Wednesday, July 27, 2011

Newly Published Harvard Paper of Mine: "Will Electric Cars Transform the U.S. Vehicle Market?"

A paper that I've been working on with one of my former HKS professors for about a year has finally been published:

Click on the picture to go to the summary page. Here's a direct link to the full paper (PDF).
The bottom line on the costs of electric cars:

This paper finds that, at 2010 purchase and operating costs, a PHEV-40 [plug-in hybrid electric vehicle, like the Chevy Volt] is $5,377 more expensive than an internal combustion engine or ICE, while a BEV [battery electric vehicle, like the Nissan Leaf] is $4,819 more expensive. In other words, the gasoline costs savings of electric cars over the cars’ lifetimes will not offset their higher purchase prices.
In the future, this cost balance may change. If one assumes that over the next 10 to 20 years battery costs will decrease while gasoline prices increase, BEVs will be significantly less expensive than conventional cars ($1,155 to $7,181 cheaper). Even when the authors use very high consumer discount rates, BEVs will be less expensive, than conventional vehicles although the cost difference decreases. PHEVs, however, will be more expensive than BEVs in almost all comparison scenarios, and only less expensive than conventional cars in a world with very low battery costs and high gasoline prices. BEVs are simpler to build and do not use liquid fuel, while PHEVs have more complicated drive trains and still have gasoline-powered engines.
As the paper discusses, electric vehicle adoption depends on a lot more that just costs, but I'll let you look at the full paper if you're interested (PDF).

I quite enjoyed working on this paper and got to do interesting things like build a costing model for electric cars from scratch, design and run a Monte Carlo simulation, and the like. Check it out and let me know what you think


  1. Hey, Grant --

    I'm president of the Houston Electric Auto Association -- meaning that I'm the guy who has to set up speakers for our monthly meetings.

    Would you like to be a guest speaker via Skype?

    Just think of it! -- You could address a group of EV nuts who live (and drive) right in the middle of the Oil Capital.

    We would do a half-hour thing, and you could make a presentation, or I could interview you.

    Go to our website to read all about us:

    The next meeting is Thursday, August 11th, and your slot could be anytime between 6:30 and 8:00PM Central time.

    Let me know.

    Steve Kobb
    My email address is on this page:

  2. Steve, thanks for your interest - I'd be happy to be a guest speaker with your group. I'll follow up with you via email.