Tax Situationer for the Electric Car Revolution

dollarbills
dollarbills

There are two different scenarios that are currently playing all across America. With the second term of President Obama, the thrust on the further development of electric cars is further pushed to the forefront, to which the United States receives in different manners.

At the behest of Governor Bob McDonnell, a new proposal is being discussed at the State Legislature, proposing the state’s ‘stagnant’ gasoline tax to be replaced by a new sales tax (0.8 cents on the dollar), a new registration fee for every new car (US$15 per new vehicle), and a new annual fee for plug-in and hybrid cars (US$100 per vehicle).

His rationale is that the sales low gas tax, which has been pegged at 17.5 cents to a gallon since 1986, is not enough. The sales tax would benefit the transportation sector for the benefit of everyone. Unfortunately, this shortsighted program fails to realize that the gas guzzlers would pay less to operate their vehicles, while at the same time penalizing those that opt to utilize more efficient modes of transport. This is also an indirect attack on the burgeoning electric car market yet at the same time protecting the interests of oil merchants and perpetuates oil dependency.

On another front, the recent fiscal cliff negotiations have produced positive results in the realm of green energy programs. Amongst them is the Alternative Fuel Vehicle Refueling Property Credit, or in layman’s terms, the US1,000 tax credit allotment for the installation of home electric vehicle charging stations. While this can be claimed still even for those installed in 2012, other improvements include extension of this credit to business and investment users to a maximum of thirty percent credit, or roughly US$30,000 per site.

The home charger, in order to be eligible, is dependent on the electric vehicle owned. Plug in hybrids and range extended EVs have smaller battery arrays in them and would require shorter charging times. On the other hand, full battery electric vehicles would have larger battery arrays so there is a need for quicker higher volume chargers.

Those that have availed of this credit and its incidents are advised to contact their tax advisors on how to best utilize the maximum benefit of this tax credit.

Clearly, there is a dichotomy in the landscape of the electric car revolution.

India’s Flirtations with Electric Vehicles

indiaSPHERE
indiaSPHERE

After years of work and experimentation, the first commercially viable electric motorcycle from India has been made available. Made by the start up Ampere, the electric bike is one design that many Indians, especially in the rural areas, have purchased for their daily needs.

The electric motorcycle is not sleek and shiny designed for the urban setting but it is a heavy converted Chinese bicycle that has a top speed of fifteen miles per hour and it is a workhorse when it comes to heavy loads. Named the Angel, its main customer base are farmers and tradespersons and it is lauded for its low cost, about U.S. $386. The motorcycle is able to withstand great stress workload and is powered by free electricity available in the southern countryside of Tamil Nadu.

Unfortunately, a recent power shortage hit the agricultural state forcing the government to ration electricity. This tremendously affected the sales of the bikes, up from 600 a month to just 60 bikes.

This is just a microcosm of the worsening power issues that affect the sub-Continent. Since the electric vehicle market is still in its infancy, the continued power crisis would affect the bottom line for individuals who are worried they would not be able to fully charge their batteries with the rationed power.

In the macro sense, the power crisis is affecting the whole of India and has been pinpointed to the mismanagement of a specific power grid, causing massive blackouts affecting 600 million individuals for two whole days. This though is part of a recurring problem that many Indians have grown accustomed to, nicknaming them as ‘power cuts’.

The shadow of rolling blackouts has affected not just start ups like Ampere, but also established players such as Hero Electric. Hero Electric is one of the biggest producers of two wheeled electric vehicles in the country and their bottom line has been tremendously affected with the flickering of the power grid.

According to the Chief Executive Officer of Hero Electric, “We have discovered that in the last six months our sales have dropped to only fifteen percent of what it was in Tamil Nadu. Because there is nothing in sight, no resolution in the next few months, the sentiment is really subdued and the dealerships are closing one by one.”

It is hoped that the future of electric vehicle revolution bodes well for India. The central government has promised U.S. $4.13 billion stimulus program, with subsidies with the objective of having six (6) million electric vehicles on Indian roads by 2020. A previous program to subsidize electric cars back in 2010 was prematurely stopped when funds dried up and this program now can only be hoped to work.

First Responders Beware when Approaching Electrics and Hybrids

DANGER
DANGER

Electric cars, as well as hybrids, are very different from how conventional cars are built and operate. Thus, as more and more of these vehicles are introduced into the market and are used on the roadways, the higher the possibility of having an accident that may need emergency team assistance.

In many areas in the United States and in Europe, specialized training is now being undertaken by police, fire and emergency service personnel in dealing with high voltage systems for crashed electric and hybrid vehicles. The next stumbling block would be differentiating conventional from alternative vehicles when they are in a road mishap and their passengers need immediate attention.

One of the ways to assist first responders is the SAE International suggestion that electric and hybrid vehicles should have large stickers to inform the many of their electric fuel design. These would be inch high letters or badges on both sides and the rear of the vehicle to help first responders to identify and warn of their electrically charged nature. Another way would be to place lettering at the dashboard area, so that emergency personnel would see through the windshield.

This though, would not be a problem for high profile vehicles such as the Chevy Volt and the Nissan Leaf. This can help tremendously in differentiating an electric from a conventional for a Honda Accord or a Toyota Camry, as there isn’t much of a difference between the two.

These recommendations are enumerated in SAE’s report entitled Hybrid and EV First and Second Responder Recommended Practice. The report provides references as to electrics and hybrids, as well as guidance for tow truck operators and other post accident handlers to avoid further mishaps and injuries.

According to Todd Mackintosh, Chairman of the SAE Technical Committee, “As electric vehicles enter the marketplace in greater numbers, it’s an appropriate time to recognize best practices that facilitate a safe response when these vehicles are in an accident.” He added that a ‘cheat sheet for first responders’ would be most helpful, not just in terms of safety of the passengers in the vehicle, but most especially for those first responders.

One of the more adamant recommendations is a ‘kill switch’ mechanism that would turn off battery power in the event of an accident. It also recommends standardization of the location of these switches in order to have easy access in times of emergencies.

The electric carmakers themselves are installing safety features. The Nissan Leaf’s battery pack is in an all steel case, designing it to sense a crash and disable its electrical charge. Ford for its part, has published ‘Electric Badges’ which are clearly marked logos on the doors and trunk lid to warn of possible electric shock. Cables are wrapped in orange high voltage warning sleeves under the hood of the vehicle.  GM’s Chevy Volt has helped create training modules for first responders.

2013 The Year of Wireless Charging

electricCARBATT
electricCARBATT

Wireless charging has long been a buzzword in the world of technology, especially electric cars. In recent projections based on the studies conducted by Pike Research, the sales of wireless charging technology would jump to more than 280,000 starting 2013, peaking at 2020.

The think tank identified several points of growth, such as the increasing partnerships between several electric vehicle companies and manufacturers that fuels both the demand and innovations in the technology.

The technology is quite simple and operates when an electric car parks over a ground pad. This in turn creates an electromagnetic field that is convertedinto electric current in the car in order to charge the battery. There are no wires involved in this process and ground pads can even be embedded in structures and roadways to make the process much more accessible to all.

This is one of the areas that can tremendously influence future car purchases, as this would create a “park and forget” mentality, allowing for continuous charging without the active knowledge of the car owner. The potential for frequent stops where wireless charging is available could help in alleviating many consumers ‘range anxiety’ with electric cars.

There is also great importance in the market itself for this kind of technology as several large technology and car manufacturers have started to form partnerships specifically to undertake research and create wireless charging systems. One such example is BMW, which has forged agreements with Siemens on wireless charging. Audi, Mitsubishi and Toyota have a consortium with WiTriCity and Delphi, while Qualcomm has partnered with Renault and Delta Motorsports. Evatran has also entered into research agreements with Google and Hertz.

Nissan has taken great measure in integrating the wireless technology with its new models, such as allowing the vehicle to park itself to be able to fully utilize and be efficient with regards to wireless technology.  This is showcased in the newest Infiniti electric sub compact and would become available by 2015. The Japanese automaker has stated that its system is between eighty to ninety percent efficient, which is not far from standard wired charging.

There have been pockets of usage for wireless recharging technology. Italian bus companies have been using it for over ten years now, with each stop able to recharge up to fifteen percent of battery capacity. This is predicted to have the best utilization in other public transportation platforms, such as electric taxis.

Despite its great promise there are still some limitations, such as changing infrastructure to allow the integration of wireless pads in roads and motorways, as well as the retrofitting of current electric vehicles to become compatible with the newer charging technology.  This is in reality the ‘next big thing’ that is already here, providing great solutions for many issues in choosing electric car technology. As more and more companies and consortiums become focused on the technology, the next generation of electric carts would certainly provide better options for the electric car connoisseur.

Electric Car Support Developments

electrictransport
electrictransport

The electric car revolution is not just about the car itself, but all the other major changes that need to be modified to adjust to the new demand. One of the key areas being looked at is the effect of the electric car demand on the power grid in the United States.

A current study at University of Notre Dame is doing just that, exploring how the expanding electric car market would affect the U.S. power grid. The research is funded in part by the National Science Foundation’s Physical Systems Program. The process involves the development of mathematical algorithms that would help in guiding the integration of plug-in electric vehicles to the national grid.

Initial findings from the research team lauded the benefits that electric cars can provide their owners as well as the transportation industry and the electric companies. Their low impact would also help the environment. While there are win-win solutions, there are also drawbacks that need to be addressed. These include: balancing electricity demand and supply as well as the existing infrastructure in the transportation and delivery of electrical power to the end user.

According to the study lead, Vijay Gupta, “Electrification of the transportation market offers revenue growth for utility companies and automobile manufacturers, lower operational costs for consumers and benefits to the environment.” He adds, “By addressing problems that will arise as PEV impose extra load on the grid and by solving the challenges that currently impede the use of PEVs as distributed storage resources, this research will directly impact society.”

Another industry that needs development and support would be the battery market. Researchers at the Ohio State University have discovered a means that can provide a better battery to be used for both electric and hybrid cars.

The study used lithium ion batteries and researchers found that as the batteries age, the lithium accumulates what is termed as a ‘current collector’. This substance is a sheet of copper that helps in facilitating better electron transfer between the electrodes in the car’s electrical system. This discovery can help in improving battery design for cars, as well as provide enhanced performance and battery life for the user.

According to study lead, Bharat Bhushan, “Our study shows that the copper current collector plays a role in the performance of the battery. We didn’t set out to find lithium in the current collector, so you could say we accidentally discovered it and how it got there is a bit of a mystery. As far as we know, nobody has ever expected active lithium to migrant inside the current collector.”

Many hybrid electric and all electric car platforms utilize lithium ion batteries in their systems as rechargeable power packs. The lithium ions travel between the anode and cathode end of the battery. When charging, the electrons are on the anode end while they are all at the cathode end when discharging. The current discovery debunks the long held belief that when a battery ages, the lithium builds up on the anode’s surface resulting in loss of charge capacity.

One step at a time for the Electric Car Support Developments.