Economics

From Apterawiki

There are many economics aspects to the use of an Aptera. Some of these will be covered below:

[edit] Ownership

See the main articles on maintenance, cost of ownership, and taxes.

[edit] Power generation

EVs, in general, are a boon to electric utilities. They not only provide additional demand to profit from, but they usually charge at night, creating off-peak demand. This allows power plants to serve them without having to build any new power plants, which is a financial windfall. The only downside to them is that operators of dirty power plants, such as coal, are generally at their Clean Air Act limits, and would have to upgrade their scrubbers to prevent any additional emissions (a small loss compared to the gain).[1]

There is also the potential for "Vehicle to Grid" (V2G), wherein the vehicle's batteries buffer power to and from the grid to help even out generation loads. Some of the profit from this could be passed on as lower rates to EV owners to encourage them to participate in such programs. Aptera has made no statements about V2G at this point, however.

Fast chargers, if supported, are not as profitable for utilities since they provide mainly daytime charging. They also can provide V2G, however. Even with vehicles that support fast charging, one could expect most charging to be done overnight due to lower costs.

[edit] Chargers

So far, Aptera has only announced support for 110V charging, and officially has not decided whether or not to support faster charging options (see the main article on charging). This would need "slow" charging infrastructure -- normal household outlets. Almost every homeowner has this available already. Some apartment residents may not be able to run extension cords out, and many people would like to be able to charge near their place of work or in public, and would need an outlet installed. The cost could range from a few hundred to several thousand dollars. There is also "fast charging", such as the proposed "Fastr Blastr" program, involving dozens to hundreds of kilowatts to provide charges in a dozen or so minutes for a typical EV. Aptera has not announced support for this. These chargers cost about $125,000 each (less if multiple share a common battery bank)[2][3].

Let's go with the upper end price; how many EVs would be needed on the road to make it profitable? First, we must set the parameters. As nice as the Aptera is, there will be many other EVs on the road, and most of them much less efficient. Let's say that your typical EV gets the standard 200Wh/mi (compared to the Aptera's ~80Wh/mi) and goes 120 miles (i.e., a 24kWh battery pack, compared to the Aptera's 10kWh). For simplicity and to be pessimistic, let's say that the charger retains no resale value after purchase (complete depreciation), the owner doesn't profit from V2G using the charger's batteries, and that there are no "fringe" benefits such as customer loyalty from EV owners, tax credits, and earning "green cred" (the combination of these should be strongly biased against installing chargers, since the fringe benefits are often the biggest incentive). Let's say that the owner of the $125,000 charger wants to earn a 20 year IRR of 8% (a good investment), and that there's a 3% inflation rate. (Note that IRR implies paying off the charger *and* earning an overall profit). Let's also say that green power costs them at $0.15/kWh after charger losses (they're buying in bulk, and green power keeps getting cheaper, so this is probably pessimistic). To achieve these numbers, they need to earn $10,000 a year (let's say $11,000 after maintenance).

Let's say that the standard is to sell power for a cost per mile similar to that of a 30mpg car at $3/gal gasoline. Using 200Wh/mi, we get an equivalency of 6kWh to 1 gallon of gasoline, or $0.50/kWh. This means a profit of $0.35/kWh, meaning that to earn $11k per year, they'd have to sell 31.4MWh/year. This would imply fully charging 1,300 vehicles per year, or 3.5 per day. Naturally, people don't wait until their batteries are dead to charge, but that doesn't change the numbers -- if they charge sooner, they correspondingly have to charge more often. Factoring in V2G alone could lower the cost of this to 2-3 vehicles per day (and the fringe benefits could possibly, depending on the business, more than pay for the chargers in their own right).

Let's go with 3 vehicles per day. Picking a random highway:

http://www.interstate-guide.com/i-095_aadt.html

We see that the busiest stretches average 200,000 vehicles per day, while the sparsest stretches are about 40,000. There are about 250,000,000 vehicles in the US. If there were 100,000 EVs on the road, then 1 in every 2,500 vehicles would be an EV. In busier stretches, you can expect less need to fast charge, since many drivers will be just going from one part of the city to the next. In sparse stretches, you'd expect most people to need to fast charge, since they're probably going long distances. Let's say 40% in busy areas need to charge and 80% in sparse areas do. This comes out to 32 EVs per day needing to charge in the busy areas and just over 13 in the sparse areas. With 3 vehicles per day per charger being profitable and a 120 mile range on the typical EV, the busy areas would support a charger every 11 miles and the sparse areas every 27 miles. Even a desolate desert interstate will typically average at least 20,000 vehicles per day, which (assuming that still only 80% need to charge) would support a charger every 55 miles. Clearly, busy areas could become profitable with far fewer than 100,000 EVs on the road. And, once again, we ignore the other benefits of owning a charger, such as tax credits and using as a loss leader to attract customers. Even Wal-Mart wants to get in on the game.[4]

Of course, this covers the economics of fast chargers. If these sort of economies can be achieved with a charger that costs $125,000 to install, a normal (slow charging) outlet's cost would be trivial to make up, and the owner could afford to charge little more than the price of electricity. Also, since the Aptera uses so little energy, it would benefit more than the average EV from whatever charging price schedule was used. The more EVs are on the road, the easier it is to get a given number of vehicles to charge per day, creating both the incentive to buy more chargers (thus lowering purchase price through economies of scale and by having multiple chargers in a single location share a battery bank) and to lower prices simply due to the ability to get more people charging from a given charger each day.