Participants in the “Challenge of Electrification for Personal Mobility” panel held April 12 at the SAE 2011 World Congress in Detroit said that while industries are investing heavily to develop vehicles and an infrastructure, government support will be a critical requirement to establish a foundation for this new power source.

“One of the big issues is cost. We will need several more years—not necessarily ten—to have incentives,” said Minoru Shinohara, Senior Vice President of Nissan Motor Co. Other panelists also suggested that it would be a significant setback if budget cuts hit these funding supports.

Governments in many regions have been willing to support industry as it shifts from the internal combustion engine. Subsidies for both industry and consumers who buy hybrids or electric vehicles have helped hybrids gain a foothold. They have also helped establish a domestic source for the lifeblood product of electric powertrains: batteries.

Mary Ann Wright, Vice President of Global Tech & Innovation Accelerator at Johnson Controls, noted that a “disruptive event” occurred in 2009 when the federal stimulus package pumped $1.9 billion into advanced battery development in the United States. That helped put U.S.-based firms on a more competitive level with those from China and elsewhere.

However, she noted, government support in the form of tax breaks for pure and partial electric vehicles needs to be predictable in coming years. “A rational, sustained energy policy would mean a lot to us going forward,” Wright said.

Ongoing design efforts will help improve efficiency, cutting costs by letting vehicles use fewer batteries. Selling batteries when the vehicle is scrapped could also help reduce the overall expense of battery packs.

“When EV batteries reach the end their life for automotive, about 80% of their capacity remains,” said Anthony Earley Jr., Executive Chairman of the Board for DTE Energy, the Detroit area’s electric utility. Finding a market for these batteries could help reduce the effective cost of the battery pack. However, there’s no certainty that consumers might buy them for applications like neighborhood battery backup systems or for wind and solar energy storage, he explained.

Though EVs and hybrids still face significant challenges, there are many rationales for continuing their development, panelists agreed. Cleaner air is a big one, while building an infrastructure that’s less volatile than fluctuating oil prices is another.

“The Middle East continues to have disruptions, and when you see disasters like the spill in the Gulf of Mexico you see higher prices and delivery interruptions. We have to have alternative solutions in place,” said Michael Bly, Executive Director, Group Global Functional Leader, General Motors Co.

The disparity between what consumers want and what they will pay for is another challenge for sustainable energy at all levels. In vehicles, consumers say they want fuel efficiency, yet many balk at paying more up-front for vehicles that pay dividends over the long term.

That attitude may be behind a bit of flattening in the hybrid market. The market share for hybrids has not grown significantly in the past couple years.

“Hybrids are almost 10 years old, but they’re still only 2-3% of the market. That’s something I’m concerned about,” said Sherif Marakby, Director of Electrification Programs & Engineering at Ford Motor Co.

This disparity also shows up when consumers are polled about the techniques utilities use to generate electric power. “The large majority of consumers want us to use renewable energy, but when we ask if they will pay an extra 5%, the numbers fall to single digits,” Earley said.

Ongoing advances for internal combustion engines pose another pricing hurdle for electrification. Even if gasoline prices go up substantially, vehicles with internal combustion engines will remain viable because of improvements in fuel efficiency. For example, vehicles that shut down at stoplights are expected to see rapid growth in the next few years.

“We believe start-stop will encompass 75% of new cars in Europe by 2017,” Johnson Controls' Wright said.

After the initial presentations by panelists, audience members asked about other challenges, some wondering whether urban legends about batteries and electric power are true. One asked whether Internet postings about a limited supply of lithium were a reality.

“We could put millions of electric vehicles on the road and not drain the supply of lithium,” Wright said. “Lithium is only 2% of the cell’s composition.”

A similar myth about grid capacity was also dispelled. “The average capacity of the grid is running at about 50% today. We could double output immediately if we need to charge a large number of EVs,” Earley said. “The real issue is the timing of those charges; everyone can’t recharge at 5 p.m. on the hottest day of the year. That could cause problems.”