The phrase,'Unsound Transit', was coined by the Wall Street Journal to describe Seattle where,"Light Rail Madness eats billions that could otherwise be devoted to truly efficient transportation technologies." The Puget Sound's traffic congestion is a growing cancer on the region's prosperity. This website, captures news and expert opinion about ways to address the crisis. This is not a blog, but a knowledge base, which collects the best articles and presents them in a searchable format. My goal is to arm residents with knowledge so they can champion fact-based, rather than emotional, solutions.


Monday, March 10, 2008

The Car and Fuel of the Future- Tech and Policy Overview



Prepared for the National Commission on Energy Policy by

The Center for Energy and Climate Solutions

JUNE 2004


Transportation is the major source of U.S. dependence on imported oil and the sector that has had the

fastest growth in greenhouse gas emissions over the past two decades. Yet the efficiency of our light

duty vehicle fleet is at a 20-year low and efforts to promote alternative fuel vehicles in the

marketplace have largely failed. Nonetheless, the urgent need to reverse the business-as-usual growth

path in greenhouse gas emissions in the next two decades to avoid serious if not catastrophic climate

change necessitates action to make our vehicles cleaner.

The pathways most widely discussed for reducing or replacing oil while significantly reducing

transportation greenhouse gas emissions are efficiency (such as hybrid vehicles), hydrogen, grid-

connectable or plug-in hybrid-gasoline vehicles, ethanol from cellulosic biomass, and synthetic diesel

fuel (with carbon sequestration). Most alternative fuel vehicle (AFV) pathways, however, are

unlikely to be cost-effective strategies for reducing gasoline consumption and emissions for the

foreseeable future, according to most studies.

In the near- and medium-term, by far the most cost-effective strategy for reducing emissions and fuel

use is efficiency. Hybrid vehicles in particular offer the possibility of breaking the political logjam on

higher fuel efficiency standards because they can reduce gasoline consumption and greenhouse gas

emissions 40% to 50% with no change in vehicle class and hence no loss of jobs or compromise on

safety or performance. If we are to achieve significant fleet-wide efficiency gains by 2025, some

form of marketplace intervention by the federal government is virtually inevitable.

All of the AFV pathways will require technology advances and strong government action to succeed.


Hydrogen is the most challenging of all alternative fuels, particularly because of the enormous

challenge required to change our existing gasoline infrastructure. It is the least likely to be a cost-

effective solution to climate change by 2035. Cellulosic ethanol has significantly less infrastructure

challenges since it can be blended into gasoline. It is a very promising strategy if costs can be

reduced and productivity increased. If carbon sequestration on a large scale proves practical,

synthetic diesel fuel from coal and biomass gasification (such as Fischer-Tropsch or dimethyl ether)

may also become a viable strategy.

Plug-in or grid-connectable hybrids may be the most promising AFV pathway. These hybrids can be

plugged into the electric grid and run in an all-electric mode for a limited range between recharging.

Plug-in hybrids will likely travel three to four times as far on a kilowatt-hour of renewable electricity

as fuel cell vehicles. Unlike most AFVs, plug-ins hold the potential of being cost-competitive at

current gasoline prices. They deserve at least as much attention from policymakers and car

companies as hydrogen fuel cell vehicles have received. We believe that the most plausible vehicle of

the future is a plug-in hybrid running on a combination of low-carbon electricity and a low-carbon

biomass-derived fuel.

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One of the few recent studies to compare different alternative fuels including plug-in hybrids is the

August 2003 joint report of the California Energy commission and the California Air Resources

Board, Reducing California's Petroleum Dependence.


The two agencies looked at the direct

economic benefit of various AFVs and alternative fuels, including Fischer-Tropsch diesel made from

natural gas, a mixture of 85% Ethanol and 15% gasoline (E85) for flexible fuel vehicles (FFVs), a

future low-cost FFV fuel, a hybrid zero emission vehicle with a 20-mile all electric range (Hybrid-

ZEV 0), and a direct hydrogen fuel cell.

Direct Net Benefit of Fuel Substitution Options

The results are very dependent on the assumptions. Gasoline prices were assumed to be from $1.47 a

gallon to $1.81 a gallon, for instance, and they are currently higher than that and could be even higher

in the future. No environmental benefits were calculated, although they could be significant in some

cases. No economic value was assigned for the possibility of using the plug-in hybrids to provide

grid services (such as spinning reserve) when the vehicles were not being driven, even though this is a

plausible scenario. The incremental cost of fuel cell vehicles ranged from $1800 to $5000 although

current incremental costs are several hundred thousand dollars.

Nonetheless, the results show that in a detailed apples-to-apples analysis comparing a wide variety of

alternative fuel vehicles, plug-in hybrids hold the potential for significant direct net economic

benefits. They also make clear that alternative fuels can be attractive when they approach the price of

gasoline and underscore the need for some way to value the environmental benefits of alternative

fuels. The same study also showed that most of the pure fuel-efficiency options, including hybrids,

had a positive direct net benefit.

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Any U.S. energy and environmental policy effort must come to grips with transportation. Some two-

thirds of U.S. oil consumption is in the transportation sector, the only sector of the U.S. economy

wholly reliant on oil. The energy price shocks of the 1970s helped spur growth in natural gas use for

home heating, and drove the electric utility sector and the industrial sector to reduce their dependence

on petroleum. But roughly 97% of all energy consumed by our cars, sport utility vehicles, vans,

trucks, and airplanes is still petroleum-based.

The transportation sector remains one of the largest sources of urban air pollution, especially the

oxides of nitrogen that are a precursor to ozone smog and particulates that do so much damage to our

hearts and lungs. Vehicle emissions of such pollutants, however, have been declining steadily, and by

2010, federal and state standards will make new U.S. cars exceedingly clean.

Yet, even as new internal combustion engine vehicles dramatically cut the emissions of noxious urban

air pollutants by automobiles, their contribution to global warming has begun to rise. In the 1990s, the

transportation sector saw the fastest growth in carbon dioxide emissions of any major sector of the

U.S. economy. And the transportation sector is projected to generate nearly half of the 40% rise in

U.S. carbon dioxide emissions forecast for 2025.


Internationally, the situation is equally problematic. As Claude Mandil, Executive Director of the

International Energy Agency (IEA), said in May 2004, “In the absence of strong government policies,

we project that the worldwide use of oil in transport will nearly double between 2000 and 2030,

leading to a similar increase in greenhouse gas emissions.”


If by 2050 the per capita energy

consumption of China and India were to approach that of South Korea, and if the Chinese and Indian

populations increase at currently projected rates, those two supergiant countries by themselves would

consume more oil than the entire world used in 2003.


Since oil is a finite, non-renewable resource, analysts have attempted to predict when production will

peak and start declining. Some believe this will occur by 2010. In his 2001 book, Hubbert’s Peak:

The Impending World Oil Shortage, Princeton geophysicist Kenneth Deffeyes, writes “There is

nothing plausible that could postpone the peak until 2009. Get used to it.”


Royal Dutch/Shell, a

company itself downgrading reserve estimates, adds only a few years to this forecast. According to

Shell, “A scarcity of oil supplies—including unconventional sources and natural gas liquids—is very

unlikely before 2025. This could be extended to 2040 by adopting known measures to increase

vehicle efficiency and focusing oil demand on this sector.”


Whether we will adopt these known measures or not remains to be seen. The purpose of this paper is

to discuss and compare the various measures.

Shell’s other hedge, “including unconventional sources and natural gas liquids,” is environmentally

problematic. Making liquid fuels out of unconventional sources of oil (such as Canadian oil sands) is

relatively energy-intensive, and relying on these sources will significantly increase greenhouse gas

emissions. Indeed, Canada's increasing use of natural gas to extract its heavy oils is one reason that

its exports of natural gas to United States are projected to shrink in coming years. Both the U. S.

Energy Information Administration (EIA) and the National Petroleum Council (NPC) project a sharp

decline in net imports of Canadian natural gas by 2025.


Making conventional liquid fuels out of

natural gas is also a questionable use of natural gas from an environmental perspective.

In particular, for those who are concerned about global warming, it is critical that whatever strategy

the United States adopts to reduce greenhouse gas emissions in the vehicle sector does not undermine

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our efforts to reduce greenhouse gas emissions in the electricity sector. The nation has been sprinting

to build new natural gas power plants. As of 2003, the U.S. had more than 800 gigawatts (GW) of

central station electric power generation. “Of the 144 gigawatts added between 1999 and 2002, 138

gigawatts is natural-gas-fired,” as EIA noted in 2002.


Rising demand coupled with supply constraints has led to soaring natural gas prices. Remarkably, in

its most recent Annual Energy Outlook 2004, EIA concludes that in the electricity sector, "the share

from coal is projected to increase from 50 percent in 2002 to 52 percent in 2025 as rising in natural

gas prices improved the cost competitiveness of coal-fired technologies. AEO2004 projects that 112

gigawatts of new goal-fired generating capacity will be constructed between 2003 in 2025." At the

same time, utilization of existing coal plants is projected to rise, so that by 2025, coal consumption by

electric generators will be 50% higher than today.


EIA projections are made assuming no change in U.S. policies, such as a cap on carbon emissions,

and as such are often wrong. Yet, they underscore the critical need for a different energy policy and

for using any incremental natural gas production/imports or renewable energy for displacing new coal

fired generation, rather than for making alternative fuels for at least the next two decades.

Both the EIA and NPC project that far more of this country’s growing demand for natural gas will be

met from imported liquefied natural gas (LNG) than from increases in production. Thus, we should

start thinking of the natural gas resource base as a global one when we contemplate using natural gas

for purposes other than displacing increased coal generation. That’s especially true because projected

growth in global coal consumption is an even bigger greenhouse gas problem than projected US

growth in coal consumption.

By 1999, the world had just over 1000 gigawatts of coal-fired electric generating capacity, of which

about one third was in United States. Between 2000 and 2030, over 1400 GW of new coal capacity

will be built according to the International Energy Agency, of which 400 GW will replace old plants

Source: IEA, WEO 2002

Two-Thirds of World Coal Capacity in

2030 is NOT Yet Built

These plants would commit the planet to total carbon dioxide emissions of some 500 billion metric

tons over their lifetime, unless “they are backfit with carbon capture equipment at some time during

their life,” as David Hawkins, Director of Natural Resources Defense Council’s Climate Center told

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the U.S. House Committee on Energy and Commerce in June 2003.


Hawkins continued: “To put

this number in context, it amounts to half the estimated total cumulative carbon emissions from all

fossil fuel use globally over the past 250 years!”

So again, it is critical that whatever strategy the world adopts to reduce greenhouse gas emissions in

the vehicle sector does not undermine our efforts to reduce greenhouse gas emissions in the electricity

sector. With this caveat in mind, we will explore the five pathways most widely discussed for

reducing or replacing oil while significantly reducing transportation greenhouse gas emissions:

efficiency, electricity (particularly plug-in hybrid-gasoline vehicles); ethanol from cellulosic biomass;

synthetic diesel fuel; and hydrogen. To achieve greenhouse gas reductions, one or more of these

pathways may require permanently sequestering carbon dioxide underground.


Efficiency is typically the most cost-effective strategy for addressing major energy issues because the

savings achieved from the reduction in energy consumption can offset some or all of the increase in

cost of the efficient technology. Energy efficiency strategies often have a positive net present value

or short payback. Alternative fuels typically have high costs—for the fuel, the vehicle, and the

infrastructure—which undermines their cost effectiveness and practicality.

The fuel efficiency approach is the one this country used so successfully from the mid-1970s to mid -

1980s, when we doubled the fuel efficiency of our fleet while making our cars safer, mandating that

new cars have a fuel efficiency of 27.5 miles per gallon (mpg). In a 2002 report to President Bush, the

National Academy of Sciences concluded that automobile fuel economy could be further increased by

12 percent for small cars and up to 42 percent for large SUVs with technologies that would pay for

themselves in fuel savings.


That study did not even consider the greater use of diesels and hybrids.

Studies by the national laboratories for DOE, by the Massachusetts Institute of Technology, and by

the Pew Center on Global Climate Change have concluded that even greater savings could be cost-

effective while maintaining or improving passenger safety.


The Europeans have a voluntary

agreement with automakers that will reduce carbon dioxide emitted per mile by 25% between 1995

and 2008-2009 for the average light-duty vehicle, which equates to a vehicle fuel efficiency of almost

40 mpg. Japan has a mandatory target with similar goals.


Efforts to raise fuel economy standards have been stuck in political limbo for years. Because of this

inaction, the fuel economy of the average vehicle on American roads is at its lowest level in two



The fuel economy laws have a loop-hole allowing sport utility vehicles (SUVs) and light

trucks to average 20.7 mpg, 25% lower than the new car standard. This has allowed overall vehicle

efficiency to drop as the SUV share of new vehicle sales has grown. Ford, for instance, has backed off

a voluntary commitment to increase SUV fuel efficiency, and, in fact, its 2003 model year SUVs were

less fuel-efficient than the previous year.


The two most potent arguments against raising fuel economy standards have centered around safety

and jobs. The argument has been that fuel economy standards will inevitably push people into

smaller and lighter vehicles. Such vehicles are supposedly less safe—a claim with little analytical

support but tremendous political potency. The matching argument has been that Detroit makes most

of its profit on bigger vehicles, and a move to smaller vehicles would inevitably come at the expense

of profit and hence the jobs of autoworkers.

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Hybrid gasoline-electric vehicles are a game changer for both of those arguments. The best hybrids,

like the Toyota Prius, allow a 60% to 100% fuel economy gain with no reduction in weight or size.

The onboard energy storage device, usually a battery, increases efficiency in several ways. It allows

“regenerative braking”—recapturing energy that is normally lost when the car is braking. It also

allows the internal combustion engine to be shut down when the car is idling or decelerating. It

allows key components, such as the air-conditioning unit, to be run off the battery. Finally, because

gasoline internal combustion engines have lower efficiencies at lower power, the battery allows the

main engine to be run at higher power and thus more efficiently more of the time, especially in city


Electrifying the car also has numerous safety and performance benefits. The Prius has an electronic

brake-by-wire system that is arguably safer than traditional brakes, and hybrid electronics hold the

promise of far more controllability, instant response, and safety. Ultimately we may see electric

motor on every wheel for increased control. Also, most manufacturers are using some of the

efficiency gain from the hybrids to increase acceleration, yet another performance gain.

Since hybrids actually cost a little more, they represent a source of increased income and jobs for

Detroit and for the country as a whole. This creates the possibility of replacing imported oil with

hardware manufactured by Americans. Temporary tax credits can help consumers with the price cost

for initial models. But once hybrids are in mass commercialization in a variety of models from

several automakers, their incremental costs will likely be less than three years of their gasoline

savings—a good payback for all consumers and businesses.


Also one can't simply ascribe a pure

cost to hybrids since they deliver performance, safety, engine-downsizing and other benefits beyond

their energy savings.

General Motors has, until recently, been very dismissive of hybrids, especially hybrid cars. Indeed,

as recently as January 2004, CNN/Money reported: “General Motors Corp. has no plans to try to

answer the success of the Toyota Prius, the critically-acclaimed gas/electric hybrid car, said Robert

Lutz, GM's vice chairman of product development. It just doesn't make environmental or economic

sense to try to put an expensive dual-powertrain system into less expensive cars which already get

good mileage, Lutz said at the North American International Auto Show.”


Yet by March, GM was taking out full-page ads in major newspapers and magazines, with a

paragraph that begins: "HYBRIDS. Powered partly by engines, partly by batteries, hybrids deliver

improved fuel economy with uncompromising performance…. Cars, trucks, SUVS and buses you

already know and trust, with an extra boost at the fuel pump." So GM can no longer argue that fuel

economy is incompatible with “uncompromising performance.” And Ford Motor took out its own

two-page ad in late March touting their new hybrid: “As the first and only gas/electric SUV, the

Escape Hybrid compromises nothing.”

GM's and Ford's ads highlight that hybrids are now likely winners in the marketplace, delivering

improved performance with higher fuel economy. Probably the biggest danger for U.S. from a jobs

and competitiveness perspective is if car companies fail to embrace them quickly enough.

Moreover, hybrids are almost certainly the platform from which all future clean vehicles will evolve.

For instance, if we achieve two major scientific breakthroughs—in fuel cell membranes and hydrogen

storage—then fuel cells may well be inserted into hybrids. If battery technology continues to

improve, then plug-in hybrids are likely to become an attractive option. Biofuels require highly

Page 7


efficient vehicles to reduce the land and infrastructure impact of a major switch away from gasoline.

All of these issues are discussed further below.

So from a policy perspective, a top priority for any clean transportation technology is to promote the

use of hybrids. Indeed, policy should promote hybrids that are also partial zero-emission vehicle

(PZEV). These vehicles running on low-sulfur gasoline have very low tailpipe emissions, for

instance, only 0.02 grams of NOx (nitrogen oxides) per mile. Both the Toyota Prius and the Ford

Escape hybrid SUV are hybrid PZEVs. These vehicles qualify for special consideration under

California air regulations as Advanced Technology Partial Zero Emission Vehicles (AT-PZEVs).

Accelerating the market penetration of AT-PZEVs would go a very long way to addressing the

impacts cars have on air quality, gasoline consumption, and greenhouse gas emissions while creating

the conditions for the next generation of alternative fuels.


Diesel engines are the workhorses for big trucks and construction equipment because of their

efficiency, durability, and high torque (the force that produces wheel rotation and hauling power) at

low speed. Modern diesel engines are quite different from the smoky and noisy engines of the 1970s

and 1980s, with advances such as “electronic controls, high-pressure fuel injection, variable injection

timing, improved combustion chamber design, and turbo-charging.”


Although they represent less

than 1% of car and light truck sales in United States, diesels are becoming the car of choice in

Europe, where gasoline prices are much higher, where fuel taxes favor diesel use, and where tailpipe

emissions standards are less stringent.

Gasoline taxes in Europe and Japan are several times that of United States, and overall, their gasoline

prices are two to three times that of ours. Gasoline in Japan, France, United Kingdom, and Germany

costs between $3.60 and $4.60 per gallon.


In France and Germany, diesel fuel costs about $1 per

gallon less than gasoline. Diesels have some 40% of the market for cars in Europe, and by 2001

represented the majority of new cars sold in a great many European countries. They are 20% to 30%

more fuel-efficient than gasoline.


While diesels currently have higher emissions of particulates and oxides of nitrogen, they are steadily

reducing their emissions. Many believe that with the large amounts of R&D funding currently aimed

at diesels, they will be able to meet the same standards as gasoline engines in the near future, but

probably at a price premium.

A new global warming concern about diesel emissions involves their high level of emissions of black

carbon (BC) or small some particles smaller than one micron (PM1.0). Recent work by NASA’s

James Hansen and others suggest that black carbon is a potent greenhouse gas.


One estimate even

suggests that the black carbon emission from diesel engines may wipe out their global warming

benefit compared to gasoline engines. As Princeton professor Bob Williams wrote in 2004, “Thus,

ironically, the ongoing shift in Europe to diesel cars might lead to increased global warming even

though it would help Europe meet its Kyoto obligations—because BC is not a greenhouse gas and is

thus not covered by the Kyoto protocol or the Framework Convention on Climate Change.”


Under Federal Tier I emissions standards, diesel cars may have no greenhouse gas benefit versus

gasoline engines. Under the stricter Tier II emissions standards now being phased-in, the black

carbon problem is largely solved for diesel cars, and their greenhouse gas benefit returns, but, as

Williams notes, “this would be accomplished at a significant extra first cost,” which could be $500 to

$750—and this is on top of the significant price increment one must pay for diesels versus gasoline-

powered cars. Today’s diesels already cost “between one and nearly six thousand dollars more than

Page 8


their gasoline counterparts.”


There is also be very legitimate concern that in the real world,

emissions can be higher than mandated because cars and pollution control equipment often is

operated differently than in tests and because some fraction of pollution-control equipment


The key to the success of diesels as a long-term greenhouse gas reduction strategy will be fuels with

far lower net carbon dioxide emissions than current diesel fuels (possibly coupled with advanced

particulate controls). This could include bio-diesels or, as will be discussed below, a synthetic diesel

fuel made using a process that includes sequestration of carbon dioxide.


Some argue that radically new vehicle design strategies could have a huge impact on vehicle

efficiency. One of the best-known proponents, Amory Lovins of Rocky Mountain Institute, recently

argued that “designing and making cars differently—emphasizing ultralight weight, ultralow drag, an

integrated design—can reduce required propulsive power by about two-thirds.” He further argues

that “new manufacturing and design methods can also make these radically more efficient vehicles

cost-competitive and uncompromised.”


Such claims so far exist mainly at the “concept car” level. By way of comparison, “GM introduced

the first fuel cell-powered concept vehicle nearly 40 years ago,” as the company stated in a recent



Radically different car designs not only require taking head-on the huge incumbent

advantage of the sunk cost in the existing vehicle manufacturing infrastructure—which is especially

problematic since early models of new vehicles typically have not achieved economies of scale and

thus have a large cost disadvantage. At the same time, radically new vehicles must overcome

obstacles related to public acceptance and concerns about safety

It may be that ultralight weight cars can be built as safe as existing cars, but the overwhelming public

perception is that heavier cars are safer. There is little evidence at least in United States that people

are ready to embrace ultralight weight cars. While small city cars that are commonly found in foreign

capitals are not exactly the same as an ultralight, their complete absence from US roads suggests that

the introduction of vehicles that weigh the same as city cars, even if they are larger, will be a difficult

sell—unless there is a fundamental change in the car-buying public. Until we see ultralight weight

vehicles from multiple car companies succeed in the US market, it would be unwise to basic

government policy on the hope of their success.


Currently, there is scattered anecdotal information that oil at $40 a barrel and gasoline at $2 a gallon

is slowing sales of large SUVs (such as GM’s Hummer) and spurring buyer interest in hybrids.



fuel bill for the average American car is only about $100 a month, so even significant increases in the

price of gasoline have small impacts on the budgets of consumers or the total annual operating costs

of a vehicle. That is perhaps a key reason why for many years fuel economy has ranked relatively

low on the list of desired attributes for a car. It is also a reason why gasoline taxes are not a potent

policy tool.

Much higher oil prices could certainly influence consumer behavior to choose a different mix of

vehicles. However, the rule of thumb is that a $1 a barrel price increase translates into a price

increase of about 2.4 cents per gallon of gasoline.


So oil prices would have to approach $80 a barrel

before the United States even saw gasoline prices near European levels. It seems unlikely such prices

will be seen anytime soon for sustained period of time, especially since many forms of

unconventional oil are already becoming economical at current prices, and technology continues to

Page 9


improve to lower their cost.


Rather than an oil peak, we may well see an oil plateau, where carbon-

intensive unconventional oil hold off the inevitable decline in conventional oil.

We believe that it is far more likely that global warming will be the catalyst for behavior change.

Certainly there is little if any evidence today that global warming influences the car purchases of U.S.

consumers. And given how slowly the climate changes, it could well be two decades (or more)

before climate change becomes so painfully obvious as to change the way people think about their

major energy-consuming purchases. If we are going to avoid serious climate change, the government

needs to act now, rather than waiting and hoping for a major, permanent change in the public's

vehicle tastes.

If their were a carbon cap or tax resulting in a price for carbon of $50 per metric ton, that would add

1.3 cents per kilowatt-hour for coal power plants with 34% efficiency, 0.5 cents per kilowatt-hour for

natural gas power plants with 53% efficiency, and only 12.5 cents per gallon to gasoline.


So again

it would probably take a prohibitively high price for carbon to drive gasoline prices just to European

levels. A cap and trade system phased in predictably over an extended period of time that led to a

moderate price for carbon, $50 to $100 a ton, is probably a critical strategy for driving fuel switching

in the electricity and industrial sector, but its effect on the price of gasoline (and electricity for that

matter) would be too small to encourage much efficiency. Thus achieving significant greenhouse gas

reductions in the transportation sector in the medium-term will almost certainly require government

mandates or regulations aimed at raising the average fuel economy of the fleet.


Alternative fuel vehicles (AFVs) and their fuels face two central problems. First, they typically suffer

from several marketplace disadvantages compared to conventional vehicles running on conventional

fuels. Hence, they inevitably require government incentives or mandates to succeed. Second, they

typically do not provide cost-effective solutions to major energy and environmental problems, which

undermines the policy case for having the government intervened in the marketplace to support them.

On the second point, in September 2003, the US Department of Transportation Center for Climate

Change and Environmental Forecasting released its analysis, Fuel Option for Reducing Greenhouse

Gas Emissions from Motor Vehicles. The report assesses the potential for gasoline substitutes to

reduce greenhouse gas emissions over the next 25 years. It concludes that “the reduction in GHG

emissions from most gasoline substitutes would be modest” and that “promoting alternative fuels

would be a costly strategy for reducing emissions.”

The U.S government and others (such as of California and Canada) have tried to promote AFVs for a

long time. The 1992 Energy Policy Act established the goal of having alternative fuels replace at least

10% of petroleum fuels in 2000, and at least 30% in 2010. Currently, alternate fuels consumed in

AFVs substituted for under 1% of total consumption of gasoline. A significant literature has emerged

explaining this failure.


Besides the question of whether AFVs deliver cost-effective emissions

reductions, there have historically been six major barriers to AFV success:

1. High first cost for vehicle

2. On-board fuel storage issues (i.e. limited range)

3. Safety and liability concerns

4. High fueling cost (compared to gasoline)

5. Limited fuel stations: Chicken & egg problem

6. Improvements in the competition (better, cleaner gasoline vehicles).

Page 10


All AFVs that have so far been promoted with limited success—electric vehicles, natural gas

vehicles, methanol vehicles, and ethanol vehicles—have each suffered from several of these barriers.

Any one of these barriers can be a showstopper for an AFV or an alternative fuel, even where other

clear benefits are delivered. MTBE, for instance, has had its biggest difficulty with the safety and

liability issue, even though it has minimal problems in the other areas because it can be blended

directly with gasoline. Electric vehicles deliver the clear benefit of zero tailpipe emissions, and can

even have lower per mile costs than gasoline cars, but range, refueling, and first cost issues have

limited their success and caused most major auto companies to withdraw their electric vehicles from

the marketplace.

The chicken & egg problem—who will build and buy the AFVs if a fueling infrastructure is not in

place and who will build the fueling infrastructure before the AFVs are built—remains the most

intractable barrier. Consider that there are millions of flexible fuel vehicles already on the road

capable of running on E85 (85% ethanol, 15% gasoline), 100% gasoline, or just about any blend, for

about the same price as gasoline powered vehicles, and yet the vast majority of them run on gasoline

and there are have been very few E85 stations built.

In the case of natural gas vehicles, the environmental benefits were oversold, as were the early cost

estimates for both the vehicles and the refueling stations: “Early promoters often believe that ‘prices

just have to drop’ and cited what turned out to be unachievable price levels.” One study concluded,

“Exaggerated claims have damaged the credibility of alternate transportation fuels, and have retarded

acceptance, especially by large commercial purchasers.”


All AFVs face the increasing “competition” from improved gasoline-power vehicles. Indeed, two

decades ago when tailpipe emissions standards were being developed requiring 0.02 grams/mile of

NOx, few suspected that this could be achieved by internal combustion engine vehicles running on

we formulated gasoline.

The new generation of hybrid PZEVs such as the Toyota Prius and Ford Escape hybrid have

substantially raised the bar for future AFVs. These vehicles have no chicken and egg problem (since

they can be fueled everywhere), no different safety concerns than other gasoline cars, a substantially

lower annual fuel bill, greater range, a 40% to 50% reduction in greenhouse gas emissions, and a

90% reduction in tailpipe emissions. The vehicles do cost a little more, but that is more than offset by

the current government incentive and the large reduction in gasoline costs, even ignoring the

performance benefits. Compare that to many AFVs, whose environmental benefits, if any, typically

come at the expense not merely of a higher first cost for the vehicle, but a much higher annual fuel

bill, a reduced range, and other undesirable attributes from the consumer’s perspective.


In an October 2003 paper for the Commission, we examined the difficulties facing hydrogen as an

AFV. We will not repeat that analysis here, but will briefly report on some of the key analyses

published subsequently, which tend to reinforce our main conclusions

The central challenge for any AFV seeking government support beyond R&D is that the deployment

of the AFVs in the infrastructure to support them must cost effectively address some energy or

environmental problems facing the nation. Yet in the spring issue of Issues and Science and

Technology, two hydrogen advocates, Dan Sperling and Joan Ogden of U.C. Davis, wrote, “Hydrogen

is neither the easiest nor the cheapest way to gain large near- and medium-term air pollution,

greenhouse gas, or oil reduction benefits.”


A 2004 analysis by Jae Edmonds et al. of Pacific

Page 11


Northwest National Laboratory concluded in that even “in the advanced technology case with a

carbon constraint … hydrogen doesn’t penetrate the transportation sector in a major way until after

2035.” A push to constrain carbon dioxide emissions actually delays the introduction of hydrogen

cars because sources of zero-carbon hydrogen such as renewable power can achieve emissions

reductions far more cost-effectively simply replacing planned or existing coal plants. As noted

above, our efforts to reduce greenhouse gas emissions in the vehicle sector must not come at the

expense of our efforts to reduce greenhouse gas emissions in the electric utility sector.

In fact, Well-to-Wheels Analysis of Future Automotive Fuels and Powertrains in the European

Context, a January 2004 study by the European Commission Center for Joint Research, the European

Council for Automotive R&D, and an association of European oil companies, concluded that using

hydrogen as a transport fuel might well increase Europe's greenhouse gas emissions rather than

reduce them. That is because many pathways for making hydrogen, such as grid electrolysis, can be

quite carbon-intensive and because hydrogen fuel cells are so expensive that hydrogen internal

combustion engine vehicles may be deployed instead (which is already happening in California).

Using fuel cell vehicles and hydrogen from zero-carbon sources such as renewable power or nuclear

energy has a cost of avoided carbon dioxide of more than $700 a metric ton, which is considerably

higher than most other strategies being considered today.


A number of major studies and articles have recently come out on the technological challenges facing

hydrogen. A DOE study noted that transportation fuel cells currently cost about $5,000/kw, some

100 times greater than the cost of internal combustion engines.


A 2004 article for the Society of

Automotive Engineers noted, “Even with the most optimistic assumptions, the fuel cell powered

vehicle offers only a marginal efficiency improvement over the advanced [diesel]-hybrid and with no

anticipation yet of future developments of IC engines. At $100/kW, the fuel cell does not offer a short

term advantage even in a European market.”


A prestigious National Academy of Sciences panel concluded a major report in February with a

variety of important technical conclusions.


For instance, the panel said, “The DOE should halt

efforts on high-pressure tanks and cryogenic liquid storage…. They have little promise of long-term

practicality for light-duty vehicles.” A March study by the American Physical Society concluded that

“a new material must be discovered” to solve the storage problem.


An analysis in the May 2004

issue of Scientific American stated, “Fuel-cell cars, in contrast [to hybrids], are expected on about the

same schedule as NASA’s manned trip to Mars and have about the same level of likelihood.”


Hydrogen fuel cell vehicles face major challenges to overcome each and every one of the barriers

discussed above. Of all AFVs and alternative fuels, fuel cell vehicles running on hydrogen are

probably the least likely to be a cost-effective solution to global warming, which is why the other

pathways deserve at least equal policy attention and funding.


A straightforward improvement to hybrids can allow them to be plugged into the electric grid and run

in an all-electric mode for a limited range between recharging. Since most vehicle use is for

relatively short trips, such as commuting, which are followed by an extended period of time during

which the vehicle is not being driven and could be charged, even a relatively modest all-electric range

of 20 or 30 miles could allow these vehicles to replace a substantial portion of gasoline consumption

and tailpipe emissions. If the electricity were from CO


-free sources, then these vehicles would also

have dramatically reduced net greenhouse gas emissions.

Page 12


Because they have a gasoline engine, plug-in hybrid electric vehicles (PHEVs) avoid two of the

biggest problems of pure electric vehicles. First they are not limited in range by the total amount of

battery charge. If the initial battery charge runs low, the car can run purely on gasoline and on

whatever charging is possible from the regenerative breaking. Second, electric vehicles take many

hours to charge, so that if for some reason owners were unable to allow the car to charge—either

because they lacked the time between trips to charge or there was no local charging capability—

then the pure-electric car could not be driven. In some respects, PHEVs combine the best of both

hybrids and pure electric vehicles.

Battery improvement will lead to increased functionality for PHEVs. Improvements in specific

energy (Wh/kg) and specific power (W/kg) will reduce weight. Reductions in cost and increases

in cycle life (durability) will make PHEVs more affordable. Adequate safety is a requirement.

Operating temperature is important, but batteries with unusual operating temperatures may be

considered if other benefits are demonstrated. Convenience of recharging is crucial, but the

definition of “convenience” varies by users. A full recharge overnight from an ordinary home

outlet is generally considered to be sufficient for a personal PHEV. Larger vehicles might require

higher charging voltages, or possibly undergo a battery cartridge replacement rather than



Batteries with high specific energy can store large amounts of electricity for their weight. A

gasoline tank has a specific energy of about 12 kWh/kg. This is roughly 100 times as great as the

best batteries. Electric vehicles require batteries with high specific energy, and range is a

function of energy capacity. Most batteries have a minimum charge threshold that should

generally be maintained. This is often about 20% of full capacity. While the batteries can

tolerate occasional discharges below this point, repeated deep discharges will damage the battery.

The computer controls in a hybrid can automatically preserve this margin.

Batteries with a high specific power can discharge their electricity quickly in powerful bursts.

The power of a gasoline vehicle is determined by the engine, not the fuel tank; a typical gasoline

engine has a specific power of about 150-400 W/kg,


which is generally at the lower range of

what batteries can achieve. Electric vehicles, by comparison, have their maximum power output

determined by both the batteries and the motor. When the weight of the electric motor is taken

into account, electric vehicles and gasoline vehicles are roughly comparable. Acceleration is

largely a function of specific power, so specific power is important in hybrid vehicles.

Current hybrid-electric vehicles like the Toyota Prius are not designed for extended operation in

pure electric mode, so they have typically optimize their batteries to provide high specific power.

Because plug-in hybrids use the battery both for supplemental power for acceleration and for

extended electric-only operation, they require high specific energy and high specific power.

There is a tradeoff—for a given battery technology, higher specific power tends to increase cost

per kWh of storage capacity.

There are many battery technologies under investigation for use in electric vehicles. The most

widely used or most promising are discussed below.


Lead acid batteries are currently used in most automobiles for starting, lighting, and ignition

applications. Some electric vehicles have been made with lead-acid batteries, including General

Motors’ EV I and the many electric vehicles in use at the beginning of the 20


century. Lead-

Page 13


acid batteries are inexpensive, but have poor specific energy, specific power, and lifetime. Lead-

acid batteries are not seen as a promising technology for EV, HEV, or PHEV vehicles.


Nickel metal hydride (NiMH) batteries are used in existing hybrid vehicles. These batteries offer

a higher power density and longer deep-cycling lifetimes compared to lead-acid batteries. Toyota

Prius uses NiMH batteries, covered under an 8-yr/100,000-mile warranty. NiMH batteries do

suffer from self-discharge over time.


A 2001 EPRI study projected NiMH batteries as the most plausible battery technology for PHEV

vehicles, although life cycle requirements remained a concern. EPRI estimated that the lowest

reasonable price for NiMH batteries in 2010 would be $250/kWh, leading to a system

incremental cost of $5782 for a PHEV60 (of which $4844 is battery cost).


Recent information from Cobasys (formerly Texas Ovonics) indicates that the 12V NiMH

batteries alone can have a specific energy of 43 Wh/kg and a specific power of 1100 W/kg at 50%

depth of discharge (DOD). When assembled into hybrid electric systems of higher voltage,

specific energy is 27-33 Wh/kg and specific power is 667-824 W/kg (depending on size).

A report prepared for the California Energy Commision concluded that, with recent advances, the

lifetime of NiMH batteries in pure EVs was over six years.


The report also noted that specific

energy for EVs can be up to 65 Wh/kg, and that a 30-kWh pack was expected to cost $9,000 at

production volume of hundreds of thousands per year. A 2001 presentation by Dr. John

Heywood of MIT notes that NiMH batteries configured for use in EVs can have specific energy

of 70 Wh/kg and specific power of 150 W/kg, whereas those configured for use in HEVs can

have specific energy of 40 Wh/kg and specific power of 400 W/kg.


The Cobasys design

features a substantial improvement in specific power over that cited by Heywood, but only a

marginal improvement in specific energy.


Lithium-ion batteries demonstrate considerable potential for specific energy and specific power.

Although currently expensive to manufacture, and posing some safety concerns, they are a

primary focus of inquiry.

Sandia National Laboratory noted in 2000, “The lithium-ion battery has four times the energy

density of lead-acid batteries and two to three times the energy density of nickel-cadmium and

nickel-metal hydride batteries”


Argonne National Laboratory noted in 2001 that the best

laboratory designs for lithium-ion batteries provide

“specific power up to 1 kW/kg and a

cycle life of more than 100,000 shadow-discharge (10%) cycles. The battery operates at ambient

temperatures, although at 50°C (122°F) the calendar life of the cell is shortened significantly.”


Lithium-ion battery modules require protective control circuitry to prevent dangerous

overcharging conditions. Deep-discharge cycle lifetime is uncertain. Manufacturers claim they

will be able to produce at comparable cost to NiMH. More recently, lithium-ion batteries have

been observed displacing NiMH as the battery of choice for cell phones.


The following information is provided by GlobTek, a supplier of lithium-ion batteries:

Page 14


Voltage (V)

3.6 / 3.7

Specific Energy (Wh/Kg)


Specific Energy (Wh/L)


Cycle Life (Times)


Operation Performance at -20°C

(Relative to Capacity at 25°C)


Self-Discharge Rate (%/month)


Memory Effect


Lithium ion batteries are increasingly used in consumer electronics, but are not yet widely used in

vehicles. An electric vehicle developer recently constructed a vehicle with a battery pack

consisting of 6,800 conventional consumer-electronic lithium-ion batteries (battery designation

18650). The “tzero” vehicle has a range of 250 miles at 75-80 mph and can accelerate from 0-60

in 3.6 seconds. Because the 18650 battery is mass-produced in huge volumes, AC Propulsion

found assembling a huge number to be a less expensive option that purchasing a lithium-ion

battery pack designed for EV operation.


The battery weigh 43 g each for a total of 292 kg, but

the designers estimate that a conventional EV would only use about half as many cells (AC

Propulsion was interested in demonstrating extremely high performance).

Lithium ion polymer batteries attempt to improve on conventional lithium ion batteries. The

primary advantage is geometry, as these can be shaped in a variety of forms. They are more

expensive than conventional lithium-ion batteries and have lower energy density and cycle life.

They are also somewhat safer (less risk of overcharge) and lighter. Sony and Sanyo are among

the principal developers of lithium-ion polymer batteries. Recent batteries have achieved a

specific energy of 95 Wh/kg and specific power of up to 2000 W/kg at full charge (down to 1300

W/kg at 80% depth of discharge).



Sodium nickel chloride batteries include the “Zebra” batteries made by MES-DEA in

Switzerland. They are currently used in the bus and commercial vehicle market.


There is also

no self-discharge and no overcharge gassing reaction (as can happen with lithium batteries). Peak

power is retained down to 80% depth of discharge, and the battery has a 90% useful depth of



Energy density is similar to that of lithium-ion batteries, at about 94 Wh/kg

according to the company’s documentation.


Cost is currently at $500/kWh but with a projected

$220/kWh for volume production.


One drawback to sodium nickel chloride batteries is the high-temperature operation. Batteries

operate within an insulated box (300 °C). However, an NREL review found that the batteries

were generally unlikely to present significant public safety hazards.


Specific power is also low,

at 169 W/kg. For use in hybrids, the company seeks to increase specific power to at least 350



These batteries are currently used in transit bus applications, at the 600V size. For such use, the

manufacturer provides a one-year warranty. The manufacturer estimates a 75% chance of the

battery lasting at least two years and 50% chance of lasting at least three years in transit bus



Many other battery chemistries are being explored, and it is possible if not likely that future

battery technologies will outperform the best current technologies.

Page 15



PHEVs avoid many of the barriers to AFVs discussed earlier. They do not have a limited range.

They do not have major safety and liability issues—although great care would have to be taken in the

design of any home-based system that charged PHEVs or allowed them to feed back into the grid.

They do not have a high fueling cost compared to gasoline. In fact, the per mile cost of running on

electricity is likely to be less than the per mile cost of running on gasoline. The chicken & egg

problem is minimized because electricity is widely available and charging is relatively


The vehicle will almost certainly have a higher first cost, but this is likely to be more than

compensated by the economic benefit of a lower fuel bill, as the 2003 study by The California Energy

Commission and Air Resources Board concluded. Also, that study did not consider a large potential

revenue stream the vehicle owner may be able to extract from the utility by having what is essentially

a portable electric generator.

The largest potential revenue stream that a PHEV owner might be able to extract is for so-called

spinning reserves, which, as one analysis explains, “are contracts for generating capacity that is up

and running, and is synchronized with the power line.” When called upon, a spinning reserve “must

ramp up to its full output within 10 minutes.” Spinning reserves are valuable to a utility or power

system because they contribute “to grid stability helping to arrest the decay of system frequency when

there is a sudden loss of another resource on the system.”


Value can also be extracted by generators

that can provide faster response when grid voltage needs to be increased or decreased, so-called

“regulation services.” Since cars are designed to start rapidly, they could quickly add their power to

the electric grid when needed. Utilities would pay for this service if there was a guarantee that the car

could deliver juice when needed, which suggests that this is more practical for vehicle fleets or for a

corporate sponsor.

The potential value of such services is significant: $700 to $3000 per year.


This value is so large

that it might allow the monthly cost of purchasing or leasing a PHEV to be lower than a conventional

car, and perhaps even cover the replacement cost for batteries if they prove not to have a 100,000+

mile lifetime typically expected of modern cars. It is critical that we fund some real-world

demonstrations of PHEVs providing these services, to see if this value can be extracted. If it can, we

might see major utilities helping to subsidize the cost and/or financing of PHEVs.

Environmentally, PHEVs offer two potentially significant benefits. First, since they are designed to

run all electric for short trips such as commuting, they offer the possibility of being zero-emission

vehicles (ZEVs) in cities. Since the decision to run the car all electric will reside with the driver,

some method of verification will be required if these vehicles are to receive ZEV credit. Given that

early adopters, such as electric utilities, will probably want to maximize all-electric use, some sort of

remote verification (similar to smart-pass technology) seems viable. The best early uses of PHEVs

may well be to replace dirty diesel engine vehicles used regularly in cities, such as buses,

maintenance vehicles, and delivery trucks. If hydrogen fuel cell cars ultimately prove impractical,

PHEVs may be the only viable option for urban zero emission vehicles.

The potential greenhouse gas benefits of PHEVs are even more significant, if a source of zero-carbon

electricity can be utilized for recharging. PHEVs have an enormous advantage over hydrogen fuel

cell vehicles in utilizing zero-carbon electricity. That is because of the inherent inefficiency of

generating hydrogen from electricity, transporting hydrogen, storing it onboard the vehicle, and then

running it through the fuel cell. The total well-to-wheels efficiency with which a hydrogen fuel cell

vehicle might utilize renewable electricity is 20% to 25%. The well-to-wheels efficiency of charging

Page 16


an onboard battery and then discharging it to run an electric motor in a PHEV, however, could exceed


As Alec Brooks, a leading designer of electric vehicles, has shown, “Fuel cell vehicles that operate on

hydrogen made with electrolysis consume four times as much electricity per mile as similarly-sized

battery electric vehicles.”


Ulf Bossel, founder of the European Fuel Cell Forum, comes to a similar

conclusion in a recent article, “The daily drive to work in a hydrogen fuel cell car will cost four times

more than in an electric or hybrid vehicle.”


This relative inefficiency has enormous implications for achieving a sustainable energy future. To

replace half of U.S. ground transport fuels (gasoline and diesel) in the year 2050 with hydrogen from

wind power, for example, might require 1400 gigawatts of advanced wind turbines or more. To

replace those fuels with electricity in PHEVs might require under 400 gigawatts of wind. That 1000

GW difference may represent an insurmountable obstacle for hydrogen as a greenhouse gas

mitigation strategy—especially since the U.S. will need several hundreds of gigawatts of wind and

other zero-carbon power sources in 2050 just to sharply reduce greenhouse gas emissions in the

electricity sector. As Bossel writes, “the forced transition to a hydrogen economy may prevent the

establishment of a sustainable energy economy based on intelligent use of precious renewable



Biomass can be used to make a zero-carbon transportation fuel, like ethanol, which is now used as a

gasoline blend. Today, the major biofuel is ethanol made from corn, which yields only about 25%

more energy than was consumed to grow the corn and make the ethanol, according to some estimates.

Considerable R&D is going on into producing ethanol made from sources other than corn. This so-

called cellulosic ethanol can be made from agricultural and forest waste as well as dedicated energy

crops, such as switchgrass or fast-growing hybrid poplar trees, which can be grown and harvested

with minimal energy consumption, so overall net emissions are near zero.


All cars today can use a mixture of 10% ethanol and 90% gasoline, E10. Some 4 million flexible-fuel

vehicles, which can run on either gasoline or a blend with 85% ethanol, E85, are on the road today,

but few use E85 because of its high price. This suggests that we cannot solve the chicken-and-egg

problem for an alternative fuel merely by delivering a cost-effective vehicle capable of running on

that fuel.

The big advantage ethanol has over alternative fuels like hydrogen (and natural gas) is that it is a

liquid fuel and thus much more compatible with our existing fueling system. Existing oil pipelines,

however, are not compatible with ethanol, so significant infrastructure spending would still be

required if ethanol were to become the major transportation fuel.


Ethanol production will require

major technological advances before matching the price of gasoline on an equivalent energy basis.

Lester Lave and two other Carnegie Mellon University researchers present the following calculation:

Producing cellulosic ethanol costs about $1.20 per gallon (1.80 per gallon, gasoline

equivalent, since ethanol has two-thirds of the energy of a gallon of gasoline). Assuming that

the per-gallon distribution costs are the same for ethanol and holding total tax revenue

constant, ethanol would sell for $1.80 per gallon at the pump. However, this is equivalent to

$2.70 per gallon in order to get as much energy as in a gallon of gasoline.


Page 17


This calculation should viewed as a projection given that there are no commercial cellulosic ethanol

plants anywhere in the world as of 2004. Nonetheless, it suggests two things. First, if oil prices in,

say, 2020 are higher than they are today, then cellulosic ethanol will represent a potentially quite

competitive alternative fuel. This is particularly true since a price for carbon is virtually inevitable by

2020, further improving the relative cost competitiveness of cellulosic ethanol to gasoline. The

average price of gasoline United States has already hit $2.00 a gallon with oil at $40 a barrel. Given

that our first strategy for reducing greenhouse gas emissions must be fuel efficiency, particularly

hybrids, we will be unlikely to need substantial amounts of cellulosic ethanol until post-2020. At that

time we will have a far clearer picture of future trends in climate change and in the production of both

conventional and carbon-intensive unconventional oil. The key will be to ensure that we have taken

aggressive measures long before then to bring down the cost of cellulosic ethanol through R&D as

well as efforts to subsidize the first initial plants. The Commission, through its support of “The Role

for Biomass in America’s Future” project, is developing a variety of valuable recommendations in

this area. It is possible that would still need technological progress and economies of scale in

production plants, cellulosic ethanol could drop to under $2.00 per gallon of gasoline equivalent.

The second conclusion we might draw from cost projections for cellulosic ethanol is that if we can

develop a substantial biomass resource for the purpose of creating a low-carbon fuel, it will almost

certainly be more cost-effectively used to make cellulosic ethanol than hydrogen. As the National

Academy of Sciences panel on the hydrogen economy concluded in February 2004, “hydrogen

production from biomass is a thermodynamically inefficient and expensive process, in which

approximately 0.2% to 0.4% of the total solar energy is converted to hydrogen at a price of currently

about $7.05/kg H2 by gasification in a midsize plant. Even with major technology breakthroughs,

“the committee estimates the possible future technology price for hydrogen from gasification of

biomass to be $3.60/kg H2, which is noncompetitive relative to other hydrogen production



For hydrogen production from biomass, perhaps the biggest problem is how expensive and energy-

intensive it is to transport hydrogen over long distances. Unfortunately, large biomass resources tend

to be quite distant from population centers where vehicle fuel is needed, and transporting solid

biomass is also very expensive and energy intensive. Converting that biomass to a liquid fuel like

cellulosic ethanol and then transporting that fuel is likely to be the most cost effective and least

energy-intensive way of delivering a low-carbon bio-based fuel. A particularly significant benefit of

using biomass to make cellulosic ethanol rather than hydrogen is that the switchover to ethanol can be

done gradually, as more and more ethanol is blended with gasoline, whereas any switchover to

hydrogen almost certainly requires a massive government subsidy for the infrastructure to attempt to

solve the chicken-and-egg problem.



Probably the biggest barrier to biofuels, and to biomass energy in general, is that biomass is not very

efficient at converting and storing solar energy, so large land areas are needed to provide enough

energy crops if biofuels are to provide a significant share of transportation energy. One 2001 analysis

by ethanol advocates concluded that to provide enough ethanol to replace the gasoline used in the

light-duty fleet, “it would be necessary to process the biomass growing on 300 million to 500 million

acres, which is in the neighborhood of one-fourth of the 1.8 billion acre land area of the lower 48

states” and is roughly equal to the amount of all U.S. cropland in production today.


That amount of

displaced gasoline represents about 60% of all U.S. transportation-related carbon dioxide emissions

today, but under 40% of what is projected for 2025 under a business-as-usual scenario. Given the

acreage needed, using so much land for these purposes would obviously have dramatic

environmental, political, and economic implications.

Page 18


Thus, if ethanol is to represent a major transportation fuel in the coming decades, then U.S. vehicles

will need to become much more fuel-efficient. Doubling the efficiency of the fleet by 2030 with

hybrid engines and other advanced technology would substantially reduce the biomass acreage

requirements. And putting cellulosic ethanol blends into plug-in hybrids with further reduce acreage

requirements, especially since there are plausible strategy for cogeneration of biofuels and biomass


In the long-term, biomass-to-energy production could be exceedingly efficient with “bio-refineries”

that produce multiple products. Lee Lynd, professor of engineering at Dartmouth, described one such

future bio refinery where cellulosic ethanol undergoes a chemical pretreatment, then fermentation

converts the carbohydrate content into ethanol, as carbon dioxide bubbles off.


The residue is mostly

lignin (a polymer found in the cell walls of plants). Water is removed, and the biomass residue is then

gasified to generate electricity or to produce a stream of hydrogen and carbon dioxide. The overall

efficiency of converting the energy content of the original biomass into useful fuel and electricity

would be 70%, even after accounting for the energy needed to grow and harvest the biomass. The

carbon dioxide can be sequestered. Also, this process could be used to generate biodiesel. This is

admittedly a futuristic scenario, but is the subject of intense research, and could make ethanol directly

competitive with a gasoline, and biomass electricity competitive with other zero-carbon alternatives,

especially when there is a price for avoiding carbon dioxide emissions. The syngas could also be

used to make synthetic diesel fuel (see below).


Interest has renewed in coal-derived diesel fuels for several reasons. The surge in diesel vehicles

has led to a desire to find a long-term low-carbon fuel for diesels. Several of the nations that will

be key to any action on global warming have vast coal resources, including the United States,

China, and India. And there has been growing policy interest in as well as R&D funding for

carbon capture and storage, which may make it possible to utilize coal resources for making fuels

(and electricity) without increasing greenhouse gas emissions.

America’s coal resource base is vast. Recoverable coal reserves amount to about 270 billion tons,

or 250 years at current production rates.


The demonstrated reserve base is almost 500 billion

tons, and the total resource base may exceed 4 trillion tons.


Coal is also relatively inexpensive

compared to other fossil fuels, a key reason it generates over 50% of U.S. electricity. Numerous

considerations constrain the use of coal as an energy resource. Mining can have significant

impacts on land and water. When burned, coal produces sulfur oxides (SO


), nitrogen oxides



), mercury, and particulate matter (PM). Coal also produces more carbon dioxide per unit of

energy produced than oil or natural gas.

Technological innovations can ameliorate many of the difficulties associated with the use of coal

as an energy resource. By converting coal to liquid or gaseous fuels, it will be possible to use it

for transportation, greatly reducing the risks of price shocks associated with increasing demand

for oil outpacing supply. Gasification and liquefaction can remove nearly all of the sulfur and

mercury from the coal, dramatically reducing pollutant emissions. If carbon sequestration is

proven to be effective, coal-derived liquid fuels could have lower CO


emissions than

conventional diesel or gasoline. Production of liquid fuels from coal offers a viable option for

energy security for the U.S., China, and other coal-rich countries.

Synthetic fuels development was a focus of U.S. energy independence efforts in the 1970’s.

Efforts were largely abandoned, but then resumed in the 1990’s. In 2001, the National Energy

Page 19


Technology Laboratory held a series of “Clean Liquid Fuels” workshops. One coal-to-liquids

facility is under development in Gilberton, PA.


The project was awarded a DOE grant for a

feasibility study in 2000; the facility has since been funded for development through the Clean

Coal Power Initiative.


The facility will seek to produce electricity and liquid fuels from waste

coal; CO


sequestration is a possibility.

Coal can be converted to liquid or gaseous fuels through a number of processes. Some of these

were pioneered in the Second World War to provide fuel for airplanes and tanks. Germany in

particular employed a number of technologies, including lignite distillation, Fischer-Tropsch

processes, and hydrogenation.


Indirect coal liquefaction first combines the coal with oxygen and steam or water to produce

synthesis gas (also known as syngas), which is most often a mix of carbon monoxide and



The syngas can then be processed into liquid or gaseous fuels such as Fischer-

Tropsch liquids, dimethyl ether (DME), or methanol. Toxic metals can be removed from the

syngas through a carbon filter. Direct coal liquefaction skips the syngas step, and includes

technologies such as distillation and hydrogenation (adding hydrogen to a coal-water slurry). The

addition of hydrogen improves the H/C ratio, bringing the resulting product closer to lighter

hydrocarbons such as those found in gasoline or diesel fuel. It also removes sulfur, allowing for

clean-burning fuel.


Direct liquefaction results in a crude oil, which is then be further refined.

For purposes of mitigating climate change, synthetic diesel fuels seem to present an appealing

option. Diesel compression-ignition engine (CIE) cars are 20% to 30% more efficient than

gasoline spark-ignition engine (SIE) cars, and hybrid technology offers the potential for further

efficiency gain. As noted above, however, using conventional diesel fuel, black carbon (soot) can

offset the greenhouse gas benefits—even if vehicle particulate matter standards are tightened by a

factor of eight down to 0.01 grams per mile.


Although some assessments dispute this

conclusion (because particulate matter also includes light-colored matter that produces some

cooling effects), it is widely recognized that at the very least particulate matter has a number of

harmful health effects. For any replacement fuel, low PM emissions are an advantage.

Producing liquid fuels from coal with no carbon sequestration would increase net CO



relative to petroleum-derived fuels. Because much of the CO


generated in the coal-to-liquids

process is a central waste stream, capture and storage may be a viable strategy, which would

significantly reduce this impact and allow such coal-derived fuels to have the coal or lower net

greenhouse gas emissions than regular diesel fuel. Further, blending in some biomass with the

coal before it is gasified and the CO


is sequestered can sharply reduce net emissions, as the

biomass pulled CO


out of the air while it was growing and the sequestration process then

permanently stores it underground.


DME can be made from biomass, natural gas, or coal. If it is made from biomass, the life-cycle



emissions are 25% that of diesel. If it is made from natural gas, emissions are comparable to

diesel. And, if made from coal, CO


emissions would be 90% higher than diesel if the CO



vented, but could be reduced to 20% less than diesel with sequestration of CO


and H





one calculation, carbon sequestration might add only 15% to the cost of DME.


Used in a diesel engine, DME provides substantial reductions in particulate matter (PM) and

nitrogen oxides (NOx). As noted by Dr. Bob Williams, “For DME used in a heavy duty CIE,

uncontrolled emissions of NOx and PM have been measured to be 58% and 75% less than for

conventional Diesel.”


Black carbon soot is virtually eliminated due to the absence of carbon-

Page 20


carbon bonds. However, DME is a gas at standard temperature and pressure. For use as a vehicle

fuel, it would require moderate compression (similar to propane) to liquefy it for distribution.

This would entail considerable infrastructure investments.


The Fischer-Tropsch process can produce fuel out of syngas. It also offers a way to recover

“stranded” natural gas (resources that would be uneconomical to transport in gaseous form).

While diesel fuel is easily produced, the lighter components can be processed into gasoline with

substantial refining. Fischer-Tropsch processes are widely used in South Africa to produce liquid

fuels from coal.

Fischer-Tropsch liquids can be transported through the existing infrastructure and used in existing

engines. They offer a substantial opportunity to reduce dependence on petroleum, and offer

modest environmental benefits. In a 1998 study, emissions from trucks were measuring using

California diesel and Fischer-Tropsch diesel. F-T emissions were lower by 12% for NOx, 24%

for PM, CO by 18%, and hydrocarbons by 40%.


Fischer-Tropsch diesels are also very low in

aromatics, a class of compounds that includes hazardous chemicals such as benzene.



life-cycle CO


emissions from Fischer-Tropsch liquids are higher than for petroleum-derived

fuels unless sequestration is employed.


Indirect coal liquefaction through the Fischer-Tropsch process provides a “safety valve” against

oil price shocks or supply disruptions. Its emission characteristics are superior to conventional

diesel, and its cost may be competitive. The National Academy of Sciences estimated an

achievable cost of F-T diesel at $35/bbl, or $30/bbl with electricity co-production.


This cost is

for commercialized technology, not pioneer plants. The Academy also notes that “experience

with sustained R&D indicates that DOE's goal of $25/bbl (1991 dollars) for coal-based liquids

may be attainable with continued research and systems studies.”



The challenges to widespread use of coal-derived fuels are significant. As Bob Williams

explains, “the major drawback of DME is that requires a new gaseous fuel infrastructure.”



it faces most of the same barriers that have proved intractable for other alternative fuels in the

United States. DME may prove a more viable fuel in areas countries without in existing gasoline

infrastructure, such as China.

Fischer-Tropsch diesel does not have the infrastructure problems. Price, however, remains a

problem and, as with cellulosic ethanol, someone will have to take the risk with the first several

pioneer plants. Also, particulate matter, while lower than conventional diesel, is still high enough

to be a significant concern for both global warming (black carbon) and direct human health


Finally, until sequestration is demonstrated to be politically, economically, and environmentally

viable on a large-scale, neither F-T diesel nor DME will make sense from a global warming



Costs for geological sequestration are currently quite high, more than $30 a ton of carbon dioxide,

according to the DOE.


The technical challenges for reducing those costs are significant. A February

2003 workshop on carbon management by the National Academy of Sciences concluded, “At the

present time, technology exists for the separation of carbon dioxide and hydrogen, but the capital and

Page 21


operating costs are very high, particularly when existing technologies is considered for fossil fuel

combustion or gasification streams.”


Significant R&D is being invested to bring the costs down.

The key question is where to put the carbon dioxide. Recent attention has focused on pumping highly

compressed liquid CO


, so-called supercritical CO


, into geological formations, such as deep

underground aquifers. As the National Academy workshop noted, “Less dense than water, CO



floatunder the top seal atop the water in an aquifer and could migrate upward if the top seal is not

completely impermeable.”

The problem here is that even very tiny leakage rates can undermine the environmental value of such

sequestration. If we are trying to stabilize CO


concentrations at twice preindustrial levels, a 1%

leakage rate could add $850 billion per year to overall costs by 2095, according to an analysis by

Pacific Northwest National Laboratory. That study concluded, “Leakage of CO


from engineered



disposal practices on the order of 1% or less per year are likely intolerable as they represent an

unacceptably costly financial burden that is moved from present generations to future generations.”


If we cannot be certain that leakage rates are below 1%, “the private sector will find it increasingly

difficult to convince regulators that CO


injected into geological formations should be accorded the

same accounting as CO


that is avoided,” avoided, that is, directly through technologies such as wind

power. The authors note that, “there is no solid experimental evidence or theoretical framework,” for

determining likely leakage rates from different geological formations.

How long will it take before carbon capture and storage emerges as a major solution to global

warming? That remains uncertain. As Princeton’s Bob Williams wrote in 2003, “One cannot yet say

with high confidence that the CO


storage option is viable.”


The technology itself is very

challenging, and just as commercializing fuel cells has taken much longer and has proven far more

difficult than was expected, so, too, may building large commercial coal gasification combined cycle



Through its FutureGen program, DOE is aiming to design and build a prototype coal plant

that would cogenerate electricity and hydrogen and sequester 90% of the carbon dioxide. The goal is

to “validate the engineering, economic, and environmental viability” of a system by 2020.



We must change our transportation policy if we are to address rising dependence on imported oil and

greenhouse gas emissions. Avoiding serious climate change will almost certainly require a

significant reduction in projected U.S. transportation greenhouse gas emissions by 2025—and a

dramatic reduction in absolute emissions by 2050. Moreover, whatever strategy we used to reduce

transportation carbon dioxide emissions must not interfere with our equally urgent efforts to minimize

any increase in coal emissions and then to reduce those emissions.

The only plausible strategy for achieving significant reductions in projected vehicle petroleum use

and carbon dioxide emissions by 2025 is fuel efficiency. For achieving 2050 targets, we believe that

the most plausible strategy is a plug-in hybrid (PHEV) running on a combination of low-carbon

electricity and a low-carbon biomass-derived fuel. The hydrogen fuel cell is the AFV that has the

most technical and infrastructure hurdles and is the least efficient pathway for utilizing renewable

resources. Given these conclusions, we have a number of recommendations:

Page 22


Phase in CO


-related standards for cars and light trucks. We should aim for at least a 33%

reduction in CO


emissions per mile for new vehicles by 2020 (which would still leave new U.S.

vehicles less efficient than European vehicles will be by 2010). Absent such standards, emissions and

imports will continue to grow sharply. There is no escape from a government mandated solution,

whether in the form of CO2 emissions standards or a rebate for efficient vehicles and feebate for

inefficient vehicle. Absent a standard, much of the efficiency gain of new technologies will likely go

towards providing increased vehicle acceleration and weight, as it has for the past two decades.

Ideally, the government would adopt measures that would accelerate the market penetration of

hybrids, particularly hybrid partial ZEVs, since that is the best platform for the subsequent generation

of vehicles needed to achieve absolute reductions in vehicle carbon dioxide emissions by 2050.

Aggressively pursue plug-in hybrids. If PHEVs were to prove practical, they are probably the ideal

future platform for addressing all three major problems created by current vehicles: greenhouse gas

emissions, tailpipe emissions, and oil consumption. PHEVs would likely utilize renewable electricity

resources three to four times more efficiently than hydrogen fuel cell vehicles, and have a comparably

lower per mile cost of operation. Federal and state governments should launch a major R&D effort to

develop PHEVs and immediately begin pilot programs to see how they operate in real-world

conditions. It is particularly important to learn if economic value can be derived from electric utility

services, such as spinning reserves, provided by PHEVs when they are not being driven. If so,

PHEVs might have no price penalty compared to conventional vehicles. Also worth exploring is how

to capture the air quality benefits from PHEVs running all-electric during ozone-alert days.

Aggressively promote biomass-derived fuel. The most plausible biofuel for delivering significant

reductions in U.S. greenhouse gas emissions and oil consumption in the medium- and long-term is

cellulosic ethanol. We endorse the recommendations that the Commission has received through its

support of “The Role for Biomass in America’s Future” Project, including

• Driving the development of the first six pioneer cellulose-to-energy plants between 2008 and

2012 using production or investment incentives;

• Modifying agricultural subsidies to include energy crops without increasing total farm

subsidies or decreasing farm income; and

• Increasing and/or redirecting R&D towards biofuels.

We agree with the Project that the biofuels “effort should be at least as large as that currently

underway for hydrogen.” Research and development into synthetic diesel fuel made from a mixture

of gasified coal and biomass should be pursued, accompanied by R&D into capturing and storing the

hydrogen from this process. Ultimately,


renewable (or low-carbon) fuels standard will be

beneficial, especially in helping to ensure that alternative fuels like hydrogen or synthetic diesel

actually reduce greenhouse gas emissions.

Take a long-term, conservative perspective on hydrogen. While hydrogen might ultimately prove

to be a viable and environmentally desirable alternative fuel post-2035, it is currently getting funding

and policy attention that is vastly disproportionate to both its probability of success and likely

environmental benefits. Hydrogen should be viewed as a long-term, high-risk R&D effort, requiring

at least three major scientific breakthroughs (fuel cell membranes, storage, and renewable hydrogen

generation) before it is practical or desirable. It is worth continuing hydrogen R&D, but at least

twenty years premature to be investing substantial funds in deploying vehicles or infrastructure. The

only pilots that are justified are those that feed back directly into the R&D process. For hydrogen

cars to be cost-effective in reducing greenhouse gas emissions, the government will first have to

sharply shift our current energy policy to make renewable power the primary source of U.S.

electricity. Also, hydrogen is no alternative to government regulations; indeed, for hydrogen and fuel

Page 23


cell vehicles to become commercially successful, the federal government will have to intervene in the

vehicle marketplace far more than it has ever done in the past.


Writing about the future prospects of hydrogen and other alternative fuels is necessarily speculative, since

it involves making comparisons among a variety of different technologies that are not a commercial today

and some of which may never become commercial. Our conclusions are based on discussions with dozens

of experts and a review of dozens of major recent studies.


Reducing California's Petroleum Dependence, Joint Agency Report, California Energy Commission and

California Air Resources Board, Sacramento, August 2003


Energy Information Administration (EIA), Annual Energy Outlook 2003, January 2003, Washington DC, Table




Joseph Romm and Charles Curtis, “Mideast Oil Forever?” Atlantic Monthly, April 1996



Kenneth Deffeyes, Hubbert’s Peak: The Impending Oil Shortage (Princeton: Princeton University Press, 2001),

p. 158.


“Energy Needs, Choices and Possibilities: Scenarios to 2050,” Global Business Environment, Shell International,

London, 2001 (, p. 18.


Energy Information Administration (EIA), Annual Energy Outlook 2004, January 2004, Washington DC,

p. 50.


Energy Information Administration (EIA), Annual Energy Outlook 2003, January 2003, Washington DC, p. 67.


AEO2004, pp. 6, 155


David G. Hawkins, Testimony, U.S. House Committee on Energy and Commerce, Subcommittee on Energy and

Air Quality, June 24, 2003 (


National Research Council, Effectiveness and Impact of Corporate Average Fuel Economy (CAFE) Standards,

National Academy Press, Washington, DC, 2002 (


Interlaboratory Working Group 1997, p. 5.44-5.48; David Greene and Andreas Schafer, “Reducing Greenhouse

Gas Emissions from U.S. Transportation,” Pew Center on Global Climate Change, Arlington, VA, May 2003

(, pp. 13-18; and Malcolm Weiss et al., “On The Road In 2020: A life-cycle analysis of new

automobile technologies,” MIT, Cambridge, MA, October 2000 (

003.pdf), Tables 5.3 and 5.4.

An Oak Ridge National Laboratory study found that “based on a comparison of fatality data for SUVs to other

vehicles, the registered-vehicle-fatality rate (defined as number of fatalities per number of registered vehicles) for

SUVs is higher than the registered-vehicle-fatality rate for other vehicles.” Stacy Davis and Lorena Truett, An

Analysis of the Impact of Sport Utility Vehicles in the United States, ORNL, Oak Ridge, TN, August 2000, p.24



Greene and Schafer, p. 48.


Alliance to Save Energy, “Increasing Automobile Fuel Efficiency,” Fact Sheet, Washington, DC, May 2003


Engine efficiency has increased continuously for three decades; in the late 1970’s and early 80’s, manufacturers

used part of this improvement to increase fuel economy and part of it to increase engine power; now, virtually all

the improvements go towards increasing engine power for a fixed fuel economy. See U.S. EPA, “Light-Duty

Automotive Technology and Fuel Economy Trends: 1975 Through 2003,” Executive Summary, April 2003



“Ford Says New S.U.V.'s Less Fuel-Efficient Than Old Ones,” New York Times, July 18, 2003



Greene and Schafer, 14.


Chris Isidore, “GM: Hybrid cars make no sense,” CNN/Money, January 6, 2004,


Greene and Schafer, p 18.


Oak Ridge National Laboratory, Transportation Energy Data Book, Oak Ridge, TN, p. 5-2.

Page 24



Patricia Monahan and David Friedman, “The Diesel Dilemma,” Union of Concerned Scientists (UCS),

Washington DC, January 2004. The report explains why the actual efficiency gain from diesel is lower than

widely reported.


For a good recent discussion see, “Defusing the Global Warming Time Bomb,” James Hansen, Scientific

American, March 2004, pp. 69-77.


Bob Williams, “The Diesel/black Carbon Dilemma ... and Options for Resolution,” Princeton

Environmental Institute, Princeton University, Princeton, NJ, 2004, in press


UCS 2004, p. 9. The report notes that “the highest end of the cost differential is likely due to

performance differences.”


Amory Lovins, “Hypercars, Hydrogen, and the Automotive Transition,” International Journal of Vehicle

Design, Vol. 35, pp. 50-85.


“Who’s Driving the Hydrogen Economy?” GM ad, various newspapers and magazines, 2004.


The introduction of the European “Smart” micro-car from the DaimlerChrysler AG's Mercedes Car Group

plans will provide an interesting test of consumer interest in such vehicles. See Greg Schneider, “Fuel

Sippers Gaining on Heavyweights,” Washington Post, May 20, 2004, p. A1.




John Christensen, “A primer on gasoline pricing,” CNN Interactive, 2000,


See, for instance, Petroleum Economist.


Interlaboratory Working Group, Scenarios of U.S. Carbon Reductions, LBNL and ORNL, prepared for

Office of Energy Efficiency and Renewable Energy, U.S. DOE, September 1997, page 1.16


See, for instance, US General Accounting Office, Energy Policy Act of 1992: Limited Progress in

Acquiring Alternative Fuel Vehicles and Reaching Fuel Goals, GAO/RCED-00-59, Washington DC,

February 2000, and Peter Flynn, “Commercializing an Alternate Vehicle Fuel: Lessons Learned From

Natural Gas For Vehicles, Energy Policy, Vol. 30, 2002, pp. 613–619.


Peter Flynn, “Commercializing an Alternate Vehicle Fuel: Lessons Learned From Natural Gas For Vehicles,

Energy Policy, Vol. 30, 2002, pp. 613–619.


Dan Sperling and Joan Ogden, “The Hope for Hydrogen,” Issues in Science and Technology, Spring



Well-to-Wheels Analysis of Future Automotive Fuels and Powertrains in the European Context, European

Commission Center for Joint Research, EUCAR, and Concawe, January 2004.


U.S. Department of Energy (DOE), “Basic Research Needs for the Hydrogen Economy,” 2003,



Antoni Oppenheim and Harold Schock, “Raison d’Etre of Fuel Cells and Hydrogen fuel for Automotive

Power Plants,” Society of Automotive Engineers, 2004.


National Academy of Sciences, “The Hydrogen Economy,” February 2004,



American Physical Society, “The Hydrogen Initiative,” March 2004,



“Questions about a Hydrogen Economy,” Matt Wald, Scientific American, May 2004, pp. 66-73.


Foster, D., “Competition to the Diesel Engine?” slide #9, presentation to SAE Congress 2002, Madison,

WI. Online at


The Prius is designed not to operate if the batteries become depleted, which can happen in the vehicle is

not used for extended period of time (for example, if left at an airport for two weeks).


Comparing the Benefits and Impacts of Hybrid Electric Vehicle Options, Electric Power Research

Institute, July 2001, Table 4-11.


Anderman, M., “Brief Assessment of progress in EV Battery Technology since the BTAP June 2000

Report,” 2003. Online at


Heywood, J., “On the Road in 2020: An Assessment of Future Transportation Technology,” 7th Diesel

Engine Emissions Reduction Workshop, Portsmouth, VA, August 2001, at


“Hybrid cars coming: Sandia’s lithium-ion battery research paves way toward American electric

hybrids,” Sandia Lab News, Vol. 52, No. 18, September 2000. At


Page 25



Argonne National Laboratory, Lithium-ion Batteries for Hybrid Vehicles, Document Number 800-037,

September 2001. Online at


Ohr, S., “Lithium-polymer batteries find favor in cell phones,” EE Times, October 1, 2002. Online at


“AC Propulsion Debuts tzero with LiIon Battery,” September 15, 2003. Online at


Keyser, M., et. al., Thermal Characterization of Advanced Lithium-Ion Polymer Cells, Third Advanced

Automotive Battery Conference, June 2003. Online at The batteries described are the “Generation III”



Beta Research & Development web site at


Griffith, P., “Don’t Give Up on the Battery-Electric Bus Just Yet,” Santa Barbara Electric Transportation

Institute, Electric Bus Workshop, September 2002. At



Brooks, A., testimony to California Air Resources Board. Online at


Trickett, D., Current Status of Health and Safety Issues of Sodium/Metal Chloride (Zebra) Batteries,

November 1998, document NREL/TP-460-25553.


Bull, R.N. with A.R. Tilley, Development of New Types of ZEBRA Batteries for Various Vehicle

Applications, Beta Research and Development Ltd., Derby, UK. At http://evs18.tu- To meet EPRI’s figure of 17.9 kWh for a

PHEV60, one would use 190 kg of this type of battery. At 350 W/kg, this would provide 66 kW of power,

or 89 horsepower.


Beta Research and Development web site at


Alec Brooks and Tom Gage, “Integration of Electric Drive Vehicles with the Electric Power Grid—a New Value

Stream,” Paper presented at the 18th International Electric Vehicle Symposium and Exhibition, October, Berlin,

2001 (


Steven Letendre and Willett Kempton, “The V2G [Vehicle to Grid] Concept: A New Model for Power?”

Public Utilities Fortnightly, February 15, 2002, pp. 16-26.


Alec Brooks, “CARB’s Fuel Cell Detour on the Road to Zero Emission Vehicles,” May 2, 2004


Ulf Bossel, “The Hydrogen ‘illusion’, ” Cogeneration & On-Site Power Production, March-April 2004,

pp. 55-59. For a thorough discussion comparing hydrogen and plug-in hybrids, see David Morris, “Is

There a Better Way to Get from Here to There?” Institute for Local Self-reliance, Minneapolis, MN,

December 2003.


Lester Lave et al., “The Ethanol Answer to Carbon Emissions,” Issues in Science and Technology, Winter 2001

( See also Lester Lave et al., “Life-Cycle Analysis Of Alternative

Automobile Fuel/Propulsion Technologies,” Environmental Science and Technology, Vol. 34 (2000), pp. 3598–



Michael Bryan, “The Fuels Market—Biofuel Penetration and Barriers to Expansion,” Presentation to Conference

on National Security and Our Dependence on Foreign Oil, CSIS, Washington, DC, June 2002, pp. 13-15



Lave et al., 2001. Dr. Lave presented these identical numbers at the June 13, 2003 NCEP meeting. This

calculation includes a 20 cents a gallon tax on ethanol. See also Greene and Schafer, p. 30.


National Academy of Sciences, 2004.

See also, Dale Simbeck and Elaine Chang, “Hydrogen Supply: Cost Estimate for Hydrogen Pathways –

Scoping Analysis,” developed for the National Renewable Energy Laboratory by SFA Pacific, Inc., July

2002. Simbeck and Chang conclude that the cost of delivered hydrogen from biomass gasification at $5 to

$6.30 per gallon of gasoline equivalent, depending primarily on the means of delivery. The low end price

was for the hydrogen delivered in liquid tanker truck, which is pointless from an environmental

perspective, since the just the electricity needed to liquefy a kilogram of hydrogen (which contains roughly

the same energy as a gallon of gasoline) releases as much carbon dioxide as burning a gallon of gasoline.

Other studies by NREL suggest a lower cost might be possible, especially for pyrolysis (using heat to

decompose biomass into its constituents)—should we achieve significant technological improvements and

Page 26


successful commercialization of biomass and hydrogen infrastructure technologies. See Pamela Spath et

al., “Update of Hydrogen from Biomass,” NREL, Golden, CO, April 2000, revised July 2001.


Another reason the cellulosic ethanol path seems more plausible is the high incremental cost of fuel-cell

cars versus the relatively low incremental cost of cars modified to run on ethanol blends (or dual-fuel



Lave et al., 2001.


Personal communications with Lynd.


U.S. Energy Information Administration, Annual Coal Report 2002, Table 15, online at


Gerkin, D., “Coal and Energy in the 21


Century,” National Coal Association [now part of National

Mining Association], presentation to West Virginia Surface Mine Drainage Task Force Symposium, April

4-5, 2000. Presentation online at


For more details, see Clean Coal Power Initiative site at,

including presentation by Waste Management and Processors, Inc. at


“Projects To Develop Electricity/F-T Diesel Co-Production Plants Move Forward,” Hart’s Gas-to-Liquid

News, March 2001, online at


Becker, P., “The Role of Synthetic Fuel in World War II Germany,” Air University Review, July-August

1981, online at


Numerous syngas production technologies are described and illustrated at the National Energy

Technology Laboratory web site


R. Williams and E. Larson, “A comparison of direct and indirect liquefaction technologies for making

fluid fuels from coal,” Energy for Sustainable Development, VII (4): 89-115, December 2003.


Jacobsen, M.Z., “Control of fossil-fuel particulate black carbon and organic matter,

possibly the most effective method of slowing global warming,” Journal of Geophysical

Research, vol. 107, No. D19, 4410, ACH 16-1 to ACH 16-22, 2002. Online at


Williams and Larson (2003).


Williams 2004.


Williams and Larson (2003).


Norton, P., et. al., “Emissions from Trucks using Fischer-Tropsch Diesel Fuel,” SAE International Fall

Fuels and Lubricants Meeting and Exposition, San Francisco, CA,

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