Cleantech experts debate green transportation

NEW YORK - I attended two different sessions focused on so-called green transportation business models during the Cleantech New York Forum this week. Both reaffirmed my belief that the most important short-term frontier for moving toward green transportation solutions will be technologies and business models that addresses the efficiency of existing fleets. For long-term solutions, however, electric vehicle technology continues to entice investors and experts.

First, a statistic to consider, courtesy of David Johnson, CEO of Achates Power, a company that is working on boosting the efficiency of diesel engines. Johnson says figures show that diesel vehicles that represent just 2 percent of all the cars and trucks in the United States consume about 26 percent of all the fuel we use annually. Now, ponder the fact that something like one-quarter of the vehicles in emerging markets like China are diesel trucks. Improving diesel fuel efficiency (an area targeted by Honeywell's turbo-charging technology) could go a long way.

More relevant data was cited during the conference by Debjit Mukerji, vice president of research for Cleantech Group:

• The transportation industry consumes something like 70 percent of the petroleum that the United States uses; 60 percent of that oil is imported.
• There are 1 billion 4-wheel vehicles in use today; that number is expected to double in the next 20 years
• Last year, China overtook the United States as the world's largest automobile market

In short, Mukerji says: "Transportation really is at the heart of the energy problem."

Not a shocking revelation, really. For me, the more profound takeaway is the reminder about how attention to driving habits, as we well as smart navigation systems can address efficiency immediately--even while the country fights about how much money to put into helping stoke interest in electric vehicles.

I recently reported that close to half of fleet managers are now scrutinizing efficiency metrics, using telematics and other technologies to help change driving habits. Driving smarter can help reduce crash frequencies and severity, AND result in average fuel cost reductions of around 10 percent, says Eric Shisko, senior vice president of global insurance for GreenRoad Technologies. GreenRoad, which was just named to the Global Cleantech 100 list, is working with approximately 60,000 drivers. Aside from being a tool for corporate fleet managers, Shisko says that his company expects its technology and services to become core for automobile insurance companies.

Car-sharing companies like Zipcar also have a significant role to play. Mark Norman, chief operating officer and president, said during a conference presentation that for every one car that Zipcar puts on the road, it takes between 15 and 20 cars off the road. The service now has close to 400,000 members, 10,000 accounts with business, and arrangements on 225 different college and university campuses around the country. If you think about how Zipcar may expand in the future, consider the test currently going on on New York City: the city is offering the service to city employees as a way of cutting transportation costs.

It occurred to me after Norman's presentation to ask him about how many electric vehicles and hybrids the company is using. His answer: Right now, there are only about 1,000 in the Zipcar fleet.

Which brings me to the second part of this post: the current plus around the potential for electric vehicle adoption. Here are three big points that were made by some of the experts at the conference:

1. The United States will not define the future of electric transportation: According to Scott Jacobs, a transportation business consultant for McKinsey & Co., "The United States is way behind in terms of determining the future." One reason for this is that the price of gasoline is still relatively inexpensive compared with Europe, China and other areas of the world, according to Brent Dewar, senior advisor for Green Order (and a former vice president at General Motors). "This is a very sensitive issue, obviously," Dewar says.
2. Don't overestimate or underestimate the impact of the government: Everyone seems to be in agreement that the CAFE fuel efficiency standards in the United States will spur action, but some of the experts on the panel believe that the earliers adopters of electric vehicles will charge them at home. Which means that those who bemoan the slow pace of public electric vehicle infrastructure deployments may be whining for nothing.
3. Early adopters of electric vehicles won't look like traditional car buyers: A big point made on one of the panels I attended focused on the notion that there will be new automobile classes for electric vehicles that won't have much to do with existing categories. For example, expect cars focused on the needs of megacities to be big among early adopters, according to Jacobs. He cites research among consumers in New York, Paris and Shanghai that show about 15 percent describe themselves as electric vehicle buyers. Many of the New Yorkers surveyed will be looking for plug-in hybrids that they can charge at home, which presents challenges for the electric grid. "We need not to worry so much about enabling factors for consumers but enabling factors for the grid," he says.