Heavy Hybrids

One of the main drawbacks of hybrid cars is their cost premium relative to conventional cars, compared to the value of the fuel savings they offer, unless gasoline prices rise significantly. However, this analysis goes out the window when we look at high-mileage commercial vehicles. Although hybrid passenger cars get more attention, a hybrid van looks like an even better proposition, in terms of its annual cost savings. In addition, its ability to accommodate extra batteries more easily than a sedan makes it a likely choice for early demonstrations of plug-in capabilities, as in this Daimler-Chrysler prototype featured in Sunday's New York Times.

Plug-in hybrids offer even higher levels of fuel savings than regular hybrids, by recharging at night and providing an initial interval of gasoline-free driving, say 20 miles. However, as I've shown previously, the extra increment of gas savings is typically worth a good deal less than that the initial improvement from regular hybridization, going from 20-ish to 40-ish miles per gallon. These figures look somewhat different for a delivery van, though, because the starting point is much lower.

If a van driven 25,000 miles per year could get 5,000 of those miles from stored electricity, its effective fuel economy on gasoline or diesel fuel would increase by about 25%. Even if the baseline fuel economy were 15 mpg--and it's probably closer to 10--those savings would amount to roughly $1000/year at $3/gallon. The EPRI estimate of 2500 kW-hours of electricity consumption cited in the Times would cost only a fraction of that, even in high-electricity-cost regions such as the one I just moved from. That would leave the business owner with $600 to $700 of annual pre-tax savings to defray the extra cost of the plug-in. If the business depreciated the vehicle on a normal 5-year schedule, it could afford to pay up to $3,000 for the plug-in feature, even in the absence of an investment credit or hybrid incentive. By comparison, taking a car from 45 mpg (hybrid) to 100 mpg (plug-in hybrid) is only worth about $2,000 in added up-front cost, based on typical usage, even if the cost of electricity were zero--which it's clearly not.

What all this means is that, as unglamorous as delivery vans are, they are an ideal testing ground for the new technology of plug-in hybridization, and they look like its most attractive application, as well.