Telematics and electric mobility, part II

Battery problems aside, EVs are simply not as cost-effective as diesel trucks, says Steve Davis, national engineering manager for TNT UK, which has a fleet of 51 7.5-ton all-electric delivery trucks. “Even though fuel costs have gone up dramatically, they are still not really cost effective against a diesel equivalent,” according to Davis. “The battery packs on the vehicle [we converted to lithium-ion] are more expensive than a [brand-new] diesel vehicle would be.”

Autolib, an electric car-sharing scheme owned and operated by the French investment holding Bolloré Group and co-financed by the city of Paris and the outlying districts of Île-de-France, is also running a considerable financial risk. It needs 80,000 subscribers each using the service at least twice a week for a minimum of one hour each time just to break even. It attracted 7,500 during the first two months of operation. Luckily, for Vincent Bolloré, the French tycoon behind Bolloré Group, Autolib is as much about providing car-sharing solutions as it is an advertisement for the group’s lithium-metal-polymer batteries, which Bolloré spent 15 years and €1.5 billion developing and which he believes to be more stable than lithium-ion batteries.

“It is ambitious; it is risky a bit, but that’s a first step,” says Vanessa Colombier, a spokesperson for Autolib. “The aim of the group is to expand in other cities and to bring the battery into usage. We are not at all limiting our expectations. Our service could be fully or partly implemented in big cities like Rio de Janeiro, Hong Kong, Tokyo, but also in much smaller areas like campuses and industrial parks, little independent territories like Andorra, Monaco, and islands like Mauritius or La Réunion to preserve their environment.”

Charging infrastructure

Charging infrastructure is also receiving attention as one of the key preconditions to wider adoption of electric vehicles in Europe, and not just from governments that are reportedly spending estimated €5 billion on building public charging points across the continent in the comings years. (For more on charging, see Telematics and EVs: Things to do while charging and EV telematics: Is home energy management the next big thing?)

In the United Kingdom, Ecotricity, a renewable energy utility company founded by the British eco-warrior Dale Vince, is looking to stimulate interest in electric vehicles by building a network of far-flung charging points that allow owners of electric vehicles to cruise around the country without the fear ever of running out of electricity and having no place to recharge.

“There is a great deal of focus on numbers of points, but the volume of numbers of points is not going to materially affect whether or not people buy an electric vehicle,” says Simon Crowfoot, business development director of Ecotricity. “What’s more important is to have the right points in the right locations.”

At the moment, Ecotricity has 14 charging points at Welcome Break service stations across the country and plans to add 29 more this year. Although one must apply for a membership card to use them, their electricity is free of charge. “What we are trying to do is act as a catalyst for the electric car industry by removing one of the challenges that the electric car industry has and [by] encouraging people to drive electric vehicles,” Crowfoot says. “It didn’t make a lot of sense for us to charge customers at this stage, because it would be a very small amount of money and it was such a barrier to entry psychologically.”

As a not-for-profit business that reinvests all of its profits into renewable energy, Ecotricity can justify spending between £10,000 and £20,000 per charging point and no income to show for it. But that’s hardly a luxury the likes of E.ON can afford. As a result, the German energy giant is focusing on where money can be made: home-charging solutions and fast-charging stations.

Charging points

A vast majority of the charging points in Europe are of the slow, alternating current (AC) kind. Because they take hours to fully recharge a car, they are unable to achieve high enough turnover or charge substantial enough premiums for electricity to be profitable at the moment.

?E.ON sells two types of home-charging solutions that cost €899 and €999 and include a 3.7-kilowatt “wallbox”, which ensures that a plugged-in car doesn’t overload the household circuits, and professional installation. And, at a gas station near Wolfsburg, a popular stop on a highway between Munich and Salzburg, one can now recharge an electric vehicle for a flat fee of €5 at E.ON’s 50-kilowatt direct current (DC) fast-charging point, which takes between 15 and 30 minutes to fully recharge a car.

With five to ten charging sessions a month, E.ON is far from hitting a break-even point of eight sessions per day. But there is at least the potential for a business case, particularly when fast-charging is bundled with other services, says Johannes Eckstein, R&D e-mobility program manager at E.ON. Ten more fast-charging points are planned for this year. (For more on EVs and services, see How telematics can help overcome barriers to EV adoption and Telematics and EVs: The need for common standards.)

Further down the line EO.N also sees opportunity in smart grid solutions that will not only allow owners of electric vehicles to charge when electricity is at its cheapest, but also make them money by supplying energy back to the grid when energy consumption is peaking and prices are at their highest. “From a technological point of view, it’s no big deal and the batteries are getting more and more robust as well,” Eckstein says. “But I still see in the OEM sector some reluctance to do that and this is limiting the dynamics in the market a bit.” (For more on smart grids, see How telematics can help smart grids talk to cars.)

A better battery

Meanwhile in Denmark, Shai Agassi, founder and CEO of Better Place, is working to prove that there is a mass market for electric cars even at today’s prices and that the cars need not be golf cart-sized city cars that most associate with electric mobility today. “Our goal is to provide drivers with a true alternative to gasoline cars that doesn’t require any kind of sacrifice on their part,” says Julie Mullins, spokesperson for the Palo Alto, California-based company.

Agassi's idea is to separate the ownership of the car and the batteries. The customer buys the car without batteries and then subscribes to a mileage plan that gives him access to a nationwide network of 20 battery switch stations. Buying the car without batteries saves him roughly €10,000 in up-front costs, and not owning the batteries gives him the ability to switch them at will for fully charged ones in a matter of minutes. “Battery becomes a consumable, that is the key differentiator,” Mullins says. What’s more, the customer need not worry about battery deterioration. Better Place guarantees the quality.

Also part of the subscription package is a home charger and a telematics solution that provides road-side assistance and helps drivers with trip-planning based on how much energy they have available and the location of nearest switch stations. An all-you-can-drive package for drivers driving more than 40,000 kilometers per year costs €399 a month, and savings on the total cost of ownership can be as high as 20 percent, according to Mullins. The program will lunch in the coming months with the arrival of first vehicles.

“There has always been a tug-of-war between if you are being green and being profitable,” Mullins says. “What we hope is that with this model you can achieve both of those goals and you can show that this is actually a very smart investment and something that has a very competitive advantage for moving off of oil.” 

Jan Stojaspal is a regular contributor to TU.

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Telematics and electric mobility, part I.

For more all the latest telematics trends, check out Telematics Detroit 2012 on June 6-7, Insurance Telematics USA 2012 in September in Chicago, and Telematics Munich 2012 on October 29-30.

For exclusive telematics business analysis and insight, check out TU’s reports on In-Vehicle Smartphone Integration Report, Human Machine Interface Technologies and Smart Vehicle Technology: The Future of Insurance Telematics.