[Senate Hearing 114-370]
[From the U.S. Government Publishing Office]
S. Hrg. 114-370
THE STATUS OF INNOVATIVE TECHNOLOGIES WITHIN THE AUTOMOTIVE INDUSTRY
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HEARING
BEFORE THE
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED FOURTEENTH CONGRESS
FIRST SESSION
__________
JANUARY 21, 2016
__________
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COMMITTEE ON ENERGY AND NATURAL RESOURCES
LISA MURKOWSKI, Alaska, Chairman
JOHN BARRASSO, Wyoming MARIA CANTWELL, Washington
JAMES E. RISCH, Idaho RON WYDEN, Oregon
MIKE LEE, Utah BERNARD SANDERS, Vermont
JEFF FLAKE, Arizona DEBBIE STABENOW, Michigan
STEVE DAINES, Montana AL FRANKEN, Minnesota
BILL CASSIDY, Louisiana JOE MANCHIN III, West Virginia
CORY GARDNER, Colorado MARTIN HEINRICH, New Mexico
ROB PORTMAN, Ohio MAZIE K. HIRONO, Hawaii
JOHN HOEVEN, North Dakota ANGUS S. KING, JR., Maine
LAMAR ALEXANDER, Tennessee ELIZABETH WARREN, Massachusetts
SHELLY MOORE CAPITO, West Virginia
COLIN HAYES, Staff Director
PATRICK J. McCORMICK III, Chief Counsel
CHESTER CARSON, Professional Staff Member
ANGELA BECKER-DIPPMANN, Democratic Staff Director
SAM E. FOWLER, Democratic Chief Counsel
NICK SUTTER, Democratic Professional Staff Member
C O N T E N T S
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OPENING STATEMENTS
Page
Murkowski, Hon. Lisa, Chairman, and a U.S. Senator of Alaska..... 1
Cantwell, Hon. Maria, Ranking Member, and a U.S. Senator from
Washington..................................................... 2
WITNESS
Friedman, David, Principal Deputy Assistant Secretary, Office of
Energy Efficiency and Renewable Energy, U.S. Department of
Energy......................................................... 5
Bainwol, Mitch, President and CEO, The Alliance of Automobile
Manufacturers.................................................. 17
Cullen, Genevieve, President, Electric Drive Transportation
Association.................................................... 35
Gearhart, Dr. Chris, Director, Transportation and Hydrogen
Systems Center, National Renewable Energy Laboratory........... 41
Mosquet, Xavier, Senior Partner and Managing Director, The Boston
Consulting Group............................................... 51
ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED
American Chemistry Council
Statement for the Record..................................... 91
Association of Global Automakers, Inc
Statement for the Record..................................... 94
Bainwol, Mitch
Opening Statement............................................ 17
Slide Presentation........................................... 18
Written Testimony............................................ 29
Cantwell, Hon. Maria
Opening Statement............................................ 2
Cullen, Genevieve
Opening Statement............................................ 35
Written Testimony............................................ 37
Responses to Questions for the Record........................ 86
Friedman, David
Opening Statement............................................ 5
Written Testimony............................................ 7
Responses to Questions for the Record........................ 80
Fuel Cell & Hydrogen Energy Association
Statement for the Record..................................... 98
Gearhart, Dr. Chris
Opening Statement............................................ 41
Written Testimony............................................ 43
Responses to Questions for the Record........................ 89
Mosquet, Xavier
Opening Statement............................................ 51
Written Testimony............................................ 53
Murkowski, Hon. Lisa
Opening Statement............................................ 1
THE STATUS OF INNOVATIVE TECHNOLOGIES WITHIN THE AUTOMOTIVE INDUSTRY
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THURSDAY, JANUARY 21, 2016
U.S. Senate Committee on Energy and Natural
Resources
Washington, DC.
The Committee met, pursuant to notice, at 9:49 a.m. in Room
SD-366, Dirksen Senate Office Building, Hon. Lisa Murkowski,
Chairman of the Committee, presiding.
OPENING STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM
ALASKA
The Chairman. Good morning. We will call to order the
Senate Energy and Natural Resources Committee.
This morning we have a hearing on the status of innovative
technologies within the automotive industry. The good news for
me is I do not have to drive a lot here in Washington, DC, but
I know there were a lot of people out on the roads yesterday.
They were wondering what the new advances are in automotive
technology and industry and how they were going to handle the
snow.
We timed this hearing deliberately not just to occur with
when we are starting with our bipartisan energy bill, which we
are looking to take up at the first of next week on the Senate
floor, but we are also here this morning because the Washington
Auto Show is commencing. That show kicks off tomorrow. While
there is no substitute for going in person, we do have the CEO
of the Alliance of Automobile Manufacturers here, Mr. Bainwol.
He is here to share his thoughts. So welcome to the Committee
this morning.
It is not just the auto show that makes this hearing
timely. Auto sales in the U.S. hit an all-time high in 2015
with 17.5 million cars and trucks sold. This banner year was
spurred in part by low gas prices. As we heard earlier this
week, those prices are projected to remain low throughout the
year. Vehicle sales have also been boosted by the tremendous
innovation taking place in the auto industry right now, and I
think that is a story that deserves more attention.
We have seen dozens of alternative fuel models emerge from
electric vehicles like the Tesla Model S to the fuel cell-
powered Toyota Mirai to a Ford F-150 that can run on compressed
natural gas and propane. At the same time, we have seen
exciting developments in everything from safety technology to
self-driving cars which may offer their own energy and
environmental benefits.
I see today's hearing as an opportunity for us to learn
more about significant innovation taking place within the auto
industry, particularly as it relates to alternative fuels and
lightweight materials which are at the heart of the Department
of Energy's research activities and of this Committee's
jurisdiction.
This is a look down the road, if you will. It is a chance
for us to hear about the technologies that are emerging, to
gauge how they might affect our energy and mineral needs and to
understand the challenges that need to be overcome.
This hearing is also a chance for us to recognize that the
auto industry is facing heavy regulations right now,
particularly when it comes to fuel efficiency. While those
particular regulations are not within this Committee's
jurisdiction, they do have an impact on our nation's fuel
consumption and are worth monitoring as we modernize our energy
policies.
Another goal for this hearing is to examine whether Federal
programs meant to support innovation are working as intended
and whether they are properly oriented to help our auto
industry innovate, compete and thrive.
That brings us to the work that the DOE is doing through
its Vehicle Technologies Office and at the national labs. I
have consistently advocated technology neutral policies for the
automotive sector instead of picking one favorite technology
and plowing most or all of our limited Federal research dollars
into it. I am convinced that the better path is to support
research in a wider range of possible winners and to let the
markets and the consumers determine which is best.
Here in this Committee I think we are on a good track. As a
result of our commitment to work together, our bipartisan
energy bill includes several provisions to boost innovation
within the automotive industry, including a modified version of
the Vehicle Innovation Act which was sponsored by Senators
Peters, Alexander, and Stabenow. It will provide the Department
of Energy with a structured authority and clear direction for
its research mission.
Our energy bill is bipartisan. We worked hard to make sure
of that, and I think we can make sure that our vehicle
innovation policies are bipartisan too.
I am looking forward to what the witnesses will have to
offer this morning.
We will turn to Senator Cantwell.
We do have a vote scheduled at 10:30 this morning and I
know that the panel needs to leave by 11:30, so we will be
expeditious here this morning.
Senator Cantwell?
STATEMENT OF HON. MARIA CANTWELL, U.S. SENATOR FROM WASHINGTON
Senator Cantwell. Thank you, Madam Chairman, for holding
this important hearing.
Vehicles affect almost all Americans. Today's hearing is a
way to talk about new vehicle technologies, so I am interested
in hearing from our panelists about the changes that we are
seeing in the transportation sector.
The U.S. auto industry has come back during the last seven
years and it sold a record number of vehicles last year, but
there is still a lot of work to be done.
American vehicles are still very dependent on oil. In fact,
transportation is responsible for 70 percent of U.S. petroleum
usage and nearly 30 percent of greenhouse gas emissions. So
while we have significantly reduced the use of oil in our
electricity generation and home heating, we now need to sharpen
our focus on the transportation sector.
This is why the Department of Energy has had a long
standing relationship with the automotive industry to develop
and deploy new and next generation research. The Vehicle
Technologies Office works with light duty automobiles as well
as commercial trucks to conduct research to improve fuel
efficiency standards and on light weight composites, batteries,
and materials. I should just say, as a side note, light weight
composites have definitely driven great transformation in the
aerospace industry and provided great benefits.
The bipartisan energy legislation we passed out of
Committee last year builds on the success in part of work done
by members of this Committee. Senators Stabenow, Alexander, and
Peters (not on this Committee) authored legislation that
reauthorizes the Vehicle Technology Office at the Department of
Energy and directs focus on new vehicle technologies. I am
looking forward to working with the Department on these key
programs and exploring the ways in which these partnerships
will help make additional modes of transportation more
efficient.
As the price of gas continues to drop, in some areas even
below $2, consumers are looking and returning to larger
vehicles and SUVs. According to the University of Michigan's
Transportation Research Institute, the average fuel economy of
all vehicles sold in the U.S. in 2015 were less fuel efficient
compared to the vehicles sold in 2014. This is the first time
since 2008 that the average fuel economy of cars sold has
dropped.
But the oil market can be volatile, and we need to remember
this. As we heard from our panel on Tuesday, there will be a
correction. So increasing the fuel efficiency of U.S. vehicles
is one of the biggest steps we can take to save families more
money by reducing the cost and helping to reduce emissions. In
addition, there are promising new technologies today in
alternative fuels, advanced safety features, and light weight
composites. Making the right investments can help bring these
to larger scale in the market.
In the State of Washington, the Pacific Northwest National
Laboratories (PNNL) has partnered with the industry for decades
on technologies for cleaner and more fuel efficient vehicles.
Researchers have focused on incorporating more aluminum into
auto manufacturing to make lighter vehicles. Again, just to go
back to aviation, there is huge fuel efficiency savings in
aviation. The customers are very happy with those lighter
weight planes and the savings that they get.
So the technology from PNNL is being used in vehicles on
the road today including the Cadillac STS and the Chevy Malibu
Maxx. In addition, the Pacific Northwest National Lab is
working on game changing technology using catalysts to produce
fuels from plant matter that could change the future of our
nation's energy economy. This is important work to help us
diversify our sources of fuel and hedge against volatile energy
markets for the future, but improving efficiency is also
brought about by focusing on our freight network. Each year
three billion gallons of fuel is wasted due to congestion and
businesses across the country pay the price which is estimated
at $27 billion a year in added transportation costs. So as our
export economy continues to grow and as we produce great
products, we have to get them to market so that is why,
particularly, the super truck program is very important. I know
my colleague from Michigan is here, and she has been a leader
on helping on this in order to achieve more fuel efficiency.
Meanwhile electrification of our transportation sector
provides important benefits, and an electric vehicle can save a
consumer up to $1,200 a year in fuel prices and it could reduce
emissions by 48 percent compared to a gasoline-fueled car. The
Department of Energy has partnered with industry to help drive
down the cost of electric car batteries and improve
performance. In 2008 the average battery pack was more than
$1,000 per kilowatt. Today it is estimated to be less than
$300. This means vehicles can travel further and with better
performance.
But we need to continue to ensure that we are focusing on
these next generation technologies. There are currently only
900 public fast charging stations and 14 hydrogen refueling
stations compared to almost 170,000 gas stations across the
United States of America.
I look forward to hearing from the witnesses today. How we
can continue to answer that part of this equation? And of
course, self-driving cars are an important aspect of the
discussion of the future of automobiles, and I look forward to
what our witnesses have to say on that.
Secretary Moniz and others have made a fine point to
continue the discussion on the public/private partnerships that
drive successful innovation efforts. I know this recent mission
innovation that the Secretary and others in the private sector,
like Bill Gates, are pioneering are an important aspect for us
doing our job here in making sure that we continue to have the
next generation of technology so the United States can continue
to be a leader in manufacturing cars.
Thank you.
The Chairman. Thank you, Senator Cantwell.
We will now turn to our panel. I would advise that each of
you will have five minutes for your oral testimony and your
full statements will be included as part of the record, but we
would ask you to try to observe that five-minute timeline so
that we can get to our questions of you.
We have a very distinguished panel this morning led off by
Mr. David Friedman, who is the Principal Deputy Assistant
Secretary for the Office of Energy Efficiency and Renewable
Energy at the Department of Energy. Thank you for joining us.
We have Mr. Mitch Bainwol, who I just mentioned, who is the
President and CEO of the Alliance of Automobile Manufacturers.
You are busy this time of year.
Ms. Genevieve Cullen is the President of Electric Drive
Transportation Association. Welcome to the Committee.
Dr. Chris Gearhart is the Director of Transportation and
Hydrogen Systems Center at the National Renewable Energy Lab.
Welcome.
The final member of the panel this morning is Mr. Xavier
Mosquet, who is the Senior Partner and Managing Director for
the Boston Consulting Group.
So welcome to each of you.
Mr. Friedman, if you would like to lead off, please?
STATEMENT OF DAVID FRIEDMAN, PRINCIPAL DEPUTY ASSISTANT
SECRETARY, OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY,
U.S. DEPARTMENT OF ENERGY
Mr. Friedman. Well thank you, Chairman Murkowski, Ranking
Member Cantwell and all the members of the Committee, for the
opportunity to be able to testify today on behalf of the
Department of Energy's Office of Energy Efficiency and
Renewable Energy.
If we look at the world today our national imperative is
clear. We must win the clean energy race. And when we do that
we will capture a significant share of the multi trillion-
dollar global clean energy market and the jobs, the energy
security and the other opportunities that will be created along
the way.
As Principal Deputy Assistant Secretary at the Department
of Energy's EERE, I help manage a broad portfolio of solutions
comprised of high impact applied research, development and
demonstration activities to deliver on our mission through
renewable power, energy efficiency and of course, our focus
today, sustainable transportation.
As we heard earlier transportation accounts for more than
70 percent of U.S. petroleum usage, about one-fifth of
household expenditures and nearly one third of U.S. energy-
related carbon emissions. It also remains a significant source
of other air pollutants that are harming our children and their
grandparents.
Our transportation program focuses on two key solutions to
these challenges. First, using less energy to move people and
freight. Second, fueling vehicles with cost competitive,
domestically produced, alternative fuels with lower greenhouse
gas emissions.
Through our work at the National Renewable Energy Lab and
with our other national lab partners, private sector partners
and other key stakeholders, we've helped deliver significant
results through technologies that are on the market today. In
fact, each dollar we've invested in heavy duty vehicle
combustion technology has delivered about $70 in net benefits
for taxpayers, a 70 to 1 ratio.
Our super truck program has shown the potential to cut the
fuel use of low haul trucks by one third to one half and some
of the air dynamic and tire technologies from that program are
already making their way into the market.
Then the batteries from the Chevy Bolt, Volt, Spark, the
Cadillac ELR and the Ford Focus plug in electric vehicles all
tap into industry licensed technology developed at Argonne
National Labs.
EERE backed research has also helped increase fuel cell
durability four fold while cutting projected high volume costs
in half since 2006.
And thanks, in part to research and memory electrode
assembly technology developed at Los Alamos National Labs, two
companies today are selling or leasing fuel cell vehicles with
another one to enter the market this year and others soon to
follow.
Now while we're proud of how far we've come, there's a lot
more to do. As President Obama and other world leaders affirmed
at the launch of the Mission Innovation Initiative in November,
solving our energy and climate challenges will require
significantly accelerated development and innovation of new
technologies. And while we continue to lead the world on
innovation and entrepreneurship, we've historically
underinvested in clean energy. In fact, compared to the size of
our economies, we invest about one third as much on clean
energy research and development as competitors like China and
Japan.
As we try to reverse this trend we will continue our
electric and heavy duty vehicle work. We will also invest in
other important areas like the co-optimization of new fuels and
engines to boost efficiency and renewable fuel use through work
at NREL and other national labs through cross cutting R and D
efforts to develop advanced high strength materials to reduce
cost, improve performance and enhance manufacturing processes
for automotive use, such as the ongoing work mentioned before
at Pacific Northwest National Labs, as well as composites work
there and at Oak Ridge National Labs and across the country
through our Institute for Advanced Composites Manufacturing
Innovation.
Grid modernization is also important to fully integrate
plug in electric vehicles and fuel cells into the national grid
in a safe, secure, reliable and cost effective manner including
critical cyber security work at Idaho National and other
laboratories. And research and transportation mobility is also
critical in order to identify untapped, system level, energy
savings through connected and automated vehicles like those at
the Ann Arbor Connected Vehicle Test Program.
With programs like these and support from you and the
technologies you'll hear about from NREL and Dr. Gearhart, the
Department of Energy will continue to strive innovation within
the auto industry and into the vehicles on showroom floors and
highways across the United States.
I look forward to working with Congress and very much with
this Committee to further advance transportation technologies
to create new jobs in industries while saving consumers and
businesses money and helping to address our nation's energy and
climate challenges.
Thank you very much.
[The prepared statement of Mr. Friedman follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Mr. Friedman.
Mr. Bainwol, welcome.
STATEMENT OF MITCH BAINWOL, PRESIDENT AND CEO, THE ALLIANCE OF
AUTOMOBILE MANUFACTURERS
Mr. Bainwol. Thank you, Chairman Murkowski and members of
the Committee. I appreciate the chance to be here today on
behalf of 12 OEMs, the D3 and nine others from Europe and from
Japan.
Our guys and other OEMs are investing massively in R and D,
$109 billion last year, and that is 16 percent of the global R
and D spent. That's roughly four times our economic waste, so
we're prospering right now with sales and we're investing back
into R and D and that's paying real dividends.
As I got up this morning I looked at the weather and
realized I had to travel in 20 miles and tried to figure out
the best way to go. I turned on my NAV, and I took a path that
was different than any other I'd ever taken over the last 20
years of commuting from Fairfax. NAV directed me to Washington
in a fashion that was quicker, so I saved time, was more
productive, was cleaner and was more fuel efficient. That
struck me as kind of a metaphor for today. Technology is
bringing about a convergence of these social objectives. We
want mobility to be cleaner, we want it to be safer, we want it
to be more efficient, and that's exactly what we're doing here
today.
I thought I'd go through some slides rather than read a
statement, and if I can I'd do it fairly quickly and ask that
you be patient as I try to get through them.
[The information referred to follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The first one will take a bit of time. It is titled,``What
Type of Engine Will Your Next Vehicle Be?'' We do extensive
polling. We do about 5,000 samples of consumers a month,
literally every day 167 folks, and we ask them what kind of
power train their next vehicle will be. So this is
aspirational.
The good news here is, as you can see in May of '12 when we
started this, roughly 20 percent say they wanted to go to a
hybrid. A hybrid becomes a proxy for alternative power trains
for most folks. Roughly 60 percent said they wanted a gas
engine.
If you look at the line over the last three and a half
years, you see the hybrid number falling, drifting down and you
see the gas number rising. That's a little counterintuitive in
a world in which we're offering more models, more hybrid and
electric models, in showrooms.
What's going on is we've made progress with the ICE, with
the internal combustion engine, that is so profound that when a
consumer goes into a showroom they discover that there are new
cars getting roughly 25 percent more fuel efficiency than their
old car. The success of the conventional engine is it's making
it harder to justify the delta to the electric, and that's a
challenge for us where going electric is a worthy goal but
there is a market challenge there.
The next slide just speaks to the number of alternative
power train models there are for sale. You can see that in 2008
there were roughly 21, 22 models. That is now up close to 80,
and that's a combination of electric hybrid and plug ins.
The next slide shows the number of models achieving 30 plus
MPG and 40 plus MPG, and what you see there is really profound
success. This is part of the value of the investment. It's a
seven times increase in number of models. So the models are in
the showrooms. The opportunity to buy the more fuel efficient
vehicles are there. And on the conventional side, that is
making the choice to go to alternative power trains a little
bit more complicated.
Then you look at the sale of alternative power trains and
you can see that there's been a dip by 2015. It slowed down.
Part of that is gas prices and part of that is the success of
the conventional engine.
The next slide shows retail market share of hybrid and gas
prices, and it looks like synchronized swimming. What you have
is a direct linear relationship between gas prices and the sale
of hybrids.
A similar pattern with the sale of cars and trucks is the
next slide. And I'm moving quickly because I'm running out of
time. I want to spend a second on safety.
The slide titled,``Total 2014 Vehicle Related Fatalities''
shows that we lost 33,000 Americans on the road in 2014 which
is obviously an awful number that we're all working to drive
down. But I think it's worthwhile to point out that 97 percent
of those had nothing to do with the vehicle. It was human
error, and that's why technology is so important. Technology
can mitigate human error.
The next slide puts the fatality number into context.
That's a 65-year trend line. The vertical bars are the absolute
number of folks we've lost. And you can see in 2013-2014 it's
roughly where we were in 1949 but the vehicle miles traveled is
dramatically higher and the number of drivers is dramatically
higher. So the yellow line shows the progress we've achieved
which is a function both of less drunk driving, more folks
using belts and improved crash worthiness technology.
The next chapter of progress on fatalities will come from
the technology we're talking about here today, I would make
that point that I started with in terms of the NAV. All these
technologies are not about safety, they're not about green.
It's about maximizing all these social objectives.
There's a convergence. When you avoid a crash it is both
very green because there have been injection implications and
there's also very safe and it's very productive. So crash win
technologies, whether it's the advanced driver assist or
whether it's a fully autonomous vehicle, have a profound,
almost magical implication for the economy and for life. And so
we appreciate the focus on innovation today, and we just focus
on the convergence of these benefits.
I'd make one last point, if I could, and that is this last
slide shows the fundamental dilemma that we've got. This shows
a 25-year pattern. The blue line is year over year change in
household income, fundamentally flat. The salmon, I guess
that's a salmon-colored line, that rises is the price of the
auto which in part is being driven up by compliance
responsibilities. And the yellow line is interest rates, year
over year change in interest rates.
So in effect what we've done is we have financed the
ability to comply with more expensive vehicles based on
compliance by lower interest rates and with longer terms. And
as interest rates begin to rise we've got to be mindful of this
equation because it produces a challenge that may have jobs
implications in terms of the manufacture of vehicles but also
adoption implications in terms of turning over the fleet to
vehicles that are much more efficient.
And with that, I'd say, thank you.
[The prepared statement of Mr. Bainwol follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Mr. Bainwol, very interesting.
Ms. Cullen, welcome.
STATEMENT OF GENEVIEVE CULLEN, PRESIDENT, ELECTRIC DRIVE
TRANSPORTATION ASSOCIATION
Ms. Cullen. Good morning, Chairman Murkowski, members of
the Committee. I'm Genevieve Cullen, President of the Electric
Drive Transportation Association, and I'm very pleased to be
here today to speak to you about the advances being made in
electric drive.
The Electric Drive Transportation Association is a cross
industry trade association. Our members include the entire
electric drive value chain that is developing, manufacturing
and deploying vehicles and infrastructure of an electric drive
fleet. Today electric drive is performing in light duty cars,
trucks, buses and mobile equipment offering clean, high
performing, affordable and efficient alternatives to oil.
Innovation throughout the industry value chain is providing
consumers with even wider vehicle options with enhanced
performance and at reduced costs. These advances are also
accelerating transformational changes in mobility overall by
connecting the power, transportation and communication sectors.
Since the commercial scale introduction of plug in vehicles
in late 2010, this segment has grown exponentially from two
vehicles to almost 40 battery and plug in hybrid vehicles for
sale today are planned for roll out in the next model year.
These vehicles include offerings across a range of price
points, performance profiles and vehicle categories from
economy to luxury with all electric ranges from 11 to 280
miles.
Total U.S. sales of plug in vehicles surpassed $400,000 in
2015, and global sales are expected to triple to $179 billion
in 2024.
The diversity of the electric drive market is set to grow
further with the addition of fuel cell electric vehicles which
can offer approximately 300 miles of range and refueling in
three to five minutes.
Over the past few weeks at auto and consumer electronic
shows auto makers have showcased a large array of electric
drive vehicles including a mid-priced battery electric vehicle
with a 200-mile range and fast charge capability, a luxury plug
in hybrid, a fuel cell electric crossover, a battery electric
microbus and a plug in hybrid minivan. This is just a sampling
of the headline catching vehicles but it illustrates the
diversity of electric drive offerings and the diversity of
customer needs they are designed to meet.
Behind the vehicles are innovations and investments
throughout the supply chain that are enhancing performance and
reducing the cost of batteries, fuel cells, components and
materials.
A notable example is the reduction in the cost of lithium
ion batteries which Senator Cantwell mentioned and as well as
the reduction in automotive fuel cell costs in part from the
private sector collaboration with the Department of Energy
which has brought down those costs by more than 35 percent
since 2008.
Innovation in electric drive extends beyond vehicles.
Collaborations are occurring across the industry to drive down
ecosystem costs and build out infrastructure.
Utilities are creating new business models with smarter
demand management mechanisms to serve this mobile load and
maximize the benefit of energy storage to the grid and to their
customers.
Vehicle battery and energy companies are partnering to
scale battery production and diversity energy storage options
at the home and commercial scale.
Use of new and post automotive batteries for stationary
storage gives energy consumers greater control of their energy
choices, enhances grid stability and efficiency and in sports,
the increased use of renewable and distributed energy.
At the same time vehicle charging facilities have also
expanded greatly. There are a reported 12,000 public charging
stations in the United States with 30,000 charging outlets.
These numbers do not include private, residential and the fast
growing number of workplace charging options available. Just as
quickly business models are emerging to leverage hardware and
software capabilities for diverse charging needs and locations.
Vehicle and phone-based applications as well as increased
operability between charging facilities are making it easier
for drivers to evaluate charging options and increase their
electric miles traveled.
Hydrogen infrastructure is emerging along with last market
fuel cell electric vehicles. In California nearly 70 stations
are scheduled to open in the next few years. Public/private
collaborations are moving forward to expand that number in
California and other states.
Electric drive transportation is also reinforcing the
autonomy of the in vehicles. While the continuum of the
autonomous technologies being built into vehicles today, it's
not exclusive to electric drive. Electric drives, in many ways,
is the optimal partner as high visibility prototypes on the
road today demonstrate.
Watching my clock, so I will wrap this up.
To summarize I will say that we are making great strides,
but we are still an emerging market and we're pushing to
deliver enhanced performance at reduced cost. Public/private
partnerships throughout the value chain from technology to
infrastructure build out are critical to speeding those
innovations.
And we very much appreciate this Committee's recognition of
that important work in S. 2012 supporting research, development
and deployment work in cars and trucks at the Department of
Energy.
Again, I thank you for the opportunity to speak with you
today, and I look forward to your questions.
[The prepared statement of Ms. Cullen follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Ms. Cullen.
Dr. Gearhart, welcome.
STATEMENT OF DR. CHRIS GEARHART, DIRECTOR, TRANSPORTATION AND
HYDROGEN SYSTEMS CENTER, NATIONAL RENEWABLE ENERGY LABORATORY
Dr. Gearhart. Chairman Murkowski and members of the
Committee, thank you for the opportunity to speak today. I'm
Chris Gearhart, Director of Transportation and Hydrogen Systems
Research at the National Renewable Energy lab. Prior to coming
to NREL I worked at Ford Motor Company for 16 years on, among
other things, hydrogen fuel cell vehicles.
Innovation has always been an important part of the
automotive industry, but today the rate of change is faster
than ever. There are technologies on the horizon that promise a
future with cars that don't crash, that don't damage the
environment and they create new business opportunities we
couldn't have imagined just a few years ago.
The Department of Energy and the national labs are working
on technologies to help make this future a reality. And today
I'd like to talk to you about just a few of the many ways the
national labs are helping the automotive industry meet these
goals while continuing to be the engine of our economy.
Connected and autonomated vehicles are all over the news.
They're generally presented in the context of safety and
convenience but they're also going to have a very big impact on
energy and emissions. A group of researchers at NREL and at
other national labs are starting to quantify these impacts.
One example of such research in this area is NREL's
connected traveler project. This is an ARPA-E funded project
with the goal to develop algorithms to understand a traveler's
preference so that tailored recommendations and incentives can
be provided to the individual traveler using real time data so
they can make better transportation decisions. From this and
other projects it's clear that big data and cyber security are
going to be increasingly important in the automotive industry
and the national labs have significant expertise and
capabilities in these areas.
The labs are also doing lots of work to accelerate the
development and deployment of electrified vehicles. We're using
our expertise in lithium ion batteries, high performance
computing and simulation to help the automotive industry
shorten design time and improve the performance of automotive
batteries. One great example of this is our CAEBAT project
which is a project to develop new computer-aided engineering
tools which the automotive industry can use to shorten design
time for battery development.
Wide band gap semiconductor materials. These will make
power electronic devices smaller, more efficient and able to
operate at higher temperatures. For electric vehicles what this
means is that we'll have more efficient vehicles and more
efficient charging stations. Power America, sponsored by the
DOE, is a partnership bringing together industry, universities
and national labs to accelerate the development and
commercialization of these devices.
Electric vehicles are also becoming part of the ever
expanding Internet of everything. And at NREL we're examining
these interactions, the interactions between building energy
systems, the utility grid, renewable energy sources and
electric vehicles and we have world class facilities including
the energy systems integration facility and the vehicle
technology integration facility to study these interactions.
As has been mentioned a few times, fuel cell electric
vehicles are now commercially available. This has been made
possible, in no small part, but more than a decade of
innovation supported by the Fuel Cell Technologies Office
resulting in more than a 50 percent decrease in the cost of
fuel cell systems. This is fantastic, but there are still
significant challenges to be met including the cost effective
generation of renewable hydrogen and the development of a
robust hydrogen fueling infrastructure.
NREL is a world leader in renewable hydrogen production.
We're also partners in H2 First, a collaboration with Sandia
National Labs, that is working with industry partners to find
innovative solutions to hydrogen infrastructure problems.
The internal combustion engine is going to continue to be
an essential part of the transportation system, particularly
for heavy duty transportation. Ground breaking research over
the past 10 years has identified new combustion engine
strategies that particularly when optimized to run on renewable
fuels, will offer significantly higher efficiency and lower
emissions. The DOE has launched an initiative coordinating the
efforts of researchers across the lab system to work on this
co-optimization of biofuels and engines.
Replacing heavy steel components with components made of
lighter metals, plastics or composites can reduce vehicle mass
by up to 20 percent which results in a 12 to 16 percent
reduction in fuel consumption and greenhouse gas emissions. The
Institute for Advanced Composites Manufacturing and Innovation,
supported by DOE's Advanced Manufacturing Office, is working to
develop new, low cost, high speed, efficient manufacturing and
recycling process technologies for advanced polymer composites.
So in conclusion there's a wide range of research underway
that will achieve many benefits for the nation's transportation
system including improving energy efficiency, reducing
environmental impact and driving U.S. competitiveness. These
are very exciting times.
Thank you and I would be happy to address any questions.
[The prepared statement of Dr. Gearhart follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Dr. Gearhart.
Mr. Mosquet, welcome.
STATEMENT OF XAVIER MOSQUET, SENIOR PARTNER AND MANAGING
DIRECTOR, THE BOSTON CONSULTING GROUP
Mr. Mosquet. Thank you, Chairman Murkowski and the members
of the Committee for the opportunity to testify today.
Innovation is clearly increasing in the automotive
industry. OEM R and D spending has increased by eight percent
per annum since 2009, and the supplier spending has increased
by five percent. And interestingly our consumer surveys show
that customers want to buy cars from car manufacturers who
bring new technologies to market.
We see today five areas of spending and patent filing for
car manufacturers and suppliers today. It's power trains,
including electrification; it's light weighting; it's
connectivity; it's active safety; and then, autonomous driving.
These innovations are fueled by regulation, by customer demand,
but also by technological advancements.
If I look at the power train evolutions there's three
areas. One is internal combustion engines. The other one is
hybrids and battery electric vehicles, and the next one is fuel
cells.
In internal combustion engines, we've seen many
improvements. Right now, all the evolutions seeing you a low
friction, advanced injection, advanced new cooling and others
have bringing you efficiency improvements from 2009 to 2020 by
35 percent to 50 percent reduction of fuel efficiency and
emission roughly at a cost of $2,000 to $2,500 per car. And
this is why we see today a landscape and that will continue for
the foreseeable future where naturally these technologies will
present the vast majority of the market.
Meanwhile, the market for hybrids and battery electric
vehicles is being challenged. Right now this market has been
growing for ten years and peaked in 2013 at 3.8 percent
penetration of the U.S. market and the penetration declined to
2.9 percent last year.
The challenge is only six percent of the U.S. drivers are
ready to pay more for a greener and more efficient car. And
what they want to spend, on average, is $4,600. So that creates
an unstable market for hybrids and is well below the cost of
either battery electric vehicles and fuel cells.
What this means is the support from the legislator in the
form of incentives will have to remain potentially below the
current cap of 200,000 vehicles per OEM and then support for
charging and refueling infrastructure will be needed for this
market in the next few years.
On light weighting, it's commonly agreed that about ten
percent of weight reduction would help gain six to eight
percent fuel efficiency on each car at a cost of $2 to $5 per
pound saved. The materials are aluminum, magnesium, advanced
steel, carbon composite, of course. And there's two challenges
there for innovation.
One is the availability of some of this materials. It's
particularly true for advanced steel and maybe for the cost of
carbon fiber which I know the Committee has been very active
on.
The other thing is now OEMs and you will all agree that
they're picking the right material for each different parts of
the car is what needs to happen and then bonding technologies
will be a main source of innovation.
Connectivity includes two areas. One is 4G LTE. I would say
this is happening with natural market development. But the
other one is vehicle-to-vehicle, vehicle-to-pedestrian,
vehicle-to-infrastructure, which we're required a minimum
adaption to give the benefits both in terms of safety and in
terms of traffic regulation. And there they will be a need for
further regulation for this market to develop naturally.
Active safety features today that are available with
existing technology have the potential to reduce by 30 percent
the number of accidents on U.S. roads and the number of
fatalities. We think the benefit is about $250 billion every
year to the U.S. economy. The challenge is today those features
cost about twice more than customers are naturally willing to
pay; therefore, penetration is low, single digits and only
going at a few percent per annum.
Whereas, with more support, with a 50 percent penetration,
the cost would decrease by two and there would be a naturally
sustainable market. There will be need there for further
innovation and also for more support to increase the
penetration through customer education, potential incentives
and more regulation.
Autonomous vehicle, which is the next step after active
safety, has the promise to reduce the number of accidents by 90
percent and therefore, to reduce congestion and to improve the
fluidity of the traffic.
Furthermore, we think that in dense urban environments we
could replace, with a share of automated cars, we could replace
roughly 900,000 private cars in New York, for instance by
19,000 shale vehicles which reduces the number of cars on the
road, improves traffic and has significant impact not only on
safety but also on fuel efficiency. And therefore there's a
major challenge now to get to these as soon as possible.
Overall these technologies truly deserve the attention of
the legislator--there is an important balancing act to think
about where to spend, not only for the legislator, but also for
the consumers as many of these technologies today still cost
more than the consumer would be naturally willing to pay.
[The prepared statement of Mr. Mosquet follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Mr. Mosquet.
We appreciate the testimony from each of you. It is always
interesting to hear where the exciting developments are.
Mr. Bainwol, I am going to start with you.
I mentioned in my opening statement that I am in that group
of lawmakers that is really reluctant for us in the government
to be picking winners and losers whether it is as it relates to
type of automobile or energy sources. Mr. Mosquet just led me
right into this in acknowledging that some of the incentives
and supports that we currently have are going to, in his
opinion, need to be around for a while longer.
In looking at the charts that you have provided us, it is
clear that what has happened with the lower price of gasoline
at the pump has influenced consumers' decisions as to whether
or not they are going with electric or hybrid.
Can you speak to this issue of, again, where we try to pick
a winner and loser in an emerging area from your members'
perspective and preferences, how should the Federal Government
handle, or should they at all, promoting fuel and efficiency-
related innovation that, inadvertently or not, may push in a
direction that perhaps does put us in a situation where we are
picking winners and losers?
Mr. Bainwol. So the short answer is our members prefer an
approach that is technology neutral. And so that's the short
answer.
The longer answer is more complicated. We identify with the
goal of reducing carbon. We identify with the goal of reducing
fuel dependency, so all those things are noble, societal
objectives.
The complications come from the nature of the regulatory
regime, and what we have is an approach in CAFE that NHTSA
measures by MPG. EPA measures by greenhouse gas. And then
there's an overlapping state program from California, the ZEBB
program, which is executed in a bunch of other states
representing about 30 percent of the market. The ZEBB program
is effectively not technology neutral. It's either, basically,
to comply to their electrification or fuel cell, in today's
world mostly electrification.
We're complying with different regulatory regimes which
creates friction and added costs, and we get caught in the
middle between a mandate on consumption. It's not a mandate on
production. It's a mandate on what consumers buy. In a low gas
tax environment, low gas price environment, consumers are
moving away from the stated social objectives of
electrification and moving folks into smaller cars rather than
trucks. So it's a challenge.
Technology neutral is ideal. We have to recognize that
consumers are going to respond in a fashion that's rational for
them, and they're not into optimizing policy. They're into
maximizing their pocketbook.
The Chairman. I appreciate that.
Ms. Cullen had mentioned in her testimony that contained
within this bipartisan energy bill that we have moved out of
Committee and that we are going to have on the floor next week,
that there are some R and D provisions in there that are good
for the industry. I appreciate you pointing that out.
Mr. Bainwol, is there anything else in that energy bill
that the auto makers are looking at and saying this is helpful
for industry?
Mr. Bainwol. Yes. Well, first of all, a bill that's a major
bill that has bipartisan support is a wonderful gesture around
the country. It's a great symbol of the Congress working.
The Chairman. We want it to be more than a symbol. We want
it----
Mr. Bainwol. Well----
The Chairman. We want to update some policy.
Mr. Bainwol. So it's good from the standpoint of consumer
confidence, and consumer confidence is vital to purchasing big
cost items, like cars. But more specifically there are
provisions in the bill that are helpful.
The critical minerals piece matters. I showed the chart
that has increasing price of cars mostly flowing from
compliance. To the extent we can rustle challenges down like
the critical minerals, we're stabilizing supply and reducing
costs. That allows people to buy new cars, and that's terrific.
So that's very helpful.
The VIA component that Senator Stabenow brought to the
table is also very helpful. And we love the focus on V to V
because at the end of the day V to V, NHTSA, you're no longer
at NHTSA, but NHTSA has estimated that V to V can address 80
percent of all non-impaired accidents. So the fuel implications
of that and the safety implications are substantial. So the
assistance there is very helpful.
The Chairman. I appreciate you bringing up the critical
minerals bill. Mr. Mosquet, you mentioned that as well in the
context of material availability and what that means for the
industry recognizing that we do not want to go in the same
direction with our critical minerals that we were headed when
it came to vulnerability and relying on foreign sources for our
oils. That is something I think we are all paying attention to.
The 10:30 vote has started. I am going to excuse myself
from the Committee and Senator Cantwell will ask her questions,
and I would just ask her to go back and forth here. I think you
will see members popping in and out. Do not take that as a lack
of interest, but I will be back to ask another round of
questions.
With that, Senator Cantwell?
Senator Cantwell. [presiding]: Okay, thank you.
Thank you, Madam Chair, and I am going to defer to my
colleague from Michigan so she can----
Senator Stabenow. Thank you very much, Senator Cantwell.
Senator Cantwell. Yes.
Senator Stabenow. And Madam Chair.
First, I have to say that I could spend hours talking about
this, obviously, representing Michigan and so many of the
technologies are being developed through our industries in
Michigan and our great universities that are collaborating with
the Department of Energy and the Federal labs and so on. So
vehicle-to-vehicle technology, autonomous technology, all the
safety things that you are talking about that are so critical,
as well as addressing energy savings and emissions and what is
happening on a range of things, certainly, around battery
development, fuel cells, I mean, all of it.
I do want to say though, Mr. Bainwol, and I am sorry that
the Chair left because I will be talking to her more about
this, that one piece that did not get into the energy bill that
were looking forward to doing on the floor is the provision
that Senator Cassidy and I put forward on the advanced
technology vehicles program, to be able to expand the
flexibility of that to larger vehicles which are so important
and to auto suppliers.
We know right now that the latest Department of Energy
advanced technology manufacturing loan actually went to Alcoa
in Tennessee to be able to help them continue the very exciting
opportunities around aluminum. We know the F-150, I sound like
ads for automobiles whenever I am talking about all of this,
but the F-150 has been able to take 700 pounds out of their
truck by using aluminum instead of steel, so composites and all
of this.
Mr. Bainwol, I wonder if you might just expand on what I
know is in your written testimony as well about the importance
of taking an existing program and just giving it a broader
portfolio so that we can address what needs to be done around
larger vehicles and trucks.
Mr. Bainwol. Well we certainly are supportive of your
effort to broaden the eligibility to trucks and suppliers, so
we think that makes sense and we Are delighted to be supportive
of it.
Senator Stabenow. Great.
Mr. Friedman, from your perspective as well, how do you see
that helping us as are moving forward to tackle energy savings
and so on?
Mr. Friedman. Well it's clear that heavier vehicles are an
incredibly important area that we have to tackle when it comes
to fuel efficiency.
I think our super truck program has shown that there's a
lot of progress that can be had. That progress needs to be
backed up with investments, especially when you consider that
long haul trucks account for about four percent of
registrations but around ten percent of oil use. So clearly
having more resources, having more opportunities to invest in
proving those technologies is an important part of a balanced
portfolio.
Senator Stabenow. Thank you.
In listening to all of you and in watching, and in going to
the North American Auto Show and having a chance to sit in a
lot of these vehicles, it is very exciting to see what is
happening.
One of the things that I keep coming back to and, even Mr.
Bainwol, even in your chart looking at what consumers are
choosing, and certainly gas prices work against, sort of, as we
look at new technologies and so on, but when we look at this
what I hear all the time from people is a concern about lack of
infrastructure.
Now at the auto show we were seeing hybrids, electric
vehicles with 120 watt and you can plug it into a regular plug.
But when I look at things like hydrogen fuel cells that have
huge potential that our Department of Defense is doing work, of
course, in all of these areas, but it seems to me that we have
got to be focused much more aggressively at making sure the gas
station is actually a service station and that you have the
options there and that it is consumer friendly.
So I wonder, Dr. Gearhart, if you would want to respond to
that and then Ms. Cullen and anyone else that would want to
respond to the question of how do we really get there where we
get over the huge barrier of lack of choice at the service
station?
Dr. Gearhart. So I agree, particularly with hydrogen. It's
a tie by, I understand.
So I agree with you, particularly with hydrogen fuel cell
vehicles, that the lack of infrastructure is the big problem. I
think that that's one of the big roles that the Federal
Government can play is to make sure that the technology for the
infrastructure is as ready as the technology for the vehicles
are. The auto companies have done a fantastic job.
If you get a chance to drive the Mirai and any of the new
vehicles, they'll knock your socks off. They're really great,
but drivers are going to want reliable fueling stations that
are online every time they go there. And if they don't, we're
going to have a false start.
So that's why at NREL we've built a research station
specifically for the purpose of looking at the reliability of
the hydrogen infrastructure to make sure that the components
are ready to identify mistakes. We're working with H2USA which
is a public/private partnership of people in the industries to
try to identify what are the critical items for them to make
sure that the hydrogen infrastructure can get ready.
Senator Stabenow. Thank you.
I know I am out of time but, Ms. Cullen, if you could just
briefly respond to that?
Ms. Cullen. Well quickly I would say that I agree
completely on the hydrogen infrastructure. It is premised, the
fuel cell vehicle is premised, on a gas station model of
centralized, say once a week, fueling.
For plug-in vehicles it's more of a cell phone model, work,
home and opportunistic charging. And so responding to the needs
of the work, home and public are slightly different. I would
say that we are working, the industry is working, with the
Department of Energy and state and local partners to actually
build out those infrastructures on all of those levels.
Senator Stabenow. Thank you.
Senator Cantwell. Senator Gardner?
Senator Gardner. Thank you very much to the Ranking Member,
and thank you to the witnesses for your time today,
particularly Dr. Gearhart, welcome.
Dr. Gearhart, welcome to the Senate Energy Committee.
I enjoyed driving for the first time a hydrogen fuel
vehicle at the Golden headquarters of the National Renewable
Energy Laboratory last year, so it was a great opportunity to
see the work that you are doing there.
Also for the interest of members, Senator Gary Peters and I
have created a smart transportation caucus. Our focus is going
to be on vehicle-to-vehicle communication and the kind of work
that you are doing and talking about today. So if anybody is
interested in those efforts, I would love to see you in the
caucus and talk to Senator Peters and I for that. We have a
range of issues that we can talk about. It is kind of fun to
hear what everybody is working on.
In Colorado, of course, if you have driven to the mountains
from Denver to Vail or to Beaver Creek at any time in the last
several years, you have probably spent a couple of hours in
traffic jams. The odds are we are not going to be drilling or
adding an additional tunnel to the Eisenhower/Johnson tunnels
any time soon, so the solutions that we have to look for are
being talked about on this panel, the vehicle-to-vehicle
communications and alternative transportation methods and
modes.
I just have a couple of questions I think that go beyond
this Committee. I mean, because we have questions of spectrum.
How our cars are going to communicate with each other? Do we
have enough spectrum to make sure that cars can communicate
with each other?
We have issues of moral authority that are going to have to
be determined. When a car is going to make a decision if it is
driving by itself to take the ditch, to hit wildlife, the baby
crossing the road because there is another car coming. These
are all questions that over time are going to have to be worked
out for moral choices that a driverless or autonomous car is
going to have to make to the kind of communications that an
older vehicle makes.
It is interesting in agriculture, of course, that we have
been using driverless tractors, self-guided, auto-steering
tractors for over a decade now. You can retrofit a 30- or 40-
year-old tractor with a self-steering mechanism, and we have
seen it bring increases in productivity to agriculture. Now, of
course, what it could mean to solve transportation, you know,
clogging the arteries of our transportation system is using
this to solve that problem.
I know it was recently announced that the National
Renewable Energy Laboratory had entered into a MOU with the
Department of Transportation in Colorado for research on the I-
70 and I-25 corridor when it comes to vehicle-to-vehicle
communication.
Dr. Gearhart, can you talk a little bit about the work you
are doing there?
Dr. Gearhart. Yes.
CDOT has announced their, what they're calling, the Road X
program which is to look at the potential for using these
automated and connected technologies in really all aspects. And
they joined with the National Renewable Energy Lab, in
particular, to bring in the fuel economy and the emissions
aspect of it.
So we're in discussions with them. We're looking at a
number of possible projects where we can help CDOT by
collecting data and providing analysis for the data for them
and confirming that these technologies do make the difference
that we really hope that they make. So we're very excited about
it.
In particular, we haven't quite found the I-70 corridor
project but I'm really looking forward to the day that we, the
car, drives me up I-70 rather than me sitting there in traffic.
It's a very, very exciting partnership.
Senator Gardner. What has NREL's research shown when it
comes to potential congestion relief with connected vehicles?
Are you able to model that yet? Have we gotten that far?
Dr. Gearhart. Senator, we're working on modeling it. Right
now what we've seen if we look at the energy impact there can
be dominated by several effects. If the dominant effect of
introducing these new technologies is to make the traffic flow
much, much smoother, we will reduce the energy per mile driven
significantly.
The problem is now if we make it so convenient will people
drive more miles? And so that's the big research question that
we're looking at now is, you know, what is the bounce back
effect of having removed the barriers? If no one no longer
cares that they're sitting in their car or they just drive more
miles and does that then drive the emissions up even though
that there are fewer emissions per mile?
That's a tough-to crack. It's as much about how consumers
think and make decisions based on the information that they're
receiving as it is on the technology, so I can't give you an
answer right now. It could be anywhere from half of the energy
consumed to twice as much energy consumed. But it's going to be
a big effect, and I think we need to understand that what it is
going to be as soon as possible.
Senator Gardner. Well I think it would be a perfect
solution to the victory the Broncos will have over Senator
Warren's team, the New England Patriots, later this weekend.
[Laughter.]
Senator Gardner. So thank you very much for the opportunity
to be here with all of you today.
Senator Cantwell. Uh oh.
Senator Warren. Dream on, Senator Gardner. [Laughter.]
Senator Warren. Dream on. Your dreams will last a few more
days.
Senator Cantwell. The throw down. Who expected that?
Okay, Senator Warren?
Senator Warren. Thank you, Madam Chairman.
You know, there are two ways to repeal a rule. You can
repeal it outright to strike it from the books or you can paper
over the rule with enough exceptions and alternatives that the
rule becomes fairly meaningless.
Now the auto industry complains about ambitious fuel
economy standards because it costs money to make cars more
efficient and to reduce their pollution. The industry knows it
can't win a head on fight to roll back fuel standards so it
looks like the industry is trying the paper over it approach.
Here is how it works. Recently House Republicans introduced
a bill to improve auto safety that includes a loophole to let
the auto makers break from fuel economy standards. The bill
lists nine specific safety technologies. It sounds good. Car
companies have already agreed to install several of them, so
this is obviously not a big stretch. But the bill says that if
any auto maker installs three technologies from the list, they
will be eligible for a credit equal to at least three grams of
carbon dioxide per mile toward their greenhouse gas emissions
requirements. In other words, this gift to the auto industry
says you do what you have already agreed to do and you can
slide by with lower EPA standards. It sounds like a pretty
slick operation. Now what I cannot figure out is the
calculation that three safety features should be worth exactly
three grams of carbon dioxide per mile, not one gram or ten
grams.
Mr. Bainwol, you represent the auto industry, and you have
been a vocal supporter of this provision. Can you tell me
whether your industry suggested this number to the House of
Representatives or did the House Republicans give you the
number?
Mr. Bainwol. I think some context, if I could.
Senator Warren. I just want to know who came up with the
number.
Mr. Bainwol. We did not originate the number. But let me--
--
Senator Warren. So the House Republicans gave you the
number and put three grams on any of those safety features?
Mr. Bainwol. This was a draft provision that was shown to
us. We did not ask for the grams per mile that were provided.
But I mean you can contextualize it.
Senator Warren. So you would be okay if they did not do it?
Mr. Bainwol. Right. If I could contextualize it. The Tesla
gets about 600 grams of credit. That's a car that cost roughly
$135,000 to buy, and we're providing 600 grams of credit.
These safety technologies which, as we've discussed today,
have a value for the environment, have a value for congestion,
have a value for safety, have a value for fuel efficiency.
Senator Warren. So Mr. Bainwol, let me----
Mr. Bainwol.--Are 15, 140.
Senator Warren. Stop you there. The question is not whether
or not reducing congestion may or may not reduce pollution
ultimately. I think this is actually a quite debatable point.
There has been a lot of evidence on both sides of this that, as
I understand it, economist Joe Cartwright puts it when it comes
to pollution the evidence there suggests that if you reduce
congestion people actually drive further and that more than
offsets the effects of idling. I think this was related to the
point that Dr. Gearhart was just making.
But that is not my question. I had just one question, and
that is who calculated the number that it was three grams? If
you are telling me the auto industry did not do it, then I just
want to know who did it. You are out here lobbying for it. You
say it is supported by scientific evidence. Where did the
number come from?
Mr. Bainwol. This was a draft document. I don't know where
the number came from but it was an extraordinarily modest
number in the context of what's regarded to Tesla and in the
context of the overall CAFE target.
Listen----
Senator Warren. Well, I appreciate that you think it is a
small number but, you know----
Mr. Bainwol. Well it's one theory as to what Tesla was
recorded.
Senator Warren. But we are not talking about Teslas. What
we are talking about are gasoline powered engines here.
Mr. Bainwol. So----
Senator Warren. And we are talking about not meeting
established EPA standards.
But I think that what is clear, and I asked you whether you
have got any evidence on this and you said, no, even though you
are supporting this and saying it is backed up by evidence.
Neither the idea nor the number is based on any concrete
research. I think this is just trying to roll back part of the
EPA rules without having to tell the American people about it.
In 2014 more than 32,000 people were killed in motor
vehicle crashes, as you rightly pointed out. That is 32,000
reasons right there to encourage the adoption of promising
safety technologies like automatic emergency braking.
Car companies should make cars safer and they should also
meet their fuel economy obligations, period. If they do not
want to do that then they should face the American people and
explain how they want softer pollution standards and then let's
see what the American people have to say.
Mr. Bainwol. But we----
Senator Warren. Thank you, Madam Chair.
Mr. Bainwol. May I respond, Senator?
Chairman Murkowski, may I have an opportunity to respond a
bit?
So we signed up for the CAFE program. And as I noted, the
CAFE program is a consumption mandate not a production mandate.
I showed you the number of models, both electric hybrid, and
high MPG models that we've generated and put in the showroom.
So we are doing our part.
If it were a production mandate the issue would be over,
but it's not a production mandate. It's a mandate on what
consumers buy, and consumers are not buying the products that
you want them to buy.
Senator Warren. But----
Mr. Bainwol. There's a challenge.
Senator Warren. I asked for the scientific evidence for how
it is that we have a build this proposed to say a few----
Mr. Bainwol. But let's talk scientific evidence.
Senator Warren. You do what you are already doing.
Mr. Bainwol. Let's----
Senator Warren. You are going to get credit, and so far all
you have said is you are not the one who hasn't.
Thank you.
Mr. Bainwol. Let's talk scientific evidence for just a
second.
The Chairman. [presiding]: We are out of time, and Senator
Warren does have to vote.
Mr. Bainwol. Okay.
The Chairman. So maybe you can do that in response to
another member.
Mr. Bainwol. Perfect, thank you.
The Chairman. Thank you, Mr. Bainwol.
Senator Daines?
Senator Daines. Chair Murkowski, Ranking Member Cantwell,
thank you for holding this hearing on this very important and
timely topic.
My home state of Montana is a big state. It is the fourth
largest state. It is not as big as Alaska, Madam Chair, but we
are the fourth largest.
We have a very dispersed population, over 75,000 miles of
roads. We have the second highest rate of car ownership in the
country, so it brings about unique challenges and extraordinary
dependence on our transportation infrastructure.
Montana's extensive transportation system is a pillar of
our economy. It allows visitors, residents and freight to
traverse the state. It goes without saying, it is imperative
that we keep people and freight moving as efficiently and
safely as possible.
Today we have touched on the role of regulations and
standards in driving auto industry innovation. My concern with
mandates in this domain, like so many others, is that they
typically do more harm than they do good. Based on cases we
have seen under this Administration, they are often
unattainable. They pinch the wallets of hardworking Americans,
hardworking Montanans, and they waste hard earned taxpayer
dollars.
For example, as Mr. Bainwol points out, of the 17 and a
half million vehicles sold last year only approximately 400,000
of them were plug in hybrids and battery electric and fuel cell
vehicles, not even reaching half of President Obama's goal to
have a million on U.S. roads by 2015.
Another case in point, in 2008 Congress mandated the
installation of passive train control on freight rail tracks
that carry passengers of certain hazardous materials by the end
of 2015 despite the rail's best efforts. The complexity and
sheer scale of this implementation make full development and
deployment of PTC by the end of this year impossible.
Additionally, President Obama's Fiscal Year 2017 budget
will request $4 billion for the development of autonomous
vehicles. Meanwhile automakers are going to invest $800 billion
a year globally on R and D to produce reliable and safe
mobility solutions. Ninety-nine percent of this investment in
America is from private, non-governmental sources according to
the Alliance of Automobile Manufacturers.
We should continue innovating technology to make our
vehicles safer and make them more efficient, but we should let
consumers determine the market for vehicles not a bunch of
Washington bureaucrats.
My question is for Mr. Bainwol. As you note, public
policies and regulations do not always align with the
preferences of consumers. Could you expand upon your vision for
a more productive relationship and emphasize a productive
relationship between industry and government, and how do you
see reducing the Federal role in vehicle technology innovation
may actually benefit the industry and benefit the consumer?
Mr. Bainwol. That's a tough one, but easier than Senator
Warren's question, so thank you.
The goal of fuel efficiency and electrification, those were
social goals. And to get there requires an investment on the
part of OEMs and that's the $100 million that you've
referenced. It requires consumers playing ball because it is a
consumption mandate not a production mandate, and it requires
government being supportive either in the form of research help
but again where it's 99 percent private or in the form of
infrastructure to induce the purchase of electric and hydrogen
vehicles. So it's a complicated matrix.
But once we've established that we're shooting for a
target, we've got to find a way to get there. In a low gas
priced environment that's a challenge, and it's exacerbated by
the success of the conventional engine.
So we're kind of caught. We're engaged in the research.
We're producing magnificent product. We want these programs to
succeed, electrification, fuel cell and other alternative power
trains, because we have to both because it's good for the
environment but also because we have mandates to make that
happen. But it's a trick because consumers do want to do what
consumers want to do. They are rational in their behavior. And
as I indicated earlier, policymakers seek to optimize that
outcome and consumers are motivated by a different standard
which is enough is enough.
If they can save $5,000 and apply that to a college
education or to food on the table and not buy a hybrid, they
may choose to do that. And then we're caught in the middle.
It's a challenge.
Senator Daines. It may seem counterintuitive to some, but
how do you see reducing the Federal role in vehicle technology
and innovation actually benefiting the industry and benefiting
the consumer?
Mr. Bainwol. So I think where government could be most
helpful would be to get rid of regulatory friction. We have the
ZEBB mandate for a quarter of the marketplace. It's not a
Federal rule, but it's a rule that effects 25 to 30 percent of
the country.
We have the NHTSA MPG requirement and we have the EPA
greenhouse gas requirement, and they're not harmonized. If we
had one national program, in truth, then it would be much more
efficient to comply. We could reduce the cost of the vehicles.
That would speed up adoption. That'd be a great thing.
So there's a way to square this, but we've got to get rid
of regulatory burdens. We've got to provide the infrastructure
support, and then there's a chance for it to succeed.
Senator Daines. Thank you, Mr. Bainwol.
The Chairman. Senator King?
Senator King. Thank you, Madam Chair. Sorry to be late. I
was at an Armed Services hearing.
First I should say I am excited that I just bought an
electric car and am looking forward to using it.
I apologize if I am repeating because I have not heard your
testimony, but one of the most interesting aspects of electric
vehicles, it seems to me, is the potential for a more efficient
utilization of the grid because of the fact that most people
will charge their cars at night which is the time when we have
excess, both excess capacity and excess capability on the
wires.
Is that something that you have discussed and if you have
not, do you, anyone of you, wish to address it? Yes, sir?
Mr. Friedman. Thank you, Senator.
Let me say a few words about that because at the Department
of Energy we just recently released the core of our plan for a
grid modernization effort. And as part of that effort there's
going to be over 220 projects looking at improving the
reliability, resiliency of the grid and increasing its ability
to integrate variable sources of energy such as wind power and
solar power.
A couple of key parts of that are studying the ability to
integrate electric vehicles, fuel cell vehicles, into the grid
so that at night when you have more wind blowing you can use
cost effective wind power. During the day when demand is up,
maybe the batteries or fuel cell vehicles can provide
electricity to the grid to help balance those loads.
I think that's a great example of why government has such a
critical role in bringing these technologies to the marketplace
and giving consumers more choices.
If you look back over my lifetime we've seen six major oil
price spikes that have either dramatically slowed or reversed
economic growth in the United States. And so we have to look at
the long term as we invest in electric vehicles and in more
fuel efficient vehicles because if all we do is look at the gas
prices today, just like in 2007, we're going to drive the auto
industry into a ditch.
Instead we need to focus on investing on technologies that
double fuel economy, that provide electrification and improve
the resiliency of the grid to save people thousands of dollars,
to tap into cleaner, lower carbon fuel sources and to give
consumers a lot more choice in the marketplace.
Gas prices are going to spike again, and we've got to be
ready.
Senator King. Yes, ma'am?
Ms. Cullen. Senator, in addition to the benefits of the
mobile load that David mentioned, the rise of electrification
is also building out the battery segment. It's scaling up
options in both residential and utility and distributed energy
storage. Both new and post automotive use batteries are being
used too, as a grid resource.
Senator King. Like the Tesla house battery that came out of
the automobile technology
Ms. Cullen. Correct.
The Tesla's partnership with Panasonic on their giga
factory which is building markets for energy storage while
building out, building scale in the battery segment.
Senator King. But what I think a lot of people do not
realize is that the grid is like a church built for Christmas
day. It has enough room for all the parishioners, but on a slow
Sunday in March there are a lot of empty seats. The wires are
built for the heaviest day of the year and at night,
particularly in the winter because they are more conductive in
cold weather, at least in my region of the country, there is a
tremendous excess capacity.
You could increase the load dramatically at night which
presumably electric vehicles would without a dime of additional
infrastructure investment. I think that is one of the
attractive features of electric cars beyond just the fact of
freeing yourself from dependence on the volatile fossil fuel
price.
Ms. Cullen. In fact one of the earliest studies of this
from one of the labs estimated that if 73 percent of the
vehicle fleet were electrified you could fill its need with
existing grid capacity without adding any new generation.
Senator King. Yes, I think that is an important point in
this discussion other than the vehicles themselves.
I missed your testimony. In just the few seconds left are
there new technologies on the horizon? The big issue is range,
I suppose. And where are we on battery technology and getting
to the place where we are going to have a 200- and 300-mile
range on a change?
I remember a fellow who was going to have batteries that
were removable so you could drive into the station and take out
the old one. It is like trading in your propane tank. What
happened to that idea?
Mr. Friedman. Well a couple of words on that.
First, I'm holding here a lithium ion cell that uses nickel
manganese/cobalt technology that was developed at our national
labs. This kind of technology is now being licensed to the auto
industry. It's helping to drive electric vehicles like the
Chevy Bolt to 200 miles range.
We're continuing to invest. And in fact, under mission
innovation we need to look at dramatically increasing our
investments in technologies like these so that consumers can
have those 200-, 300-, 400-mile battery electric and fuel cell
electric vehicles to give the exact benefits you're talking
about.
Senator King. Developments in battery technology have huge
implications for rooftop solar, for example and also again, for
grid stability. I think there is a national security interest
here in decentralizing the grid so that it is not subject to a
catastrophic centralized attack and could be more self-healing
if you have distributed generation and distributed storage.
You are nodding. Can somebody say yes?
Ms. Cullen. Yes.
Mr. Friedman. Yes.
Senator King. Yes, nodding does not go.
Mr. Friedman. Yes, it doesn't.
The Chairman. For the record.
Senator King. Yes, exactly.
Mr. Mosquet. The one thing I would add is I think as we go
to extended range batteries for 200 miles or more, which is
actually the trend, I think we will probably need more 220
volts installation. And so there will be actually a need for
some upgrade of the last mile of the grid, potentially also
some support to the consumer who today is paying the bill of
that increased span. And it was at some point, some support at
this and local states for that and that's probably something
we'll have to think about if we want people to access more with
new cars like the Chevrolet Bolt which is offering much more
mileage.
Senator King. Madam Chair, may I ask one followup question?
Oh, I am sorry. Senator?
Senator Franken. I object.
Senator King. Yes.
Senator Franken. No, go ahead.
Senator King. You are objectionable anyway, sorry.
Senator Franken. Now I do object. [Laughter.]
Senator King. Are there any estimates of the number of, or
I guess you told me 70. We could go to 73 percent of the
vehicles without changing the grid. Do we have estimates of
what would be required to go to 220, for example? Does that
require something new to the house or isn't 220 what a clothes
dryer uses? So the house is just a matter of rewiring your
house to have a 220 in the carport.
Ms. Cullen. So just quickly. So a level one charging it's
your standard.
Senator King. Right.
Ms. Cullen. Standard 120 outlet. Level two is 240 and
that's what your dryer plugs into.
Senator King. Right.
Ms. Cullen. And that will charge your car.
Senator King. And then there are the super chargers that
will charge it----
Ms. Cullen. DC fast charge and that's 480 volts, and that's
more of a commercial and public installation not something
you'd likely have in your garage.
Senator King. How many people could have electric cars with
short ranges? In other words, how many people only use their
cars for short trips? Do we have data on that?
Ms. Cullen. We do. In fact, the vast majority, more than 80
percent, of commuters travel less than 40 miles a day. And I
think the charging patterns have shown that the fact is 80
percent of charging happens at work and at home, and the last
20 percent is public charging and opportunistic charging.
And not that that's unimportant because that's the part
that adds to long distance travel, increases electric miles
traveled overall. But in fact, the existing infrastructure is
supported by workplace and home charging.
And the cost of installing T40 level charging, although
they vary based on how old your house is, whether you have to
upgrade the panel, in fact have come down materially.
Mr. Friedman. I think that's a really important point. I
mean, we have a program called the workplace charging challenge
which is focused on getting more and more companies, more and
more partners, to install workplace charging even at the level
one, 120-volt range. We're up to about 250 partners. We're
looking to work toward doubling that.
And you know, I own a plug in vehicle. If I could plug in
at work that could easily effectively double the range that I
could use on a battery, so it's an incredibly effective option.
Senator King. There are charging stations in the Senate
garage. They charge an arm and a leg besides the car, but other
than that, we do have them.
Thank you, Madam Chair.
The Chairman. Senator Franken?
Senator Franken. I noticed that no one answered Senator
King's question on the what happened to the battery that you
pop in and pop out, and I was very intrigued by that because
Israel was doing that.
The answer that I got, and I do not mean to do your job,
but I think it was that Israel is a very small country, so
electric cars make more sense and also they do not have many
brands of car. The idea that the battery would be like a high
percentage of Israelis would have the same car with the same
battery. So I love the idea of it, but it does not seem to work
for the United States.
Is that kind of accurate?
Ms. Cullen. That is accurate.
There are the additional challenges that the business model
not only requires a standardized vehicle and battery
configuration that it can be swapped out, it also contemplates
that you would have an inventory of very expensive batteries
waiting for people to come in and get them swapped out.
Senator Franken. Which makes sense if everybody has sort of
the same car. What I loved about this was that I could ask
questions about if it had a sound effect in it. So that is too
bad.
Mr. Mosquet. But so most countries, no longer the U.S.,
have abandoned the project and notably because of the logistic
challenge of basically rebalancing the loads of batteries that
may not be in the right places and would be shipping batteries
from one station to the other to rebalance the load. And so it
seems not to be, actually, a great solution.
But fast charging actually at service stations is a
solution that within 15, 20 minutes you could get, I don't
know, 50 to 90 miles extra for your car. And then you'll do the
last part of your travel. That's probably the solution that
will be the most effective.
Dr. Gearhart. And that's the analysis I'd seen as well is
that the opportunity cost of having that much space tied up in
racks of batteries that the owners of service stations have
much higher value uses for those spaces, so.
Senator Franken. Glad that in addition to giving Senator
King three extra minutes, I have spent my two minutes and 15
seconds on answering his question.
The Chairman. You are just here to help.
Senator Franken. Yes, so I am just here to serve my other
colleagues. That is why I'm so popular.
I was fascinated with all the testimony, and Mr. Friedman,
your testimony laying out all the incredible advances that we
are making.
When cleaner, reducing the cost of high energy, high power
batteries by more than 45 percent in three years. This is very,
very exciting, I think.
The one thing we had a few years ago, I know the Chairman
remembers when we had members of the American Energy Innovation
Council. Remember it was Norman Augustine of Lockheed and there
was a guy from Cisco and General Jones, I believe. They were
basically saying that we used to spend a higher percentage of
our GDP on energy research.
At a time where, in the paper today 2015 was the hottest
year on record by a significant margin over the previous
hottest year which I think was, well I know was, the previous
year, and we have a real problem here.
My question is, and it can be to anyone but especially Mr.
Friedman, shouldn't we be spending more on basic research on
this exact kind of research as a percentage of our GDP?
Mr. Friedman. Well in short the answer is yes, absolutely.
In fact that's why President Obama joined with 19 other world
leaders in November in kicking off an effort called Mission
Innovation which is about trying to get, not only the United
States, but the globe to potentially as much as double spending
on clean energy research and development, and putting that
investment toward technologies that can be investable by
industry.
The way government works really well is by working on the
tough problems that industry cannot do on its own and then
being in a position to hand off those advances to industry, who
can then provide more choices, more technologies, more options
for consumers so that we can ultimately develop the low carbon
diet we need to address global warming pollution.
Senator Franken. We have done this successfully time and
time again, including in the oil and gas industry with
hydraulic or making possible this revolution that we have had
in getting gas and oil out of shale. That was a partnership in
many ways and it came out of our national laboratories.
To me, I just think it is absolutely essential that we
spend more in healthcare and in the National Institutes of
Health needs more funding for things like Alzheimer's, but this
is so important and the benefits, the off shoots. Can you give
me some data on what the benefits are of the money that we
spend?
Mr. Friedman. Well a few examples and you know, you talked
about public health. In many ways these are public health
issues. The investments we've made to improve heavy duty diesel
engines between saving fuel and saving lives by reducing asthma
and lung disease, have delivered a 70 to 1 benefit to cost
ratio as a result of Department of Energy investments.
Overall, if you look over the last 20 or 30 years, we've
delivered a 24 to 1 benefit to cost ratio. So it's clear that
when we invest in innovations, when we develop technologies
that can save lives, save fuel, cut carbon emissions and cut
oil use, we deliver back to taxpayers. I would argue we're a
very good investment when it comes to the future of the nation.
And, you know, you talk about health care and
pharmaceuticals, they spend about 50 times what we do on a
sales basis on research and development than we do on clean
energy. We need to close that gap.
Senator Franken. Okay, well, thank you.
I know the Chairwoman at the beginning of this hearing was
talking about being technology neutral, and I have heard this
analogy to a race and that you do not know which horse is going
to win the race. Having every horse on the track at the
beginning is good and we do not know if hydrogen now is behind
by some analogies in this race, but you never know at the end
what is going to be the technology that wins the race. So I
agree with the Chair.
The Chairman. Thank you.
I want to talk about what Alaskans are talking about right
now, trucks, because we drive a lot of trucks. I was prompted
on this by Senator Daines as he mentioned, Montana is big. You
have a lot of open spaces. Alaska is big, and we have a lot of
open spaces. We haul a lot of gear. We just haul a lot of
things whether it is the boats or the four wheelers or the snow
machines or the stuff that you just move around. We haul it in
worse conditions than Washington, DC is seeing here. We have
actually got real snow accumulation. There is a lot of interest
in terms of where the industry is going, when it comes to these
technologies.
I noted in my opening statement that Ford is looking at an
F-150 that can run on compressed natural gas and propane.
Certainly that is interesting, but when we talk about the
difference we are making with lighter vehicles to gain fuel
efficiencies, that is important. You cannot have it too light
or then you have your trucks sliding all over the place and you
cannot haul what you need to haul.
Tell me where we are in meeting that consumer demand,
because in certain parts of the country I would venture to say
that there are probably a lot of people here on the Eastern
seaboard that are really interested in what is going on with
how we are making our trucks more fuel efficient, but still
safer and still very, very capable.
In addition to that, recognizing that in places like Alaska
or Minnesota, you have some very cold temperatures, so some of
the things that we're talking about with our fuels----
Senator King. Or Maine.
The Chairman. Oh, my gosh. I am looking at you at the other
end of the table here, of course, Maine.
Senator King. When you go to Northern Maine all you see are
trucks.
The Chairman. My Arctic Caucus co-chair here. [Laughter.]
The Chairman. But these are some of the issues we face when
we are dealing with colder temperatures and trying to meet the
fuel standards and requirements, again, with trucks. Where are
we with trucks? Somebody talk to me. You all need to talk to me
about trucks because that is what Alaskans are talking to me
about when it comes to their vehicles.
Mr. Bainwol. So I'll start by making I guess, two points.
The first is that at the end of the day, as I mentioned, this
is a consumption mandate.
The Chairman. Right.
Mr. Bainwol. And we have to respect what consumers want to
do. The CAFE program tries to do that by establishing a program
that's footprint-based.
The Chairman. What?
Mr. Bainwol. Footprint-based.
The Chairman. Okay.
Mr. Bainwol. So the 54-5 is a composite that is, kind of, a
weighted average of what cars get, of what larger cars get,
what trucks get. And so it's all blended. And so it does
provide for some flexibility for trucks.
Now moving forward in the out years the cliff or the rated
growth in terms of expectations on fuel efficiency for trucks
is rising. And so it is a trick, but it's not the same number
as the 54-5.
And so, our mission as auto makers is both to strive to
comply with the obligations of CAFE but also to provide what
consumers want. I think at this point that part is, in the
early years, working.
The Chairman. Some others.
Where are we on the technologies in advancements?
Ms. Cullen?
Ms. Cullen. Senator, the choices in electrification are
also making their way into those heavier segments of vehicles.
If you get to the auto show you will see hybrid, plug-in
hybrid, and fuel cell SUVs and crossover vehicles. The auto
makers are meeting the demands of their consumers for
drivetrain capability as well as their drive cycles.
There are also great advances being made in the next
segment up, for instance in medium duty. For instance, there
are plug-in hybrid trouble trucks so that when a utility goes
out late at night it can work on a site silently using its
electric power to operate the, activate the bucket. Thus they
operate cleanly, quietly and safely because the workers on the
ground can hear what the arm is doing.
Moving up through the weight scale then the heavy duty
segment. There are fuel cell buses on the road today. They
accommodate those heavier loads, and based on their range and
performance they're optimized for that application.
The Chairman. But we are still not seeing them in the
trucks. You know, we are a three truck family and we are still
looking at the older trucks that are out there.
Mr. Friedman. Well and the story with trucks.
The Chairman. Mr. Friedman?
Mr. Friedman. In many ways it is actually, right now, it's
a story about innovations that are dramatically boosting the
efficiency of internal combustion engines.
I mean, you can buy a truck engine now that's a V6 instead
of V8. It gives you all the haul and power of that V8. It cuts
weight. It delivers the same or better safety performance, and
a lot of those technologies were supported by investments from
the U.S. Government.
So I would argue there's been massive progress when it
comes to pickup trucks and SUVs. It's just not as obvious in
some ways because it's under the hood or it's in the materials.
But when you look at the standards that Mitch was talking about
you can roughly think of it is no matter the size of your
vehicle you're going to roughly double the fuel efficiency of
that vehicle.
For a truck, that's even more valuable than for a car
because you use so much more fuel. So you can save money on
fuel, have the same hauling power, the same or even better
safety with technologies that Ford and GM and others have been,
I think, helping lead the way on.
Nissan right now is about to introduce a Cummings Diesel
into their Titan pickup truck. It's dramatically boosting fuel
efficiency using a diesel engine. So real, great progress on
the internal combustion engine and weight reduction side for
those big vehicles.
The Chairman. Dr. Gearhart, are we doing anything at NREL?
Dr. Gearhart. Yes.
Another thing I'd like to add to this is at NREL, for
example, we're looking at the various molecules that we can get
out of biomass and the unique fuel properties that are
associated with those different molecules that when combined in
different ways and combined with what we can get from petroleum
feed stock, that's going to enable, I think, the next
generation of combustion improvements. And so, we'll be able to
continue to make improvements on the efficiency of internal
combustion engines while increasing the renewable feed stock
that's going into those liquid fuels. I think those two
together have a potential to give us fuel economy and reduce
greenhouse gas emissions.
I think there's a lot of room that hasn't been pursued
there. If we start to look, not just at engine efficiency but
also what we can do on the fuel side, to use various bio feed
stocks.
The Chairman. Good.
Senator King, if you want to do wrap up questions, please
do, and then we are going to let our panel go at 11:30, as
promised.
Senator King. Thank you, Madam Chair.
First, I want to thank you for holding this hearing. I
think this is an important topic, and I appreciate your
allowing us to have this discussion.
Mr. Mosquet, I am interested in the money in the finances
of this. When will electric vehicles be fully competitive and
not need a tax credit and particularly with regard to gas
prices? I heard recently about one state whose tax credit went
away and the sales plunged.
The real question for any renewable, it seems to me, is
when can it stand on its own two feet. I would like your
thoughts about where this goes. Of course, I realize there is a
lot of speculation about what are gas prices. It is hard for
anything to be competitive with gas at the price it is today.
But your thoughts?
Mr. Mosquet. So, as you said, Senator, there's nothing sure
about the future. But I think it may take some time. That would
be the short answer for a number of reasons.
First, if we look today at the evolution of the cost of the
technologies, I mean, they have significantly reduced that
cost. But if we want to have cars that have a 200 miles or plus
driving range, we will need 50, 60 kilowatt hours of battery to
fuel those cars. Then the cost even when the sales are at $100
per kilowatt hour, multiplied by 50 you see what the cost is
going to be to the OEMs. So it will remain a significant cost.
But it depends then on what are the breakthroughs that are
going to come up to take that. I would say another 50 percent
down. It's not impossible, but it's probably a few years out.
It's also highly dependent on the price of, you know, gasoline,
of course.
We did our initial calculations with ranges of anywhere
between $120 and $180 per barrel and we're not there today
because consumers are looking for paybacks up to typically
three years to buy more fuel efficient vehicles. We're far from
this for years.
Senator King. Well the current plunge in oil prices is
attributable directly to my having made the decision to buy the
electric car because it just----[Laughter.]
Mr. Mosquet. But that's the good thing is I think. The more
we improve the efficiency of conventional engines and the more
we develop battery technologies and fuel cells, the more we
keep the oil prices down. And so I think it's both actually a
winning proposition for the consumer and for the country but at
the same time it makes the life of the battery electric vehicle
tougher in the long term.
Senator King. It is interesting you should say that. An old
professor friend of mine, Richard Hill, an engineering
professor at the University of Maine, made the most profound
observation about oil prices I have ever heard.
He said,``Oil prices in the future will always be the
opposite of what you expect. If you expect them to be high and
act accordingly by conserving and doing more conservation kind
of measures, then that will create an excess supply which means
prices will be low. If you think they're going to be low and
you buy cars that get eight miles per gallon, then they're
going to have a contraction of supply and prices will be
high.''
I have always thought that was an interesting observation.
Oil prices in the future will always be the opposite of what
you expect.
Mr. Mosquet. Which means, by the way, that I think maybe
it's not the market that we have to let evolve naturally. I
think that this is why the legislation is important because
otherwise you get the opposite effect of what you think you're
going to get.
Senator King. Madam Chair.
The Chairman. Thank you, Senator King.
Thank you to each of you for the contributions that you
have provided to the Committee here this morning. I think it
has been useful. It is always nice to know what is new.
I guess if we really want to see it, touch it, and feel it,
we should go to the auto show and see the advancements that
have been made. But I think it is clear that we are moving
forward in different spaces. Quite honestly, the driverless
cars are one that it is going to take me a while to get
comfortable with.
But the advances we are making in ensuring that there is a
level of safety, that there is a level of efficiency, all while
responding to what the consumers are hoping for in a range that
is affordable is good news for us.
So with that, I thank you for your contributions this
morning, and we stand adjourned.
[Whereupon, at 11:28 a.m. the hearing was adjourned.]
APPENDIX MATERIAL SUBMITTED
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