will enter the market 
later this year. Eaton's hybrid electric power system is 
currently in production option in North America with Peterbilt, 
Kenworth, International, and Freightliner, and we are also 
working with leading European manufacturers such as DAF Trucks 
and Daimler Trucks.
    Eaton was part of the U.S. Department of Commerce Clean 
Energy Trade Mission to China, and we are working currently to 
place over 200 hybrid electric buses in Guangzhou, China. Those 
should all be placed by the end of 2008.
    The design and development effort for all of this work is 
happening at Eaton facilities in Michigan and Minnesota, and 
our hybrid systems are produced currently in Indiana and Iowa.
    Eaton has invested in three separate hybrid power solutions 
for commercial vehicles. First, our hybrid electric vehicle. 
Eaton's production hybrid electric power system can provide 
significant fuel savings and reduce vehicle emissions. Hybrid 
power is particularly appealing in Classes five through eight 
vehicles. These are large trucks with weights exceeding 16,000 
pounds, such as pick-up and delivery and utility trucks.
    And as you can see on my graph that is displayed here, the 
fuel savings possible on the range of trucks we are discussing 
is not only from improved fuel economy while driving but also 
from reduction in engine idle or engine off operation at work 
sites.
    Additionally, Eaton's hybrid electric power system is the 
only certified by the IRS for the medium- and heavy-duty hybrid 
tax credit that was enacted in the Energy Policy Act of 2005.
    I would like to speak just briefly on the hybrid hydraulic 
vehicles. In addition to hybrid electrics that I have 
mentioned, Eaton is also working on development of hybrid 
hydraulic vehicles for applications such as refuse trucks and 
pick-up and delivery vehicles. We are working with the EPA and 
the Army to research and develop these vehicles.
    Finally, a few comments on plug-in hybrid vehicles. In 
addition to the hybrid electric and hybrid hydraulic vehicles, 
plug-in hybrid technology in the early stages of development 
and demonstration for medium- and heavy-duty trucks. Eaton is 
pursuing a number of development and demonstration projects 
directly and with partners such as the Department of Energy. 
With this energy the focus must not be only on batteries but 
also on chargers and electrication of the accessories that will 
be critical to the success of this technology.
    A few comments on battery system development challenges. 
The success of the hybrid market is tied to the development and 
commercialization of state-of-the-art lithium ion batteries. 
The develop, manufacturing, and assembly methodologies needed 
to allow for the wide range of vehicle sizes and unique 
configurations needed in the world of, I am sorry. The wide 
range of vehicle size and the unique configurations needed in 
the world of medium- and heavy-duty trucks.
    Remember, the benefits of hybridization apply equally to 
cars and trucks, although implementation and use of commercial 
trucks has unique challenges because of the size of the 
systems, the operating environments, and the duty cycles.
    Finally, the hybrid truck market and supporting 
technologies are still in the early stages of commercialization 
and long-term leadership will be hotly contested worldwide. 
U.S.-based companies are currently positioned to be world 
leaders in development and manufacture of hybrid systems, and 
we can provide the same benefits and solution for truck fleets 
around the globe, though we must keep pushing our research 
efforts forward.
    As the Committee debates funding research and development 
for hybrid vehicles, we would urge that electric hybrids, 
hybrid hybrids, I am sorry, hydraulic hybrids, and plug-in 
hybrid systems for commercial vehicles be included in any such 
programs.
    Once again, thank you for this opportunity to appear today 
in front of this committee as a representative of Eaton 
Corporation.
    [The prepared statement of Mr. Smith follows:]
                  Prepared Statement of Eric M. Smith
    Chairman Lampson, Ranking Member Inglis, thank you for the 
opportunity to appear today. My name is Eric Smith and I am the Chief 
Engineer for Medium Duty Hybrid Electric Powertrains for the Eaton 
Corporation. Eaton is a diversified industrial manufacturer 
headquartered in Cleveland, Ohio. We have over 79,000 employees 
worldwide, including over 28,000 employees in over 100 locations in 
over 40 states. Our 2007 sales were over $13 billion, and we sold 
products in more than 125 countries.
    Eaton has five main business groups that manufacture highly-
engineered components:

          Hydraulics, which manufactures hydraulic components, 
        hoses and connectors;

          Aerospace, which manufactures fuel systems, motion 
        control systems, propulsion sub-systems and cockpit interface 
        and circuit protection applications for commercial and military 
        programs;

          Electrical, which manufactures residential and 
        commercial power distribution equipment;

          Automotive, which manufactures engine valves, lifters 
        and superchargers; and

          Truck, which manufactures transmissions and hybrid 
        systems for heavy- and medium-duty trucks.

Eaton Hybrid Truck Power Systems

    Following years of successful development and extensive real-world 
testing, Eaton has emerged as a market leader in the development and 
production of hybrid power systems for commercial vehicle fleets. Eaton 
is currently offering hybrid electric products for commercial vehicles 
applications and our hybrid hydraulic products will enter the market 
this year. Our hybrid power systems are being tested and used in the 
United States by companies such as FedEx, UPS, Coca-Cola and Pepsi 
Cola. Eaton's diesel-electric hybrid power system is currently 
engineered as a production option in North America for Peterbilt, 
Kenworth, International and Freightliner and we are working with 
leading European manufacturers like DAF Trucks and Daimler Trucks for 
potential introduction in Europe.
    Eaton has invested in three separate hybrid power solutions for 
commercial vehicles:

          Hybrid Electric Vehicles (HEV)

          Hybrid Hydraulic Vehicles (HHV)

          Plug-In Hybrid Vehicles (PHEV)

    Eaton believes that all of these technologies have a place in the 
truck market. We will continue to develop these technologies to create 
a portfolio of hybrid power systems for a wide variety of vehicles and 
applications.
    Eaton's hybrid power systems can provide significant fuel savings 
and reduce vehicle emissions. Hybrid power is particularly appealing 
for Class 5/6 vehicles (Pickup and Delivery), Class 7 vehicles 
(Utility), and Class 8 vehicles (Over the Road Trucks)--all large 
trucks with weights exceeding 16,000 pounds, especially in stop-and-go 
applications.
    Hybrid power provides further savings through engine-off operations 
and power take-off operations at a work site. Whatever the application, 
hybrid power can provide significant fuel savings, increased 
functionality, quieter operation, and improved performance.
    Currently, the U.S. stands poised to lead the world in hybrid power 
for trucks. Our Hybrid Drive Systems are being developed and engineered 
at our facilities in Michigan and Minnesota and then our systems are 
produced in Indiana and Iowa.
    Eaton is the first Tier One Supplier of Truck components to produce 
for sale HEV systems to the Truck OEM market. We are the only hybrid 
power system to be certified by the IRS for the medium- and heavy-duty 
hybrid tax credit that was enacted in the Energy Policy Act of 2005.
    Our medium-duty hybrid electric vehicles are achieving between 20 
percent and 70 percent fuel economy gains depending upon the truck 
application.
    Early this year, Eaton Corporation agreed to sell 207 diesel-
electric hybrid power systems to Guangzhou Armada Development 
Corporation to be installed in new buses for operation in the city of 
Guangzhou, China. This purchase adds to the initial sales of 30 Eaton 
hybrid-powered buses announced in January as part of the U.S. 
Department of Commerce Clean Energy Trade Mission to China.
    It is Eaton's largest single hybrid power systems order to date. 
Additionally, Eaton Corporation recently received orders from United 
Parcel Service for 200 units while Coca Cola Enterprises ordered 120 
hybrid units. These sales make Eaton Corporation the world leader in 
hybrid power sales in the commercial truck market.

Hybrid Electric Vehicles (HEV)

    To produce Eaton's patented parallel hybrid electric system; we 
couple a vehicle's diesel engine with an electric motor/generator, 
power electronics and batteries.
    Hybrid electric systems have much higher energy storage capacity, 
and generally have low to moderate power capabilities compared to 
hydraulic hybrids. Hybrid electric systems can provide engine off PTO 
capability for applications needing work site hydraulic operations and 
an auxiliary electric power source from the vehicle. This is valuable 
in vehicles whose workday takes them off the highway and to a job site, 
where the truck's power is used to operate other tools and equipment.
    Hybrid electric vehicles also require an unprecedented level of 
integration and partnership between truck makers, engine manufacturers 
and suppliers of the drivetrain and major electrical components. 
Eaton's strategy includes early and significant collaboration with 
truck OEMs, engine manufacturers and key technology and component 
suppliers.
    The hybrid electric system maintains conventional drivetrain 
architecture--such as Eaton's Fuller UltraShift automated 
transmissions--while adding the ability to augment engine torque with 
electrical torque. The system recovers energy normally lost during 
braking and stores the energy in batteries. When electric torque is 
blended with engine torque, the stored energy is used to improve fuel 
economy and vehicle performance for a given speed or used to operate 
the vehicle with electric power only.
    This integrated system delivers a number of benefits, including:

          Up to 60 percent reduction in fuel consumption

          Up to 87 percent reduction in idle times

          Reduced maintenance and lower life cycle costs

          Reduced emissions

          Quieter operations and better acceleration

    The system can also be designed to provide energy for use during 
engine-off work site operations. As an additional benefit of the 
parallel architecture, should the hybrid system go off-line, 
conventional engine-powered operation continues.

Hydraulic Hybrid Vehicles (HHV)--Parallel and Series

    In a parallel hybrid hydraulic system, the conventional vehicle 
powertrain is supplemented by the addition of the hydraulic system. The 
system is best suited for vehicles that operate in stop-and-go duty 
cycles, including refuse vehicles, pickup and delivery vehicles, and 
buses, where fuel economy improvements between 20 percent and 30 
percent are typical. Eaton plans to commercialize its parallel hybrid 
hydraulic system in refuse trucks in 2008. Other applications will soon 
follow.
    In a series hybrid hydraulic system, the conventional vehicle 
driveline is replaced by the hybrid system. The conventional 
transmission and driveline are replaced by the hybrid hydraulic 
powertrain and energy is transferred from the engine to the drive 
wheels through fluid power. The system is suited to a broader number of 
applications than parallel hydraulic hybrids, though--as with all 
hybrids--benefits will be highest in vehicles that operate in stop-and-
go duty cycles.
    Eaton is working with the Environmental Protection Agency (EPA), 
under a Cooperative Research and Development agreement, to develop a 
series hydraulic hybrid power system that combines a high-efficiency 
diesel engine and a unique hydraulic propulsion system to replace the 
conventional drivetrain and transmission.
    The series hybrid engine continually operates at its ``sweet spot'' 
of fuel consumption facilitated by the continuously variable 
transmission (CVT) functionality of the series hybrid system and by 
regenerative braking. The vehicle uses hydraulic pump/motors and 
hydraulic storage tanks to recover and store energy, similar to what is 
done with electric motors and batteries in hybrid electric vehicles.
    These vehicles can achieve a fuel economy improvement between 50 
and 70 percent by:

          braking energy that normally is wasted is recovered 
        and reused;

          the engine is operated more efficiently; and

          the engine can be shut off when not needed, such as 
        when stopped or decelerating.

    Currently, Eaton is engaged in a program supported by the U.S. Army 
to militarize this drive train to provide power and fuel efficiency to 
military vehicle drive trains.

Plug-In Hybrid Electric Vehicles (PHEV)

    Eaton is currently working with the Electric Power and Research 
Institute (EPRI) to develop commercial PHEV trucks. However, plug-in 
Hybrid technology is in the very early stages of development for heavy 
duty trucks.
    PHEV vehicles require a notably higher energy storage capability 
then current medium or light duty production systems in order to 
maximize benefits of plug in capability. Higher energy storage battery 
systems facilitate the on vehicle energy storage necessary to move 
towards full electric vehicle capability (critical for zero emission 
and noise restriction areas). This would also require work on 
electrifying the accessories inside the vehicle (e.g., steering, 
brakes, HVAC).
    In addition, we are working with members of the Hybrid Truck Users 
Forum (HTUF) such as Southern California Edison, Pacific Gas and 
Electric, and Florida Power and Light to develop a PHEV for use in 
utility truck applications. We are also working with Navistar on a 
proposal for a Department of Energy funded PHEV truck project.

Needed Enabling Technologies

    Successful deployment of hybrid vehicles is dependent on the 
availability of high power output and high energy storage devices. 
Today, the Lithium Ion battery represents the most promising technology 
for hybrid electric vehicles. However, these types of batteries 
significantly increase the complexity and cost of the system. 
Additionally, robust battery management systems are needed to ensure 
safe and reliable operation.
    Managing the charge and discharge process within the battery pack 
to optimize service life and reliability, as well as monitoring, 
predicting, diagnosing and mitigating potentially unsafe conditions, 
are challenges that must be overcome. The use of high voltage DC 
batteries (400-600 volts) in vehicles poses a set of challenges not 
normally seen on commercial vehicles.
    For Hydraulic Hybrid Vehicles, the Accumulator provides the same 
energy storage function as a battery. Today's accumulator technology is 
adequate for certain applications. But to achieve widespread adoption 
of hybrids, an increase in the energy storage capacity is needed.

Challenges and Opportunities

    The U.S. is far behind in the development and commercialization of 
state-of-the-art, ``plug and play'' lithium ion battery systems for HEV 
and PHEV applications that are affordable, reliable and safe. The 
assembly and manufacturing methodologies need to be modular and 
flexible, in order to cater to a range of vehicle size and 
configuration needed in the world of medium- and heavy-duty trucks. 
Unfortunately, there isn't a one-size-fits-all solution for trucks.
    The benefits of hybridization apply equally to cars and trucks, 
although implementation and use in commercial trucks is significantly 
more complex. For example, the battery packs are larger, often must be 
located on the exterior of trucks (exposed to the elements) and the 
duty cycles are much more demanding, since commercial vehicles are 
typically driven for 12-16 hours a day versus cars that are normally 
used for commuting and hence driven only a few hours a day.
    Phasing in the next generation lithium ion batteries to make PHEVs 
a reality will require significantly more effort. Any significant 
effort towards accelerating the market appeal and penetration of hybrid 
vehicles in the U.S. by developing state-of-the-art technologies and 
systems will provide huge impetus to the endeavor towards energy 
conservation and pollution reduction.
    A major threat to the widespread adoption of hybrid vehicles 
(particularly the PHEVs) is the high cost of implementation of the 
fairly large battery systems needed, as well as the reliability and 
life of the energy storage systems. Developing a flexible and robust 
system to leverage multiple cell suppliers and reach the necessary 
economies of scale will go a long way toward reducing implementation 
costs. (Dr. Giorgio Rizzoni, Center for Automotive Research, The Ohio 
State University)

Conclusion

    The hybrid truck market is in its infancy and the jury is still out 
as to who will lead the world in this space. Investment in Research and 
Development will help reduce our dependence on foreign oil, help truck 
fleets big and small mitigate the cost of fuel and reduce emission here 
at home. In fact, these are the types of technologies that can lead to 
a leadership position for the United States in the manufacture of 
hybrid truck technologies. We can provide these same benefits and 
solutions to truck fleets around the globe.
    As the Committee debates funding research and development for 
hybrid vehicles, we would urge that electric hybrid, hydraulic hybrid, 
and plug-in hybrid systems be included in such a program. Battery and 
accumulator technologies need to be developed specifically for 
commercial vehicles because their size, weight, duty cycle and energy 
storage requirement are unique from those storage systems being 
developed for passenger vehicles. It only makes sense to include 
commercial trucks in the mix. With proper investment, the United States 
could lead the world in these new and exciting technologies.

                      Biography for Eric M. Smith

Employment History

         2005 to Current:

         Eaton Corporation in the Truck Group, current role Chief 
        Engineer--Hybrid Medium Duty Product Engineering. Responsible 
        for development and bring to production the medium duty 
        electric hybrid system. Current in post launch phase of the 
        program.

         2001-2005:

         Ballard Power Systems--Powertrain Engineering Manager 
        responsible for design and development of the electric 
        powertrain used in the Ford and Daimler pre-production fuel 
        cell vehicles.

         1989-2001:

         Ford Motor Company--Various positions in manufacturing, 
        testing and product development all within the Transmission 
        group.

Education

         Bachelor of Science--Metallurgical Engineering, Michigan 
        Technological University

Personal

    Have lived the majority of my life in Michigan, currently living in 
Kalamazoo, MI with wife and three daughters.

    Chairman Lampson. Thank you very much, Mr. Smith.
    Mr. Dalum, you are recognized for five minutes.

    STATEMENT OF MR. JOSEPH T. DALUM, VICE PRESIDENT, DUECO

    Mr. Dalum. Good morning, Chairman Lampson, Ranking Member 
Inglis, and distinguished Members of the Subcommittee. Thank 
you for inviting me here today. Also, thank you for the 
opportunity to offer the views of Dueco and for soliciting the 
views of others on hybrid technologies for medium- to heavy-
duty commercial trucks.
    My name is Joe Dalum, and I am Vice President of Dueco. 
Dueco, headquartered in Waukesha, Wisconsin, is one of the 
largest final stage manufacturers of utility trucks in the 
country. We produce aerial devices, digger derricks, and cranes 
that are sold to electric utilities for the maintenance of 
their transmission and distribution power lines. Dueco also 
provides equipment and services for the telecommunications 
market, other industries, and the government.
    In 2006, Dueco began to assess alternative hybrid vehicle 
technologies. Those activities led to a collaborative 
development program between Dueco and Odyne Corporation. Odyne 
is a developer of plug-in hybrid electric vehicle powertrains 
for Class six, seven, and eight vehicles. Our efforts resulted 
in the introduction of the utility industry's first pre-
production plug-in hybrid medium-duty truck in the fall of 
2007.
    While you have already received my more extensive written 
testimony, this morning I will focus on our development of a 
plug-in hybrid medium-duty truck. There are several factors 
that favor the development and deployment of hybrid and plug-in 
hybrid trucks: rising fuel prices, increased pressure for 
environmentally-friendly and green operations with lower carbon 
emissions, a national priority to reduce foreign oil 
dependency, and increased maintenance costs.
    In our company's opinion, plug-in hybrid technology for 
medium- and heavy-duty trucks is particularly well suited to 
addressing those challenges. In my written testimony you will 
find a more detailed explanation of the factors that support 
that position.
    I will now discuss our experience with the plug-in medium-
duty truck. A photo of a plug-in medium, heavy-duty truck is 
shown on the screen. This type of truck is typically used by 
utilities for the maintenance and installation of power lines. 
It is unique in that a very large battery system of 
approximately 35 kilowatt hours, more than 15 times larger than 
one used in a conventional hybrid, provides power to help 
propel the vehicle, along with the diesel engine.
    The battery system also provides power for equipment on and 
off the truck. When the truck returns to the garage, 
domestically-generated grid power recharges the battery system, 
offsetting the need for petroleum. The size of the battery 
system and the ability to recharge using grid power 
differentiates the plug-in hybrid system from a conventional 
hybrid. Using the large grid rechargeable battery system 
reduces fuel consumption and emissions during driving and 
provides for an all-electric stationary mode. The system 
completely eliminates fuel consumption and emissions at the job 
site for a typical day, while also reducing noise.
    Fuel savings and corresponding reduction in greenhouse gas 
emissions are dependent upon the application. The current 
vehicle reduces fuel consumption by an estimated 1,400 gallons 
of fuel per vehicle per year for a typical utility application. 
I am confident additional research can further improve fuel 
savings.
    In my opinion there will be a time in the future when 
affordable plug-in hybrid systems for a medium or heavy-duty 
truck provides 100 percent electrical operation for a limited 
driving range, completely eliminating fuel consumption and 
reducing emissions when recharged by clean electricity produced 
through renewable or non-emitting domestic energy sources.
    There are several technical hurdles to the deployment of 
plug-in hybrid trucks. Battery system costs and performance 
challenges, non-optimal powertrain architecture, questions 
about utility infrastructure for charging large fleets of 
trucks with high capacity battery systems, and a lack of 
information about specific medium- and heavy-duty applications 
need to be overcome.
    Dueco encourages the Federal Government to develop programs 
that help to specifically fund research into the development of 
plug-in hybrid systems for medium- and heavy-duty trucks used 
in specific applications that are open to final-stage 
manufacturers and other entities. Assistance with testing, 
certification, the creation of tax incentives for customers, 
and modification of government purchasing policies to favor the 
acquisition of more fuel-efficient trucks using plug-in hybrid 
technology can also accelerate development and deployment.
    Commercial fleets consume large amounts of fuel; developing 
more efficient trucks that utilize domestically-sourced power 
from the Nation's energy grid would have several benefits. The 
development of this technology in the United States would 
provide opportunities for job creation, export opportunities, 
reduce the cost of businesses competing in a global market, 
reduce greenhouse gas emissions and emissions of other 
pollutants, reduce dependency on foreign oil, reduce noise 
within our cities, and potentially improve productivity for 
certain applications, such as crews who could perform work at 
night in residential areas.
    This is potentially a historic opportunity to develop the 
technology needed for the electrification of medium- and heavy-
duty trucks. I would ask for your support of the proposed 
legislation that would help to accelerate research into plug-in 
hybrid technology for medium- and heavy-duty trucks and 
encourage the development of partnerships between manufacturers 
and utilities.
    Thank you.
    [The prepared statement of Mr. Dalum follows:]
                 Prepared Statement of Joseph T. Dalum

Introduction

    Good morning Chairman Lampson, Ranking Member, Inglis and 
distinguished Members of the Subcommittee on Science and Technology. 
Thank you for inviting me here today. Also thank you for the 
opportunity to offer the views of DUECO and for soliciting the views of 
others on hybrid technologies for medium to heavy duty commercial 
trucks.
    My name is Joe Dalum, and I am Vice President of DUECO. 
Headquartered in Waukesha, Wisconsin, DUECO is one of the largest final 
stage manufactures of utility trucks in the country, with facilities 
also located in South Dakota, Minnesota, Indiana, Ohio and 
Pennsylvania. We produce aerial devices, digger derricks and cranes 
that are sold to electric utilities for the maintenance of their 
transmission and distribution power lines in a 15-state region and are 
also used by utilities throughout the country through UELC, our rental 
and leasing company, with direct facilities in Florida, Texas and 
California. DUECO also provides equipment and services for the 
telecommunications, contractor, electric cooperative, municipality, gas 
utility and tree care markets.
    In 2006, DUECO began to assess alternative hybrid vehicle 
technologies. Those activities lead to a collaborative development 
program between DUECO and Odyne Corporation. Odyne Corporation is a 
developer of Plug-In Hybrid Electric Vehicle (PHEV) power trains for 
Class 6, 7 and 8 vehicles. Our efforts resulted in the introduction of 
the utility industry's first commercial plug-in hybrid medium duty 
truck in the Fall of 2007.

Background

    Medium- and heavy-duty trucks, used by the utility industry are 
typically built in multiple stages. During the first stage an original 
equipment manufacturer builds an incomplete vehicle, commonly known as 
a chassis. The vehicle is then often completed by a final stage 
manufacturer. Final stage manufacturers typically evaluate the intended 
application of the vehicle, perform engineering analysis, and then 
install an appropriate body, equipment and interface components with 
chassis systems in a manufacturing operation.
    Hybrid drive systems may be installed by an original equipment 
manufacturer or by another entity during an intermediate or final stage 
of manufacturing process. DUECO installs the plug-in hybrid drive 
system and interfaces the system with the chassis and installed 
equipment during the latter stage of manufacturing.
    Hybrid drive systems may be installed only on newly manufactured 
truck chassis or some designs may facilitate either an installation on 
a new chassis or a retro-fit on an existing chassis for certain 
applications. The plug-in hybrid system developed by DUECO and Odyne 
can be either installed during the manufacturing process of a new truck 
or it can be installed as a retro-fit on an existing chassis. Retro-fit 
applications must be carefully engineered, installation of a system on 
an existing truck requires sufficient payload, packaging space and 
specific chassis data communications interfaces.
    Trucks used by utilities typically drive to a job site and then 
conduct stationary operations. In a conventional truck, the diesel or 
gas powered engine provides the sole source of propulsion for the 
vehicle and is also used to power truck mounted equipment, such as an 
aerial device, digger derrick, crane, compressor, winch or other 
equipment. While at the job site, the vehicle may idle for many hours 
to provide power for the equipment and provide heat or air conditioning 
in the cab. A medium duty truck may average approximately eight mpg 
while being driven and while at idle will typically consume 
approximately one gallon per hour.
    A plug-in hybrid electric vehicle (PHEV) is a hybrid vehicle with 
batteries that can be recharged by plugging into our nation's electric 
power grid. It shares the characteristics of both conventional hybrid 
electric vehicles and battery electric vehicles, having an internal 
combustion engine and batteries for power.
    Hybrid systems used in larger trucks, greater than Class 4, have 
typically utilized two basic design configurations--a series design or 
a parallel design.
    Series design configurations typically use an internal combustion 
engine (heat engine) with a generator to produce electricity for both 
the battery pack and the electric motor. There is typically no direct 
mechanical power connection between the internal combustion engine and 
the wheels in an electric series design. Series design hybrids often 
have the benefit of having a no-idle system, include an engine-driven 
generator that enables optimum engine performance, typically lack a 
transmission (on some models), and accommodate a variety of options for 
mounting the engine and other components. However, series design 
hybrids also generally include a larger, heavier battery; have a 
greater demand on the engine to maintain the battery charge; and 
include inefficiencies due to the multiple energy conversions.
    Parallel design configurations have a direct mechanical connection 
between the internal combustion engine and the wheels in addition to an 
electric or hydraulic motor to drive the wheels. Parallel design 
hybrids have the benefit of being capable of increased power due to 
simultaneous use of the engine and electric motor or hydraulic motor, 
having a smaller engine with improved fuel economy while avoiding 
compromised acceleration power, and increasing efficiency by having 
minimal reduction or conversion or power when the internal combustion 
engine is directly coupled to the driveshaft, typically through a 
transmission. However, parallel design hybrids typically lack a no-idle 
system and may have non-optimal engine operation (e.g., low rpm or high 
transient loads) under certain circumstances. Existing systems on 
trucks of Class 4 or higher have traditionally not had a system that 
combines the benefits of a series system and a parallel system.
    DUECO has produced plug-in hybrid electric trucks, hybrid electric 
trucks and conventionally powered trucks for the utility industry.

The need for plug-in hybrid and conventional hybrid trucks:

    There are several factors that favor the development and use of 
hybrid and plug-in hybrid trucks:

          Rising fuel prices.

          Increased pressure for environmentally friendly and 
        green operations with lower carbon emissions.

          A national priority to reduce foreign oil dependency.

          Increased maintenance costs.

Differences between plug-in hybrid electric trucks and hybrid electric 
                    trucks:

    The following compares some of the benefits of a plug-in hybrid to 
that of a conventional hybrid. The primary difference between the plug-
in hybrid and the conventional hybrid is the size of the battery system 
and the ability to recharge the battery system from the domestic power 
grid.
    While a plug-in hybrid truck offers some of the same benefits as a 
conventional hybrid truck, plug-in hybrids offer advantages in several 
areas:

          Reduced fuel consumption

                  A plug-in hybrid system has a large battery 
                system that operates in a charge depleting mode. The 
                energy from the battery is typically used to help 
                propel the vehicle and operate equipment. Energy 
                required to recharge the battery is ideally provided by 
                the power grid or from regenerative braking, displacing 
                the use of petroleum. A vehicle with a large enough 
                battery system could potentially eliminate fuel 
                consumption by operating in an all electric driving 
                mode for a limited distance and operating in an all 
                electric stationary mode. All electric trucks are 
                available in Europe, while there are disadvantages such 
                as limited range; electric trucks demonstrate that the 
                technology is available for emission free operation.

                  A conventional hybrid typically uses power 
                from the diesel and gas engine to recharge the battery 
                or may be recharged from regenerative braking. Since 
                much of the energy in the battery system results from 
                recharging through the engine, fuel consumption may be 
                higher.

          Reduced emissions, potentially eliminates emissions 
        at the job site.

                  A plug-in hybrid typically reduces fuel 
                consumption and corresponding CO2 emissions 
                during urban driving and has a large battery system 
                that can allow the engine to stay off the entire day at 
                the job site. The large battery system is used to power 
                truck mounted equipment such as an aerial device or 
                electrically powered air conditioning system. 
                Electricity to recharge the battery system may be 
                generated by sources with lower emissions; some 
                utilities generate a sizable portion of power from non-
                emitting sources. As an example, PG&E generates over 50 
                percent of their energy from renewable sources.

                  A conventional hybrid due to a smaller 
                battery system often may need to restart the engine at 
                the job site to recharge the battery and may not have 
                enough energy in the battery system to power large 
                loads, such as an electrically driven air conditioner, 
                with the engine off. When the engine is started 
                periodically for short durations in the field to 
                recharge the smaller battery system, emission systems 
                may not be at optimal effectiveness, potentially 
                resulting in greater emissions of harmful pollutants.

          Lower noise levels during stationary operations.

                  The engine typically stays off with a plug-in 
                hybrid, resulting in lower noise levels. A conventional 
                hybrid may require the engine to restart to charge the 
                batteries.

          Uses low cost, domestically produced energy from the 
        Nation's electric grid.

                  Off-sets fuel consumption by displacing 
                petroleum with electricity. Ability to recharge at off-
                peak hours.

          Maintains a charge or is recharged at any time with 
        conventional engine.

                  While a plug-in hybrid is typically designed 
                to deplete the charge in the battery system and 
                recharge through the grid, the system can be designed 
                to maintain a minimum state of charge in the battery 
                system by recharging through the engine if needed. This 
                allows extended operations in the field during 
                situations where it is impossible to recharge through 
                the grid. In other words, while it is desirable to 
                recharge a plug-in hybrid through the grid, it is not 
                necessary to plug it in. Charging using the engine is 
                similar to how a conventional hybrid recharges.

          Improved vehicle acceleration.

                  Electric motors provide additional power and 
                torque to the drive train of the truck. The larger 
                battery system of a plug-in hybrid provides more energy 
                for extended use of the electric motor. The smaller 
                battery system of a conventional hybrid may become 
                depleted more quickly, reducing available power when 
                needed for climbing grades or other demanding 
                situations.

          Standby power capability: option for 9 kW or more 
        exportable power for applications such as job site power tools, 
        lighting and temporary restoration of power to facilities.

                  The large battery system of a plug-in hybrid 
                offers the ability to export power from the vehicle for 
                external uses. In the more distant future it may be 
                possible to export power from the vehicle to the grid 
                (Vehicle to Grid, or V2G) to reduce peak loads on grid 
                generation systems. The smaller battery system in a 
                conventional hybrid typically does not have enough 
                energy for export without turning on the engine to 
                provide additional power.

          Reduced maintenance costs.

                  Utility vehicles often are serviced based 
                upon hours of engine operation. A plug-in hybrid truck 
                has reduced hours of engine operation, potentially 
                extending maintenance intervals.

Benefits of Electricity as a Fuel:

    A plug-in hybrid electric truck uses electricity to supplement or 
replace the use of fossil fuels. There are several benefits to using 
electricity as a fuel.

          Feed Stock diversity promotes stability

                  Hydro, Wind, Bio-Mass, Natural Gas, Coal, Nuclear

          A portion of our nation's existing generation fuel 
        mix is currently CO2 free.

                  Example: approximately 56 percent of PG&E's energy 
                portfolio is CO2 free

          Recent and ongoing legislation promotes cleaner 
        generation mix over time

                  Renewable Portfolio Standard (RPS) legislation 
                enacted in 21 states

          Low fuel cost and minimal additional infrastructure 
        required

                  Preferential rates for off-peak consumption

          Projected future renewable energy sources tend to be 
        an off-peak energy resource

                  Wind can often produce more energy at night

Plug-in Hybrid Electric Truck, bucket truck application:




    A plug-in hybrid electric medium duty bucket truck is shown above. 
This type of truck is typically used by utilities of maintenance and 
installation of power lines. The truck has many of the benefits listed 
previously. Specifically this vehicle has the following features:

          Hybrid launch assist and regenerative braking

          All Electric Operation at a job site for a typical 
        day

          35 kWh Energy storage (note: a traditional hybrid may 
        have two kWh of energy storage)

                  Electrically powered hydraulic system moves 
                Aerial lift & outriggers, this function is also known 
                as E-PTO

                  Electrically powered air conditioning

          110/220VAC Electric shore power nine kW, more 
        optional

          Interfaces with an Allison transmission, the system 
        may also interface with other transmissions (testing with other 
        transmissions has not been completed)

          Modular design with standard components

          Enhanced reliability with redundant power for 
        critical operations

          Advanced diagnostics & data acquisition available, 
        ability to monitor vehicle via satellite

          Very versatile design:

                  Basic system design can be used on for a 
                variety of truck weight Classes: 5, 6, 7, 8 (19,500 - > 
                33,000 GVWR). Testing of the system on Class 5 and 
                Class 7 trucks has begun, testing on Class 6 and Class 
                8 is planned within the next year.

                  Basic design can be used on a variety of 
                chassis configurations: 2x4, 4x4, tandem. Testing has 
                begun on the two-wheel drive application, testing on 
                the tandem will begin within the next year. Testing on 
                the 4x4 has not been scheduled.

                  System should be able to interface with 
                multiple power trains from multiple chassis 
                manufacturers. Testing has begun on GMC and 
                International units and on chassis with gas and diesel 
                engines.

          Ability to tow trailer.

          No special diagnostic software.

          Enhances stability of vehicle for aerial device 
        applications.

          Utilities can power their fleet with their own fuel: 
        Electricity

    Fuel savings are dependent upon the application. The current 
vehicle reduces fuel consumption during driving in urban areas by 
approximately 10-15 percent. The vehicle will typically save 100 
percent of fuel consumption during stationary operations at a job site, 
resulting in approximately one gallon per hour reduction. There is 
little to no fuel savings during higher speed highway driving.
    Anticipated fuel savings for a plug-in hybrid in comparison to a 
conventional truck depend upon many factors such as the type of system 
architecture, size of battery and field application. The following is 
an estimate for two types of plug-in systems, one with parallel system 
architecture and one with series system architecture. The sample 
application is a 20-mile drive, a five-hour idling period, and an 
additional 20-mile drive.
    Parallel system with plug-in battery system compared to a 
conventional truck:

         Stated Assumptions:

         Conventional chassis: approximately eight mpg fuel efficiency 
        during driving and approximately one gallon per hour fuel 
        consumption during idle.

         Parallel system with plug-in: approximately 12 percent 
        decrease in fuel consumption for a plug-in hybrid during 
        driving and 0 gallons per hour fuel consumption during idle.

         Estimated fuel savings: 56 percent reduction in fuel 
        consumption, or approximately 1,400 gallons of fuel saved per 
        year, based upon 250 work days per year.

    Series system with plug-in battery system compared to a 
conventional truck:

         Stated Assumptions:

         Conventional chassis: approximately eight mpg fuel efficiency 
        during driving and approximately one gallon per hour fuel 
        consumption during idle.

         Series system with plug-in: 50 percent decrease in fuel 
        consumption for a plug-in hybrid during driving and 0 gallons 
        per hour fuel consumption during idle.

         Estimated fuel savings: 75 percent reduction in fuel 
        consumption, or approximately 1,875 gallons of fuel saved per 
        year, based upon 250 work days per year.

    Due to the large amount of savings, medium- and heavy-duty trucks 
with plug-in hybrid technology may be able to reach an attractive 
return-on-investment more quickly than other vehicles.
    A diagram of a plug-in hybrid electric system for a truck is shown 
below. Electrical energy is used to increase efficiency while driving 
through hybrid launch assist and regenerative braking. Electrical 
energy also powers equipment loads at a job site, potentially 
eliminating the need to run the engine.



Major technical hurdles for deployment of plug-in hybrid trucks:

    There are several technical hurdles for the deployment of plug-in 
hybrid trucks.

Battery system technology:

    Existing battery technology either tends to offer battery systems 
that are relatively low cost, but heavy, large and of limited life or 
are relatively expensive, but much lighter, smaller and with 
potentially longer life. While certain applications of trucks may be 
able to carry lower cost, heavier battery systems, it is generally 
desirable to minimize battery system weight, size and cost. Development 
of cost effective larger advanced battery systems, potentially with 
energy storage in excess of 35 kWh, or even in excess of 100 kWh, would 
improve the performance and reduce the operating cost of plug-in hybrid 
trucks.
    In order to accelerate deployment of plug-in hybrid trucks using 
existing technology, it may be desirable to design battery systems that 
are modular, that allow for newer technology battery systems to be 
placed on existing vehicles when the original battery system no longer 
performs to acceptable standards.

System architecture:

    Existing hybrid systems for trucks tend to utilize system 
architectures that are similar in many ways to that of existing truck 
power trains. The internal combustion engine typically remains 
operating while the vehicle is driven to power auxiliary loads such as 
power steering systems, brake systems and HVAC systems. Keeping the 
engine running while stationary or in low speed stop and go traffic 
increases fuel consumption. Some vehicles also do not have a clutch in 
between the internal combustion engine and the transmission. While such 
systems utilize an automatic transmission, it may be desirable to 
create a method to uncouple from the transmission from the engine for 
improved regenerative braking or an all-electric drive mode.
    In order to improve fuel economy further, different system 
architectures that are designed for high volume production in which the 
internal combustion engine can remain off during driving need to be 
developed. The development of electrically driven sub-systems such as 
braking, power steering, HVAC and others need to be brought to high 
volume production for medium- and heavy-duty trucks.
    Existing parallel hybrid electric vehicle systems for trucks also 
tend to use relatively small electric drive components with relatively 
low power output, compared to the power provided by the internal 
combustions engine. Larger electric motors and higher capacity battery 
systems may allow smaller engines to be used that operate at higher 
efficiency without a reduction in vehicle performance, or allow the 
vehicle to be driven entirely by electric propulsion. Future system 
architectures could also combine the benefits of plug-in hybrid 
technology, which requires battery systems with high energy densities, 
with that of hydraulic hybrids that have high power densities. The 
combined plug-in electric hybrid system with hydraulic hybrid 
components could offer high horsepower during acceleration and 
recapture more energy during braking while providing enough energy for 
sustained operation with the engine off.
    Alternative power train architectures, such as a combined series/
parallel hybrid system with plug-in battery system are also recommended 
for consideration. A combined series/parallel system would allow the 
vehicle to operate in an all electric mode, a series hybrid 
configuration or a parallel hybrid configuration, depending upon which 
is most advantageous given operating requirements.

Utility infrastructure:

    While studies tend to indicate that there is sufficient capacity in 
the Nation's energy grid at off-peak periods to provide power for 
charging a large number of plug-in vehicles, there has been little 
testing on the effects of charging a large number of commercial plug-in 
hybrid trucks. A commercial fleet of 1000 vehicles, each with a 35 kWh 
battery system, could require approximately 25,000 kWh (or 25 MWh) of 
power to recharge overnight. Assessment and testing on the effects of 
charging a large number of plug-in hybrid trucks is suggested.

Research into specific medium- and heavy-duty applications:

    Plug-in hybrid technology for medium- and heavy-duty trucks may 
reduce fuel consumption and emissions in a wide variety of 
applications. Besides aerial utility trucks and delivery trucks, other 
truck applications such as those that use cranes, compressors, welding 
equipment, or are used in gas utility maintenance, refrigeration, 
rescue, refuse and construction may benefit from plug-in hybrid 
technology.
    Specific information about the energy required for various mobile 
and stationary applications is typically not available. In order to 
optimize the design of a plug-in hybrid medium or heavy duty truck, it 
is recommended that data be collected on actual fleet utilization, 
including miles driven, time at idle, power requirements, fuel 
consumption and other operational factors. The development of plug-in 
hybrid systems for vehicles that operate at especially low efficiency 
should be a priority and testing should be undertaken to validate 
improved efficiency and reliability.

DUECO's experience with government technology development programs and 
                    how the federal role can be enhanced:

    Federal technology development programs focused on plug-in hybrid 
systems for medium- and heavy-duty trucks have been very limited. DUECO 
has not obtained federal assistance in this area, with the exception of 
possible general research tax credits. Most of the funding in this area 
has focused on the development of plug-in technology for automobiles or 
has been focused on large original equipment manufacturers. The medium- 
and heavy-duty truck industry is unique in that many of its products 
are often manufactured in multiple stages and brought to market by 
companies that are not directly affiliated with the original equipment 
manufacturer.
    DUECO encourages the Federal Government to develop programs that 
help to specifically fund research into the development of plug-in 
hybrid systems for medium- and heavy-duty trucks used in specific 
applications and that are open to final stage manufacturers and other 
entities. Assistance with testing, certification, the creation of tax 
incentives for customers, and modification of government purchasing 
policies to favor the acquisition of more fuel efficient trucks using 
plug-in hybrid technology can also accelerate development and 
deployment.
    Commercial fleets consume large amounts of fuel, developing more 
efficient trucks that utilize domestically sourced power from the 
Nation's energy grid would have several benefits.
    The development of this technology in the United States would 
provide opportunities for job creation, export opportunities, reduce 
the costs for businesses competing in a global market, reduce 
greenhouse gas emissions and emissions of other pollutants, reduce 
dependency on foreign oil, reduce noise within our cities and 
potentially improve productivity for certain applications, such as 
electric crews who could perform work at night in residential areas.
    This is potentially a historic opportunity to develop the 
technology needed for the electrification of medium- and heavy-duty 
trucks. I would ask for your support of the proposed legislation that 
would help to accelerate research into plug-in hybrid technology for 
medium- and heavy-duty trucks and encourage the development of 
partnerships between manufacturers and utilities.

                     Biography for Joseph T. Dalum
    Mr. Dalum obtained a BS in Mechanical Engineering from the 
University of Notre Dame in 1986 and a Master's of Business 
Administration from the Kellogg School of Management, Northwestern 
University, in 2003. He has over 20 years of experience in the 
automotive and truck industries.
    As Vice President of DUECO, Joe has management responsibility for 
hybrid programs and several business segments. He has technical 
experience in the design and manufacture of aerial bucket and digger 
derrick trucks for the utility industry and has managed the engineering 
group within DUECO. Joe also works with key accounts and helps to 
direct business and investment strategy for DUECO. He serves on the 
Board of Directors of DUECO and its affiliates.
    Prior to joining DUECO in 1999 as Engineering Manager, Mr. Dalum 
developed automotive products and systems for over 10 years. He has 
experience in managing projects and bringing new technology from 
initial concept into high volume production. Joe has been granted eight 
U.S. patents in the area of automotive technology. He has worked on a 
variety of domestic and international programs with vehicle 
manufacturers including General Motors (both domestic and foreign 
subsidiaries), Suzuki, Isuzu, and Fiat to design new components into 
their vehicles.

    Chairman Lampson. Thank you, Mr. Dalum.
    Ms. Egbert, you are recognized for five minutes.

      STATEMENT OF MS. JILL M. EGBERT, MANAGER, CLEAN AIR 
         TRANSPORTATION, PACIFIC GAS & ELECTRIC COMPANY

    Ms. Egbert. Good morning, Chairman Lampson, Ranking Member 
Inglis, and Members of the Committee. I am very pleased to 
appear before you this morning on behalf of Pacific Gas and 
Electric Company to offer my views on the important role of 
medium- and heavy-duty hybrid and plug-in electric hybrid 
vehicles.
    Pacific Gas and Electric Company, headquartered in San 
Francisco, California, is one of the largest natural gas and 
electric power utility companies in the United States. The 
company provides natural gas and electric service to 
approximately 15 million people in northern and central 
California.
    For nearly two decades PG&E has also actively worked to 
advance alternative transportation technologies, including 
natural gas and electric vehicles. We are particularly 
enthusiastic about the incorporation of hybrid and plug-in 
electric hybrid medium- and heavy-duty trucks into our fleet. 
We have already seen tremendous financial and environmental 
benefits from doing so.
    The two most common uses for integrating hybrid and plug-in 
hybrid electric trucks into our fleet are for our so-called 
trouble trucks and more familiar, bucket trucks. PG&E's trouble 
trucks are used by our first responders when an outage or other 
situation is initially reported. These trucks operate within a 
wide range of mileage parameters, ranging from a few miles if 
operated within the city of San Francisco, to covering long 
distances if operating in more remote parts of our service 
territory. This range of operation makes hybrids an ideal 
solution for our company and our industry.
    For most repair work the utility industry standard is to 
dispatch large diesel-powered bucket trucks. These trucks are 
then required to idle for long periods of time to complete many 
necessary repairs, consuming one gallon of diesel per hour of 
idle time. The idling is necessary to maneuver the bucket used 
to hoist servicemen to perform repairs.
    In 2007, PG&E became one of 14 utilities across North 
America to deploy one of 24 diesel electric hybrid bucket 
trucks developed by the International Truck and Eaton 
Companies. PG&E's field trial for this new truck is currently 
ongoing in San Francisco, and preliminary results indicate that 
diesel electric hybrid bucket trucks reduce fuel consumption by 
40 to 60 percent, reduce emissions by 50 to 90 percent, provide 
on-board power generating capacity to power up to five average-
sized homes while service is being restored, improve 
operational and scheduling flexibility, and reduce maintenance 
costs.
    In addition to incorporating these and other new vehicle 
and truck technologies into our fleet, PG&E has actively 
participated in DOE-sponsored workshops by providing a utility 
company perspective on the benefits and potential of all types 
of plug-in hybrid vehicles.
    Even as new technology demonstration options are becoming 
available to PG&E at an increasing pace, there remains 
significant barriers to our ability to more fully deploy the 
hybrid and plug-in hybrid electric medium- and heavy-duty 
trucks, the most significant being financial barriers. 
Currently the up-front cost of a hybrid bucket truck is 50 
percent higher than a conventional bucket truck. In other 
words, we could purchase three conventional bucket trucks for 
every two hybrids we purchase.
    Although the lifetime fuel and maintenance savings help 
make the investment more attractive and the environmental 
benefits are a key part of our business objectives, the up-
front costs are still daunting. In order to accelerate the 
procurement of hybrid trucks into utility fleets, we believe 
some financial incentive will be needed in either the form of 
grants or tax credits. These financial incentives would spur 
demands from PG&E and other utilities around the Nation that 
will allow truck and power system manufacturers to ultimately 
bring down their unit costs.
    At a time of historically high diesel prices, increasing 
concerns over climate change, and energy security, the time is 
right to accelerate research, development, and deployment of 
hybrid and plug-in hybrid electric truck technologies. With 
thousands of utilities nationwide, the market for medium- and 
heavy-duty hybrid and plug-in hybrid electric trucks is very 
significant. PG&E commends the Subcommittee's inquiry into this 
important market, and we are hopeful that with effective 
government leadership the right incentives will be implemented 
to help reduce the financial barriers that currently exist and 
that discourage widespread, rapid deployment of clean hybrid 
commercial truck technology.
    On behalf of Pacific Gas and Electric Company, I want to 
thank you for the opportunity to appear before the Subcommittee 
today. Thank you.
    [The prepared statement of Ms. Egbert follows:]
                  Prepared Statement of Jill M. Egbert
    Chairman Lampson, Ranking Member Inglis, and Members of the 
Committee, I am very pleased to appear before you this morning on 
behalf of Pacific Gas and Electric Company to offer my views on the 
important role of medium- and heavy-duty hybrid and plug-in electric 
hybrid trucks in utility fleets. At a time of historically high diesel 
fuel prices, increasing concerns over climate change and U.S. energy 
security, I commend the Committee for its leadership in addressing this 
important topic.
    Pacific Gas and Electric Company, headquartered in San Francisco, 
California, is one of the largest natural gas and electric power 
utility companies in the United States. The company provides natural 
gas and electric service to approximately 15 million people throughout 
a 70,000-square-mile service area in northern and central California. 
PG&E proudly delivers some of the Nation's cleanest energy to our 
customers. On average, more than half of the electricity we deliver to 
customers comes from sources that emit no carbon dioxide, or 
CO2, and an increasing amount comes from renewable sources 
of energy.
    For nearly two decades, PG&E has also actively worked to advance 
alternative transportation technologies, including natural gas and 
electric vehicles. More recently, the Company has added diesel-electric 
hybrid, plug-in hybrid electric and fuel cell powered vehicles to its 
fleet. PG&E's clean air transportation strategy is integrated 
throughout our fleet and the fleets of many of our customers as well. 
This is a key pillar of PG&E's overall emissions reduction and 
environmental stewardship strategy--no less important than procuring 
clean sources of energy or protecting wildlife habitats.
    PG&E operates the largest natural gas alternative fueled utility 
fleet in the Nation. Our fleet includes more than 1,200 natural gas 
fueled vehicles, of which more than 100 are classified as medium- and 
heavy-duty vehicles. The majority of these vehicles run on cleaner 
burning compressed natural gas. Over the past ten years, PG&E's fleet 
displaced over 3.4 million gallons of diesel and gasoline with natural 
gas which translates to over 6,000 avoided tons of CO2 
emissions. When combining our fleet with those of more than 300 of our 
customers whom we have helped with incorporating alternative fueled 
vehicles into their own fleets, the amount of diesel and gasoline 
displaced grows to more than 47 million gallons and 174,000 tons of 
avoided CO2 emissions over the last three year period 
alone.\1\
---------------------------------------------------------------------------
    \1\ These figures represent a full ``well-to-wheel'' analysis, 
which takes into account energy use and emissions at every state of the 
process, from the moment the fuel is produced at the well to the moment 
the wheels are moved. Estimates compare the avoided emissions from 
PG&E's CNG vehicles to petroleum usage based on the methodology 
outlined in Full Fuel cycle Assessment (CEC-600-2007-003, June 2007), 
which uses the Argonne National Laboratory's GREET emissions model 
modified to California inputs.
---------------------------------------------------------------------------
    We are particularly enthusiastic about the incorporation of hybrid 
and plug-in electric hybrid, medium- and heavy-duty trucks, or PHET's, 
into our fleet. We have already seen tremendous financial and 
environmental benefits from doing so. Our goal in assessing and 
applying new vehicle power technologies is to demonstrate their 
practical application in our fleet, and gain the experience necessary 
to provide our fleet management with alternatives to conventionally 
fueled vehicles. With each demonstration vehicle and truck we consider 
a number of factors, including initial capital cost, operating and 
long-term fuel costs, ability to meet greenhouse gas emissions 
reduction goals, reliability and serviceability, operational 
flexibility, fuel consumption reduction, tailpipe emission reductions 
consistent with California and federal regulations, noise pollution 
reduction and operator safety.
    The two most common uses for integrating hybrid and PHET trucks 
into our fleet are for our so-called ``trouble trucks,'' and the more 
familiar ``bucket trucks.'' PG&E's ``trouble trucks'' are used by our 
first responders when an outage or other situation is initially 
reported, and are dispatched to assess a problem, and occasionally 
perform minor repairs lasting under two hours. These trucks operate 
within a wide range of mileage parameters, ranging from a few miles if 
operated locally within the City of San Francisco to covering long 
distances if operating in more remote parts of our service territory. 
This range of operation makes hybrids, such as the Ford F550 SuperDuty 
hybrid truck an ideal solution for our company and our industry. These 
types of vehicles provide significant benefits which include improved 
fuel efficiency, lower fuel costs, and lower refueling time as compared 
to our conventional trouble trucks. PG&E is currently working with Ford 
to develop an all plug-in electric version of the F550 SuperDuty truck.
    For most repair work, the utility industry standard is to dispatch 
large diesel-powered bucket trucks. These trucks are then required to 
idle for long periods of time to complete many of the necessary repairs 
which forces a fuel consumption rate of approximately one gallon of 
diesel per hour of idle time. The idling is necessary to power the 
hydraulic arm, which is powered by the engine, to maneuver the bucket 
used to hoist servicemen who perform repairs.
    In 2007, PG&E became one of 14 utilities across North America to 
deploy one of 24 diesel-electric hybrid bucket trucks developed by the 
International Truck and Eaton Companies. PG&E's field trial for this 
new truck is currently ongoing in San Francisco with an on-board 
telematics system that sends continuous performance and operations data 
which measures efficiency against that of a conventional diesel truck 
being used in the same application and in the same general geographic 
location. Preliminary results indicate that diesel-electric hybrid 
bucket trucks:

          Reduce fuel consumption by 40-60 percent.

          Reduce emissions by 50-90 percent by operating the 
        utility bucket in electric-only mode without the engine 
        running. A typical utility truck's engine runs eight or more 
        hours a day.

          Provide on-board power generating capacity of 25 
        kilowatts of standby power--enough to power up to five average-
        size homes while service is being restored.

          Improve operational and scheduling flexibility, and 
        customer satisfaction by operating quietly, particularly when 
        working at night in noise-sensitive areas.

          Reduce maintenance costs due to less engine use and 
        brake wear due to regenerative braking capacity that charges 
        the battery.

    PG&E has also procured two pre-production heavy duty Peterbilt 
hybrid trucks which will have two buckets per truck, designed 
specifically for live wire work.
    In addition to incorporating these and other new vehicle and truck 
technologies into our fleet, we also participate actively in industry 
and government sponsored initiatives aimed at defining standards and 
requirements for new hybrid and PHET technology. PG&E has actively 
participated in DOE sponsored workshops by providing a utility company 
perspective on the benefits and potential of all types of plug-in 
hybrid electric vehicles and the potential impacts on the electric 
power grid of significant penetrations of such vehicles.
    Even as new technology demonstration options are becoming available 
to PG&E at an increasing pace, there remain significant barriers to our 
ability to more fully deploy the hybrid and PHET medium- and heavy-duty 
trucks--the most significant being financial barriers. Currently, the 
up-front cost of a hybrid bucket truck is 50 percent higher than a 
conventional bucket truck. In other words, we could purchase three 
conventional bucket trucks for every two hybrids we purchase. Though 
the lifetime fuel and maintenance savings help make the investment more 
attractive, and the environmental benefits are a key part of our 
business objectives, the up-front costs are still daunting. In order to 
accelerate the procurement of hybrid trucks into utility fleets, 
therefore, we believe some financial incentive will be needed in either 
the form of grants or tax credits. These financial incentives would 
spur demand from PG&E and other utilities around the Nation that will 
allow truck and power system manufacturers to expand operations and 
production, achieve economies of scale, and ultimately bring down the 
unit costs.
    At a time of historically high diesel prices, increasing concerns 
over climate change and energy security, the time is right to 
accelerate the research, development and deployment of hybrid and plug-
in hybrid electric truck technologies. With thousands of utilities 
nationwide, each deploying a fleet of trucks daily to points far and 
wide within their service territory, the market for medium- and heavy-
duty hybrid and plug-in hybrid electric trucks is significant. PG&E 
commends the Subcommittee's inquiry into this important market and we 
are hopeful that with effective government leadership, the right 
incentives will be implemented to help reduce the financial barriers 
that currently exist and that discourage widespread, rapid deployment 
of clean, hybrid commercial truck technology.
    On behalf of PG&E, I want to thank you for the opportunity to 
appear before the Subcommittee today.
    Thank you.

                      Biography for Jill M. Egbert
    Jill is the Manager of Pacific Gas and Electric Company's Clean Air 
Transportation department. She has worked for PG&E for over 25 years in 
a number of capacities, including governmental affairs, customer 
service, service planning and community relations. She chairs the 
Greater Sacramento Regional Clean Air Coalition, sits on the Board of 
Directors for the California Natural Gas Vehicle Coalition (CNGVC) and 
the Electric Drive Transportation Association (EDTA). Jill has a BS in 
Business Management.

    Chairman Lampson. Thank you very much.
    Mr. Parish, you are recognized for five minutes.

  STATEMENT OF MR. RICHARD C. PARISH, SENIOR PROGRAM MANAGER, 
   CALSTART HYBRID TRUCK USERS FORUM (HTUF), DENVER, COLORADO

    Mr. Parish. Thank you very much. I would like to thank the 
Subcommittee for inviting CALSTART here today to present our 
viewpoint on heavy hybrid technology. We feel like we serve a 
very important role in implementing this technology into the 
general public and then also providing a means to focus the 
activity and the interest of the different fleets in producing 
these types of technologies for use in the fleet activities.
    I would like to draw your attention to my presentation 
charts that are on the screen. The CALSTART activity is based, 
it is a non-profit organization, a consortium of not only 
industry but also fleet providers, that is very interested in 
improving the industry, the transportation industry, and moving 
it forward in terms of decreasing the amount of fuel used and 
decreasing the amount of emissions that are produced by the 
commercial industries.
    HTUF, the Hybrid Truck Users Forum, is actually a subset of 
the CALSTART activity and is a user-driven process in which we 
represent the fleets and try to bridge the gap between the 
technology development activity and the actual 
commercialization of these vehicles. HTUF intends to bring 
working groups together of fleets that are quite interested in 
a variety of different applications. Our first activity that we 
put together was in the utility bucket truck activity, which 
PG&E took part in, and we simulated the different requirements 
from the various fleets to identify a common set of 
requirements that the truck manufacturers could then respond 
to.
    So what we did was get the hybrid truck technology off the 
ground. There had been some development of heavy hybrids in the 
Department of Energy as well as U.S. Army National Automotive 
Center, and the Federal Transit Administration, but there was 
no real pull from the fleet side to actually get these vehicles 
into service.
    So what the Hybrid Truck Users Forum did was aggregate the 
requirements to provide a focal point for the industry to then 
start producing these vehicles. We did this in a joint activity 
with U.S. Army National Automotive Center. They are very 
supportive of this particular activity, because the Army is 
very interested in seeing the hybrid technology being 
implemented and being put out on the street so they can see a 
reduction in the cost of these vehicles rather than footing the 
cost of developing this type of technology on their own. They 
would like to see it become commercially viable and therefore, 
more cost effective in putting in the military vehicles.
    So we have been very active in terms of this first 
particular working group that we put together. We have looked 
at other working groups and are in the process of implementing 
those as well.
    You should be aware that hybrid trucks and medium- and 
heavy-duty trucks are very different than the light-duty 
vehicles. We have seen a great implementation of light-duty 
vehicles, hybrid vehicles, in the public sector. There is good 
acceptance there now, but we feel like because of that 
acceptance that the government should now start focusing on 
medium- and heavy-duty sectors to start making some real 
technology improvements and implementation of these new vehicle 
concepts.
    On this timeline you see where there is a real range in 
implementation of these particular vehicles. On the far right 
we are already in early production as identified by Mr. Smith 
from Eaton Corporation. We are in early production of these 
bucket truck vehicles from International using the Eaton drive 
train, and that is very encouraging, but these vehicles are 
still rather expensive. There are other vehicles that are being 
implemented in terms of the refuse vehicles, parcel delivery, 
also shuttle bus type of vehicles that are going to be entering 
early production here in the next few years, but still the 
technology is not there to implement some of the benefits that 
we see in the light-duty world. In particular, I think it was 
pointed out that light-duty vehicles have the ability to shut 
off their engines when they are at a stop, engine off at idle 
capability. Right now we do not have that capability in medium- 
and heavy-duty trucks because we do not have the electrically-
driven accessories that are required. So much development is 
required in getting that type of technology in place.
    So we are seeing just the first versions of these vehicles 
emerging at this point in time, and much technology development 
is still really needed to make these viable.
    And was as pointed out earlier, hybrid technology is 
starting to be incorporated in Class eight over-the-road 
vehicles, and are now being looked at in drage vehicles for the 
ports, particularly ports of LA and the ports of Long Beach. 
And these are very promising types of technologies, but until 
we get the appropriate support for the technology, development, 
as well as the implementation of these vehicles, and then some 
incentives to help reduce the up-front costs, they will be 
lagging in terms of their implementation.
    So as identified, the trucks are different from passenger 
cars, even though the technology has been well developed for 
passenger cars, and we see it starting to emerge, trucks are a 
different order of magnitude in terms of their weight, class, 
and the scale of the systems that need to be put in place, as 
well as the durability that is required for these vehicles. So 
there is a whole new segment of development activity that needs 
to take place here.
    We feel that industry and the fleets could benefit from 
support for ongoing R&D. There was some preliminary R&D efforts 
involved at the Department of Energy under the Heavy Hybrid 
Program managed by the National Renewable Energy Lab, but that 
funding has been reduced and is now coming to a close. And but 
without the full benefit of coming to fruition for these new 
technologies. So we would like to see some further support for 
that type of R&D effort.
    And we would also like to see that there be some purchase 
incentives. As was also pointed out the initial costs of these 
vehicles is fairly high. The cost of the fuel at this point in 
time, even though it is high, does not quite cover the total 
cost of the differential cost of the hybrid vehicle. So what we 
are seeing is some additional funding needed up-front to help 
cover that differential.
    So we would also like to see a commitment by the government 
over a long-term, five- to ten-year program, to really 
implement these technologies, not only hybridization, but also 
more efficient truck technologies into the commercial fleets.
    I would like to thank you very much for the opportunity to 
talk with you today and hopefully we have a good discussion.
    [The prepared statement of Mr. Parish follows:]
                Prepared Statement of Richard C. Parish
    CALSTART thanks the House Committee on Science and Technology, 
Energy and Environment Subcommittee and its members for the opportunity 
to testify and share our knowledge with you on the important issue of 
hybrid and more efficient medium- and heavy-duty vehicles. This is a 
critical area of emerging capability for the U.S., both in terms of 
reducing fuel--and cutting costs--for users, as well as reducing urban 
pollution and global warming emissions. It is also an important 
competitive leadership issue for U.S. manufacturers building leading-
edge products here and for export to the international market.
    CALSTART and its Hybrid Truck Users Forum (HTUF), together with its 
industry, fleet and public partners, are working together to speed 
hybrid and advanced truck commercialization and have identified the key 
benefits and barriers to progress which we welcome the chance to 
explain. We think there is an opportunity for smart, targeted 
investments and partnerships between industry and government to speed 
these new capabilities to market.
    Our testimony will follow this outline: A brief introduction to 
CALSTART; the Role & Goals of HTUF; the Importance of Hybrids; the 
State of the Industry; Gaps and Barriers; Next Steps; Future Vision.

What is CALSTART?

    CALSTART is North America's leading advanced transportation 
technologies consortium. It is a fuel and technology neutral, 
participant-supported non-profit organization of more than 150 
companies and agencies, dedicated to expanding and supporting a high-
tech transportation industry that cleans the air, creates economic 
opportunity and reduces imported oil use and greenhouse gas emissions.
    CALSTART serves as an unbiased, strategic broker to spur advanced 
transportation technologies, fuels, systems and the companies that make 
them. It works across four areas to expand and support this industry: 
operating technology development and demonstration programs with 
industry partners; consulting to ports, fleets and others on 
implementation of new fuels, vehicles and technologies; providing 
services to industry members to expand their capabilities; and 
supporting and guiding the creation of policies that increase the 
efficiency and reduce the emissions of U.S. transportation.
    CALSTART plays a leading national role in facilitating the 
development of advanced propulsion systems and alternative fuels in the 
heavy-duty vehicle and transit industry. It helped create the 
capability for heavy-duty hybrid drive systems in transit buses in 
program partnerships with DARPA, and now leads efforts in advanced 
commercial vehicle hybrids, fuels cells, hydrogen and biofuels. Founded 
in 1992, CALSTART is headquartered in California but operates 
nationally and internationally in its programs.

Role and Goals of the Hybrid Truck Users Forum (HTUF)

    The Hybrid Truck Users Forum (HTUF) is a national program made up 
of first-mover fleets and major truck and system makers to speed the 
commercialization of medium- and heavy-duty hybrid vehicles and to 
build a competitive, sustainable medium- and heavy-duty hybrid vehicle 
market. HTUF is operated by CALSTART in a unique partnership with the 
U.S. Army Tank-Automotive Research, Development and Engineering Center 
(TARDEC)--National Automotive Center (NAC).\1\ Additional program 
support has been provided by the Hewlett Foundation, with some project 
funding from the Department of Transportation and the Department of 
Energy. HTUF has proven to be a highly successful program to jump-start 
the commercial hybrid truck industry in North America. Its track record 
of success, and the results in terms of industry development and 
product launches, has benefited truck makers and suppliers as well as 
military planners keen on supporting a dual-use commercial 
manufacturing capability for advanced trucks. HTUF is credited with 
removing one to two years from the product development cycle.
---------------------------------------------------------------------------
    \1\ The NAC is the Army's outreach arm to the commercial 
transportation industry, and is charged with both understanding the 
capabilities of the commercial vehicle industry and working to increase 
the capabilities of the industry to build advanced vehicles and 
technologies that can support emerging Army and military needs.
---------------------------------------------------------------------------
    HTUF was designed to fill what was clearly a gap between technology 
development and products moving into the market. What was needed was a 
nimble, fast-track process for commercialization. HTUF's model for 
action focuses on truck users to create market ``pull'' (demand) around 
their needs for saving fuel, reducing emissions and noise and better 
performance. HTUF now works with more than 80 national fleets 
representing more than one million vehicles on the road, and all major 
truck makers and system suppliers. HTUF has identified the most 
promising early uses of hybrid technology (such as refuse, delivery and 
utility trucks), is working with fleet users of these vehicles to 
determine their common needs, and then is organizing these committed 
users to purchase and use commercially-built hybrids that meet these 
requirements. For the commercial industry, this has significantly 
accelerated their time to market by allowing them to focus on the most 
promising first markets. Product improvement is also much faster 
because customers share information and needs in real time with 
suppliers during assessment and development.
    There is an additional benefit in the model--reducing cost and time 
for the military user. By developing a commercial manufacturing base 
and market for similarly sized and functioning systems, eventual costs 
to military users are reduced. The time to source and deploy future 
military systems is reduced, as well. By partnering in early commercial 
deployments, the military is able to assess performance, designs and 
architecture at extremely low cost. And by being active in the 
performance requirements, future military capabilities, such as silent 
watch, are designed into commercial systems from the start.



    HTUF fleets have already launched or completed several fast track 
projects. Fourteen initial fleets ordered, deployed and assessed 24 
utility hybrid trucks in a national pilot program, demonstrating up to 
50 percent fuel economy improvements and exceptional reliability. This 
effort led directly to a follow up order of more than 100 trucks and 
has now helped launch early hybrid production in this class of medium-
duty trucks. HTUF fleet working groups in the parcel, refuse and small 
bus categories are launching similar pilot efforts to spread hybrid 
truck applications. A new working group--in full-size, Class 8 long 
haul trucks, plans to deploy some hybrid ``big-rigs'' by late 2008. As 
a result of the HTUF process, the commercial industry is now rapidly 
developing early heavy-duty hybrid products in several different market 
applications. First assembly line production has now started and 
additional product launches are pending.

Importance of Hybrids

    Hybrid technology is a transformative technology for 
transportation. Future vehicles need to reduce urban pollution while 
also cutting fuel use. Few technologies can do both: hybrid can, 
increasing efficiency while also reducing emissions. Not only can it 
provide immediate benefits today, in terms of reduced fuel consumption, 
reduced criteria emissions and reduced greenhouse gas emissions, it 
also is an enabling architecture for future reductions and 
improvements. Once hybridized, vehicles can become more effective 
platforms for additional improvements, including the use of 
electrified, more efficient components, the use of downsized and 
optimized engines and combustion schemes, and enabling a transition to 
greater engine-off operation with enhanced energy storage. The stored 
energy can come from cleaner fuel sources--such as electricity--in 
plug-in variants. For the military, hybrids provide not just reduced 
consumption--which means a reduced supply chain and longer endurance--
but also advanced capabilities. Military vehicles desperately need 
increased electrical power in deployed vehicles, and military users 
desire greater power generation in the field: both are inherent 
capabilities of a hybrid electric system. Military planners also seek 
engine-off ``silent watch'' functionality, which is the ability to 
support vehicle functions from stored energy without using the noisy--
and detectable--engine. Hybrids deployed in assessment by HTUF and the 
NAC have already proven-out this stealth function. Advanced versions 
can allow ``stealth'' driving, as well--vehicle movement for limited 
distances without the engine starting.

State of the Industry

    Hybrid truck technology has made significant strides in the last 
several years and is now on the ``cusp'' of commercialization. However, 
unlike passenger cars, where hybrid technology has been in production 
for a decade, first hybrid production is only now just starting in the 
truck industry. Integrating hybrid technology into truck platforms 
presents different challenges than in passenger cars, requiring 
different strategies, packaging and weight concerns, system designs and 
component sizing. The market drivers and purchase criteria are 
completely different in the commercial vehicle market than in the 
consumer market. Therefore, it is fair to think of hybrid trucks as 
being ten years behind the auto industry and also needing very 
different research, development and market acceptance tools to support 
them.



    So far, unlike the automotive industry, the leaders in medium- and 
heavy-duty hybrids are U.S.-based manufacturers. This is a significant 
advantage to the Nation. However, that leadership is not assured. More 
than six truck makers and ten system makers are now developing heavy 
hybrid prototypes or pre-production products in first applications, but 
the effort has not yet achieved critical mass and is at an important 
point in its evolution. To break out, these first efforts must succeed 
and expand. One of the key early barriers to success is that production 
volumes are low, so prices remain high.
    On target with HTUF's intermediate goals, the first U.S. truck 
maker entered early assembly line production of hybrids in October 
2007. International Truck and Engine Corporation, using an Eaton 
Corporation hybrid electric drive system, launched the DuraStar hybrid 
truck. It is now available in limited quantities from all its dealers 
in North America. The company can build up to one thousand trucks its 
first year. This capability was assisted directly from HTUF's efforts. 
Two other truck makers, Peterbilt and Kenworth, have announced early 
production plans for 2008, including hydraulic and electric hybrid 
offerings using Eaton systems, and Peterbilt is developing a Class 8 
long-haul hybrid truck. Azure Dynamics will start producing a hybrid 
chassis with Ford in 2008. Freightliner has recently announced it will 
join International, Kenworth and Peterbilt in the medium hybrid truck 
market. Volvo/Mack has announced a hybrid truck capability in the 2009/
2010 timeframe. Other companies are show-casing capabilities and 
prototypes, including Dueco with an Odyne plug-in hybrid utility truck, 
Oshkosh with an electric refuse collection truck, Crane Carrier with 
both an electric hybrid featuring an ISE driveline and a hydraulic 
hybrid featuring a Bosch Rexroth driveline. BAE, Allison, Parker 
Hannifin, Hybra-Drive, Permo-Drive, Enova Systems and ArvinMeritor are 
other examples of suppliers with active development efforts, some of 
which already produce hybrid systems for transit or other applications.
    Initially there was skepticism by some whether hybrid technology 
would have a broad enough application to all trucks. Certainly 
initially, it is clear there are some first ``beachhead'' markets and 
applications for hybrids, such as refuse, urban and regional delivery, 
utility and similar work truck applications. However, these early 
markets are just the beginning, not the end pint, for hybrids. HTUF and 
partner testing are showing that hybrid technology delivers greater 
fuel economy in almost every duty cycle. The key early issue is to 
place hybrid vehicles where they will have the highest initial payback. 
However, as system costs come down with increased volume, improved 
system design and integration and new technologies, hybrid drivelines 
will steadily be applied in more and more market segments. Indeed, the 
next breakthrough in hybrid technology appears to be Class 8 long haul 
trucks, the highest fuel using truck class. Five truck-makers have 
public or private programs to develop this capability, currently led by 
Peterbilt-Eaton. Hybrid systems may contribute three to four percent 
fuel economy improvements alone; combined with their built-in ability 
to provide idle reduction savings, this could approach six to eight 
percent improvements. Hybrid technology actually shows the future 
capability of addressing a significant percentage of the truck fleet, 
building out of first markets in heavy urban work trucks.

Gaps and Barriers

    Hybridizing the truck driveline is a key stepping-stone to future 
advanced capabilities in both hybrid and conventional trucks. If we are 
to reduce petroleum use (and address climate change) it is one of the 
key technologies to achieve that. Yet truck and system makers need 
public sector support and partnerships to bring these important 
technologies forward as quickly as the Nation needs them. The industry 
is resource constrained: as much as 80 percent of the engineering 
talent at the truck and engine makers has been focused, rightly, on the 
emission reduction requirements of 2007 and 2010. To support a parallel 
and fast-track effort in hybrids, critical as it is, is more than the 
industry can do alone. Industry needs government partnership and shared 
risk and investment to make it happen as fast as it is needed.
    The core early barriers to fleet adoption are clearly high unit 
cost mostly due to low manufacturing volumes and the lack of a robust 
component marketplace. Assistance to help fleets cross this first 
market incremental price barrier would be extremely helpful. However, 
fleets also need additional in-use performance data and validation to 
help justify their capital investment in these new systems, and 
assistance to aggregate their demand with other fleets to speed 
purchases. Together with this is industry's need for additional 
development and testing of new components, better system integration 
and advanced capabilities. In essence, hybrid trucks are at the 
emergent stage of technology; the performance shown by early vehicles 
is just the beginning of what future hybrid and advanced capabilities 
can be.
    Given these observations, CALSTART/HTUF has identified with its 
industry and fleet partners the core needs for continuing momentum in 
hybrids, and they fall along the stages of development:

          Need for continued funding of research and 
        development in core hybrid and advanced systems (R&D--
        development stage)

          Need for continued funding and partnership in fleet 
        support/pre-production demonstration and pilot projects to 
        assess and validate hybrid performance and reliability 
        (Demonstration/Validation--pre-production stage)

          Need for fleet purchase assistance in the early 
        market stage to speed introduction and rapidly increase 
        manufacturing volume (Purchase Incentives--early market stage).

    In terms of R&D, the core technology development needs now are for 
improved system integration and manufacturability, reduced energy 
storage costs specific to commercial vehicle designs, electrified 
components (to enable even greater fuel economy gains in all trucks, 
and more capable hybrids in particular), optimized and downsized 
engines, advanced combustion schemes, power generation, light-weight 
materials, and advanced control systems.
    It's important to understand that there are still technical 
barriers for trucks and buses that are not the same for passenger cars. 
For instance, there is no commercially-available electrically-driven 
air conditioning, steering pump or other components yet in the truck 
world. There are expensive prototypes, but no systems that can hold up 
to heavy-duty vehicle duty cycles. This is a core area of need, because 
their availability not only enables more-effective hybrids, they make 
for more efficient conventional trucks as well. Optimized engines are 
another good example. Specifically because a hybrid drive system allows 
the main engine to work differently, and usually to work less or work 
in a narrower power range, cleaner and more efficient engine designs 
are possible, such as Homogenous Charge Compression Ignition (HCCI). 
Such engines are more difficult to use if they must cover the full 
range of a conventional truck's power needs, but may be possible when 
functioning in a more limited power range coupled to a hybrid system.
    The medium- and heavy-duty industry would greatly benefit from 
support across all three of the stages identified above to more rapidly 
improve the fuel efficiency of the heavy truck sector, which has the 
highest per vehicle fuel use, and therefore the highest pay-back 
potential for investment. Yet investment has been sorely lacking for 
the commercial vehicle platforms, or applied in a less than focused 
way.
    It is worth noting that Department of Energy projects to help 
develop and test early heavy hybrid technologies, managed by the 
National Renewable Energy Lab (NREL), were very useful and moved 
specific technologies forward that are in products we are now seeing 
today in transit hybrid buses and medium hybrid trucks. Unfortunately, 
most of that funding and commitment has ended.
    Similarly, significant progress was made to drive the core hybrid 
driveline functionality via early Department of Transportation-Federal 
Transit Administration and Defense Advanced Research Projects Agency 
(DARPA) funding in the 1990s. These were exceptionally innovative 
programs.
    Missing from all these efforts was not only a longer-term duration, 
but support and strategies that moved technology along all the stages 
of development.
    The commercial vehicle segment has not been a high enough priority 
for funding. It has also been assumed that investments made in 
passenger cars are sufficient to support commercial vehicle needs. The 
truth is, there are important differences between commercial and 
consumer--truck and car--hybrid vehicles in terms of duty cycles, 
system architectures, market needs and business cases. A portfolio of 
smart, targeted funding over a multi-year period and covering all the 
stages identified above and aimed at the needs of the commercial 
industry would have significant impacts.
    The Army has been a great partner and leader, supports this effort 
and has directed internal funds to it, but resources to completely 
support the needs and develop new capabilities are limited by the 
Army's immediate priorities. Additional broader support is needed to 
accelerate the effort and achieve critical next steps to develop a 
national heavy hybrid capability.

Next Steps

    HTUF itself, together with its partners, are currently focused on a 
multi-year strategy that envisions creating a sustainable hybrid and 
high efficiency truck market over the next seven years, and working to 
develop the support to achieve this vision. Hybrids are the first and 
critical component of the move to high efficiency trucks. To achieve 
this will require building both market volumes in early applications, 
and adding new capabilities to both hybrid and conventional trucks over 
this time frame. To do this effectively will require government 
partnerships and risk sharing with the industry and fleets.
    To succeed will require a robust, self-sustaining hybrid truck 
market, with offerings across multiple platform sizes and applications. 
To achieve these goals HTUF needs to continue to recruit and educate 
fleets in the targeted segments, and ensure that pre-production and 
early production commitments are achieved in these segments over the 
next several years. This will also entail opening new segments as price 
points allow, such as industrial/non-road vehicles and drayage trucks.
    Hybrid alone will provide such benefits in many but not all duty 
cycles. It will require enhanced capabilities to achieve these levels, 
including optimized engines, improved energy storage, light-weight 
material use, more efficient components, better aerodynamics in long 
haul applications, plug-in hybrid modes, and other strategies. Such 
enhancements enable the increased capabilities of quiet, engine-off 
operation and the ability of some trucks to be mobile power generators 
for emergency and work needs.
    Importantly, these same improvements that increase the capabilities 
of hybrids also increase the fuel efficiency of conventional trucks. 
This concurrent move of hybrids into Class 8 heavy segments and the 
focus on improving core truck components is the leverage point to much 
more broadly impact the truck industry. By targeting users demanding 
increased fuel efficiency, working with regulatory agencies to develop 
accepted metrics for hybrid fuel efficiency and expanding the suite of 
enabling and enhancing technologies for hybrids, we will provide the 
platform and the pathway for measuring, delivering and expanding 
improved fuel efficiency in all trucks.



Future Vision

    The government has a rightful and needed role to play at each stage 
of hybrid and high efficiency truck and technology development, and it 
is likely a different role at each point. If government agencies were 
to commit to moving forward medium- and heavy-duty hybrid and high 
efficiency trucks following an integrated plan and an ``investment'' 
strategy for the use of funding, that would be extremely useful and 
cost-effective for the industry.
    In light of the growing market penetration and public acceptance of 
hybrid drivetrain technology in light-duty vehicles, the government can 
now direct a concerted focus on the medium- and heavy-duty sectors to 
further advance the technology benefits.
    It is important to note that assistance is needed now. The industry 
is at a critical stage and on the threshold of a successful launch. 
However, this launch can also be viewed more broadly as the first stage 
of a transformation of transportation technology. What is required is a 
commitment to a major program, on a par with light-duty efforts, to 
move medium- and heavy-duty vehicle technology to the next level. 
Therefore, looking forward in the broadest sense, CALSTART could 
envision a high profile program built on these parameters:

          First, a commitment to target, support and fund over 
        a multi-year period the steps required to achieve 
        commercialization outlined earlier: R&D Fleet Support and Pre-
        production Demonstration; and Purchase Incentives. To get 
        maximum effect, an integrated strategy encompassing all three 
        is needed.

          Second, government's role and risk should be 
        different at each stage, as is acknowledged already in most 
        programs. However, a portfolio approach as to how much funding 
        to apply to each stage, and a commitment to do so consistently 
        over several years, would be most beneficial to the market. It 
        would focus industry technology investments and engineering 
        resource allocation as well as signal to private investors 
        where to extend their investment into innovation in new 
        technology. Such signals can often leverage as much private 
        resource as direct governmental funding.

                  Research and development might rightly make up 15-20 
                percent of such a total government partnership 
                portfolio, with pre-production demonstration, testing 
                and validation an additional five to ten percent. We 
                can see the need for purchase incentives, based on a 
                sliding scale determined by truck size and level of 
                increased efficiency, and declining over time, making 
                up as much as 70-75 percent of this overall portfolio.

          Third, it is highly important that research, 
        development and demonstration activities be designed and 
        operated to encourage competition, innovation and new players. 
        Past efforts in some agencies have been closed to any but a 
        handful of manufacturers and suppliers, a constraint unlikely 
        to speed new approaches. Additionally, a commitment to spur 
        action and achieve aggressive outcomes would add energy to the 
        program. We can envision a ten year commitment to achieve 40-50 
        percent fuel economy gains as an average across all new trucks 
        as a starting point for discussion.

          Fourth, such a program structure would ideally take 
        place over a minimum of five years and be led by an agency or 
        partnership that sees the value of and desires action to occur. 
        Given the likely growing concerns with reducing foreign oil 
        imports for energy security, the need for greater fuel 
        efficiency to save truck operators money and secure jobs, and 
        the need for significant carbon reductions in the future, a ten 
        year program would be ideal as a clarion call to and a signal 
        of commitment and action.

          Fifth, the level of investment should be commensurate 
        with the needs and the challenge. California has recently 
        enacted a high tech and fuel investment program (Assembly Bill 
        118) that will invest $200M per year over seven years in new 
        transportation technology and fuels. Given this precedent in 
        only one state, we would recommend at least a comparable 
        federal effort, but targeting hybrid and high-efficiency 
        medium- and heavy-duty vehicles over ten years. This can serve 
        as a framework for the effort needed to ensure U.S. 
        manufacturing technology leadership and meeting its energy 
        security and greenhouse gas emissions goals. Based on the 
        investment portfolio proposed, this could mean $40-$60M per 
        year for R&D and fleet support/pre-production deployments, and 
        $140M per year for purchase incentives. This balance can also 
        be modified to ``front load'' the investment in the early years 
        and decline over time, from $400M/year down to $50M in the 
        final year. Purchase incentives can also be structured to 
        decline over time.

    Such program commitments and integrated strategies are difficult to 
coordinate across different agencies, as demonstrated by the limited 
success of some previous efforts. However, it is possible that 
motivated agencies can be determined to carry out segments of the total 
strategy. The Department of Transportation already has responsibility 
for setting truck fuel economy standards; its Federal Transit 
Administration has helped spur hybrid bus acceptance; the Environmental 
Protection Agency is establishing truck fuel economy testing protocols; 
the Department of Energy's NREL has managed R&D and testing for heavy 
hybrids; The Department of Defense's NAC has invested in both targeted 
hybrid R&D and in pre-production pilot demonstrations. A coordinated 
approach is critical, as is a strong and willing commitment to lead. 
The DOD's NAC is a good example of an agency taking a focused, outcome-
oriented approach and achieving measurable results. Such 
characteristics have been the hallmark of past successful efforts in 
which we have experience.
    Again, thanks to the Committee, staff and Members for the 
opportunity to provide this testimony and share the progress to date we 
have seen in medium- and heavy-duty hybrids, and the significant 
benefit we could create for our industry and nation with a focused and 
strategic commitment to move change in this field.

                    Biography for Richard C. Parish

EDUCATION:

University of Texas-Austin, 1980--MS, Mechanical Engineering

Thesis: Performance Analysis of the Gateway Solar Energy Project

University of Texas-Austin, 1971--BA, Anthropology; Math minor

REGISTRATION:

    Professional Engineer, State of Colorado

EXPERIENCE:

         5/06-Present--WestStart-CALSTART; Denver, Colorado

                 T3Senior Program Manager (May 2006 to present)

                 Leading the Hybrid Truck Users Forum (HTUF) program 
                activity to assist in the commercialization of medium- 
                and heavy-duty hybrid vehicles. Specific 
                responsibilities include: leading the Hybrid Refuse 
                Truck, Class 8, and Parcel Delivery Working Groups; 
                overseeing the Shuttle Bus and Utility/Specialty Truck 
                Working Groups; and organizing and implementing the 
                annual HTUF National Meeting.

         2/92-4/06--NATIONAL RENEWABLE ENERGY LABORATORY (NREL), 
        Golden, Colorado

                 Senior Project Leader--Transportation Systems (Jan. 
                2000 to Apr. 2006)

                 Led three Department of Energy (DOE) funded tasks: 1) 
                Gaseous Fuels; 2) Advanced Heavy Hybrid Propulsion 
                Systems; 3) Power Electronics Systems. Developed 
                medium- and heavy-duty natural gas engines and hybrid 
                electric technologies and vehicles through in-house and 
                subcontracted efforts with engine and vehicle 
                manufacturers. Managed $6.2M annual budget. Previously 
                initiated and managed a project to provide technical 
                assistance (Tiger Teams) to Clean Cities organizations 
                attempting to implement alternative fuel vehicles. 
                Simultaneously led the Advanced Vehicle Testing 
                Activity for test and evaluation of emerging, 
                alternative fuel vehicle technologies. Participated in 
                the California Fuel Cell Partnership, Fuel Cell Bus and 
                Light-Duty Vehicle Working Groups.

                 Senior Project Leader--Federal Energy Management 
                Program (Sept. 1996 to Dec. 1999)

                 Implemented DOE Federal Energy Management Program 
                (FEMP) projects to conserve energy and incorporate 
                renewable energy technologies in federal facilities. 
                Assisted the Environmental Protection Agency (EPA) in 
                establishing an Energy Savings Performance Contract 
                (ESPC) to upgrade and create a renewable energy 
                showcase for their Ann Arbor, Michigan facility HVAC 
                system. Assisted NASA Headquarters Energy Manager in 
                developing an ESPC and renewable energy program for 
                their field offices. Worked closely with a 
                subcontractor expert in building energy evaluation to 
                perform preliminary evaluations of various federal 
                facilities to implement renewable energy and energy 
                efficient systems.

                 Senior Project Leader--Thermal Systems (Feb. 1992 to 
                Aug. 1996)

                 Led the development of a variable-conductance,vacuum 
                insulation system to be used for the thermal control of 
                high-temperature advanced batteries in electric 
                vehicles. Managed budget, schedule, technical 
                personnel, research constraints, and performance to 
                technical requirements to maintain the project on 
                track. Managed laboratory test activities, evaluating 
                test procedures and results, to accomplish multiple, 
                parallel test goals. Interfaced with the primary 
                customers, the U.S. Advanced Battery Consortium 
                (USABC), which was composed of auto and battery 
                manufacturers, to refine project requirements and 
                goals. Managed the project to implement these in a 
                timely and efficient manner. Performance under the 
                original $3.5M cooperative research and development 
                agreement (CRADA) resulted in a $600K supplemental 
                contract with the USABC, which was managed concurrently 
                with the original project.

                 Active participant in the NREL2000 activity to 
                streamline operational processes within the laboratory. 
                Led a sub-team focused on improving the operations and 
                reducing costs within the NREL Facilities Office.

         10/80-1/92--NATIONAL AERONAUTICS AND SPACE ADMINISTRATION 
        (NASA), Houston, Texas

                 Space Station Thermal Systems Integration Manager 
                (Sept. 1990 to Jan. 1992 and Dec. 1988 to Sept. 1989)

                 Responsible for the coordination and integration of 
                the Space Station Thermal Control System (TCS) design 
                between the participating NASA centers and 
                International Partners. Charged with managing the TCS 
                Architecture Control Document, which served as the 
                system definition and design requirements document. 
                Actively served as the Chairman of the TCS Working 
                Group composed of NASA and International Partner 
                thermal system experts, conducting Working Group 
                meetings, resolving interface issues, creating action 
                plans, and coordinating the goals of the Group. Thermal 
                System prime point-of-contact for the NASA Space 
                Station Program and Project Offices.

                 Planet Surface System, Systems Engineer (Sept. 1989 to 
                Sept. 1990)

                 Performed as lead engineer in the development of 
                planet-surface system concepts and element designs. 
                Responsible for coordinating and managing line 
                organization support to the Planet Surface System (PSS) 
                Office. Served as alternate to the PSS Manager at 
                agency-wide Program Review Boards. Frequently acted in 
                the stead of the PSS Manager in his absence. 
                Responsible for organizing and directing the PSS 
                Technical Status Review Board with the goal of 
                interaction and communication between the various NASA 
                centers' engineering and project office organizations.

                 Space Station Heat Acquisition and Transport Subsystem 
                Manager (Jan. 1988 to Dec. 1988)

                 Responsible for the design, development, test, and 
                evaluation of critical Space Station thermal control 
                subsystem hardware. Developed system design 
                requirements, test requirements, test plans, and 
                hardware performance criteria for candidate active 
                thermal control systems.

                 Thermal Transport System Development Contract Manager 
                (Jan. 1984 to Dec. 1988)

                 Acted as contract technical manager for development 
                contracts focusing on technology advances in two-phase 
                (liquid/vapor) spacecraft thermal transport systems as 
                well as specific hardware components of the systems, 
                such as contact and integral heat exchangers and 
                rotating fluid couplers. Total contract value was 
                approximately $5 million. Development efforts included 
                design and implementation of reduced gravity flight 
                tests.

                 Microgravity Research Principal Investigator (Jun. 
                1984 to Jan. 1988)

                 Established requirements and preliminary designs for 
                experiments to investigate the behavior of liquid/vapor 
                fluid in the microgravity environment. Coordinated 
                research efforts with thermal technology development 
                activity.

                 Thermal Analysis Development (Jan. 1984 to Oct. 1985)

                 Initiated the development of ``next generation'' 
                thermal analysis programs for utilization with two-
                phase thermal control systems. Provided analytical 
                support for preliminary design of Space Station thermal 
                tools.

                 Shuttle Vehicle Thermal Model Development (Oct. 1980-
                Dec. 1983)

                 Generated and correlated detailed thermal models of 
                portions of the Shuttle vehicle using SINDA and TRASYS 
                analysis tools. Provided real-time mission support and 
                post-flight data analysis.

                               Discussion

        The Federal Government's Role in Promoting Heavy Hybrid 
                              Technologies

    Chairman Lampson. Thank you, Mr. Parish.
    At this point we will open our first round of questions, 
and the Chair will recognize himself for five minutes.
    Mr. Penney, let me ask of you, what, at what point in the 
development do you feel that it is appropriate for DOE 
involvement to begin to drop off? And secondly, should we focus 
only on the most basic research, or do we have a responsibility 
to see that technologies get to the market, and where are they 
weakest?
    Mr. Penney. That is a good question. The opportunity from 
my perspective I enjoy seeing systems level approach. When we 
work on components, which is essential and required, you 
sometimes don't, when you put all the pieces together, you 
learn new things, and I tried to emphasize in my testimony that 
a systems approach is absolutely critical.
    Now, the Department of Energy has classically funded on the 
component level for energy storage, power electronics, thermal 
controls, and issues like that. They have drawn the line 
because they feel that industry's responsibility is to put that 
system level together. As was pointed out by Mr. Parish, we did 
have a few projects with Oshkosh truck, with Eaton, and Allison 
Bus transit fleets. The system level performance really taught 
us new things that we didn't learn from just component-type 
activities. And all of these companies benefited greatly by 
that education, and they would not be there today had it not 
been for that federal support.

                                Pricing

    Chairman Lampson. Thank you. Mr. Smith, what is the price 
premium for an Eaton hybrid truck compared to a conventional 
model, and what accounts for the difference?
    Mr. Smith. Well, the difference is accounted for because of 
the added componentry that we need to add. There is, in a 
parallel system like we provide, there is a motor generator 
that is in the system, there is a power electronics inverter 
that takes energy from the batteries and feeds it to the motor 
or in the condition where you are acting as a generator such as 
regenerative braking, you are taking power back from the 
generator and feeding it into the batteries to recharge.
    So the price premium that you are paying is for all of the 
additional components, plus all of the controls that make all 
of these individual components work together, you know, 
efficiently and safely.
    As far as the price premium, that is actually an OEM 
decision to the customer since we sell to OEMs and then the 
OEMs sell directly to the customers, but as Ms. Egbert 
mentioned, you know, the 50 percent premium currently on a 
hybrid vehicle is probably very close to what we are seeing out 
in the market today for a hybrid vehicle.

                   The 21st Century Truck Partnership

    Chairman Lampson. Has the 21st Century Truck Partnership 
been a success? And should it continue? And I would like for 
all of you to comment on that, and add a second part to it. How 
could the program be structured better to speed hybrid 
technology in medium and heavy truck, heavy-duty trucks?
    And do you want to start, Mr. Smith?
    Mr. Smith. Yeah. It is actually not a topic that I am well 
informed on, and I can respond in writing at a later date to 
give a full response from the Eaton perspective.
    Chairman Lampson. Anyone want to comment on those two 
things?
    Please, Mr. Parish.
    Mr. Parish. Yes. I think the 21st Century Truck Program 
ideally was very well conceived, and I think it started out 
with good promise, because we did have the involvement of a 
variety of different federal agencies in that particular 
activity, and it looked like it was going to be very 
constructive.
    However, as it turned out, I think it had limited success, 
because there was a lack of a real vision and adequate funding 
for the activity. I think as we have observed the 21 CT 
activity now is kind of a gathering of interested parties that, 
you know, they are interested to see if anything is going to 
happen from the federal level, but from what we have seen so 
far nothing has really been initiated, and there has been no 
real program activity that resulted as a result of the 21 CT 
Program.
    So I would say that, yes, as it is conceived it is a very 
viable and very worthwhile type of activity, but I think it 
needs to be revisioned in terms of how it is led and make sure 
that there is an agency that is very motivated to make it a 
success. And our association with U.S. National Automotive 
Center has proven that they have the ability to----
    Chairman Lampson. Mr. Penney, do you want to comment?
    Mr. Penney. Yes. I am NREL's lab rep for 21 CT. In fact, I 
canceled my trip today, they are having a 21 CT meeting at 
Volvo Corporation in Greensboro, and I think the issue as was 
pointed out, there needs to be a flagship project, and I think 
getting together and sharing the education that I talked about 
in the 21 Century Truck Partnership has been very useful. We 
generally have at least monthly phone calls, people share what 
is happening, what is new, what are the issues that need to be 
worked on, but as Richard had pointed out, the funding from DOE 
has been focused more on the light duty because of the 
displacement of oil savings on the large number of light-duty 
vehicles as opposed to the heavy-duty vehicles.
    But I think we have talked in the 21 Century Truck 
Partnership with all the members of a flagship project such as 
a super truck, putting all these technologies together, 
aerodynamics, idle reduction, hybridization, start, stop, you 
know, these things as one big package it would be nice to have 
a moon shot for a truck, so to speak, especially on the Class 
eight applications, which, in fact, could save a lot of oil.
    Chairman Lampson. Thank you. I yield to Mr. Inglis for five 
minutes.

             Scientific and Economic Barriers to Deployment

    Mr. Inglis. Thank you, Mr. Chairman.
    First of all, Mr. Smith, thank you for having, Eaton having 
a facility in Greenville, South Carolina. We are very happy to 
have you there, and I will give you an opportunity to give a 
plug if you want to about what you do there, especially if it 
relates to this or even if it doesn't. But figure out a way to 
work that into an answer, would you? Do an advertisement for 
Greenville, South Carolina.
    So I am sort of wondering here whether we are doing science 
or economics. If it is science that is holding us back through 
the deployment of these technologies or if it is economics. The 
issue with economics is you can approach it a couple of 
different ways. One is you can do grants and tax credits and 
regulate things, or you can unleash the power of the market. If 
you unleash the power of the market, it seems to me the first 
step is to stop having free externalities associated with 
incumbent technology, which is diesel.
    If you attach the price to that, you internalize the 
externals to that product, then that 50 percent premium becomes 
a much smaller premium. Right? Because then the freebie in the 
air that currently is, benefits the incumbent technology, which 
is diesel, shrinks. And as it shrinks hybrids and every other 
kind of alternative suddenly becomes economically viable. Maybe 
not so suddenly but it becomes economically viable.
    So which are we talking about here? Are we talking science 
that is holding us back, or are we talking economics that is 
holding us back?
    Anybody want to tackle that?
    Mr. Dalum. In my opinion it is both. I think there are some 
very short-term benefits that could be gained in this area, in 
my view, in plug-in technology, but those benefits are somewhat 
limited by not performing enough research. The research in my 
view could improve the performance over what is available 
today. I am referring to different powertrain designs which use 
smaller engines, larger electric motors, different battery 
technology that I have not seen available in a large capacity 
advanced battery for a truck.
    So I think it is a little bit of both. I think we could 
move very quickly if we had some research for specific 
applications and incentives, and then secondly, perhaps some 
research devoted to more longer-term advancement of the 
technology.
    Mr. Inglis. And what you are selling today, is the 
electricity used to charge the battery which then runs the 
powertrain or is it like the Chevy Volt is going to do? That is 
the concept of the Volt. Right?
    Mr. Dalum. It is a parallel system, which means that the 
diesel engine is always operating when the vehicle is moving, 
and that is because as Mr. Parish had talked about, in the 
industry right now there is not a commercially-available, high-
volume, electrification of certain subcomponents like the HVAC 
system, power steering, brakes, and so forth.
    So the engine is always running, and the electric motor 
provides supplemental propulsion. Okay? So there are limits to 
its efficiency gains because the engine is always running. The 
battery that we use is a very large battery. It is a heavy 
battery, but it has been around for a long time, and that is 
why we chose it, because it is well understood technology. But 
it depletes. That means that you charge it up at night, and you 
want the battery to deplete, and then when you are done after 
the day, you charge it up at night.
    That being said, this vehicle never, you never have to 
charge the vehicle up, because the system will monitor the 
state of charge of the battery, and the engine will turn on if 
it has to, but we try to, you know, reduce that so that you can 
use grid power to recharge the battery.
    Mr. Inglis. Right.
    Mr. Dalum. I hope that answers your question. It is using 
both diesel and the battery system to provide propulsion.
    Mr. Inglis. Is there an advantage to going to a system that 
uses only electricity for propulsion?
    Mr. Dalum. In my view there is in certain areas, and I am 
talking more about stop and go driving in urban areas. And 
perhaps in what I would call mission that has a, or a job that 
has a short duration travel to a job destination, that might be 
able to be performed under 100 percent electric operation for a 
limited range. And then when you are at the job site, operate 
off the battery power, and then return to the garage after the 
work is completed and charge up overnight using power from the 
grid.
    Right now the battery power that we have is not sufficient 
really, though, for that kind of application. I think more 
research needs to be done to provide that kind of power.
    Mr. Inglis. Mr. Smith, that commercial.
    Mr. Smith. Yes. Yes, sir. Or even an electrical group down 
in your area.
    Mr. Inglis. Good.
    Mr. Smith. But if I could just comment on what Mr. Dalum 
said. I think I would agree. It is a little bit of both science 
and economics. You know, to your question, you know, would it 
be better just to be all electric, I think that is a question, 
though, that you can't meet all of the needs because of the 
very wide range of applications that we are--and clearly a 
heavy-duty Class eight truck you would never be able to get 
enough storage capacity on a vehicle to do what it needs to do. 
Some of these work trucks travel far enough distances in any 
given day that, again, you couldn't store it.
    But there are pick-up and delivery trucks like potentially 
a Fed Ex, a UPS truck, depending on their duty cycle and where 
they run, you might be able to get into a situation where you 
could run that way. But the, you know, the hybrid and having 
the ability to regen and recharge batteries on the vehicle I 
think will always be a significant portion of the market, and 
you will need that.
    Chairman Lampson. Thank you, Mr. Smith. I am sure the 
Greenville Chamber of Commerce will be most appreciative of 
your comments.
    I now recognize Mr. McNerney for five minutes.

                    Battery Technology and Disposal

    Mr. McNerney. Thank you, Mr. Chairman. I want to thank the 
panel. It has been a very interesting hearing, and it is an 
area that a tremendous opportunity for our country. I 
particularly want to thank Mr. Parish for coming from CALSTART. 
CALSTART is working very hard to reduce emissions in the San 
Joaquin Valley, which is one of the worst air pollution regions 
in the country. So thank you, Mr. Parish, and Ms. Egbert for 
coming from PG&E, my home utility company. I think your 
comments on reducing emissions by 50 to 70 percent is very 
important, and that is something we need to keep in mind.
    Stockton, which is the largest city in my district, has now 
the highest gas prices in the country surprisingly, considering 
that it also has the highest foreclosure rates, and I have seen 
or we have seen a lot of hybrid technology on the highways with 
regard to private vehicles, but companies like BNSF are 
developing high-speed rail, not high speed but rail hybrid 
technology. So there is a lot happening, and it is very 
exciting to see it.
    My first question is about the battery technology. There 
are four things that I am concerned about. That is the cost of 
the technology, of course, the reliability, the life, and the 
disposal requirements for batteries. Is that something that 
they recycled?
    Could Mr. Smith or Mr. Dalum take that question?
    Mr. Smith. Yeah. I can comment on it. The, you know, the 
Eaton system currently is based on lithium ion batteries, and 
yes, those are fully recyclable and can be handled safely in an 
end-of-life condition. I mean, it is, there are several current 
sources in the U.S. where we can take batteries for appropriate 
disposal.
    Mr. McNerney. I spent much of my career in the 
manufacturing industry, and there is a law that the, every time 
you double your manufacturing volume, your cost goes down maybe 
10 percent or 15 percent. Do you expect that sort of law to 
apply? In other words, as we go up the manufacturing volume, 
are we going to see the costs go down accordingly? Or is there 
some inherent cost barriers that we are going to be facing with 
hybrids?
    Mr. Smith. I, we definitely believe that, that, you know, 
we are currently, the price premium we are, our customers are 
paying today is driven mainly by volume issues. As we can 
increase the volume of the components, we expect significant 
price decreases. It is all based, it is what you said. As we 
can drive up the volumes and get into high volume, lower cost 
manufacturing processes, the cost will come out.
    Mr. McNerney. Is the battery technology improving in a way 
that will be parallel with the cost reductions or be 
contributing to the cost reductions?
    Mr. Smith. Yeah. What we see today, and again, Eaton 
Corporation has chosen or chose very early on to pursue lithium 
ion batteries as the appropriate technology for this, for these 
vehicles, and there is a lot of lithium ion batteries for hand 
tools, but they are smaller cells, lower energy capacity. Those 
systems are already in very high volume, manufacturing 
facilities, but the size that you need for vehicles hasn't made 
that transition yet. There is not, you know, there is not the 
market demand driving that increase yet, so we are on that 
road, but we are not to the point where we can justify spending 
the money that you need into the manufacturing facilities to 
increase the volume production and then ultimately get the 
lower cost.
    Mr. McNerney. Mr. Penney, do you have comments on the 
battery technology?
    Mr. Penney. Absolutely. I was in Tampa at the International 
Battery Conference a couple of weeks ago, and as was said, the 
cell size are like C and D size batteries, and even for the GM-
Volt that was mentioned, you know, you are talking thousands of 
batteries and thousands of interconnects, and every time you 
have an interconnect, there is that potential for that string 
or module to go bad.
    Furthermore, as you package more and more batteries 
together for these heavy-truck applications, you have got to 
worry about thermal issues. Thermal management of batteries is 
something that we at NREL have focused on, are very important.
    And then finally there is the control. The Prius, for 
example, was mentioned. The state of charge in the Prius, you 
only use about a quarter of that battery because the state of 
charge swing goes from about 85 percent to 65 percent or 50 
percent. So that is only a third of the capacity. On many of 
these duty cycles and especially lithium, you can go from 90 to 
10, 90 to 10.
    And for a refuse example, they cycle that battery a 
thousand times a day or that ultra cap. A battery can last 
maybe several thousand cycles, several million cycles depending 
on that state of charge swing, the temperature, and actually 
the life. And the point is that all of these factors are 
unknown, and it is extremely difficult for these manufacturers 
to take the risk to say that this vehicle will last ``X'' 
number of miles and put a warranty on it. That warranty cost 
and that backing of that component is a very, very risky 
business at this point in time.
    Mr. McNerney. Thank you, Mr. Penney. My time has expired.
    Chairman Lampson. Thank you, sir.
    The gentlelady from Illinois, Ms. Biggert, you are 
recognized for five minutes.

                  Department of Defense Hybrid Efforts

    Ms. Biggert. Thank you, Mr. Chairman. I am one of those 
people that was around in the '70s, sitting in the gas lines 
with three little kids in the back, thinking I was never going 
to get a full tank of gas again. And at that time everybody 
thought that, and then suddenly all of this, the crisis ended, 
and we forgot about it. The cars went back to being the SUVs 
and the heavy trucks and everything.
    And I don't think that that is going to happen again. I 
think that we really see that the world has changed and that we 
have got to reduce our dependence on foreign oil and gas and 
whatever.
    But my concern is that, you know, we waited so long, and we 
are still waiting, I think. We have got the hybrid car. I have 
one, and yet the hybrid plug-in to me seems to be something 
that really is going to, you know, I think revolutionize the 
industry of both cars and trucks.
    But trying to, you know, get the battery small enough and 
to last long seems to be taking quite a bit of time, and I 
think that if we are going to have the grid, then we have to 
have the nuclear power, which is going to create the 
electricity rather than some other type of energy.
    My question is then how are, well, maybe start with Mr. 
Penney, is NREL working with the Army or other, any other 
branch of the military in the development of the hybrid truck 
technologies in bringing down the costs of the hybrid trucks?
    Mr. Penney. Probably the intersection is through, as was 
mentioned, the 21st Century Truck Partnership. We get most of 
our funding, as you know, from the Department of Energy. We get 
no funding from DOD or TACOM.
    Ms. Biggert. Is, there was somebody else that mentioned the 
military that--Mr. Parish.
    Mr. Parish. Yes. CALSTART works with the military and gets 
some funding from the military to operate the Hybrid Truck 
Users Forum Program. Obviously, we do feel like there does need 
to be further development in the battery area, specifically for 
medium- and heavy-duty trucks. Right now trucks rely on battery 
packs that were predominantly designed for light-duty vehicles. 
Even some of the buses that we see up in the northwest and the 
Seattle area actually have Prius battery packs on them. These 
hybrid electric buses.
    And so what is really neat is some specific design of these 
battery packs for the medium- and heavy-duty operation, and 
then a standardization of that battery pack so we can see the 
costs of the battery pack come down and be available to a wide 
variety of manufacturers.
    Ms. Biggert. Well, the military has been working on finding 
lighter-weight material or metals for reducing the weight of 
tanks and trucks and whatever. Is the industry looking at that 
also, like say titanium?
    Mr. Parish. Yes. As a matter of fact, one of our 
participants in CALSTART, Alcoa, is very interested in trying 
to identify new markets for aluminum in light-weighting of 
vehicles, and I think we are going to start to see that emerge 
more importantly here as fuel economy becomes more important 
for medium- and heavy-duty trucks.
    Ms. Biggert. Will that dramatically reduce the, if we 
reduce the weight, then the battery will last longer and would 
that aid in the development of the batteries?
    Mr. Parish. Well, it is kind of an integrated problem. We 
have to approach it from a variety of different perspectives in 
order to get the total benefit that we are looking for. So 
reducing weight in heavy-duty vehicles, as well as increasing 
the efficiency of the battery packs, increasing the efficiency 
in the electrification of the auxiliary systems is very 
necessary.
    And then appropriate application of hybridization to the 
duty cycles of the vehicles is very important because it, there 
is a wide variety in the way these vehicles are applied, and so 
you get a wide variety of benefit from the hybrid system as a 
result of the duty cycle of these vehicles. So it is, there is 
a broad spectrum of technologies that need to be investigated 
in order to be integrated appropriately.
    And also, downsizing and optimizing of the engines. Right 
now hybrid trucks typically use diesel engines, however, the 
fleets are now very interested fleets, such as Fed Ex and UPS, 
are very interested in seeing gasoline engines.
    Ms. Biggert. How, you mentioned UPS and I might mention 
that I do have an International truck in my district, and UPS 
has a big facility not too far from us, since everybody is 
claiming something in their state, but with that, how, about 
how big is a fleet of the UPS with the hybrid trucks versus 
regular trucks?
    Does anybody know that as we have been talking about them? 
Well, I will ask them later then.
    Mr. Parish. Well, they have just started incorporating 
hybrid trucks. I believe they have maybe on the order of 200 
hybrid electric vehicles at this point in time. UPS is also 
investigating hydraulic hybrid vehicles, and one of our working 
groups is focused on bringing hydraulic hybrid vehicles to the 
parcel delivery segment. So they are just being implemented. 
They are being tested, but they need some improvements to 
really hit full stride.
    Ms. Biggert. Thank you. I yield back.
    Chairman Lampson. Thank you. Mr. Sensenbrenner, you are 
recognized for five minutes.

                           Competitive Grants

    Mr. Sensenbrenner. Thank you very much, Mr. Chairman.
    First of all, I will claim Mr. Dalum as a constituent since 
everybody is putting their oar in the water here. And I also 
was around when we had the gasoline crisis of 1979, and 1980. 
It was kind of my baptism of fire as a Member of Congress 
because they had this over-complicated allocation system, and 
since I represented an area where the population was growing, 
the allocations were not enough, and the problems were more 
acute. And President Carter actually announced he was having 
the Bureau of Engraving and Printing print up gas rationing 
coupons. We saw pictures of them in the newspaper. Well, Mr. 
Carter didn't make it through the next election. President 
Reagan got rid of the allocation system. The gas lines ended, 
people were able to have full tanks, the price went down, and I 
don't know if they threw the gas rationing coupons in the trash 
or not, but we haven't seen them, and that was about 30 years 
ago.
    Now, that has convinced me that technology is the way to 
get out of the pickle that we are in rather than government 
regulation or taxes and more red tape and more Congressional 
casework for our employees.
    Now, the bill that I have circulated around here 
establishes five grants for the development of plug-in hybrid 
trucks. In your written testimony, Mr. Penney, you state that 
there is no single hybrid truck designer system that will meet 
all of our transportation needs. And I guess my question I 
would like to ask of all five of you in the remainder of the 
five minutes that I have is, are five separate grants enough to 
be able to have a specific technology developed so that one of 
these technologies would end up being suitable for the various 
types of trucks that are on the road?
    And since you brought the issue up, Mr. Penney, you can go 
first.
    Mr. Penney. Thank you. You know, if you break down trucks 
into various vocations as the class system tries to do, as I 
mentioned, each class, each vocation needs a different duty 
cycle, just establishing and identifying and understanding that 
duty cycle is very difficult. And there probably are more, 
circling more than five. I think we identified maybe a dozen 
vocations which you would have to focus in on.
    Mr. Sensenbrenner. Okay. That is asking a little too much, 
and the Sensenbrenner rule of legislation is he who sticks 
snout in trough too far runs risk of getting head chopped off. 
So I guess that the competitiveness in the five grants is 
probably necessary.
    How about you, Mr. Smith?
    Mr. Smith. Yeah. I guess I would say that, you know, is 
five the right number? I guess I am not sure. I think really 
what we need to look at is identifying the most likely paths to 
success or the areas where we are furthest behind or we have 
the largest challenges.
    Mr. Sensenbrenner. But doesn't the competitive nature that 
is contained in the bill take care of that?
    Mr. Smith. I guess I am not sure. I need to review it a 
little bit further so that I could comment on that.
    Mr. Sensenbrenner. Competitive grants work very well. Most 
of the scientific grants that the Federal Government hands out, 
whether it is in basic science or biomedical research.
    Mr. Dalum.
    Mr. Dalum. I think it is an excellent start. The five 
grants in my opinion would allow a variety of different 
applications to be submitted, and I am talking about 
technologies that might be, as discussed here, for delivery 
trucks, utility trucks. There are other applications I think 
that could be submitted that could benefit from plug-in hybrid 
technology, and those could also be part of that. So I think it 
is a very good start.
    Mr. Sensenbrenner. Ms. Egbert.
    Ms. Egbert. I would agree. I think it is a very good start 
as well. To start to get some of these technologies on the road 
and putting them into real world applications I think will 
bring us a long way.
    Mr. Sensenbrenner. Mr. Parish.
    Mr. Parish. Well, from CALSTART's perspective I think we 
would prefer to see a more general type of a funding activity 
in looking at medium- and heavy-duty hybrids specifically or 
generally improving that general technology with plug-ins being 
a subset of that general technology. So we feel that there is 
development work that needs to be done, but if we focus 
strictly on the plug-in aspect, that will just look at a very 
limited portion of the whole spectrum of the activity that 
needs to be approached.
    So, you know, our feeling is that we would really like to 
see something more generalized than specifically plug-in.
    Mr. Sensenbrenner. Thank you. My time is expired.
    Chairman Lampson. I yield myself as Chairman five minutes, 
and I yield to Mr. Sensenbrenner for him to continue his 
questioning if you would like, Mr. Sensenbrenner.
    Mr. Sensenbrenner. No. I am done.

                  Hybridizing Off-road Work Equipment

    Chairman Lampson. All done? Thank you very much. Then I 
will, then let me ask any of you who would care to or all of 
you if you want, are you aware of work being done to hybridize 
other sectors such as heavy off-road work equipment, stationary 
power sources or other applications?
    Mr. Parish.
    Mr. Parish. Yes. As a matter of fact, CALSTART has just 
initiated a working group focused on commercial construction 
equipment. That is also being sponsored by the U.S. National 
Automotive Center, U.S. Army National Automotive Center, 
because they are very interested in seeing obviously a fuel use 
by their construction equipment being reduced.
    So what we have done is started some activity in bringing 
together the industry and the manufacturers, as well as the 
users of this off-road equipment to see if we can stimulate 
some additional activity in hybridization. We have already seen 
Volvo initiate a front-end wheeled loader that is hybridized, 
and we expect other, particularly U.S. manufacturers start to 
enter that as well. John Deere as well as Caterpillar have both 
expressed a great interest in off-road equipment hybridization.
    Chairman Lampson. The Port of Long Beach, I understand, has 
demonstration hybrid tugboats.
    Mr. Sensenbrenner. Yes, and they also are hybridizing the 
crane lifts for the containers. So we see hybridization 
starting to enter in a variety of different modes.
    Chairman Lampson. The primary thing that we are going to 
have to accomplish to facilitate all of that is going to be the 
battery.
    Mr. Parish. The battery.
    Chairman Lampson. The link to the battery.
    Mr. Parish. And the auxiliary systems. You know, we can't 
just look at one aspect as Mr. Penney pointed out. If you look 
at just one component of the system, then you may not get the 
full story. You really need to look at the whole system affects 
and look at the variety of different things that are feeding 
into that system operation. So it is not only the battery but 
it is an optimized engine that operates on the hybrid system.
    Right now the engines tend to be a little bit too large for 
the systems they are actually running, so you have to optimize 
those a little bit better, plus the control. And then also the 
electrical auxiliaries. If you could get electrical auxiliary 
systems or hydraulically operated auxiliary systems, then that 
would improve even more the efficiency gains.
    Chairman Lampson. How long away are we from looking right 
now, and what is it going to take for us for this function of 
money that we have to throw at this to get faster results, get 
our in-gain more quickly?
    Mr. Parish. Well, I think so. I think the first vehicles we 
have seen out there by Eaton and International, which PG&E is 
using and a variety of other utilities are using, have shown 
the benefit of the hybridization.
    However, in order for the next generation to come out, you 
know, we saw the first generation of Priuses back in '98, and 
then when we saw the second generation of Priuses, which really 
mushroomed because of the improvements in the design, we expect 
to see something similar in the medium- and heavy-duty truck 
category, where this first iteration that has come out, you 
know, that it is a great improvement over the conventional 
vehicle; however, there needs to be a second iteration, and in 
order to accomplish that second iteration, there has to be 
significant improvement in a variety of different technologies.
    Chairman Lampson. And industry is just not willing or 
capable to do enough of that by themselves without government 
help?
    Mr. Parish. I think they have seen a downturn in their 
sales they did last year as a result of the pre-buy for the 
2007 emissions regulations. They are going to see another big 
pre-buy for 2010 emissions regulations. So right now they are 
currently in a very low slump. I think this last year they were 
in a very low slump in sales, and so as a result of that they 
were probably unable to spend the dollars that they wanted on 
research for hybridization, and now they are also spending 
quite a few dollars on getting ready for the 2010, emissions 
regulations.
    So, you know, that is what we are seeing is they are, 
rightly they are focused on trying to improve their products 
for the emissions regulations, but because of that they don't 
have adequate funding, I feel, to do the research necessary to 
bring hybrids along.
    Chairman Lampson. I would like to pursue that some more but 
let me switch.
    Just looking at the extensive membership list of CALSTART, 
it would seem that the industry efforts are fairly well 
integrated when it comes to new technologies. How integrated is 
the heavy-truck industry compared to that for passenger 
vehicles, and how is it different?
    Mr. Smith. If I could comment, I think there is a fairly 
significant difference, because if you look at the passenger 
car industry, it is mainly vertically integrated. There is, you 
know, a high level of oversight, design responsibility, 
integration responsibility that is all maintained within the 
companies, the Fords, the Toyotas, you know, whoever it is.
    In the medium-duty, heavy-duty market it is quite a bit 
different, where I think there is a view that they are buying 
components that go on the system. They are buying a 
transmission or a hybrid system that needs to integrate within 
the existing chassis with as little disruption to the chassis 
as possible. And I think the systems you see out there, I know 
the Eaton system we intentionally try to make it as non-
obtrusive to the engine and the chassis as possible.
    So there is some real challenges there because of the lack 
of, you know, heavy integration or high level of integration in 
the vehicle.
    Mr. Dalum. I would like to add that the vehicles that we 
are discussing are really, at least in the case of the utility 
truck, are built in multiple stages, and what that means is 
that an Eaton here may provide componentry to International, 
Ford, GM, or another chassis manufacturer. That chassis is then 
provided to another company. That company buys that and 
integrates their equipment on top of the chassis and finishes 
the manufacturing process and then brings it to market.
    So unlike some other passenger cars, you have got various 
entities along the whole development chain here in going to 
market. So it is not as integrated as a passenger car.
    Chairman Lampson. Mr. Parish.
    Mr. Parish. Yes. One more additional comment. What we found 
when we put the International Eaton bucket trucks out, those 
were the first hybrid trucks that were really on the road for 
commercial use. We found that there was some discord between 
the providers as was identified, International, Eaton, and the 
actual arm manufacturer in terms of who was responsible for 
what if there was a problem.
    So unlike in a light-duty vehicle, a Ford or a Chevrolet, 
where they are totally responsible for the vehicle, then 
because of the integration issues with a truck, it becomes then 
necessary to work out who is responsible for the operation of 
the different aspects of the vehicle.
    So this is one area where some, you know, further 
development activity needs to go on in terms to make everybody 
comfortable with the product that they are offering and in 
terms of establishing who has ultimate responsibility.
    Chairman Lampson. Thank you very much.
    Mr. Inglis, you are recognized for five minutes.

         More on Scientific and Economic Barriers to Deployment

    Mr. Inglis. Thank you, Mr. Chairman.
    You know, when it comes to basic science, grants seem to 
make a lot of sense. National Science Foundation, for example, 
does basic science, and there are no commercialization 
opportunities immediately apparent in a lot of that basic 
science, and therefore, the government makes it happen by 
grants.
    When it comes to applied technology like we are discussing 
here, I sort of break out in hives at the mention of grants, 
because that means grant writers and grant readers, it means 
regulations and regulators, it means an awful lot of productive 
energy being spent pursuing just a little tad of money.
    It seems there are some other ways to get there more 
quickly. One of them is tax credits, which if you think about 
it, is a very efficient way to deliver a stimulus because then 
you don't have writers and readers and regulators and 
regulations.
    But I wonder really what we are talking about here is 
mostly getting to the place where the incumbent technology is 
recognized for all the filth that it is. And if you do that, 
then suddenly everything else becomes more attractive, and then 
you have this incredible rush of creativity and innovation and 
jobs being created as we go out to take on that incumbent 
technology, which, by the way, is fueled by some people who 
don't like us very much.
    And so I just wondered whether anybody sees it that way or 
if you want to make a spirited defense of a grant kind of 
system for applied technologies. I remember opposing in this 
committee, I didn't want to because I like her very much, but 
Ms. Giffords had a bill involving the installation of solar 
panels, training people to install solar panels, and the, I 
opposed that, and I lost on a vote about 20 to three or 
something.
    But it is the application of this principle. Do you really 
want to do applied work through grants, or do you want to use a 
more efficient way of getting the market to respond?
    Mr. Parish, do you want to respond to that?
    Mr. Parish. Yes. And typically what we see, and I agree 
with in that we need to identify what the real value of 
externalities are, because I think that would indeed help these 
alternative strategies become more viable. If we could monetize 
those externalities that would make it even more viable.
    However, what we see in the typical development cycle or 
R&D cycle for new technologies is that the government funds the 
front end R&D activity to get the basic science, to develop the 
technology, and that funding starts dropping off until it hits 
a valley of death basically. So the industry is sitting there 
with a technology they don't have the funds to bring that 
technology to market, and so that is one of the things that 
Hybrid Truck Users Forum does is tries to aggregate the pull, 
the demand for that particular technology to get it out of the 
OEM and get it on the road.
    Now, we couldn't have done that without the support of the 
U.S. Army National Automotive Center, which provided us funding 
to not only run the working groups but also to provide some up-
front buy-down funding. And what we have also learned, so we 
feel that the government participation in trying to bridge that 
chasm is very important because without that government funding 
to help bridge that chasm, the technology could very well just 
disappear and not be incorporated at all.
    Mr. Inglis. And we are here not talking about, it is not a 
question of basic science here. Right? If we were talking the 
batteries and better battery efficiencies and things like that, 
that would be more basic science. As it is what we are talking 
about is the application of that to particular uses, right, in 
issues like warranties which Mr. Penney, I think, mentioned. As 
I understand it, in the case of the Volt, that is a real issue 
is the pricing of the Volt will be affected by the warranty 
that they have got to issue.
    And so working that out, I mean, just really became more of 
the nature of economics and risk kind of allocation rather than 
science. The science of better batteries might really change a 
lot of what we are talking about. Right?
    Mr. Parish. Right. There is a considerable amount of money 
being spent by the Department of Energy through the Department 
of Energy on battery development, but it is particularly 
focused on light-duty batteries. We feel that demonstration 
programs are a very important aspect of this activity, and the 
government has been involved in light-duty fuel cell 
demonstration programs in particular, and we feel like this is 
also necessary for the medium- and heavy-duty sector as well.
    So it is really a three-pronged approach that we would like 
to propose is research and development, which talks about the 
science, what is really necessary to bring these advanced 
components into being. Number two is demonstration programs so 
we can actually get the vehicles on the road and get people 
interested in seeing how they operate and seeing how they 
actually operate in service, and then number three, incentives 
to make the purchase. And what we found from the 2005 Energy 
Bill is that tax incentives do work for some segments, but not 
all segments. What we have seen is that for those who cannot 
take advantage of the tax incentives, they were able to be 
taken by the seller of the vehicle, however, that savings was 
not passed along to the buyer of the vehicle. So it didn't 
fulfill the role it was needed to at that point in time.
    So we would like to see something that would be more of a 
rebate or something along the lines that would make sure that 
the end-buyer, the end-user did, in fact, see the reduction in 
the cost.
    Mr. Inglis. Thank you, Mr. Chairman.
    Chairman Lampson. Ms. Biggert, you are recognized for five 
minutes.

                 Role for the DOE National Laboratories

    Ms. Biggert. Thank you, Mr. Chairman. I am concerned that 
we do need, that there is still basic research that needs to be 
done, and we haven't completed that, and that is, I am 
concerned with a question that I asked Mr. Penney before. And 
still is what is preventing the DOE and the Department of 
Defense from collaborating, and I think that the public and the 
private sector would benefit from a collaborative R&D effort.
    But my next question then is, is there a role for 
universities and national labs to play in the competitive grant 
program created by the Sensenbrenner bill, maybe as research 
partners, and as I look at the bill, it talks about the five 
grants, and then it talks about partners, which include other 
entities including manufacturers and electric utility 
companies. But I think that there certainly is a role for the 
labs and for the universities, which really the grant program 
would then pull the technology out of the labs and get the 
technologies into the marketplace if we were to look at that.
    I would like, if anybody would like to respond to that.
    Mr. Penney. Certainly. As Mr. Inglis pointed out, you know, 
we need to work together, but at the same time I don't want to 
waste my energy writing proposals for Eaton to send its 
proposal to get a thing, and then someone else comes to me, and 
I want our staff and our capability to be available to 
everybody, and I don't want to waste the energy and the money 
to have to use our staff writing proposals through competitive 
grants. Personally. For the lab point of view. We like to make 
ourselves available to all companies, and it is an open source, 
open knowledge, education, and work through a competitive 
process, through non-disclosures, et cetera.
    Ms. Biggert. I don't think I was thinking of the lab as 
actually writing the grants or anything. It would be still 
the--but to be maybe a research partner that they would work 
with.
    Mr. Penney. Right, but there has to be a flow of money, and 
part of the disincentive for Eaton, most of these grants or 
most of the programs are cost-shared, 50 percent cost-shared. 
We can't cost share. We can't use government money to, you 
know, cost share government money funding. So as a result it 
puts a burden, an extra burden on an Eaton or an International 
or a truck company to work with us or select us because they 
have to come up with our cost share. So that disincentive needs 
to be taken away.
    Ms. Biggert. Mr. Dalum.
    Mr. Dalum. Yes. In my opinion the universities and national 
labs can play a role in this. I am talking about testing, 
modeling, other types of activities that could help promote and 
improve the technology.
    Ms. Biggert. I know that Argonne Lab does have the Freedom 
Car that they do the testing for a lot.
    Mr. Dalum. Right. And there are other universities I am 
aware of in Wisconsin that are working the hydraulics and other 
technologies that could be applied perhaps with research into 
this application.
    Ms. Biggert. Would anybody like to comment on the 
coordination between the DOE and DOD?
    Mr. Parish.
    Mr. Parish. Yes. I think that has been attempted in 21st 
century truck and I think as I had stated previously, the 
vision of that particular activity was very good, and I think 
it was a good forum by which there could have been a greater 
amount of interaction.
    However, in actual practice it didn't turn out quite that 
way, but I think that given another try at it, you know, there 
is a possibility that we could make that happen. I think 
perhaps with more visionary leadership and stronger leadership 
for the 21 CT that would, in fact, happen.
    Plus, if we had some real funding that the--a consortium 
could work with to start identifying what real projects were 
viable, do some competitive grants for different aspects of the 
program, I think that would be very worthwhile. You could have 
different agencies looking at different aspects of the whole 
problem.
    Ms. Biggert. Thank you. I yield back.
    Chairman Lampson. I want to thank everyone for taking the 
time to appear before us today, this committee.
    Under the rules of the Committee, the record will be held 
open for two weeks for Members to submit additional statements 
and any additional questions that they might have for the 
witnesses.
    This hearing is now adjourned. Thank you.
    [Whereupon, at 11:37 a.m., the Subcommittee was adjourned.]



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