The Issues with PHEV Usage Reflect the Challenges to BEV Adoption

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In reading through recent articles on the PHEV debate, the followup on PHEV reporting, and the range of insightful comments to those articles, one persistent question popped out: if you were to buy a PHEV, why wouldn’t you plug it in? Taking a step back, a PHEV is essentially giving people both a BEV and a hybrid in one vehicle. The reasons why someone might choose to operate it as a hybrid also reflect the reasons why someone might not choose a BEV.

Limited Availability of Affordable, Capable Vehicles

PHEVs with 200 km of range are increasingly becoming the norm in China. This is enough to cover typical daily driving needs, while not needing to charge every day. Due to competition, these vehicles also now tend to cost less than comparable ICE vehicles. These are EV-first PHEVs. Whether or not the engine can engage the wheels under some circumstances, the electric motors are the primary means of propulsion. The battery range tends to be consumed without the engine coming on.

However, these vehicles are less available in the West. The PHEVs that tend to be more available are largely ICE vehicles with small motors (what Maarten Vinkhuyzen calls “fake plug-in EVs”). Regardless of the rated range, these models will tend to engage the engine during moderate acceleration or high-speed operation. This leaves more miles under ICE power. And when an EV-first PHEV model is available, it tends to be more expensive.

Likewise, capable BEVs still tend to be more expensive than comparable ICE vehicles in the West. Less expensive EVs can be purchased, but those often lack the capabilities people want. Opening markets will bring competition, expand the availability of capable vehicles, and bring prices down. For both PHEV and BEV.

The Fuel Cost Differential Is Not High Enough

When comparing the price of gasoline to the price of electricity, the difference is substantial from country to country. I put together the following list comparing the average cost of residential retail electricity to the average price of gasoline, and edited it down to show a few key countries.

Overall, in many populous Western countries, a liter of gasoline costs around 5 times as much as a kWh of electricity. If you were to compare an EV using 15 kWh/100 km to a hybrid using 4 l/100km, it would still be less expensive to charge at home. However, when you include the markup for public charging, it would often be more expensive to run a car on electricity than on gasoline. However, in another group of countries, including China and Norway, a liter of gasoline is around 15 times more than a kWh of electricity. In these countries, it would almost always be less expensive to run a BEV. It is no coincidence that many of these countries either lead in EV adoption or are seeing massive growth (as well as often being where BYD is manufacturing). There are also some developing countries with plentiful renewable energy where running a car on gasoline makes no financial sense at all. Ethiopia’s hydropower-driven electricity, combined with a ban on ICE imports, has them set for massive growth.

Overall, lowering the cost of electricity with renewables will incentivize people to both plug in their PHEVs and buy BEVs. Reducing the cost of electricity could also lead to greater electrification of overall energy use, reducing emissions. Taxing gasoline at a higher rate to cover negative externalities could also help motivate more electrified transportation. However, fuel price is only a motivator if people pay for it.

Subsidy Structures Supporting Petroleum Consumption

In Europe, the majority of cars sold are classified as “company cars,” but these are not just corporate fleets for strictly business use. In many cases, these vehicles are offered to employees for personal use as a perk. The government and the company then often compensate for fuel usage, but not home electricity consumption. This makes it more expensive for the end user to run a PHEV on battery than it is to run it on gasoline. As such, subsidized company cars distort the PHEV picture in Europe.

Ending subsidization of petroleum consumption for company cars should be the first step. While we are at it, end all subsidization of pure ICE company cars. The savings could be used to support electrification. People will prefer to charge their PHEVs and buy BEVs. But people still need a place to access that electricity with their cars.

Charging Infrastructure is Needed

One of the top reasons why someone might choose not to run a PHEV on electricity comes down to charging. Many people do not have the ability to charge at home and do not have access to convenient public charging. In China, many apartment complexes have EV charging, and public chargers are far more prevalent. In addition, most public chargers are DC fast chargers, which Chinese PHEVs can use, making charging more convenient. With mass production and competition, public charging comes down in price.

Building codes could change to ensure that new construction includes connections for charging. Regulations could change to ensure apartments provide charger access. Governments could work to accelerate the rollout of public charging. Making charging more accessible and cost effective would increase PHEV battery use and BEV adoption.

Shift Focus to Support EV Usage & Adoption

A PHEV may not pass the purity test of some, but it ultimately puts a vehicle that is capable of operating as an EV in the hands of more people. It is unlikely that someone with a capable PHEV that chooses not to regularly run it as an EV would then choose a BEV. Taking measures to make EV operation more attractive will help people to choose to run their PHEV on battery power, as well as help other people to choose a BEV. Although some might try to take away the choice, regardless of what consumers want or need, that is more likely to create backlash than it is to become lasting policy. While I am sure the fossil fuel interests love the infighting, we could do more if we focus on the measures that advance the use and adoption of electric vehicles.