Energy Values Lab

DISCLAIMER: I’m an applied decision researcher and professor for energy systems at Michigan State University.  My research focuses principally on helping people to identify their values, concerns and objectives and then engage the trade-offs between those values, concerns and objectives and the many options available.

The trade-offs between purchasing and operating a conventional gasoline vehicle and a plug-in electric vehicle (PEV) in particular are considerable and complex.  Not surprisingly, most of the the US public misunderstands the basic functions of a PEV, doesn’t know their local and state PEV policies, and misinterprets a PEV’s fuel and maintenance savings.  Those that do follow the evolution of PEVs more closely tend to focus on either PEVs’ purchase price or their “return on investment” with regard to the size and capacity of the PEV’s battery.

And yes, the retail price of a PEV, for example a Chevrolet Volt or Tesla Model 3, is considerably higher than that of a conventional gasoline vehicle, typically 10-50% higher–though the US Government does offer a $7500 tax credit.  However, driving a PEV has numerous other benefits; some of which accrue to the vehicle’s owner, with many others accruing to society and Michigan more broadly.

For instance, driving a PEV is far less expensive than driving a conventional vehicle (once the vehicle is purchased of course).  Driving 100 miles in a PEV costs between $3.00 and $4.00 in electricity, whereas driving a conventional vehicle that same distance requires about $14.00 of gasoline.  Additionally, because a PEV has no transmission, does not require oil changes and uses a regenerative braking system—thus not needing its brakes replaced as often, a PEV’s maintenance costs are far lower.  Driving a PEV also generates less smog and soot in urban air, can generate fewer greenhouse gas emissions than driving a conventional vehicle, and can also improve the country’s economic security in the event of an interruption to oil production in the Middle East.

Of course, there are also real costs to driving a PEV, costs not easily measurable in dollars.  PEVs tend to have a shorter range than conventional vehicles.  They take far longer to recharge—particularly compared to the time it takes to fill a conventional vehicle’s gas tank.  They have less locations available for recharging—though they can be charged at home unlike conventional vehicles.  They also have uncertain battery life and high battery costs—though most PEV manufacturers provide long battery warranties.  For example Tesla provides an 8 year/100,000 mile battery warranty for its Model 3.

In addition to PEVs’ costs and benefits to owners and the environment, increasing the number of PEVs on the road may also have dramatic impacts on Michigan’s job market and the state’s energy system.  Michigan’s economy has historically relied heavily on automobile and automobile parts manufacturing.  And already, Michigan has multiple manufacturers producing PEV batteries (for example, LG in Holland and General Motors in Brownstown Charter Township).  The Chevy Bolt is assembled in Orion Township, Michigan, and the Chevy Volt is manufactured in the Detroit-Hamtramck plant.  GM’s Brownstown plant provides 100 advanced technology jobs, and the LG plant will house 600 employees once its latest addition is complete.

It is not a stretch to presume that the more PEVs are purchased, the more PEV jobs will become necessary.  And due to both Michigan’s history and proximity to current vehicle manufacturers, and the state’s favorable tax climate, we are likely to attract–and recruit–additional battery and PEV manufacturing jobs.  The extent to which these jobs will replace conventional vehicle manufacturing jobs remains to be seen however.

Additionally, far more people purchasing and driving PEVs could have dramatic effects on Michigan’s energy system.  Most people charge their PEVs at night, when the cost and demand for electricity is low.  Those vehicles and their batteries can then be used (when properly equipped) to “feed in” or provide electricity back into the electrical grid during the day when demand for electricity—and its cost—is highest.   The PEV’s owner would receive payment for that electricity—further reducing the cost of operating their PEV.  This not only reduces the cost of electricity to all consumers–not just PEV owners, but this leveling out of demand eases the incorporation of additional intermittent renewable sources, like wind and solar, into Michigan’s energy system.