November 21, 2007

Dozens of cities and school districts are getting good marks for implementing hybrid buses that run on both diesel and electricity. In doing so, they are helping to commercialize a technology that proponents say will save fuel costs and prevent the release of harmful emissions.

Utilities are making a contribution to the cause. Duke Energy, Progress Energy, Dominion North Carolina Power and North Carolina electric cooperatives are participating with school districts nationally -- all part of a broader business and government consortium interested in seeing electric vehicles take off. The endeavor is well-timed given the attention paid to oil security and climate change along with the technical improvements in battery technology. While commercialization is the ultimate goal market support is still largely absent.

"There's an adoption cost and it is fairly high," says Ewin Pritchard, hybrid program manager for Raleigh-based Advanced Energy that facilitates programs such as one recently adopted by the Austin, Texas, school district. "There are incremental costs. But as more units are bought, the price per school bus drops down to a stable number."

At present, hybrid buses cost about $225,000 each, or about three times that of conventional diesel bus. Once 1,000 buses come to market, Pritchard says that the premium over-and-above a traditional bus will be $40,000. If the typical bus last 15 years, the hybrid school bus will pay for itself after the eighth year of ownership. That equates to $6,500 a year in fuel savings in combination with reduced maintenance. Altogether, hybrids buses are said to increase energy efficiency by 40 percent.

Hybrids are best suited in city traffic. When those vehicles apply their brakes, electrical energy is generated that is stored from the battery. As a result, there's reduced fuel use and lower emissions. The hybrid vehicle industry says that if a fraction of the nation's 500,000 school buses can be replaced, it would displace billions of gallons in gasoline.

The evolution can only be good for consumers and the environment. While today's hybrids are recharged by an electric motor that converts power from the gas engine to electric power, tomorrow's hybrids may be of the plug-in variety that can be charged through the electrical outlet at night. If the idea comes to fruition, then consumers will experience not just convenience but also cleaner air and cheaper transportation costs.

"The hybrid electric school bus project is an exciting example of how key stakeholders from the utility industry, business and government can form partnerships that produce great benefits for communities in which we live," says Ellen Ruff, president Duke Energy in the Carolinas, which is interested in plug-in hybrids.

Overall Evolution

As part of its wide range of fuel-efficient advanced technologies, General Motors has also developed a commercial parallel hybrid system that combines a diesel engine with electric motors to power transit buses.

It's already delivered more than 200 hybrid buses to the city of Seattle. They are said to save 750,000 gallons of fuel per year over the buses they will replace. Over the 12-year life cycle of the vehicles, the total savings is expected to be 8 million gallons of fuel. If America's nine largest cities replaced their transit fleets -- totaling 13,000 buses -- with hybrid buses, GM says that the cities would save 40 million gallons of fuel each year.

"You get low emissions, great fuel economy, smooth and quiet operation, but one other thing is acceleration," says Tom Stephens, group vice president of GM Powertrain.

To be sure, not everyone is a fan of hybrid buses. They are cost prohibitive and critics say that the estimated fuel mileage and subsequent fuel savings may not materialize. A typical bus may get six miles to the gallon while a hybrid may get 12 miles to the gallon -- making return on investments currently out of reach.

In the case of Seattle, fuel efficiencies have not worked as advertised because some of the buses are used on suburban routes where they don't benefit from stop-and-go traffic. Others say that federal emissions standards are getting stronger and turning less expensive diesel buses into cleaner-running machines.

But, no one disagrees that the hybrid buses require less maintenance and that they are quieter. Those buses have the capacity to run hundreds miles between fill-ups, says Advanced Energy's Pritchard. That's because battery technology is always improving. As such, the kilowatt-hour per square foot is better than ever. As the hybrid bus industry gains experience, its products will become less expensive and more reliable.

That's how Madison, Wis., sees it. It is investing in five new GM-manufactured buses as part of a city-wide initiative to improve sustainability and air quality. According to the National Energy Renewable Laboratory, those buses will cut emissions from nitrogen oxides by 39 percent, particulate matter by 97 percent, carbon monoxide by 60 percent and hydrocarbons by 75 percent.

"These buses are good not just for the environment, but for the city's bottom line," says Madison Mayor Dave Cieslewicz. "With the cost of diesel fuel continuing to rise, Metro's hybrid-electric buses will save taxpayer dollars as well as conserve fuel."

Hybrid buses are part of a phenomenon that is demanding the manufacture of cleaner vehicles. It's the free market at work. The problem is that those buses are now expensive and untested over time. With more production, however, the costs are expected to decline while the overall quality will improve. To get to that point, public-private partnerships must form and ones that will likely involve the utility sector.

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Ken Silverstein EnergyBiz Insider Editor-in-Chief
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