With a recent mandate that effectively requires major automakers to put at least 58,000 gas-electric vehicles on California roads by 2014, California has become a pioneer in new technology developments. After years of research and development the auto industry giants and startup companies are investing, researching and building prototype vehicles that can be fueled either with gas or electricity from a wall socket. General Motors and Toyota plan to launch PHEV versions by late 2010, while Honda and some smaller manufacturers are expected to follow.
"Plug-in hybrids are going to be the vehicle story of the next few years," said Joseph Romm, an energy policy expert with the Center for American Progress, a think tank in Washington, D.C. Plug-in hybrid electric vehicles (PHEV) have the potential to revolutionize the auto industry over the next decade. This is because PHEVs could provide a cost-effective, practical solution to improving automotive fuel-economy and emissions. In short, Plug-in hybrids are vehicles that are powered by an on-board engine and a battery/electric motor that can be charged by plugging into the electric grid. This gives PHEVs an extended 20-40 mile all-electric driving range vs. current hybrids plus the ability to drive long-distances like a regular car.
To read the full report please go to http://www.floyd-associates.com/phev.pdf.
Monday, April 13, 2009
Sunday, April 5, 2009
High Demand for Electric Vehicles
The high demand for electric and hybrid vehicles during the recent months has been strong despite predictions that the lower oil and fuel prices would reduce the favorability of such vehicles. Tesla Motors, recently unveiled its much anticipated Model S sedan and also announced that it had received 520 reservations for it. Persu Mobility (www.persumobility.com) has designed a revolutionary two-passenger, three-wheel vehicle based on a proprietary tilting technology and has more than 19,000 registrations for its product, planned to be mass produced in 2012.
Such trends indicate that consumers’ desire for clean and alternative transportation is not formed solely based on price. Energy independence and environmental conservation play instrumental roles in shaping our preferences. There is also a movement in the US that has mobilized the masses towards awareness of the reality of global warming and the role that the US economy plays both in generating greenhouse gasses and in potentially solving the problem.
The first steps towards a green tomorrow are now being taken. Future decades will take us closer to sustainable development and today’s startups will become conglomerates of future supplying our energy and eco-friendly products.
Such trends indicate that consumers’ desire for clean and alternative transportation is not formed solely based on price. Energy independence and environmental conservation play instrumental roles in shaping our preferences. There is also a movement in the US that has mobilized the masses towards awareness of the reality of global warming and the role that the US economy plays both in generating greenhouse gasses and in potentially solving the problem.
The first steps towards a green tomorrow are now being taken. Future decades will take us closer to sustainable development and today’s startups will become conglomerates of future supplying our energy and eco-friendly products.
Thursday, April 2, 2009
China Vies to Be World’s Leader in Electric Cars
I read this story by Keith Bradsher and thought it depicts an interesting picture of China's policies towards green vehicles.
The goal, which radiates from the very top of the Chinese government, suggests that Detroit’s Big Three, already struggling to stay alive, will face even stiffer foreign competition on the next field of automotive technology than they do today.
“China is well positioned to lead in this,” said David Tulauskas, director of China government policy at General Motors. To some extent, China is making a virtue of a liability. It is behind the United States, Japan and other countries when it comes to making gas-powered vehicles, but by skipping the current technology, China hopes to get a jump on the next.
Japan is the market leader in hybrids today, which run on both electricity and gasoline, with cars like the Toyota Prius and Honda Insight. The United States has been a laggard in alternative vehicles. GM's plug-in hybrid Chevrolet Volt is scheduled to go on sale next year, and will be assembled in Michigan using rechargeable batteries imported from LG in South Korea.
China’s intention, in addition to creating a world-leading industry that will produce jobs and exports, is to reduce urban pollution and decrease its dependence on oil, which comes from the Mideast and travels over sea routes controlled by the United States Navy.
But electric vehicles may do little to clear the country’s smog-darkened sky or curb its rapidly rising emissions of global warming gases. China gets three-fourths of its electricity from coal, which produces more soot and more greenhouse gases than other fuels.
A report by McKinsey & Company last autumn estimated that replacing a gasoline-powered car with a similar-size electric car in China would reduce greenhouse emissions by only 19 percent. It would reduce urban pollution, however, by shifting the source of smog from car exhaust pipes to power plants, which are often located outside cities.
Beyond manufacturing, subsidies of up to $8,800 are being offered to taxi fleets and local government agencies in 13 Chinese cities for each hybrid or all-electric vehicle they purchase. The state electricity grid has been ordered to set up electric car charging stations in Beijing, Shanghai and Tianjin. Government research subsidies for electric car designs are increasing rapidly. And an interagency panel is planning tax credits for consumers who buy alternative energy vehicles.
China wants to raise its annual production capacity to 500,000 hybrid or all-electric cars and buses by the end of 2011, from 2,100 last year, government officials and Chinese auto executives said. By comparison, CSM Worldwide, a consulting firm that does forecasts for automakers, predicts that Japan and South Korea together will be producing 1.1 million hybrid or all-electric light vehicles by then and North America will be making 267,000.
The US DOE has its own $25 billion program to develop electric-powered cars and improve battery technology, and will receive another $2 billion for battery development as part of the economic stimulus program enacted by Congress.
And Premier Wen has his own connection to the electric car industry. He was born and grew up here in Tianjin, the longtime capital of China’s battery industry, 70 miles southeast of Beijing.
Tianjin has thrived in the six years since Mr. Wen became premier. It now has China’s first bullet train service (to Beijing), a new Airbus factory and an immaculate new airport. Tianjin has also received a surge of research subsidies for enterprises like the Tianjin-Qingyuan Electric Vehicle Company.
Electric cars have several practical advantages in China. Intercity driving is rare. Commutes are fairly short and frequently at low speeds because of traffic jams. So the limitations of all-electric cars — the latest models in China have a top speed of 60 miles an hour and a range of 120 miles between charges — are less of a problem.
The goal, which radiates from the very top of the Chinese government, suggests that Detroit’s Big Three, already struggling to stay alive, will face even stiffer foreign competition on the next field of automotive technology than they do today.
“China is well positioned to lead in this,” said David Tulauskas, director of China government policy at General Motors. To some extent, China is making a virtue of a liability. It is behind the United States, Japan and other countries when it comes to making gas-powered vehicles, but by skipping the current technology, China hopes to get a jump on the next.
Japan is the market leader in hybrids today, which run on both electricity and gasoline, with cars like the Toyota Prius and Honda Insight. The United States has been a laggard in alternative vehicles. GM's plug-in hybrid Chevrolet Volt is scheduled to go on sale next year, and will be assembled in Michigan using rechargeable batteries imported from LG in South Korea.
China’s intention, in addition to creating a world-leading industry that will produce jobs and exports, is to reduce urban pollution and decrease its dependence on oil, which comes from the Mideast and travels over sea routes controlled by the United States Navy.
But electric vehicles may do little to clear the country’s smog-darkened sky or curb its rapidly rising emissions of global warming gases. China gets three-fourths of its electricity from coal, which produces more soot and more greenhouse gases than other fuels.
A report by McKinsey & Company last autumn estimated that replacing a gasoline-powered car with a similar-size electric car in China would reduce greenhouse emissions by only 19 percent. It would reduce urban pollution, however, by shifting the source of smog from car exhaust pipes to power plants, which are often located outside cities.
Beyond manufacturing, subsidies of up to $8,800 are being offered to taxi fleets and local government agencies in 13 Chinese cities for each hybrid or all-electric vehicle they purchase. The state electricity grid has been ordered to set up electric car charging stations in Beijing, Shanghai and Tianjin. Government research subsidies for electric car designs are increasing rapidly. And an interagency panel is planning tax credits for consumers who buy alternative energy vehicles.
China wants to raise its annual production capacity to 500,000 hybrid or all-electric cars and buses by the end of 2011, from 2,100 last year, government officials and Chinese auto executives said. By comparison, CSM Worldwide, a consulting firm that does forecasts for automakers, predicts that Japan and South Korea together will be producing 1.1 million hybrid or all-electric light vehicles by then and North America will be making 267,000.
The US DOE has its own $25 billion program to develop electric-powered cars and improve battery technology, and will receive another $2 billion for battery development as part of the economic stimulus program enacted by Congress.
And Premier Wen has his own connection to the electric car industry. He was born and grew up here in Tianjin, the longtime capital of China’s battery industry, 70 miles southeast of Beijing.
Tianjin has thrived in the six years since Mr. Wen became premier. It now has China’s first bullet train service (to Beijing), a new Airbus factory and an immaculate new airport. Tianjin has also received a surge of research subsidies for enterprises like the Tianjin-Qingyuan Electric Vehicle Company.
Electric cars have several practical advantages in China. Intercity driving is rare. Commutes are fairly short and frequently at low speeds because of traffic jams. So the limitations of all-electric cars — the latest models in China have a top speed of 60 miles an hour and a range of 120 miles between charges — are less of a problem.
Saturday, January 3, 2009
SOLAR ENERGY IS THE BIG WINNER
The rescue package approved in late October by the Congress included various incentives for energy projects including solar energy. A 30% tax credit for solar projects was extended for another 8 years until 2016. This investment tax credit means that companies that purchase solar energy equipment for commercial use can claim 30% of the cost in the year the equipment is put to use. Initially the deadline for putting the equipment to use was 2008 but it was extended until 2016. Originally, companies were able to use the investment tax credits to reduce the tax payments by up to 75% but not less than the minimum taxes calculated using the broader definition of taxable income. The new bill made this provision more favorable by simply allowing a reduction of taxes using such credits by up to 75%.
These, along with other provisions of the bill, are indicative of the Congress’s commitment to development and implementation of renewable energy technologies. Solar technologies have experienced very rapid growth in the recent years and concentrated solar power projects have enabled power production at costs that are economical even without subsidies.
The next few years shall bring about development of vast solar power fields around the world and as such, over time global dependence on coal and other forms of energy produced from fossil fuels will decrease and will be replaced with renewable sources. With the sun being such a vast resource and with recent leap in solar power technologies solar will be the big winner.
These, along with other provisions of the bill, are indicative of the Congress’s commitment to development and implementation of renewable energy technologies. Solar technologies have experienced very rapid growth in the recent years and concentrated solar power projects have enabled power production at costs that are economical even without subsidies.
The next few years shall bring about development of vast solar power fields around the world and as such, over time global dependence on coal and other forms of energy produced from fossil fuels will decrease and will be replaced with renewable sources. With the sun being such a vast resource and with recent leap in solar power technologies solar will be the big winner.
Saturday, December 13, 2008
Electric Vehicles and the Future of the Auto Industry
With the recent drop in the price of oil, new doubts have been cast over the future of hybrid and electric vehicles. Many manufacturers and designers of electric vehicles have faced technical and financial challenges in the past few months. Such challenges combined with large capital investments in research and development necessary for these cars, have prompted some analysts to predict a reversal of the trend towards green vehicles.
Climate change and environmental concerns, however, play a major role in policies and trends that shape the future of the automotive industry. Green tech vehicle programs are not only critical in shaping the future of our transportation but also vital for the long term survival of big global auto companies such as Detroit's big 3. Electrification is on its way and at the forefront of innovation in the auto industry.
Atmospheric and environmental scientists have shown us the effects of carbon emissions on the increase of average global temperatures. There is more to the cost of operating internal combustion engines than the price paid at the pump. It will be irresponsible if we do not spend resources on development and optimization of battery technologies, which can lead to less expensive and ultimately economically feasible generations of electric vehicles, vehicles that have zero carbon footprints and no harm to our mother nature and that will replace current gasoline engines responsible for significant part of the green house gasses released in the atmosphere.
For now, governments have realized that value of research on this topic. In many places policies have been implemented that encourage consumers to purchase electric vehicles. The next US administration has already indicated its will and desire to support electric vehicles and it is anticipated that subsidies and/or tax credits will make the price of electric vehicles competitive for a number of years. Our belief is that the revolution has already begun and that the signs are already visible on the road. Our prediction is that more community and government cooperation shall take place on a global scale to bring the best minds together and to create future cars that run on efficient electric motors fueled by durable and economically feasible batteries.
Climate change and environmental concerns, however, play a major role in policies and trends that shape the future of the automotive industry. Green tech vehicle programs are not only critical in shaping the future of our transportation but also vital for the long term survival of big global auto companies such as Detroit's big 3. Electrification is on its way and at the forefront of innovation in the auto industry.
Atmospheric and environmental scientists have shown us the effects of carbon emissions on the increase of average global temperatures. There is more to the cost of operating internal combustion engines than the price paid at the pump. It will be irresponsible if we do not spend resources on development and optimization of battery technologies, which can lead to less expensive and ultimately economically feasible generations of electric vehicles, vehicles that have zero carbon footprints and no harm to our mother nature and that will replace current gasoline engines responsible for significant part of the green house gasses released in the atmosphere.
For now, governments have realized that value of research on this topic. In many places policies have been implemented that encourage consumers to purchase electric vehicles. The next US administration has already indicated its will and desire to support electric vehicles and it is anticipated that subsidies and/or tax credits will make the price of electric vehicles competitive for a number of years. Our belief is that the revolution has already begun and that the signs are already visible on the road. Our prediction is that more community and government cooperation shall take place on a global scale to bring the best minds together and to create future cars that run on efficient electric motors fueled by durable and economically feasible batteries.
Monday, November 3, 2008
US Welcomes Foreign Direct Investments
Following the recent global financial turmoil and the collapse of several US financial institutions, the United States Government is encouraging foreign investments in US companies and institutions. Specifically, funds in the Gulf Cooperation Council countries are aggressively being encouraged to invest in the United States.
According to the Gulf News Agency, Robert Kimmitt, deputy secretary of the US Department of the Treasury, praised sovereign wealth funds (SWFs) such as the Abu Dhabi Investment Authority (ADIA) in sharp contrast to a debate in the West early this year that sought to put protectionist barriers against investments made by these organizations. Kimmitt said the US favors "the free flow of capital, both from sovereign wealth funds and all other overseas investors." He is meeting officials and business leaders in Saudi Arabia, Kuwait, Qatar, Iraq and the UAE, trying to encourage Arab funds to invest in the US.
The economic downturn and the ensuing panic has already created unprecedented investment opportunities in the US both in real estate and in science and technology. Lack of liquidity has caused some assets to be sold at significant discounts to the fundamental values of such assets. In this environment, prudent investors from around the world have started to take a closer look at the US market. As an example, Mohammad Ali Al-Hashimi, the Executive Chairman of Zabeel Investments, recently announced that his company is keen to invest in the US, but not willing to "overpay" for deals.
The question in the mind of many institutions is where the bottom of the market may be. However, for fundamental investors catching the bottom of the market must not be the sole objective. Acquisition of assets that are trading at discounts to intrinsic valuations shall translate into economic gains in the long term. Waiting for the market to bottom out might lead to realization of higher gains on investments but carries the risk of missing the bottom and ending up trying to make investments in a rising market, where quality assets will be harder to come by.
For sovereign wealth funds and other GCC pools of capital, it is prudent to continually evaluate opportunities and to make investments as the markets gradually stabilize. Investments in fundamentally sound and strong companies with proven cash flows and a clear growth path is a great diversification tool for GCC funds and right now the time is great for accessing unprecedented opportunities.
According to the Gulf News Agency, Robert Kimmitt, deputy secretary of the US Department of the Treasury, praised sovereign wealth funds (SWFs) such as the Abu Dhabi Investment Authority (ADIA) in sharp contrast to a debate in the West early this year that sought to put protectionist barriers against investments made by these organizations. Kimmitt said the US favors "the free flow of capital, both from sovereign wealth funds and all other overseas investors." He is meeting officials and business leaders in Saudi Arabia, Kuwait, Qatar, Iraq and the UAE, trying to encourage Arab funds to invest in the US.
The economic downturn and the ensuing panic has already created unprecedented investment opportunities in the US both in real estate and in science and technology. Lack of liquidity has caused some assets to be sold at significant discounts to the fundamental values of such assets. In this environment, prudent investors from around the world have started to take a closer look at the US market. As an example, Mohammad Ali Al-Hashimi, the Executive Chairman of Zabeel Investments, recently announced that his company is keen to invest in the US, but not willing to "overpay" for deals.
The question in the mind of many institutions is where the bottom of the market may be. However, for fundamental investors catching the bottom of the market must not be the sole objective. Acquisition of assets that are trading at discounts to intrinsic valuations shall translate into economic gains in the long term. Waiting for the market to bottom out might lead to realization of higher gains on investments but carries the risk of missing the bottom and ending up trying to make investments in a rising market, where quality assets will be harder to come by.
For sovereign wealth funds and other GCC pools of capital, it is prudent to continually evaluate opportunities and to make investments as the markets gradually stabilize. Investments in fundamentally sound and strong companies with proven cash flows and a clear growth path is a great diversification tool for GCC funds and right now the time is great for accessing unprecedented opportunities.
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