Resolving the enigma of plug-in hybrid vehicles
Are they good or are they bad? Like the feline thought experiment, where the cat is both dead and alive simultaneously until observed, the answer is that plug-in hybrid vehicles (PHEVs) are both good and bad until they are used. It matters because this particular powertrain lies at the epicentre of the battleground for carbon dioxide (CO2) reduction and, therefore, the prospects for containing climate change.
An earlier newsletter (Plugin hybrids without behavioral compliance risk failure) considered the variability in emissions and fuel consumption of PHEVs, and the dangers for policy. Now that PHEV sales are accelerating, the topic has become more urgent: how to ensure that a valid bridging technology to an electrified future does not become the next emissions crisis. How can we head off a collision between unpredictable consumer behaviour and misleading official emissions ratings?
Car labelling (whether for CO2, fuel economy or noxious emissions) has historically been about the car, with the view that ultimately its performance can be characterised fairly in a single “combined” number. This figure is used variously for regulation, taxation, urban access policy and consumer information. Now we face the situation where vehicle performance is arguably secondary to driver behaviour. The corollary of this is, perhaps: label the driver, not the car.
In traditional vehicle emissions labelling, it has been possible to “get away” with the single combined number because the difference between the worse case (urban driving) and better case (motorway driving) was around a one-third increase in CO2 emissions and fuel consumption. In other words, the combined number would not be far away from reality for most drivers over time.
Emissions Analytics has tested 37 PHEVs for its independent emissions programme. The method uses the EQUA Index test route – which is significantly longer than official cycles, combining urban, rural and motorway driving – and tests separately for electric-only range and engine-only efficiency, both in real-world, on-road conditions.
The table below summarises the results, split between European and US tests1. Comparing the engine-only mode to official certification values, real-world CO2 emissions are between double and treble. In this case, though, the real-world combined number appears to be a good characterisation of the performance of the vehicle, whether it is used in urban or extra-urban driving.
However, once you introduce real-world driver behaviour in terms of trip mixes and charging up of the battery between trips, it becomes clear that there is a significant problem. From the same test data, real-world CO2 emissions are as high as 299g/km in average urban driving if you never charge the battery up. At the other extreme, if you always charge up the battery and only ever take short journeys, CO2 emissions will be almost zero. In other words, there are orders of magnitude of difference between the best and worse cases. In certain use cases, real-world CO2 may be substantially better than the official figures.
For comparison, at the height of the divergence between the old New European Driving Cycle (NEDC) and real-world values for internal combustion engines (ICEs) – before it was replaced by the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) – the spread was only around 50%. The result of the NEDC official labelling system diverging from reality artificially led to the sales of downsized engines in large cars and the dieselisation of city cars. The damage in terms of both CO2 emissions and air quality will remain for more than another decade as those ‘artefact vehicles’ remain on the fleet.
The US test procedure is different from the WLTP, but achieves similar test results, but then applies a reduction of up to 30% to the fuel economy values and thereby a similar increase to the CO2 values. While this approach can work well for ICEs to align official values for real-world consumer labelling, it does not solve the problem of the divergence in performance possible for each PHEV.
The variance in performance between best and worst cases is more than a point of statistical interest. It has the strong potential to undermine the whole system of fleet average CO2 targets. If, for example, these vehicles travel only 10% of their distance on battery, they would be greater generators of CO2 emissions that full hybrids (FHEV) and mildly hybridised diesel ICE vehicles.
This proportion of miles travelled on the battery is called the “utility factor” (UF). If we compare the average European real-world tailpipe emissions of 182g/km from a PHEV with the crucial 50g/km threshold, this implies a UF of 72%. The 50g/km is important because it is a widely recognised benchmark for “ultra low emission vehicles”, below which manufacturers receive supercredits towards their fleet average CO2 targets and many consumers receive significant tax benefits. However, according to a recent report from the International Council on Clean Transportation (ICCT)3, the UF may currently be around 37% – this would imply real-world CO2 emissions of around 115g/km, worse than the best FHEVs.
On this 37% UF scenario, real-world emissions would be 130% higher than the 50g/km threshold. This means that labelling of PHEVs presents a much greater danger than ICEs did under the NEDC, the latter being a major contributor to the Dieselgate scandal. The combination of low CO2 values the WLTP permits and the current supercredits system is leading manufacturers to launch a large number of new PHEV models. For example, Jaguar Land Rover will have seven models by the end of 2020, and Daimler will have 20 by 2021, rising to 25 by 2025. In the UK, sales of PHEVs rose from 4,788 in January 2020 to 12,400 by September. According to the Fraunhofer Institute, there were approximately two million such vehicles on the roads worldwide by the end of 2019. Therefore, the next scandal is already brewing, as manufacturers react to the incentive structure provided by regulations, which is creating the next generation of artefact vehicles.
The system as currently constructed means that the manufacturer is bearing no direct risk of this UF being less than required for real-world emissions to align with official values. Instead, society bears the risk. In fact, manufacturers have a positive incentive to produce these vehicles due to the supercredits system that runs for the coming three years. This is a dysfunctional situation.
To illustrate the degree of the challenge, we can consider what proportion of miles must be driven on battery by a PHEV to be better than alternative powertrains. To make the comparison as fair as possible, including against BEVs, lifecycle emissions are used in the table below.
These values are based on Emissions Analytics’ testing of Euro 6 vehicles, and its proprietary lifecycle model. ‘Cleaning grid’ refers to the CO2 intensity of the electricity used to power a new BEV over its lifetime as the grid decarbonises, as forecast by the Eindhoven University of Technology5.
Although even modest charging-up renders PHEVs superior to unhybridised ICEs, a mildly hybridised diesel – with a ~6% efficiency advantage over a standard diesel ICE – would be comparable if around a fifth of miles were on the battery. The current utility factor of 37% described above leaves PHEVs performing the same as non-plug-in full hybrids, but with the extra consumer hassle and resource requirements. However, PHEVs can be superior to BEVs if they are used on the battery for just over seven out of every ten miles, using a reasonably optimistic view on grid decarbonisation, due to the extra CO2 from manufacture of the larger BEV battery.
The final line in the table shows that the official 50g/km threshold implicitly assumes that consumers charge up at least 73% of the time, which is double the reality. This is another way of quantifying the artefact of the WLTP and fleet average CO2 target systems.
This shows that it is possible to argue that PHEVs are the best of all worlds, rendering all other powertrains obsolete. Customers could have the smooth, low-end torque, high-end power boost and no range anxiety at an acceptable price. At the same time, you could argue that they are no better than non-plug-in hybrids and should not exist. Thence this enigmatic feline?
One option would be for manufacturers to assume this UF risk, through a system of post hoc reweighting of their official figures for the purposes of the fleet average CO2 targets, according to the real-world UF. Consumer labels could also be reviewed annually, without vehicles needing to be retested or certified. This would incentivise manufacturers to market these vehicles only to consumers likely to operate them with a high UF.
Under European regulations, vehicles will have to report their real-world fuel consumption from 2021. This could give a good estimate of the real-world UF, which could be used for this reweighting, applied retrospectively to all PHEVs on the road. It would not be a sufficient solution just to wait and see from this data whether there is a problem. There is a problem, and this data can be used to implement a solution today. In vehicle and product safely law, manufacturers are generally responsible for the foreseeable misuse of their products – not charging up a PHEV is arguably foreseeable misuse.
Putting risk onto the manufacturer could be coupled with more sophisticated charging mechanisms for consumers. In the UK, the Renewable Heat Incentive (RHI) for domestic heating offers a subsidy to homeowners based on the amount of ‘renewable’ heating generated, e.g. from an air-source heat pump. Translating this onto vehicles, a telematics system could provide a subsidy for every mile driven on battery and tax on every minute the engine is running. Through a solution like this, the risk could be shared between the manufacturer and the car owner, while delivering society’s goal.
Unless this challenge is resolved, it could lead to – if PHEVs gain high market share – a subversion of the policy for reducing CO2, but equally – if PHEVs are banned – the removal of a potentially powerful low-carbon technology. If you already believe the endgame is BEVs and we just need to get there as soon as possible, then banning PHEVs will seem the obvious and comfortable option. If you believe that the world’s light duty fleet should not be controlled by an oligopoly through its access to battery raw materials and that a competitive market of rival powertrains should be fostered, then the PHEV conundrum needs to be solved.
There are ways in which the official testing regime could be improved. For example, the EQUA Index test methodology for PHEVs developed back in 2014 acknowledged these vehicles could not be characterised in a single number. Therefore, each vehicle has both an electric-only range and an engine-only fuel economy. The official system in the EU already has similarly granular information from certification tests, but then falls into the trap of producing a single number. More recently, Emissions Analytics has measured electricity consumption independently of the vehicle’s systems in real-world conditions through a portable meter, coupled with a measurement of charging losses. Overall, this is the most condensed yet representative way of labelling this type of powertrain.
Nevertheless, better labelling does not answer the policy question of how these vehicles should be represented in the fleet CO2 targets, which still comes back to actual consumer behaviour and that utility factor. Get it wrong, and we may miss our CO2 targets by a significant margin, or dispose of an attractive technology. We may, through neglect, cede a major global market to the owners of certain strategic raw materials.
In the European Commission’s own words: “The stakes are high.”6
Footnotes:
- It is worth noting that the products are clearly very similar in performance between the two territories, and also in technology, as average engine size is 2.0 litres and average battery capacity 11.5 kWh in both regions. The average electric-only range across both markets is 41km. Average prices in Europe are around £41,000 compared to typical average ICE vehicles at £25,000-30,000.
- CO2 conversion from the US Environmental Protection Agency’s MPG-equivalent value
- Real-world usage of plug-in hybrid electric vehicles, International Council on Clean Transportation/Fraunhofer Institute for Systems and Innovation Research ISI, September 2020
- Applying estimated manufacture CO2 emissions to tailpipe threshold for supercredits
- Comparing the lifetime green house gas emissions of electric cars with the emissions of cars using gasoline or diesel, Eindhoven University of Technology, 2020
- Critical Raw Material Resilience: Charting a Path towards greater Security and Sustainability, European Commission, COM(2020) 474 final, 3 September 2020