DOE Transportation Budget Is All
Mar 05, 2011 - John Gartner - matternetwork.com
The 2012 Department of Energy budget submitted
to Congress on Monday includes a 20-page section on
Vehicle Technologies (VT), and nearly every word of
it refers to vehicle electrification. In language of
funding dollars, the VT budget jumps by 80 percent
from $325 million to $588 million.
The majority ($229 million) of the VT budget increase
goes towards the expansion of the EV deployment and
infrastructure rollout. This is a $200 increase in
the program that will largely benefit the Clean Cities
program where metropolitan areas provide grants for
purchasing of EVs and charging equipment.
This is welcome news for EV charging equipment (EVCE)
companies who are likely to see increased orders
for 2011-12 by local transit agencies and fleets.
Pike Research projects that $61 million will be spent
across the U.S. on EVCE during 2011.
The other significant area of increased VT funding
is in energy storage technology, which doubles from
2010 spending to $188 million. The cost of lithium
ion batteries for PEVs is slowly coming down, but
the government wants to accelerate the cost-reducing
technologies through more material science research
and manufacturing funding.
Lithium ion batteries are the primary recipient
of funds, although a surprising amount of text is
spent on the potential for ultracapacitors. Funding
for ultracapacitors isn't spelled out, but given
the ample gushing about the technology, it is likely
to be in the multiple millions. The budget report
states that while ultracapacitors have poor energy
density today and won't challenge batteries as primary
energy storage, they "offer the possibility
of improved vehicle performance in a battery-plus-ultra-capacitor
hybrid configuration and a 10 to 20 percent fuel
economy improvement in city driving if used in a
start/stop application." This reflects the findings
in Pike Research's recent Ultracapacitors report,
which projects the market for ultracapacitors in
stop-start vehicles will grow from less than a quarter
of a million dollars to nearly $50 million by 2015.
The budget more than doubles the funding from 2010
for power electronics and motors to $46.6 million.
This area doesn't get nearly as much attention as
vehicle batteries or charging, but improvements in
electric drive technology will improve overall vehicle
The budget was released just days after the Obama
administration hyped the success to date for its
plan for 1 million plug-in vehicles to be on the
road by 2015. The investments in infrastructure and
rollout of EVs will help, but not enough to sway
consumer adoption to get to the levels needed to
reach its target. Pike Research estimates that 841,000
PEVs will be sold by 2015.
The VT budget contains zero dollars for alternative
fuels such as biofuels, natural gas or hydrogen.
Biomass and hydrogen/fuel cells have their own sections
of the budget where the feedstocks and the efficiency
of the fuels are looked at instead of their use transportation.
Natural gas as a transportation fuel is not referred
to at all in the budget which isn't good news for
Pickens Plan backers. The budget for fossil energy
research is slashed by $418 million.
The overall budget for DOE increases by 12 percent
in 2012, which won't please folks who are prioritizing
debt reduction. However, the administration's plan
to reduce oil subsides by $43 billion over 10 years
will more than offset the increase in the DOE budget.
As my esteemed colleague Lisa points out, ending
the oil subsidies would be politically courageous
with uncertain results. But it's sure worth trying.
John Gartner is a senior analyst at Pike Research
and a co-founder of Matter Network.