This Week’s Top 10: CARB stays with clean car program, Keystone pipeline backed by Trump administration

by Jon LeSage, editor and publisher, Green Auto Market

Here’s my take on the 10 most significant and interesting occurrences during the past week…….

  1. California stays with it:  The California Air Resources Board has approved the Advanced Clean Cars (ACC) program, which reaffirms vehicle emissions standards set through 2025 should stay on track. The approved measure also mandates development of stronger requirements for vehicles manufactured in subsequent model years. It was created in 2012 in conjunction with the federal fuel economy and greenhouse gas rules, which may be weakened in Washington by the Trump administration over the next year. It could be the start of a clash between California and the federal government. California’s zero-emission vehicle regulation requires auto manufacturers to produce an increasing number of plug-in hybrid, battery electric, and fuel-cell electric vehicles. CARB also approved the South Coast Air Quality Management District’s comprehensive air quality plan.
  2. Keystone pipeline approved:  The U.S. State Department’s approval of the Keystone XL pipeline is expected to face a series of hurdles in states directly affected and which have yet to approve. President Donald Trump had committed to Canadian oil company TransCanada to lift the Obama administration’s ban on the pipeline. The 1,200-mile pipeline will transport heavy crude oil from tar sands mines in Canada to a second existing pipeline, which will deliver the crude oil to specialized refineries in Louisiana and other parts of the Gulf Coast. Environmental groups such as the Sierra Club are expected to file legal challenges to final approval and building of the pipeline.
  3. Tesla gets new investor:  Tesla Inc. reported that Chinese tech giant Tencent Holding has taken a 5% stake in the electric automaker for $1.78 billion. Tencent has been playing a role investing in U.S. and Chinese mobility startups in self-driving, electrified vehicles. The company has been best known for its WeChat mobile messaging app. Other EV-maker investments include NextEV, a Shangai-based startup which recently renamed itself Nio. That company has a Silicon Valley office not far from Tesla’s headquarters. Future Mobility is another Chinese startup Tencent has funded.
  4. Uber crash:  Uber is returning part of its autonomous test fleet to San Francisco after experiencing a collision Saturday that ended up grounding the fleet. Uber has been cleared from the accident in Tempe, Ariz., with police saying the crash occurred because a human-driven vehicle failed to yield to the autonomous Uber test vehicle. Uber’s test vehicles are able to travel autonomously, but the company keeps a human driver in the passenger seat ready to take over the car if necessary. Uber, as a company, continues to deal with a wave of bad news.
  5. Musk backs artificial intelligence venture:  Tesla CEO Elon Musk has taken on another passion: Neuralink. Musk is backing the startup venture that, as he says, will merge “biological intelligence and digital intelligence.” The business will be centered on creating devices that can be implanted in the human brain. The end game will be helping human minds partner with software and keep pace with advancement in artificial intelligence. Memory could be improved, and the capacity for human minds to interface with computing devices will be tested. The new system will explore how brain interfaces might alleviate the symptoms of dangerous and chronic medical conditions such as epilepsy and severe depressive disorder. Musk is excited about being part of the “neural lace,” which is a sci-fi term for a brain-computer interface humans could use to improve themselves. He’s been known for debating other entrepreneurs in the artificial intelligence community, which is tied into SpaceX, robotic manufacturing, autonomous vehicles, and other topics.
  6. New York EV incentives:  New York has set up an incentive program for purchasing electric vehicles that supports longer range, affordable cars. Only a few vehicles, like the Tesla Model 3 and the Chevy Bolt EV, will take advantage of the full $2,000 incentive. Requirements for the full incentive are selling electric cars with a range of over 120 miles and a price tag at less than $60,000. Expensive electric cars like the Tesla Model S and Model X, and the BMW i8, can only receive a $500 incentive.
  7. Aerovironment and eMotorWerks:  AeroVironment will be integrating eMotorWerks’ JuiceNet smart-grid electric vehicle charging platform into AeroVironment’s line of charging products. The worked relationship is aimed at helping consumers find increased charging capabilities utilities to assist in managing demand load aggregation. EV drivers will be able to tie in their smartphones, web, and Amazon Alexa voice control over charging. They’ll also be able to tap into other features like looking at real time and historic energy usage for charging and notifications of charging status and other resources for lowering their utility bills.
  8. ACT Expo keynoters:  The speaker lineup has been announced for ACT Expo 2017. Thom Shea, President and CEO of Adamantine Alliance, will share his experience on navigating through challenging times based on his experience as a highly decorated U.S. Navy SEAL, author, and leadership and human performance coach. With a number of policy and budget changes at the federal level, and the always present oil price roller coaster, the advanced technology and alternative fuels sectors face continued uncertainty and possible headwinds. Other speakers announced by ACT Expo include: Pete Melin, Director of Zero Emission Technology, Metro Transit of King County on managing a transit fleet integrating 120 battery electric buses into its operations; Kathryn Garcia, Commissioner, New York City Department of Sanitation on the world’s largest sanitation department testing DME and other efficiency measures; Sandra Berg, Vice Chair, California Air Resources Board on the agency’s role in advanced clean transportation policies; Kary Schaefer, General Manager, Marketing and Strategy, Daimler Trucks North America on leading the way in technology development for advanced clean trucking; Rob Neitzke, President, Cummins Westport on the company’s experience launching the game changing .02g NOx engine. Plus dozens more. See the full agenda and you can get a good look at the display vehicles.
  9. MUD chargers:  A new report by UCLA’s Luskin Center for Innovation identifies multi-unit dwellings (MUDs) that could be targeted for outreach as they exhibit high latent demand for plug-in electrified vehicles (PEVs) and low-cost installation of charging equipment. In order to reach California’s goal of 1.5 million zero emission vehicles by 2025, residents of apartments, condominiums and other MUDs need to be assured that they can charge their PEV at home, writes, Alex Turek, Project Manager, at Luskin Center.
  10. Cost of fuel economy standards:  International Council on Clean Transportation, an independent research group, released a report stating that automakers costs could be reduced by 34 percent to 40 percent per vehicle in the 2022 through 2025 phase of the federal fuel economy standards if enacted from what was approved in January by the Obama administration. Much of that is already happening with automakers utilizing new technologies like turbochargers and advanced transmissions, and lighter weight materials such as aluminum. ICCT has played a role in the Volkswagen diesel emissions scandal investigations, and worked closely with California Air Resources Board and the U.S. Environmental Protection Agency on the findings.

Looking beyond the White House for strategic planning in clean transportation

The Trump administration is keeping the president’s campaign promises supporting fossil fuels and pushing back on clean energy and efficient, clean transport. The State Department’s approval of the Keystone XL pipeline last week raised hackles further for many. Low-to-moderate gasoline and diesel prices aren’t helping make the business case for clean fuel and technologies, either.

Breakthroughs in vehicle fuel efficiency and emissions reductions, clean fuel infrastructure, battery range, renewables, and electrified vehicles sales, are helping solidify the business case for policy and funding support; but, it isn’t the right time to gain broader support.

Fleet operators and suppliers attending the Work Truck Show and Green Truck Summit recently in Indianapolis reported on mixed results for sales. Interest in alternative fuel trucks rose from 2011 through 2013, when fuel prices approached $4 a gallon nationally, but has stayed down since then. Customers are harder to see with payback on the investment taking longer. Perception of things changing in Washington also played into the mood.

Some companies and fleets had good news to report. California-based Motiv Power Systems has been seeing an uptick for electric delivery trucks and school buses built on a Ford truck chassis. State-based incentive programs are taking the pressure off likely cuts in federal subsidies, the company said. California continues to be strong, and the New York and Chicago metro areas have paid off with similar purchase incentive programs in place. AmeriPride Services, a linen and uniform supply company, will bring 30 Motiv trucks to its fleet.

Daimler AG’s Mitsubishi Fuso division said it will bring a new line of electric work trucks to North America this year. A lease program will be offered for its eCanter medium-duty electric truck. The company said it will also rollout a second generation model within two years. Fuso forecasts growing market demand for urban electric trucks as cities in Europe consider banning fossil-fuel trucks by 2030 through climate change policies; and pressure by cities to reduce congestion, pollution, and noise is helping grow demand.

UPS, known for having the largest and most diverse alternative fuel fleet, announced it will spend $90 million to add six more CNG fueling stations and to purchase 390 CNG and 50 LNG trucks.

Ohio-based Workhorse Group showed its all-electric pickup truck that will come to market next year. Recently, the company announced it has received Letters of Intent from fleets totaling 2,150 of the Workhorse W-15 electric pickups. Deals are being made with Duke Energy, Portland General Electric, the city of Orlando, Southern California Public Power Authority, Clean Fuels Ohio, and one other utility.

Soon after the Work Truck Show, a port trucking company announced it will bring in low carbon natural gas engine trucks using Cummins Westport’s new ISX12 G natural gas engines. Total Transportation Services Inc., a large drayage trucking company serving the Ports of Los Angeles and Long Beach, has started using one of the trucks to move cargo containers around the port complex.

An 8.9-liter version of the Cummins Westport engine has been certified by the California Air Resources Board to produce 90 percent less NOx than permitted in diesel engines under the current guideline of 0.2 grams per horsepower-hour; a 12-liter variation is also expected to gain CARB approval. If run on renewable natural gas, heavy-duty trucks can reduce greenhouse gas methane emissions by 70%, the company said.

On the passenger vehicle side, several auto analysts see Trump rolling back fuel economy mandates as having limited effect – with other market forces leading the way. Aggressive targets Europe and China will have more impact on the globalized auto industry than it would have had years ago. Strong and growing consumer expectations for increasing fuel efficient vehicles is another market dynamic that can’t be ignored, they say.

California, Oregon, and eight states in the northeast, are following California’s zero emission vehicle mandates. Collectively, these states make up 30 percent of U.S. auto sales. Automakers have faced many years of resenting California’s rules going back to catalytic converters and the first gas stations with E-10 gasoline. Now they’re concerned over high targets being far ahead of consumer demand for all-electric, plug-in hybrid, and fuel cell vehicles.

Tangible growth in clean transportation and energy appear to need a combination of long-term strategic planning more common in Asia, and with technology innovations usually seen first in the U.S. and Europe. Automakers like Toyota and Honda are leading-edge in engine performance, efficiency, electronics, and alternative powertrains; but they tend to take a more conservative and gradual approach to rolling out zero emission vehicles and automated systems. That said, Toyota’s kaizen philosophy of “change for better” has influenced other global automakers and suppliers and brought improvements in quality, safety, and integrating its technologies with partners such as dashboard infotainment features.

Luxury automakers are committing to roll out futuristic and electrified vehicles in large volumes much sooner, but they’ll need to gain sustained support from board members, shareholders, and customers. There is a great deal of concern about making electric vehicles more profitable.

BMW’s “A new era has begun” video released last week says it all. Strategies are described for the company’s Vision Next 100 models from its BMW, Mini, Rolls-Royce, and BMW Motorrad motorcycle brands. The Motorrad Vision looks like it was designed for the next “Batman” movie; the three car models look like they won’t be released for a long time. Everything will be connected and automated, and most of them electrified.

Commercial vehicle makers (heavy trucks, work trucks, vans, and buses) are in a similar spot, complying with stricter emissions standards and convincing buyers to reach a tipping point and make acquisitions taking longer to justify in return on investment.

Europe and China emissions targets don’t appear to be lowering. EU headed there for years with concern over diesel with VW scandal pushing it over the edge. Daimler and BMW have taken on huge goals for sales with these markets being critical and Tesla’s presence and public awareness spreading globally.

China is starting to cut back on manufacturer and car buyer subsidies, but the government stays committed to reducing emissions in the country. It’s plug-in vehicle sales boom is a sign of that, and China may take on a regulatory structure similar to California’s. While down at the beginning of the year with softening incentives, they seem to be going back up.

Most of the experts speaking on industry panels, and writing white papers and policy on the issues, do see transformational technologies and mobility models moving along much faster than expected.

The Institute of Transportation Studies at the University of California-Davis just released survey results tied into the ITS-Davis’ new policy initiative, “Three Revolutions: Sharing, Electrification and Automation.” That report features a set of policy briefs written by transportation policy experts; and in-depth survey interviews with 40 experts on the subject from government and nonprofit organizations, and representatives from automakers and technology companies. About 70% think that by 2040, fully autonomous vehicles will make up more than 20% of vehicles sold in the U.S. Shared rides will go from 5% of all passenger miles by 2030 to more than 20% of miles driven by 2040, according to about 80% of the respondents.

Most vehicles used by ridesharing and carsharing firms till be zero emission vehicles by 2050, about 70 of survey respondents said. That includes battery electric, plug-in hybrid, and fuel-cell vehicles.

“This survey shows us that without thoughtful collaboration and community-facing policies, these changes would lead to increased inequities, vehicle travel and greenhouse gas emissions. We need to be creative to steer these innovations to the public interest,” said ITS-Davis Director Dan Sperling.

BMW outlined its experience in carsharing services in its new corporate sustainability report. The German automaker reported that more than 853,000 customers worldwide used the BMW Group’s carsharing services in 2016 – an increase of 45% compared with the year before. In Europe, BMW’s DriveNow fleet has more than 5,400 vehicles with all-electric i3s making up about 15% of the fleet. Around 190,000 customers have already driven approximately 6.5 million emission-free kilometers with the fleet’s electric BMW i3

The European DriveNow fleet currently comprises more than 5,400 vehicles, of which 15.4% are pure electric BMW i3s. As of 31 Dec. 2016, DriveNow served around 607,000 customers in Germany and roughly 815,000 Europe-wide (2015: over 580,000 Europe-wide). DriveNow is one of the main driving forces for electro-mobility in Germany. Around 190,000 customers have already driven approximately 6.5 million emission-free kilometers (about 4.04 million miles) with the fleet’s electric BMW i3.

This Week’s Top 10: Trump cutting DOE grant funding, Ford launches electrified QVM program

by Jon LeSage, editor and publisher, Green Auto Market

Here’s my take on the 10 most significant and interesting occurrences during the past week…….

  1. Federal funds cut:  If the Trump administration’s 2018 proposed budget passes in Congress, two important federal funding programs for green vehicles and cleantech will go away. The proposal would eliminate the U.S. Department of Energy’s Advanced Technology Vehicle Manufacturing Loan Program (ATVM) and Advanced Research Projects Agency-Energy (ARPA-E). To absorb Trump’s proposed $54-billion increase in defense spending, big cuts will be made to other federal agencies. These two Department of Energy funding programs have been able to tap into DOE-sponsored university programs and public/private alliances with vehicle makers and tech suppliers. The first-ever mass market electric vehicles in the U.S. – the Chevy Volt, Nissan Leaf, and Tesla Model S, had benefited from federal backing.
  2. Ford eQVM program: Ford is adding OEMs in electrified vehicles to the Advanced Fuel Qualified Vehicle Modifier (QVM) program. These vehicle modifiers and upfitters develop and install electrified and hydraulic hybrid powertrains for Ford trucks and vans. The eQVM program kicks off with three developers – XL Hybrids, Motiv Power Systems and Lightning Hybrids. These companies offer electrification or hydraulic hybrid solutions for a range of Ford vehicles popular with fleet and commercial customers, including F-150, F-250 to F-550 Super Duty, F-650 and F-750 medium-duty trucks, Transit and E-Series vans and chassis, and F-53/F-59 stripped chassis.
  3. Uber upheaval: Jeff Jones, the president of Uber, is quitting the ridesharing company after only being there about six months. The move by the No. 2 exec, sources say, is directly related to the multiple controversies there, including charges of sexual harassment. Uber’s list of controversies is long and complicated, including the Waymo lawsuit on Uber stealing its technology for self-driving cars. The company said it plans to review and commit to diversity goals and publish results from a sexual harassment investigation over the coming weeks. Arianna Huffington, a company board member, said a probe into the company’s culture and harassment claims is likely to be completed by the end of March. Huffington will help oversee the investigation along with Eric Holder, the former U.S. attorney general.
  4. VW MEB product launches:  Volkswagen is preparing to launch its first all-electric I.D. car in 2020 on the new MEB modular electric platform. The company is concerned that increasingly strict emissions rules in China and Europe will need to be taken very seriously. VW brand CEO Herbert Diess told analysts last week that the I.D. concept hatchback shown at the Paris auto show last year is expected to have its design approved in August for the 2020 launch; followed by an electric SUV coming out after 2020, with a concept being revealed next month at the Shanghai motor show. The I.D. Buzz minibus concept previewed at the Detroit auto show in will be the third EV and should come out in 2022. China will play the most important role for VW meetings its ambitious EV sales target over the next decade.
  5. Lucid Air pricing:  Lucid Motors has revealed the pricing of Lucid Air, the company’s all-electric supercar that was unveiled in December. Lucid says it will charge $60,000 for a 400-horsepower, rear-wheel drive version of the sedan, which will have 240 miles of range. The company is currently taking $2,500 reservation down payments; the car is scheduled to begin shipments in 2019.
  6. VW settlement:  Volkswagen’s Electrify America subsidiary will be installing 320 kW fast chargers in California as part of the $2 billion settlement from the diesel emissions scandal. The chargers will not be proprietary to VW and will use Combined Charging Systems, CHAdeMO, and open protocols like Open Charge Point Protocol (OCPP) in the chargers being placed. In total, the company plans to install between 2,000‐3,000 chargers (mostly Level 2 and 50 kW DC chargers) at 400 or more individual stations.
  7. NextEV finds another backer:  Chinese search engine giant Baidu will be investing about $600 million in Chinese startup NextEV. NextEV already has the backing of tech giant Tencent Holdings and Hillhouse Capital. The startup launched the world’s fastest electric car, the Nio, at a bay area event. Both NextEV and Baidu have licenses to test out there self-driving cars in California, so electrified autonomous vehicles should be part of the alliance.
  8. NGVs in Europe:  European Alternative Fuels Observatory released a special edition report on the natural gas vehicels in that market. This edition is dedicated to the use of natural gas vehicles in Europe. Some facts about the NGV market in. The latest figures show that there are about 1.3 million NGVs in Europe. They fuel up at more than 3,600 CNG stations in Europe with the top five infrastructure countries being Italy, Germany, Sweden, Netherlands, and Austria. There are more than 50 different models of CNG and LNG vehicles available in Europe. NGVs are years ahead in Europe as these vehicles and fuel played an important role in several decimated countries like Italy recovering from World War II.
  9. Goodbye Model S 60: Tesla’s Model S 60 will go away after April 16 orders as Tesla cuts out the least popular, and least expensive, electric motor and battery pack option. The cheapest option will be the S 75 and the starting price will go from $71,300 to $77,800. There will be a wider gap between those looking for the cheaper Model 3 and pricey Model S and Model X.
  10. Hydrogen station webinar:  Today at 12 noon (PST), you can join the California Fuel Cell Partnership for a brown-bag webinar update about hydrogen station network development in California. This webinar will provide general, non-technical overview about: retail fueling network development status; next retail stations ready to come online; proposed CEC funding of 16 additional stations; and SOSS system updates​. To participate from 12 noo to 1:00 pm PST, register here. You can also participate in a Q&A after the presentations.

What’s next for fuel economy and emissions mandates: Who’s fighting the fight

President Donald Trump’s statement on Wednesday reopened the fuel economy and emissions midterm review through the next year, possibly up to the original deadline of April 2018. It’s expected that the Trump administration will weaken the mandate, which when set in 2012, was to double average fleetwide fuel economy to 54.5 mpg by 2025. That mandate was actually based on real-world window sticker average mpg in the high-30s when factoring in automakers’ ability to trade credits and other factors that go into the corporate average fuel economy numbers. The midterm review was included in the 2012 negotiations, with automakers pushing to take a look at how the 2022-25 phase-two period would be going.

The Obama administration and Environmental Protection Agency’s decision in January to finalize the rules before Trump took office intensified the conflict. Automakers had begun lobbying Trump right after he won the election to extend the review and soften the mandate; and organizations that had advocated for the fuel economy standard and its enforcement issued statements supporting the Obama administration’s move.

Here’s a look at the roles that several parties to the matter are expected to play:

Automakers: Ford, General Motors, Toyota, and Volkswagen have led the argument that the numbers aren’t there. Low gasoline prices have supported record demand for SUVs, crossovers, and pickups and dragged on demand for hybrids and small, fuel-efficient vehicles. Plug-in electrified vehicle sales have grown to about 1% of the total market, but the growth rate over the past year isn’t helping on the fuel economy front. In Michigan last week, Trump met with the CEOs of GM, Ford, Fiat Chrysler Automobiles, and top U.S. executives from Toyota, Nissan, Daimler, others.

Mitch Bainwol, chief executive of the Auto Alliance, which represents 12 major automakers, including GM, Ford and Toyota, applauded the Trump administration’s decision last week. “We applaud the Administration’s decision to reinstate the data-driven review of the 2022-2025 standards. By restarting this review, analysis rather than politics will produce a final decision consistent with the process we all agreed to under ‘One National Program’ for GHG and fuel economy standards,” Bainwol said.

He said the industry will work with the EPA, the National Highway Traffic Safety Administration and the California Air Resources Board “in carefully determining how we can improve mileage and reduce carbon emissions while preserving vehicle safety, auto jobs and affordable new cars and trucks.”

Truckmakers:  In August, the EPA issued phase-two standards to reduce greenhouse gas emissions coming from commercial trucks, buses, and vans, in three phases by 2027. The regulation is intended to cut carbon emissions by about 25% compared to the current rules. The trucking industry has not asked the Trump administration to reverse those rules, according to Sean McNally, spokesman for the American Trucking Associations.

Legislators: As expected, this decision continues to be more of a Republicans vs. Democrats debate. Republicans support the Trump administration’s decision, and like his argument on supporting American automakers grow their companies and create more jobs here. “We’re going to work on the CAFE standards so you can make cars in America again,” Trump said. “We’re gonna help the companies and they’re gonna help you.”

U.S. Senator Edward Markey (D.-Mass.) has been a vocal critic of the move. The action will lead to needless uncertainly for the auto industry, and consumers will end up having to pay more at the fuel pump, he said. He and other Democratic senators criticized the EPA emissions review before it had been issued. Senator Jeff Merkley said that its bad for the economy, environment and middle class families.

Consumer groups: In late February, Consumers Union (which publishes Consumer Reports) and the Consumer Federation of America sent a letter to Trump asking the administration to maintain the strong fuel economy standards – to help to lower fuel costs for middle class families across the country, support job creation and innovation, and improve air quality. Consumers Union’s research shows that consumers will have net savings of $3,200 per car and $4,800 per truck, over the life of a vehicle that meet the 2025 standards, even at today’s low gas prices. If gas prices rise, which two organizations expect they will, the savings would be significantly higher. Consumers will have more money to spend in other parts of the economy.

The two consumer organizations also make the case that automakers are already ahead of the standards through developing innovative, fuel-efficient technologies. “Thanks to fuel economy standards, the automakers have invested in innovative technologies to improve fuel economy, and their efforts have paid off. Automakers have not only met today’s fuel economy standards, but they have exceeded the standards in many cases, all while enjoying record profits and record sales,” the letter said.

Environmental groups:  These groups see the announcement as part of a larger move by the Trump administration to overturn the Obama administration’s policies on climate change, and disregard for long-term air pollution standards like the Clean Air Act. Environmentalists have vowed to sue if the Trump administration weakens the rules, which they expect to happen.

Natural Resources Defense Council thinks it makes no sense, since the mileage standards would save consumers money at the gas pump, make the U.S. less dependent on oil, reduce carbon pollution, and advance technology innovation. It was also one of the ways GM was able to go from bankruptcy and return to financial strength.

The American Council for an Energy-Efficient Economy said that the Trump administration’s move was a bad one. Best known for its “Greenest and Meanest” awards, the organization usually stays out of public policy. This time, the ACEEE released findings from its study: it would reduce fuel consumption more than two million barrels of oil by day by 2025; eliminate six billion tons of greenhouse gas emissions over the lifetimes of vehicles of model years 2012-2025; and would save consumers over $1 trillion at the gas pump.

California:  Trump didn’t mention California’s role in the future of the national standards. He won’t seek to revoke California’s clean car rules and zero emission vehicle mandate, according to a White House official. However, the official didn’t rule out the administration seeking to withdraw California’s authority on the matter in the future. Nine states and the District of Columbia have adopted its zero-emissions vehicle mandate, which uses a credit system that will require automakers to sell about 1.5 million passenger by 2025. These include battery electric, plug-in hybrid, and fuel cell vehicles.

Governor Jerry Grown and California Air Resources Board chair Mary Nichols have made strong statements that California will move forward on ZEV mandates regardless of what the federal government decides to do. They are taking things seriously, though. The state has hired former Attorney General Eric Holder in anticipation of legal challenges, according to the Sacramento Bee.

Market dynamics:  Automakers and advocates of clean vehicles have for years been debating the structure behind the federal mandates. Under the rules, automakers have to hit fuel economy standards for manufacturing fuel efficient vehicles, but will enough of them be sold to meet the fuel economy and emissions targets?

That debate brings up the commonly cited conundrum of which economic side has to lead the way: supply or demand? It could bring up the “If you build it, he will come” line to call in Shoeless Joe Jackson during the Field of Dreams movie. Or, what comes first, the chicken or the egg? Or, putting the cart before the horse.

On the consumer side, the U.S. has seen hybrid sales soften and stagnate, but PEV sales increase at a faster pace than hybrids did 15 years ago. That’s been driven by passionate Tesla fans, PEV advocates well represented by groups like Plug In America, and consumers who like to lead the way as one of the first to adopt new technologies, and others who like the deals they’re getting through incentives and fuel savings.

Fleets will be playing an increasing important part of the PEV sales drive. Beyond a few major fleets like UPS, most had taken a very hesitant approach to electrified cars and trucks. That will be getting a major boost by the campaign taken on by 30 U.S. cities, led by Los Angeles Mayor Eric Garcetti, to get good deals from automakers. They have about $10 billion in acquisition funds for about 114,000 PEVs for their city fleets. These could go to vehicles like police patrol cars, street sweepers, trash trucks, and other applications. Buying that many PEVs would increase the segments U.S. sales by about 72%.

Market forecasters see PEV and hybrid sales staying at about this level for now. However, that’s expected to increase dramatically in the near future, with one noted analyst expecting to see PEVs and hybrids making up 10% to 15% of total U.S. sales in the next 10 years. State incentives and federal tax credits play into it, along with extended range, improved performance PEVs coming to market. Ford said it will bring an all-electric SUV with 300-miles of range to market by 2020, GM started doing well selling the 238-mile range Chevy Bolt; Nissan has said a new generation Leaf with 200 mile range will be rolled out; and in January Tesla started making batteries at its Gigafactory for the Model 3 to roll out later this year.

China:  That country has been another important market for global automakers to consider for its PEV sales strategy. The numbers have been huge in recent years as China beat out the U.S. as the leading global PEV market. Government policies are starting to change, which appear to be softening that lead. Sales of “new energy vehicles,” the term China uses to refer to battery-electric vehicles, plug-in hybrids and fuel-cell cars, dropped 74% in January from a year earlier to 5,682 units, according to China’s auto association. The government had cut subsidies more than a fight at the beginning of the year. Rules may be revised that had mandated automakers to produce and sell certain volumes of PEVs in the market.

This Week’s Top 10: Trump releasing fuel economy policy, VW pleads guilty in U.S. and faces more in Europe

by Jon LeSage, editor and publisher, Green Auto Market

  1. Fuel economy policy: President Donald Trump is expected to announce the new administration’s stance on the fuel economy and emissions policy on Wednesday. After meeting with automaker executives in a Detroit suburb, Trump will likely announce extending the public comment period and softening the mandates for automakers. The largest automakers have been asking the Trump administration to revise the mandate to be more in line with the market – making it difficult to sell smaller, fuel efficient cars, hybrids, and plug-in vehicles. Auto executives started approaching Trump administration transition team members soon after the election and staff members and advisors after the inauguration. They were upset with the Obama administration over cutting off the comment period and finalizing the mandate.
  2. VW guilty plea: Volkswagen pleaded guilty on Friday to fraud, obstruction of justice, and falsifying statements in the diesel car emissions scandal. It was part of a $4.3 billion settlement that had been reached with the U.S. Justice Department in January and was the first time the automaker has pleaded guilty to criminal charge in any court around the world. Legal battles also started heating up in Europe about the same time. Criminal investigations are intensifying across Europe, and thousands of consumer lawsuits have been filed. The lawsuits could add up, as there are a lot more owners in Europe of VW brand diesel cars.
  3. BMW sales double: BMW Group announced that global sales of its plug-in vehicles more than doubled in the first two months of 2017, over that period the year before, to more than 10,000 units sold. Vehicles currently for sale include the BMW i3 in battery electric and extended range plug-in hybrid versions; and the i8, X5, 3-Series, and 7-Series plug-in hybrids. Coming up next will be the BMW 530 iPerformance plug-in hybrid and the Mini Cooper SE Countryman All4 The company expects plug-in vehicles sales to increase through the launch of the plug-in hybrid BMW 530e iPerformance this month, and the Mini Cooper S E Countryman All4 plug-in hybrid in June.
  4. Renewable diesel: Oil refining company Neste has become the world’s largest supplier of renewable diesel. Recent additions to the client list include UPS for delivery vans and Google for its buses that transport employees to and from work. Fleets are taking to it for reasons found in support for renewable diesel – cutting carbon emissions, particulates, and NOx significantly without having to convert over diesel vehicles. Nearly 80% of the company’s renewable products are based on waste and residues.
  5. Detroit Electric: Detroit Electric has a $1.8 billion investment through a joint venture with a Chinese company that will roll out the long delayed SP:01 and other vehicles. The startup electric sport carmaker launched in 2008 and took the name of one of the very first electric carmakers that hadn’t been building cars for over a century.  Detroit Electric has created a joint venture with Far East Smarter Energy Group, a Chinese company that makes batteries and electrical components. The two companies will get production started by the end of this year for the SP:01, and are  planning for two more electric car models in the near future.
  6. Tesla energy storage: Tesla Energy is working on getting business overseas – Australia and Kauai. Tesla CEO Elon Musk has made an offer to Australia by tweeting with Australian tech billionaire Mike Cannon-Brookes. Musk pitched him on bringing Powerwall and Powerpack products to the South Australia state to have the necessary energy backup in case of another emergency. South Australia was hit by a state-wide blackout during September and are interested in Musk’s $25 million, 100 megawatt hour offer. In another deal, Tesla Energy has set up a a 13 megawatt solar farm that generates energy stored in a 52 MWh Tesla Powerpack storage set. It fits well into Hawaii’s mission to free the islands from fossil fuels for energy and transportation. Watch the video.
  7. In-wheel drive: Protean Electric is partnering with Consolidated Metco to develop an electric in-wheel drive system to provide hybrid-electric solutions for the medium and heavy-duty commercial vehicle markets. The companies say that the drive system will enable ConMet’s OEM and fleet customers to address the tightening of  safety and emissions regulations, increasing demands for improved fuel efficiency, weight and drivetrain packaging optimization, and shifts in vehicle demands for long-haul and urban delivery.
  8. Ford wins award for sustainability practices: Ford was named one of the World’s Most Ethical Companies for the eighth straight year by Ethisphere Institute, which the automaker says is the longest streak for any auto manufacturer. The award honors companies “who recognize their role in society to influence and drive positive change in the business community and societies around the world.” Ford’s Partnership for a Cleaner Environment (PACE) program with its supply chain partners helped the company make the list. The program, which started in 2014, added tools that help suppliers reduce carbon-dioxide emissions and waste. Members of PACE share best practices in reducing carbon and adopting procedures for reducing water and energy consumption.
  9. Site tours: ACT Expo 2017 has announced three technical tours for those attending the conference in Long Beach, Calif., in early May. Monday, May 1, 1 p.m. – 4 p.m.: Join American Honda at its North American Headquarters in Torrance for a reveal of its three Clarity models. The reveal will include an overview of national marketing efforts to deploy the Clarity as well as an opportunity to get in the new vehicles and test them out. Monday, May 1, 1 p.m. – 4 p.m.: City of Long Beach has one of the most diverse and innovative municipal fleets in the nation, offering an array of fuel and vehicle types with renewable diesel, renewable natural gas, and plug-in hybrid vehicles. Attendees will see an assortment of city vehicles, as well as its renewable fueling infrastructure, extensive maintenance shop, and fleet charging infrastructure. Thursday, May 4, 1 p.m. – 3 p.m.: Long Beach Container Terminal is the world’s first zero-emission marine container terminal. It uses fully automated battery electric cargo handling equipment to move containers through its terminal. While there is a lot of talk of heavy-duty vehicle automation, LBCT has more than 60 battery electric units running in every day service. Visit this incredible project, and also see how these units autonomously change their own battery packs! Enhance your ACT Expo experience by adding an offsite tour for just $50. You can also view a video about the upcoming event.
  10. Low carbon pathways: The California Air Resources Board’s Low Carbon Fuel Standard (LCFS) staff has released for public comment four new Tier 2 renewable diesel (RD) pathways using soy oil, used cooking oil, tallow, and corn oil at the Diamond Green facility in St. Charles, Louisiana. Diamond Green Diesel (DGD) uses the UOP Ecofining Process to produce RD from Used Cooking Oil (UCO), tallow, corn oil, and soybean oil. The Ecofining Process hydrogenates triglycerides and free fatty acid feedstocks which are then isomerized to create a high-quality hydrocarbon fuel.

Geneva Motor Show reveals a few electrified supercars for global competition

Held March 9-19 at the Geneva Palexpo convention center, automotive media have been seeing several premiers at the 87th annual Geneva Motor Show.

The Geneva car show is best known for showing off supercar concepts, and this event is featuring a few electric performance cars that seem to be targeted at Tesla and a few startups from the U.S. and China. This year, a few of them have been electrified, one is designed for urban mobility, and another will be a combination of a self-driving car and a flying pod…………

Artega Scalo Superelletra:  This German supercar maker was founded in 2007 and has been through a series of prototypes, starting with the Scalo sports car and Karo quad bike. The company said those concepts served as testing grounds for its first production electric car, the Scalo Superelletra, which was just unveiled at the Geneva auto show. It’s being built with a 120-kilowatt-hour lithium-ion battery. It may be able to go 300 miles on a single charge, though that’s yet to be determined; and if drivers gun it like a race car, the range will be a good deal lower. Artega says it it will come with four electric motors, two at each axle, which combined can deliver 1,020 horsepower. It will go 0 to 62 mph in just 2.7 seconds. The top speed has made it up to 186 mph. The electric supercar has been developed in partnership with Artega’s parent company, German automotive electronics supplier Paragon. They’re using energy dense batteries that can add another 60 miles of range in four minutes, and 80% capacity after 17 minutes.

Audi hypercar:  CEO Rupert Stadler said in Geneva that the company is working on what’s being called a “hypercar,” and which may be in the early development phase with a launch coming up at the end of the decade.  The hypercar may come from the Audi R8 e-tron project that was halted about 19 months after being started up for development. That prototype test model was powered by two electric motors producing a combined 456 brake horsepower and 679 lb.-ft., with 0 to 62 mph in 3.9 seconds. The new hypercar could be a rival to similar vehicles in the works, such as the Mercedes Project One and Aston Martin Valkyrie. (The featured image is another Audi concept released a few years ago.) The German VW subsidiary has committed to having three electric production cars on sale by the end of the decade. The Audi Q6 e-tron sport utility vehicle should be the first to come out, and ready for launch later this year. Stadler also expressed interest in the company’s role in the Formula E series and the idea of electromobility.

Bentley EXP 12 Speed 6e:   British luxury automaker Bentley Motors revealed the EXP 12 Speed 6e concept electric convertible at the Geneva Motor Show. Details haven’t been released on the motor or battery pack, but it will be an all-electric convertible sports car and the automaker is promoting access to wireless charging as one of its offerings. If rapid wireless charging isn’t available for a few years, the electric car can be charged through an auxiliary charging point that will be out sight behind the rear license plate. The compmany reiterated its plan to introduce plug-in hybrid electric vehicle models across the Bentley model range, which will start with the Bentayga in 2018. As for the EXP 12 Speed 6e, “Bentley is committed to offering an electric model in its future portfolio and we are interested to receive feedback on this concept,” said Wolfgang Dürheimer, chairman and chief executive.

Honda NueV:  Honda Motor Europe’s President and COO Katsushi Inoue announced that the European division will be following the Honda brand’s new ‘Electric Vision.’ Two-thirds of its European sales will have electrified powertrains by 2025, he announced in Geneva. The Honda NeuV (New Electric Urban Vehicle) will be part of it and was announced in Geneva. The all-electric concept vehicle will offer owners both personal trips and a revenue model for automated ridesharing when the owner doesn’t need to use the vehicle. Rolling out hybrid technology across of its vehicle line will be the first part of the Electric Vision; and the automaker said it will also make available a line of plug-in hybrid, battery electric, and hydrogen fuel cell vehicles in the European market. “We will leverage Honda’s global R&D resources to accelerate the introduction of a full portfolio of advanced, electrified powertrains for the European customer,” Inoue said. In other car show news, Honda announced that the all-electric and plug-in hybrid versions of the Clarity will be launched next month at the New York Auto Show.

Hyundai FE Fuel Cell Concept:  The Korean automaker announced it will be launching its second fuel cell SUV next year – and it will break the world record for driving range in a zero emission vehicle. The company says it will go 800 kilometers (497 miles) on a tank of hydrogen. Hyundai said it will be 20% lighter and have 10% greater efficiency than the Tucson Fuel Cell (called the ix35 in Europe). Energy density will be improving quite a bit, by 30%, which the company said will be integral in boosting the range from 265 miles in the Tucson Fuel Cell to 497 miles in the FE Fuel Cell Concept (at least for now; EPA fuel economy ratings will probably bring down that total for the concept fuel cell vehicle).

Italdesign and Airbus flying car:  Italdesign, Audi’s design and engineering subsidiary, and Europe-based aircraft giant Airbus debuted a concept car at the Geneva auto show that will be self-driving and able to release its passenger to a flying drone. A drone will hover over the car, attach itself, and then carry the passenger pod to its destination. Italdesign’s Capsula concept goes back all the way to the 1982 Turn auto show. The new concept vehicle from Italdesign and Airbus would offer the latest in ground mobility tapped into flying vehicle technology being tested – ideal for crowded city streets.

Lexus LS 500h: The LS 500h debuted last week in Geneva as an electric- and gasoline-fueled version of Lexus’s flagship sedan. The Toyota division hasn’t released the price, but it could compete directly with the Tesla Model S at a base level and go near $90,000 at the high end. It has a V6 gasoline engine paired with two electric motors, a lithium-ion battery, and 354 horsepower on a multi-stage hybrid transmission. It will come out as a 2018 model year vehicle.

Mercedes-AMG GT Concept:  This concept vehicle has EQ Power+ designation, which indicates that the German sports car brand is looking at adding the new model to electrification of its future models under the new electric brand. All performance hybrids from AMG will carry this EQ Power+ designation. This concept taps into a combination of a gas-powered 4.0-liter twin-turbo V8, a high-performance electric motor, and a powerful yet lightweight battery to get a total system output of 805 horsepower. The concept vehicle is being tied into Mercedes-AMG’s 50th anniversary.

Porsche Panamera Turbo S E-Hybrid:  Porsche world-premiered the Panamera Turbo S E-Hybrid in Geneva, and will be launching it in the European marketing in July 2017. The company is promoting it as the flagship in the Panamera brand for its impressive power delivery. It can deliver 500 kW/680 horsepower of system power and 850 Nm of torque. It goes from zero to 100 km/m (62.13 mph) in 3.4 seconds, and can hit a top speed of 310 km/h (192.62 mph). The power comes from a 100 kW electric motor combined with a four-liter V8 engine that can bring the hybrid system 550 in horsepower.

Renault Zoe e-Sport:  The Zoe e-Sport Concept displayed at the Geneva car show brings together the automaker’s commitment to electric vehicles with winning two titles in FIA Formula E races. The e-Sport Concept will be built on the Zoe all-electric car’s platform and will have some of the same aerodynamic design and styling of the Renault e.dams team’s Formula E single-seaters. It will also utilize lightweight carbon fiber, as does Renault e.dams’ racer. The Renault e-Sport is powered by two motors that deliver a total of 340 kW of power. It will come with two batteries for energy storage with a total capacity of 40 kWh.

Toyota i-TRIL:  Toyota’s urban mobility concept vehicle, the new electric i-TRIL concept, debuted globally at the Geneva Motor Show. It’s been designed to be smaller than other specialized cars ideal for roaming through crowded city streets and parking garages. The market will be SMESTO (Small to Medium Sized TOwns) in which Toyota references European Union studies. The automaker thinks that these types of cities in Europe and other markets will be ideal.


This Week’s Top 10: Conflict and confusion over biofuel blends, Green car sales beat overall sales in February

by Jon LeSage, editor and publisher, Green Auto Market

Here’s my take on the 10 most significant and interesting occurrences during the past week…….

  1. Battle over biofuels: Conflict and confusion over biofuel blends in gasoline – and who will do the blending – continue to shake up Washington. Renewable Fuels Association President Bob Dineen told Reuters last week that Carl Icahn, an oil industry billionaire and advisor to the Trump administration, had told Dineen that the administration would be taking a favorable position for refiners such as corn ethanol producers. The fuel blending of about 10% ethanol to gasoline would be sent down the supply chain to gasoline marketers through an executive order by the president, Dineen said. Icahn and the White House later denied this was said to Dineen. Biofuel groups and producers have been upset that Icahn has been playing this role for the White House. The oil executive demanded during the election campaign that the obligation and costs should go to fuel blenders and not to oil companies and their supply chain partners. Several biofuel companies have also been upset with RFA for taking what had appeared to be a position opposing their stance on the matter. As of Monday, oil refiners including Valero Energy Corp. and CVR Energy Inc. (in which Icahn owns a majority stake) currently have to show environmental regulators they are meeting annual mandates; they’ve urged the federal government to push this compliance further downstream to fuel blenders and integrated oil companies. The White House says it’s taking this request under review. In other related news, U.S. ethanol production set a new record of 15.33 billion gallons in 2016, according to data from the U.S. Energy Information Administration (EIA). The EIA data showed that the average gallon of gasoline likely contained slightly more than 10.0% ethanol in 2016. The American Petroleum Institute (API) estimates that Environmental Protection Agency rules on 2017 biofuel volumes will put the ethanol-to-gasoline ratio at 10.4%, higher than the 9.7% ration recommended by the oil industry association.
  2. Green car sales in February: Sales of hybrid and plug-in vehicles were up sizably from January in the usual seasonal sales pattern, and both categories beat the overall market according to HybridCar’s Dashboard. Total light-duty vehicles sales were down 1.1% from February 2016, but hybrids saw an increase of 16.3% and plug-ins saw a leap of 45.12% over the previous year. The Chevy Bolt continued to do well, finishing fifth for all plug-in electrified vehicles sold in the U.S. during February. The Chevy Volt had another leading month, finishing in first place with 1,820 units sold; that compares with the No. 2 Tesla Model S, finishing at about 1,700 units sold. For hybrid vehicles, the Toyota Prius Liftback took its first position back from the Ford Fusion Hybrid but both vehicles have sold at nearly the same totals so far in 2017.
  3. EPA likely to issue revised fuel economy: The U.S. Environmental Protection Agency is expected to reverse course this week on the 2022-25 phase of the fuel economy and emissions standards. The unexpected decision made by the agency at the very end of the Obama administration to approve the proposal and cut short the public comment period has been a source of tension with automaker executives and Washington officials. Last week, auto trade groups representing Ford, General Motors, Honda, Toyota, Volkswagen, and others asked recently approved EPA Administrator Scott Pruitt to withdraw the Obama administration’s decision to finalize the rule in January. That had cut short the timing for giving public comments, which was originally supposed to go until April 2018. They would also like to see the rule become more favorable to automakers than what was finalized under the Obama administration. The EPA notice coming out soon is expected to state that the agency will work in tandem with the U.S. Transportation Department to set consistent standards in the ruling, a source said.
  4. Trouble keeping Tesla’s talent: Pressure to get the Tesla Model 3 out on time has led to tough working conditions at the company – and exodus of management. CFO Jason Wheeler’s  departure, just 15 months after he joined Tesla from Google, will be the latest in a round of executives leaving the company. Former execs speaking confidentially said it has to do with long work hours prepping for high-volume production and a tense working environment that reflects the persona of CEO Elon Musk. Of course, setting up shop in Silicon Valley is known to run the risk of high-churnover rate. A Tesla spokesman said the company’s attrition rate was below average among technology companies.
  5. Uber facing heavy criticism: Uber is feeling a “blowback” over the aggressive fighter approach taken by CEO Travis Kalanick and its corporate culture, with the latest being an apology sent to staff by Kalanick over a conflict he’d engaged in with an Uber driver captured on video. Kalanick and others at the ride-hailing giant are known for plunging into new markets around the world, price-war fighting Lyft and overseas competitors, and taking on lofty goals like deploying self-driving and flying cars. The company had been hit hard by news coverage and social media posts leading to Kalanick quitting President Donald Trump’s economic advisory panel over the immigration ban; having a female engineer protest over alleged sexual harassment; being sued by Alphabet’s Waymo over claims its self-driving car’s intellectual property had been stolen; and using a tool called “Greyball” used to fool regulators into thinking the company is not providing ride services in markets where it’s not supposed to be operating. Lyft, its toughest U.S. competitor, is quietly looking to raise $500 million in funding to expand; smaller ridesharing companies such as Juno are able to take advantage of frustration over pay to poach Uber drivers. “I must fundamentally change as a leader and grow up,” Kalanick, wrote in a note to Uber employees last week. “This is the first time I’ve been willing to admit that I need leadership help and I intend to get it.”
  6. What will happen to Ampera-e?: The future of the Opel Amera-e, built on the Chevrolet Bolt platform, is up in the air now that General Motors has sold its stake in the Opel/Vauxhall subsidiary to French automaker PSA Group. The $2.3 billion dollar sale will make PSA the second-largest automaker in Europe. PSA will gain intellectual property licenses from GM as vehicles transition over to PSA platforms. It may be that the originally planned launch of the Bolt as the Ampera-e in Europe will stick to that plan and roll out later this year. Green Car Congress reports that GM and PSA expect they will collaborate on further deployment of electrification technologies. PSA may also source long-term supply of fuel cell systems from the GM/Honda joint venture.
  7. Maven lengthens sharing time: General Motors’ Maven carsharing division has launched a four-week rental plan through a program its calling Maven Reserve; that adds to its previous longest rentals by 24 days. Carsharing members in Los Angeles and San Francisco can now schedule rental of a Chevrolet Volt or a Chevrolet Tahoe for an hourly, daily, or monthly fee, the company said on Friday. Markets being aimed at include entertainment industry people in L.A. and entrepreneurs in San Francisco. It’s expected to expand later to other markets.
  8. Workplace charging in NYC: Calstart yesterday launched “Charge to Work,” a first-of-its-kind electric vehicle workplace charging initiative to increase the adoption of EVs in the New York City area. It’s a three-year marketing and outreach campaign seeking to bring support from over 100 businesses that will encourage their employees to replace their conventional gasoline-engine vehicles with clean and efficient EVs. Announced by New York Governor Andrew Cuomo, Charge to Work supports the governor’s Charge NY program, which is accelerating the growth of the electric vehicle market in New York State through education, research, consumer outreach and financial support for the installation of charging stations across New York. The goal is to spur 450 electric vehicles (EVs) and the installation of 132 Level 2 EV charging ports.
  9. 2,150 PHEV pickups sold: Workhorse Group Inc. is now working with Clean Fuels Ohio to bring 500 units of the W-15 Plug-In Electric Pickup trucks to Ohio-based fleets. The company says that, overall, it has received Letters of Intent for 2,150 units of its upcoming plug-in hybrid pickups. The company has received LOIs from Duke Energy, Portland General Electric, the City of Orlando, Southern California Public Power Authority, Clean Fuels Ohio, and one other utility. The company currently builds medium-duty PHEV work vans for several fleet companies including FedEx, Penske, UPS, Ryder, DHL, USPS, and more.
  10. Lucid Air details: During a recent test drive, startup Lucid Motors revealed more details on its upcoming luxury electric car, the Lucid Air. The starting price is $165,000 for the Launch Edition, in which 255 units will be made in 2019. That one gets a 130 kWh battery pack that can carry the car about 400 miles. After that, the Air will see production scaled up to build a cheaper edition. That one will have a 100 kWh battery with about 300 miles of range. Before any of these electric cars roll out, the Lucid will have to put in place its $700 million production plant in Casa Grande, Ariz., which is slated to start production in 2018.

Taking a look at next-generation transportation fuels and the future of oil

Last week’s announcement of the $155 million that oil giant BP will be placing in Clean Energy Fuel Corp.’s Redeem renewable natural gas (RNG) shows a microcosm of much larger trends:

  • The oil industry is seeing a global marketplace out there where investing in clean fuel and energy is becoming more economically viable; it’s also being pushed by new government and corporate policies being enacted as the Paris climate change agreement takes hold – even if the Trump administration pulls out of the agreement.
  • Natural gas vehicle acquisitions are expected to grow, and there’s already thousands of those vehicles in fleets across the country. Using RNG is the same as using biodiesel or renewable diesel – the engine technology, and much of the fueling infrastructure – is already in place, and greenhouse gas emissions are reduced significantly overnight by switching over. RNG has about 70% lower greenhouse gas emissions than equivalent gasoline or diesel fueled vehicles; and renewable diesel offers similar benefits in emissions reductions.
  • Fossil fuel consumption, including gasoline and diesel, is expected to decline worldwide in the near future under stringent government regulations and increasing sales of vehicles consuming less gasoline and diesel. More pressure has been coming from increasing concern over air quality, health hazards, and climate change; in that context, stakeholders are pushing for change at the legislative, regulatory, corporate, interest group, and consumer levels. This is true of both the developed economies in Europe, North America, and Asia; and of developing economies such as China, India, and Brazil. Renewable energy used to generate electricity is seeing more government support in developing nations; as is vehicle electrification and alternative fuels as government regulations and subsidies flourish.

Here’s a look at the landscape of alternative, renewable fuels and energy for this year and beyond……..

BP and Clean Energy agreement:  BP is buying Clean Energy’s existing biomethane (RNG) production facilities, its share of two new facilities, and its existing third party supply contracts for RNG. The oil company will continue to subcontract the operations of these facilities to Clean Energy, and the natural gas fueling company has an extensive network of natural gas fueling stations around the country for purchasing RNG. Clean Energy will have a long-term supply contract with BP, and will buy RNG from the oil company and collect royalties on the Redeem fuel sold at its stations. Redeem comes from organic waste; Clean Energy sold 60 million gasoline gallon equivalents of the fuel in 2016. Customers buying Redeem have included UPS, Republic Services, Ryder, Kroger, and the City of Santa Monica’s transit agency. Using RNG and renewable diesel gives fleets and transport companies access to California’s low carbon fuel standards and cap-and-trade funding programs. Other governments, including Canada, are adopting the standard calling on fleets to reduce carbon emissions by 10%, no matter what the fuel may be.

Oil companies investing in alternative fuels and energy:  Seven oil and gas companies – BP, Shell, Eni, Repsol, Saudi Aramco, Statoil and Total – are creating an investment fund to develop technologies to promote renewable energy. The industries face mounting pressure to take an active role in the fight against climate change; that joint announcement was also tied into more formal guidelines being issued on the 2015 Paris Agreement to phase out man-made greenhouse gases in the second half of the century. BP had invested heavily in biofuels and other alternative fuels years ago but then had backed off. That investment has been picking up again lately with the Clean Energy Fuels deal and other sustainable energy including biofuels and wind energy. Finland-based oil refining company Neste Corp. is now the world’s leading supplier of renewable diesel and has been investing in jet biofuel. It’s been producing over two million tons of renewable diesel annually. Shell CFO Simon Henry said in a November interview that demand for oil is expected to peak in about five years. Hydrogen has been an alternative energy of choice for Shell with investments made in six hydrogen stations that are open for fueling – four in Germany and two in the Los Angeles area, and a seventh near London’s Heathrow Airport opening soon; and the new agreement with Toyota to jointly construct seven hydrogen stations in California. Shell is also part of a global hydrogen council that formed last month that will be investing about $10.7 billion in hydrogen products within five years. Last year, Shell also did what other companies such as Total, Statoil, and ExxonMobil are doing through investments in wind farms, electric battery storage systems, and carbon capture and storage.

Oil consumption will be declining: A new study by Edinburgh-based consultancy WoodMackenzie is in agreement with comments made by the Shell executive (and other oil company leaders) that what we used to call “peak oil” is showing clear signs of coming up. WoodMackenzie analysts say that the rising number of hybrid and electric vehicles being sold around the world, and greater engine efficiency, along with higher fuel standards and emissions reduction targets in the U.S., Europe, and Asia, will cause an historic shift in consumption patterns. Oil consumption reached a record high last year from oil prices plunging in 2014; the study forecasts demand for oil will reach its peak in the U.S. next year and by 2021 globally. Vitol, the world’s top oil trader, thinks it will take a few years longer with demand for gasoline and diesel reaching their peak in 2027-2028; but it will happen. Major oil companies and processors face an historic period of change as several countries, along with the Paris agreement, support getting rid of fossil fuels entirely in the next few decades.

Renewable energy being taken seriously as its own industry:  There was another $287 billion in clean energy investments made in 2016, according to Bloomberg New Energy Finance – a sign that the clean energy economy has global reach. Natural Resources Defense Council reported that India had installed 11 gigawatts of solar and 29 gigawatts of wind capacity during 2016; that helped move things along toward the country’s goal of having 100 gigawatts of solar and 75 gigawatts of wind by 2022. China became the world’s leader in solar power capacity last year, surpassing Germany; that came through adding more than 34 gigawatts of solar capacity last year, nearly 1.5 times the amount the U.S. has installed in its entire history. China also installed more than 23 gigawatts of wind power in 2016, almost three times as much as the U.S. added last year. Latin America has also been a bright spot in renewable energy with three out of the top five developing countries for clean energy coming from this region: Chile, Brazil, and Uruguay. In the U.S., more than half of about 24,000 megawatts of electricity generation capacity added to the grid in 2016 came from renewable resources. The U.S. Energy Information Administration also reported that more than half of electricity generation capacity added to the U.S. grid last year came from renewable energy. Last year, National Renewable Energy Laboratory issued a report forecasting that renewable electricity generation from technologies that are commercially available today, in combination with a more flexible electric system, could supply 80% of total U.S. electricity generation in 2050 while meeting electricity demand in every region of the country.