At my conference on the future of methane in Fort Worth last November, I found out about a documentary called Switch, about the future of energy in the US. I finally got around to getting and watching. It is highly recommended for those interested in the subject.
It is largely non-partisan (though the protagonist is a geologist) and covers all of the important energy types in a serious and engaging way, with a bit more meat and less chrome than the typical PBS science show. You have to request a copy from the website, it is not available on iTunes or Netflix yet.
I don’t agree with everything. I think it overestimates how long the switchover to renewables + nuclear being the largest share of energy will take. It does this because it underestimates future technology advances — looking more linearly and less exponentially/logistically in terms of technology development and deployment. Similarly it underestimates the ability of larger inter-connected networks to mitigate reliability/availability problems from solar and wind, and advances in storage of various types. I don’t think this change will be overnight, but I hope it will be sooner than the 50 years the film estimates. The cost curves on solar and wind are getting very competitive, and the more interest they have, the more investment they will get.
In short it is an electric scooter with a fast-swappable battery. They propose to have a network of swapping stations. We saw this attempted with Better Place, which did not turn out well, as well as the early days of EV taxis in New York with the lead acid trust at the turn of the last century..
Location, Location, Location
“Being in Minnesota, currently with a -25F wind chill, I am not sure smart scooters will work everywhere,” said David Levinson, a transportation analyst and professor at the University of Minnesota.
However, “in the markets where they do work, battery swapping is good idea, and six seconds would be very fast,” he told TechNewsWorld.
Gogoro’s big challenge will be deploying its network of swapping stations, “since if they are not near where you are already going, they may not be of much use,” Levinson said.
“In other words, unless GoStations are as ubiquitous as gas stations, swapping will remain inconvenient for many potential users,” he pointed out.
“We will need to see a shipping product before we can really determine whether and how well this works,” added Levinson, “but I wish them good luck and hope they can find a viable deployment path with upfront capital expenses and sell their product.”
The traffic congestion you face is caused by other people. Those people did not think about the delay they imposed on you when they chose to travel. They didn’t even know about you, since they were already on the road before you were. They are ahead of you in the traffic stream.
Similarly as a driver, you, completely oblivious, impose congestion on those who follow. You never met them. You have no opportunity to stop and apologize, or even say excuse me, since that would cause even more congestion.
Economists have long had a solution to this problem. It is called road pricing. Almost all economists support this in principal. Yet, it is implemented almost nowhere (Singapore is the best example, followed by Stockholm and London, but London does not vary prices by time of day except that it is on during the day and not at night), indicating there must be some problems with the way it has been presented, or the cure (road pricing) is perceived as worse than the disease (congestion).
Problem 1: The collection of revenue. Historically this was at tollbooths, which were sources of delay rather than source of delay reduction, so people would naturally be skeptical that putting tollbooths everywhere would be an improvement. Technology now permits toll collection at full speed, using in-vehicle transponders or license plate recognition.
Problem 2: Administrative costs. Putting a toll collection gantry out on a single facility is one thing. It’s not especially cheap, and must be more expensive than gas taxes. Putting them everywhere is expensive. Using current electronic toll collection technologies that depend on readers and facility-based collection points does not scale to the system as a whole. Localized toll collection cannot in general solve the widespread congestion problem.
Problem 3 : Privacy and tracking. Surely the government will be monitoring whatever transponder or GPS device they put in the car. I have seen Law and Order as much as the next person, and I know what the police and prosecutors already do with EZ-Pass. Even if there are technical solutions (using a pre-paid unregistered cash card rather than a credit card) no-one will believe that the authorities aren’t tracking. The entire NSA scandal just makes people suspicious. While in my view privacy is mostly dead (and of your own doing so long as you carry a communications device with you or pay with credit cards), it is even deader on public roads, even without road pricing (since we have cameras, police have cameras, traffic managers have cameras, and sousveillance is everywhere). But people are still nervous, and we need to recognize that.
Problem 4: Implementability. Rolling this out and turning on the switch is a big shock to the system. Transportation is inherently a conservative field, people are comfortable with slow change. So deploying 200 million transponder devices and millions of readers across the network before turning them on was at best a foreboding task, and in all likelihood terribly unwise. What if it didn’t work properly?
Problem 5: Fairness. Tolling people is often perceived as unfair (which usually does not take in to account the distributional inequities in the existing road financing system). Everyone has the same amount of time, but rich people have more money. There are lots of solutions to this problem, but in the end, the fear is at least some individuals would be better off without the change.
Opportunity 1: Electric Vehicles are coming. In some sense they are already here. While their market share of hybrids is still low (still less than 3% of all new sales) and Battery and Plug-in EVs (still less than 1% of new sales), the latter category is growing rapidly.
Now extrapolation is dangerous, but we do have claims from some of those in the EV industry, namely Elon Musk of Tesla about achieving market share of about 13% by 2020. Further we have the history of technologies which show an S-shaped life-cycle dynamic. The tricky part is determining the ultimate market share (which I will assume to be 100%), and the rate of growth. Existing data allows us to estimate the rate of growth. Combining Hybrids and EVs, Figure 2 shows the best fit logistic (life-cycle) curve. A market share of 50% of new vehicles sold is achieved in 2022 or so. This is 8 years away. Eight years is a long time. Eight years ago there were no iPhones or Androids.
The main constraints have been limited consumer demand due to range anxiety and issues of charging location and speed. So we need to assume (1) The cars will get better over time, (2) Batteries will get better over time, (3) Electricity will get cheaper over time.
I believe all three of these are certain, the only question is the speed with which these things occur, and the degree to which batteries get better.
The cars will become better. Already Tesla produces the best car (Model S) in the US according to Consumers Reports. It is of course pricey. On the other hand, you need to discount the price some because you will not need gas ($3/gallon at 15000 miles per year at 30 mpg, which is about $1500, or $15000 over the life of the car). The price will also drop with true mass production.
You can’t beat free: Many have understood for a while (see this 2007 post e.g., and this from earlier in 2014) the solar cost curve is bending and will become cheaper than alternative sources of energy soon.
Soon is basically here. My dad in Arizona has solar panels. There is a house on my commute with solar panels.
Solar energy panels do have a fixed cost, but the variable cost per unit of electricity drops to approximately zero. This means you are replacing the cost of gasoline with about nothing, if you have solar panels on your roof generating more electricity than you would otherwise use. There is the alternative of selling the excess back to the grid, but one imagines once everyone starts doing this, the grid isn’t going to pay much, if anything for excess power. We have heard “Too Cheap to Meter” before, about Nuclear. Unfortunately we did not implement that successfully. Solar is a much more grassroots rather than top-down process, and more likely to succeed.
The difficulty is energy storage. Batteries are getting better, doubling energy density about every 10 years (or 20) – which is of course a big difference. So even if solar is cheaper than the grid, the sun isn’t always on (you know, the rotation of the earth etc.), so batteries are required at home as well in the car.
But we don’t need batteries to store a year’s worth of energy, we need them to store enough to be competitive with cars, i.e. to be good enough and cheaper, so that they can either be charged fast or swapped out fast. MP3s don’t have the fidelity of analog music, but they were good enough. Cell phones don’t have the sound quality of land lines, but they were good enough.
From a transportation funding perspective, the most important implication is that EVs don’t pay gas taxes. If they become widespread, there will be a not just the slow decline of gas tax revenue we see already due to peak travel and better fuel economy, but an actual crash.
Opportunity 2: Congestion remains a problem
Question: If pizza were free, how much pizza would be available at dinner time in the dorm?
Question: So when roads appear free, how much surplus road space do you have during rush hour?
Congestion should not be a surprise, it is what you get when you underprice a good. While it is not getting especially worse in most of the US, it is not getting especially better either. Time is still money, and this problem will remain until we actively do something about.
Opportunity 3: Still roads require some funding.
Roads don’t plow themselves. Roads and bridges don’t repair themselves. Roads don’t repave themselves. Bridges don’t erect themselves. The money for these things must come from somewhere, and people (and their machines) must be paid to do these things. The best source for these funds are the people who directly benefit from the existence of these public works – the users themselves. Our system in the US is a combination of funding from users directly, and non-user beneficiaries, as well as the general public (which usually fall into the first two categories).
Opportunity 4: Traffic is self-organizing.
While the theoretically perfect, first best, solution would charge a unique price for each link for each time of day, that is far more detail than we actually need to have an effective system. We trade-off between the additional efficiency from more time and place specificity against the additional administrative complexity and decrease consumer acceptance from such a fine-grained system. Most priced systems are much simpler than the ideal because of these practical concerns.
Fortunately, to a first-order approximation, we don’t really need to know which road people are traveling on, just the time. Wardrop’s Principle of User Equilibrium (not strictly true, but good enough for the moment) says all used routes have the same travel time. Which is to say, when traveling between A and B at a given time, if there are multiple routes you might use, their travel times are equal, and if one is higher, you won’t use it. And this holds for everyone. Traffic spreads out in a regular way to exploit available routes. So while there might be some advantages to tolling one route more than another (because their marginal costs differ), that introduces a lot of complexity for a relatively small system-wide gain. My estimates of the spatial Price of Anarchy on the Twin Cities network is that there is only a small loss (less than 2%) due to letting people route themselves rather than the Central Planner allocation. In short, the main problem is temporal (peaking) rather than spatial (routing).
Taxi-Meter: We want to keep the structure as simple as possible. Imagine an in-vehicle taxi-meter, with a per-minute charge. We can have as many different rates as we want, but we should start with a few (more than zero, otherwise it is not going to affect time of day people travel at all, more than one if you want to avoid too much boundary effect of people not leaving until the rate changes. I suggest three different prices for starters. Once people get used to the idea, the rates can be adjusted. It is much easier to go from 3 rates to 4 or 6 than to go from zero rates to 1 or 2.
Rate Structure: For instance, imagine a price structure like this:
Peak 6 hours per day (~50% of current traffic) each traveler pays [T]
Shoulder of peak discount (~25% of traffic) (50% discount) each travelers pays [0.5T]
Offpeak discount (~25% of traffic) (90% discount) each traveler pays [0.1T]
Second, we establish the base rate for the peak times, and everything else is a discount (think about movie theaters and restaurants, which have the matinee and early bird special) rather than having an unwelcome “surge” pricing phenomenon. This is I think a more positive framing. Also since the non-peak rates are lower, the fraction can remain fixed, and there is only one base toll rate for policy to regularly adjust, and then a fraction of that rate associated with day-parts, which is adjusted less frequently.
Note, we are only tracking when you travel, not where you travel, and perhaps your residence (since rates will vary by jurisdiction of residence).
System Members: We want this to be as fair as possible. Fairness means lots of things to lots of people. However having rich people pay more rather than poor people pay more is a fairer way to start. At this stage of history, early adopters like people buying brand new EVs undoubtedly have above average incomes (though I don’t have actual statistics to verify this). Making everyone pay for roads, instead of just people with gasoline powered cars, is also fairer.
We want to phase this in to avoid a big-bang implementation disaster (like the botched roll-out of Obamacare). Fortunately for this system, most people don’t have EVs now. Also fortunately, we anticipate many people will in the coming decades.
So I suggest the membership in this system should be automatic (starting the model year after next) for all new EVs, Hybrid EVs, other Alternative Fuel Vehicles sold. All such vehicles would get rebate on general tolls, local property taxes, other general revenue sources of road funding, as well as any gas tax paid as well (such as for Hybrids). This gives the automakers more than a year to implement the device into a small fraction of their cars. It ensure bugs and difficulties are discovered early and inconvenience only a small portion of the population. It gives the federal government a year to set up a revenue collection system that can ramp up over time to a larger share of the fleet, and one imagines, eventually to the entire fleet, either as EVs and other Alternative Fuel Vehicles come to dominate, or as it is imposed at some point on all new cars.
As more and more vehicles become non-gas powered, this system membership grows and it becomes more and more effective.
Opt-ins: Gasoline powered cars can voluntarily opt-in to this system, which for many travelers would be a cost savings and provide incentives that might be easily exploited to the betterment of all. We could further allow an opt-in location tracking, which would give a discount in exchange for rates which varied locally.
Surplus: If there is a surplus at the end of the year, above the members’ share for the cost of roads and rebating for other taxes, every member of the system gets a dividend. A check in the mail, that they can use for whatever they want.
Currently 1 hour of travel at 30 mpg and 30 mph uses 1 gallon of gas, which is about $0.50 of state+federal gas tax [depending on where you are].
Note: This should be about $1.00 to $1.50 to cover the cost of all road infrastructure (not including externalities), depending on how you count. Other taxes cover a large share of road expenses, including property taxes, vehicle sales taxes, and so on.
Assuming share of travel did not change by daypart, average revenue per vehicle hour would be about:
We would expect that share of travel would change by daypart, so that the average revenue per vehicle would be lower, and more in-line with system costs. Actual elasticity of demand with respect to the toll rates is an empirical question that can only be firmly established with experience, though we can make some estimates.
There is a pretty direct way to popularize zero-emission cars, but in political terms it would be a very unpopular step: issue a carbon tax. Owning a traditional fuel-engine car would become much less appealing if its sticker or gas prices included the cost done to the environment. Transport scholar David Levinson makes the argument in the May-June issue of Foreign Affairs:
A better, although more politically difficult, policy would be to charge those who burn gasoline and diesel fuel for the full economic and social cost of their decision. Right now, pollution is essentially free in the United States; drivers don’t pay anything for the emissions that come from their tailpipes, even if they’re driving a jalopy from the 1970s. If the government were to charge people for the health-damaging pollutants their cars emit and enact a carbon tax, the amount of pollution and carbon dioxide produced would fall. Consumers would drive less, retire their old clunkers, and be more likely to purchase electric vehicles.
Levinson concludes that cars are at a historical juncture similar to the one they faced a little more than a century ago. Back then the fuel-engine (thanks largely to invention of a self-starter) emerged from a group of competitors that included electric- and even steam-powered cars. Tomorrow’s winner may not be clear, but the mere fact that the contest has reopened is some form of progress.
The automobile was the obvious technology of the future. It had been forecast and developed for nearly a century before mass production. Yet when the patent application of future Congressman Nathan Read, an early steamboat developer in Connecticut who proposed a steam-powered automobile in 1790s, was read aloud in the House of Representatives, members struggled to suppress laughter. A century later some practical vehicles entered the market. The path was trod in fits and starts. In 1835 Thomas Davenport of Vermont built the first rotary electric motor which pulled 31-36 kg carriages at 5 km/h. In the late 1830s Robert Davidson of Scotland built a carriage powered by batteries and a motor, and later an electric coach, the Galvani, running on rail tracks. In 1851, Charles Page built an electric locomotive reaching a speed of 30 km/h. Those experiments ended without widespread market success. In parallel with steam and electric experiments, the Internal Combustion Engine(ICE) was patented in 1860 by Belgian engineer Jean Joseph Etienne Lenoir, who applied a coal-gas and air burning version to his three-wheeled Hippomobile. Nikolaus Otto developed his engine in the 1870s and Karl Benz used Otto’s engine to power a 600 watt (0.8 horsepower) three-wheel carriage in 1885. While today, the automobile is widespread and mostly employs the internal combustion or diesel engine, that technological outcome was not obvious to many of those in the field as late as 1900.
The electric grid, developed by Edison and others, was necessary for practical electrical transportation. Electricity was first widely applied in transportation to the streetcar. By 1879 Siemens and Halske built a 2.6 km line in Berlin. Battery trolleys were tested in early 1880s in places like the Leland Avenue Railway in Philadelphia, but by 1887, a New York financial syndicate funded Sprague Electric Railroad and Motor Company to build a 19.2 km line in Richmond, Virginia. Over the next three decades trolleys exploded across US cities. The electric streetcar, and other electric railways, transmitted power to the vehicle via a cable, a technology not suited for the automobile.
1893 World’s Columbian Exposition displayed six automobiles. The only one from the US, by William Morrison of Iowa, was electric. Yet the energy density of the battery remained the principal constraint on the electric vehicle’s market share. By the turn of the century, range and the energy per unit weight of battery compared with gasoline engines were already defined as key weaknesses by the best engineering talent of the time.
Battery-powered vehicles have more limited range (distance before recharging/refueling) than gasoline-powered vehicles due to energy density. The limits to battery technology result from battery weight. Each additional battery reduces the effectiveness of all the others, as they must spend some of their stored energy moving around other batteries instead of the rest of the car and passenger. Diminishing returns set in quickly. (The same issue affects liquid fuel of course, but it is not as severe since the energy density is higher).
While longer distance touring was a relatively small market, people consider the extreme use for the vehicle they buy, not the average, hence the personal trucks we see on urban and suburban streets. A vehicle must be usable in a maximal number of conditions. People imagined traveling longer distances than an EV could run. Other problems were the under-developed electric grid (as late as 1900 only 5 percent of factory power was electric) and lack of charging stations, especially at homes.
The plug to connect the car battery to a wall socket was not developed until 1901, prior batteries had to be removed from vehicles, no trivial task. While some electric utilities encouraged EVs and helped charge and maintain them at central stations, promoting local EV sales, most utilities saw these customers as nuisances rather than a source of business. Range (c. 1901) was about 4 hours, so charging was a frequent event. Fast charging (a charging time of one or two hours was considered fast) deteriorated the batteries. People thought of solutions. For instance, a charging hydrant, dubbed an “electrant.” located every few blocks was proposed, but never implemented, to permit travelers to pull over and pay for a metered amount of electricity. These ideas have been reappeared in recent decades as people seek to solve the same problems with electrics. Again, the number of charging stations remains quite limited, as no one wants to invest in a network of charging stations until there are many plug-in electrics requiring charges, and few will buy plug-in electrics if the cost and convenience does not match its technological competitors.
Another concept, developed by L.R. Wallis in 1900 was to have a parent battery company, from which batteries would be leased, and then swapped out when needing recharging for already charged batteries. This idea has been revived with Shai Agassi’s company Better Place in the 2000s, which hoped to develop a network of battery exchange centers, before entering bankruptcy. Similarly, electric garages, modeled on livery stables (for horses) were established to limit the owner’s need to deal with the difficulties of charging and maintaining the car.
While range and charging issues were obvious downsides, the primary advantages of electric vehicles at the time had to do with user interface. Charles Kettering had yet to develop the self-starter, so gasoline engines required the user to get out and crank. This was a non-starter for upper-income women, who thus preferred electric vehicles. EVs were often marketed to women, but this feminizing of the product may have discouraged men. An emerging middle class of urban professionals, managers, and white-collar workers formed a market for a new type of transportation.
The best-selling Oldsmobile sold only 425 vehicles in 1900. The market was still minuscule, but growing exponentially. Detroit in 1900 was much like Silicon Valley in the 1970s, with its HomeBrew Computing Club that begat Apple Computer and Microsoft. By 1912 Model T sales reached 82,388, in 1914: 200,000, in 1915: 400,000. Despite Edison’s encouragement of Ford’s gasoline-powered car, as noted in the opening quote, later Edison and Ford worked together in a failed attempt to bring about an electric car that was competitive with gasoline-powered vehicles.
In 1900 and 1905 the 1,200 electrics sold were fewer than 10 percent of all vehicle sales. Ultimately EVs fell further and further behind as economies of scale drove down the relative cost of its competitors, attracting a greater and greater share of consumers. Like Internal Combustion Engines (ICEs), EVs were rising in sales, but at a much more modest pace, growing to only 6,000 vehicles in 1912.
Because of the difficulty consumers had with charging, Salom and Morris of the Electric Storage Battery (ESB) Company proposed a fleet of rental cars (an antecedent to car sharing), where professional would charge and maintain the vehicles. Individuals would still rent or lease a particular car. However, this failed to get critical mass, and required picking up the car, rather than storing it at home. In the end this became a fleet of cabs, where instead of recharging batteries in the vehicle, batteries would be swapped in and out, and charged (slowly) out of the vehicle.
Owner of New York’s Metropolitan Street Railway Company, Henry Melville Whitney consolidated the electric vehicle industry beginning in 1898, acquiring ESB, combining with Pope, and absorbing the Riker company, with the aim of establishing a fleet of 15,000 electric cabs to serve urban America. This “Lead Cab Trust” began to fail when the batteries, designed for smoother running streetcars or stationary operations did not do well on bumpy road surfaces and the frequent charging and discharging use of cab service, rather than the more sedate private ownership. Batteries deteriorated with use along with age.
The Edison Storage Battery Company aimed to develop a nickel-iron alkaline battery to replace the lead-acid battery. Edison’s competitor, ESB, tried to perfect the lead acid battery. The New York Electric Vehicle Transportation Company, part of EVC (the Lead Cab Trust) was probably the largest consumer of such batteries. It also developed its own central station and substation, and started running electric buses on Fifth Avenue as well as other routes. Other subsidiaries of the Trust fared less well, the New England and Illinois branches of EVTC folded in 1901. Edison hyped his battery for years, but it was not widely used once it came to market, as the cost-energy density tradeoff never worked favorably.
The self-starter for the automobile was modeled on the newly motorized cash register, by National Cash Register engineer Charles Kettering. His company DELCO was acquired by General Motors. This seemingly modest innovation made the gasoline powered automobile usable by those without the strength to turn the crank, and thus as easy to start as an electric. After Kettering, the automobile become an electric system in miniature: Its generator (with the battery) was the central station, which distributed current through a network for uses like starting the car, but also for headlights, and later radios and other purposes.Battery makers thus boomed not from selling batteries to makers of EVs but from selling to makers of gasoline-powered cars containing an electric self-starter.
It would be nearly a century before EVs became popular again.
Hoffmann, P. (2002). Tomorrow’s Energy: Hydrogen, Fuel Cells, and the Prospects for a Cleaner Planet. The MIT Press.
Koppel, T. (1999). Powering the Future: The Ballard Fuel Cell and the Race to Change the World. Wiley.
Lienhard, J. (2006). How Invention Begins: Echoes of Old Voices in the Rise of New Machines. Oxford University Press.
Nye, D. (1992). Electrifying America: Social Meanings of a New Technology, 1880-1940. The MIT press.
Schiffer, M., T. Butts, and K. Grimm (1994). Taking Charge: The Electric Automobile in America. Smithsonian Institution Press
Sperling, D. and D. Gordon (2009). Two Billion Cars: Driving Toward Sustainability. Oxford University Press, USA
Swift, E. (2011). The Big Roads: The Untold Story of the Engineers, Visionaries, and Trailblazers Who Created the American Superhighways. Houghton Mifflin Harcourt
In 1896, a 33-year-old engineer working for the Detroit branch of Thomas Edison’s Edison Illuminating Company traveled to New York for the firm’s annual convention. The automobile was the obvious technology of the future by then, but it wasn’t yet clear what would propel it: steam, electricity, or gasoline. Edison had been tinkering with batteries that could power a car, so he was interested to hear that the engineer from Detroit had invented a two-cylinder gasoline vehicle. After hearing a description of the car, Edison immediately recognized its superiority.
“Young man, that’s the thing; you have it,” Edison told the inventor. “Keep at it! Electric cars must keep near to power stations. The storage battery is too heavy. Steam cars won’t do either, for they have to have a boiler and a fire. Your car is self-contained—it carries its own power plant—no fire, no boiler, no smoke, and no steam. You have the thing. Keep at it.”
Heating a sidewalk section has climate change implications. I calculate the 26-year cost of your section at $8,722 at the low end and $9,708 at the high end (depending on the discount rate you assign to the future impacts of climate change. I tend to lean towards the higher end). This means your break-even point is 8% to 20% higher, meaning maybe 173 to 192 pedestrians per day. Of course with a carbon tax in place, there would likely be more walkers in some places, meaning heating the sidewalks become feasible in more places.
Now, if you could use waste heat that hasn’t been previously captured to heat sidewalks, as they are proposing to do with the new “interchange” plaza and HERC steam, the carbon footprint becomes effectively zero additional. Much less per kWh/BTU.
Other interesting facts, heating all the sidewalks in Minneapolis with electricity from the grid for one year would produce more greenhouse gases than the disposal of all our solid waste and wastewater does over the same time period. The additional energy consumption would be equal to about 1/3 of the current annual consumption in all residential properties in the city. It would increase the city’s annual electricity consumption by 8%.
He nicely identifies a feedback effect, heating up sidewalks will create more emissions, which will heat the atmosphere, which will eventually negate the need for heating up sidewalks. There must be an equilibrium point here.
More seriously, the use of waste heat is a great idea, especially near the HERC. The problem would be building infrastructure to distribute that more broadly. There might also be waste heat from wastewater (which is still liquid in the winter, and thus warmer than the ground around it) which we don’t capture, or let go to roads, by running sewers under the streets rather than the sidewalks.