Our Partners

The Transportation Electrification Initiative crosses all OTREC campuses.

PSU UO OSU OIT

Research

OTREC supports electric vehicles research activities across the partnering campuses

Education

OTREC supports electric vehicles educational activities across the partnering campuses

Energizing Oregon

Oregon’s DOE grant for electric vehicle community planning

The Transportation Electrification Initiative

The transition from a petroleum-based transportation system to one based on electricity will require a coordinated effort between public and private organizations both locally and nationally. The Transportation Electrification Initiative will test promising mobility projects focusing on urban freight, consumer behavior, intelligent vehicle systems and the effect of electrification on the electrical grid in a living laboratory.

PSU MBA Capstone Project Looks at the Business of Electric Vehicle Charging

Posted on October 3, 2012

PSU MBA Capstone Project Looks at the Business of Electric Vehicle Charging

Over the past decade electric vehicles (EV) have become a viable opportunity to address the challenges of climate change and the uncertainty around petroleum-based fuels. According to a Pike Research study on electric vehicle charging equipment, “more than 80 different models of PEVs (plug-in electric vehicles) will be found on roadways across the globe by 2013 and at least as many charging equipment for residential and commercial customers will be available”(Gartner, J. & Wheelock, C.; Pike Research Report: “Electric Vehicle Charging Equipment” (3Q 2011)). Yet, despite the increasing number of EVs and the development of a charging infrastructure, a high degree of uncertainty remains with regard to the optimal business- and revenue models for charging stations. Many questions remain unanswered, such as “How should prices be set?”, “Are there additional revenue sources?”, and “What are consumers willing to pay?”. In short, a suitable revenue model that optimally leverages the benefits of the EV development has not been clearly defined.

A Portland State University School of Business Administration MBA Capstone project explored existing EV charging business/revenue models and analyzed an optimal business/revenue model for the different segments (workplace/public/private) of the EV charging market. The report, Business Model and Earnings Analysis for the Electric Vehicle Charging Market, examines the feasibility of business and profit models in the electric vehicle (EV) charging industry and derives a business success ranking according to the business and profit models’ attractiveness. The recommendations aim at making EV-charging stations a profitable investment for the different Electric Vehicle Supply Equipment (EVSE) operators.

 

Project Results Summary

Given the market complexity the team segmented the industry along the supply chain into three Solution Providers: (1) Device Suppliers (responsible for the front end of the supply chain, namely equipment manufacturing, distribution, and installation), (2) Service Suppliers (involved at the back end of the supply chain with network management and operations), and (3) Full Range Suppliers (taking over all products and services along the supply chain). A key partner that is always involved in commercial charging solutions is the Property Partner, whose involvement begins with the installation of the equipment. As the name suggests these players provide the space on their property for charging stations.

The profit model analysis was focused on the Full Range Supplier and led to the following conclusions: (1) Full Range Suppliers have an unstable profit model that depends on a few key factors, (2) Full Range Suppliers currently cannot cover all their corporate expenses with charging revenue, (3) membership plans with yearly fees attract customers, but lower the margin per charging event, and (4) DC quick charging has the potential to become the most attractive source of revenue for Full Range Suppliers.

The profit model findings for Property Partners has resulted in the following findings: (1) Offering charging stations is a relatively safe investment for Property Partners, (2) Property Partners’ contribution to initial set-up costs can impact the project’s profitability severely, (3) composition of charging infrastructure (no. of L2 and L3 chargers) is key to success, and (4) Property Partners have a stable profit model that depends on a few key factors.

The energy and cash flow approach focused more on the consumer perspective and analyzed the dynamics between Property Partner and Solution Provider. The combination of both business models results in three possible operating structures to provide commercial charging to the EV driver: (1) Property Partner + Device Supplier, (2) Property Partner + Full Range Supplier, or (3) Property Partner + Device Supplier + Service Supplier. Though energy always flows from the utility company through the charging station to the EV itself, the flow of cash depends on the role of the Solution Provider: In the first scenario the Property Partner owns and operates the station. Profitability varies according to whether the Property Partner charges per hour, per charging event, or offers free charging. In the second scenario, the currently most common model, given the distribution of risk and level of investment, Full Range Suppliers are the more profitable partners. In the third scenario, revenue sharing agreements allow comparable profitability for both parties; however, the Property Partner has the higher investment and thus higher risk.

The EV driver ROI analysis assessed the breakeven point of an EV investment over time under the consideration of different variables. The finding that, unless charging exclusively at home, a balanced charging mix is most beneficial allows the assumption that commercial charging is expected to increase.

Regarding the sensitivity analysis, the analysis included the following four relationships: (1) Full Range Supplier profits and charging events per day, (2) price and charging demand, (3) Property Partner profits and daily charging events per charger, and (4) Property Partner profit and charging time. This led to insights, such as: (1) after two charging events per day profit increase per event is marginal, (2) price is elastic, meaning small price increase leads to great drop in demand.

The Operational Feasibility study proved that each model is operationally feasible (based on successful partnerships, placement of charging stations, promotion, legal and security requirements, etc.) though not necessarily financially viable at the moment due to high dependence outside money.

Our Business model attractiveness conclusion has led to the following ranking: 1st place - Property Partner, 2nd place - Device Supplier, 3rd place - Full Range Supplier, and 4th place - Service Supplier. Based on this ranking we have come up with the following recommendations.

Property Partners:

  (1) Consider DC quick chargers despite higher set-up costs

  (2) Stay below 50% contribution to initial device/installation cost

  (3) Heavily promote the charging stations to ensure usage and gain associated image benefits

Full Range Suppliers:

  (1) Maintain a minimum of charging events per day to cover direct costs

  (2) Be careful to change existing pricing

Device Suppliers:

  (1) Concentrate on innovation of core competency: Manufacturing

  (2) Connect with industry players to improve forecast accuracy and secure demand

Service Suppliers:

  (1) Initiate and grow network effects early with targeted marketing measures

  (2) Focus on reliable customer service for current and potential EV users to generate network effects

  (3) Invest in quantification of network effects to exploit additional revenue opportunities and prove attractiveness to Property Partners

The EV charging industry is still in its infancy and in part highly depends on external funding to support its growth, as well as the necessary infrastructure to further the EV movement. The research shows that though operationally feasible, some business models are currently not able to sustain themselves.

A copy of the report can be found HERE.

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PSU Faculty Present Electric Vehicle Research at TRB

Posted on February 21, 2012

PSU Faculty Present Electric Vehicle Research at TRB

Students and faculty researchers from OTREC universities presented papers at the Transportation Research Board’s annual meeting Jan. 22 - 26 in Washington, D.C.  Three of the papers presented during the conference focused on transportation electrification.  Dr. Jennifer Dill, PSU, presented E-bikes and Transportation Policy: Insights from Early Adopters, at a poster session -- a paper she wrote with Dr. Geoffrey Rose of Monash University.  The paper presents findings from interviews with 28 e-bike owners in the Portland, Oregon region. These interviews revealed several possible demographic markets for e-bikes that could expand the overall share of the population bicycling: women, older adults, and people with physical limitations. One finding found that owners enjoyed the ability to travel with relative ease for longer distances and over hills and to arrive at a destination, such as work, less sweaty, or tired than with a regular bicycle.

Dr. Miguel Figliozzi, PSU, and his students Wei Feng and Brian Davis presented two papers on electric commercial vehicles (ECV) and trucks. The Competitiveness of Commercial Electric Vehicles in the LTL Delivery Industry, presents a detailed model of the logistics performance, energy use, and costs of electric vehicles and comparable diesel internal-combustion engine vehicles. The model is applied to the study the competitiveness of three vehicles of similar weight and size in the USA market: a widely available conventional diesel truck and two electric trucks. This research shows that for electric trucks to be competitive, the cost savings from the reduced operational cost must be sufficient to overcome the much higher initial purchase cost of electric trucks. This effect can be heightened when the tighter constraints on electric vehicles lead to the purchase of additional vehicles above and beyond the required number of conventional vehicles. For electric trucks to be a viable alternative, some combination of the following factors must be present:

1. Daily distances travelled are high, approaching the electric trucks maximum range of 100 miles (but the battery energy constraint is not binding).

2. Low speeds or congestion and traffic jams are prevalent in the area of the route.

3. Customer stops are frequent and numerous, and a conventional truck would typically idle during these stops.

4. The trucks are loaded to a high percentage of their capacity.

5. The time constraint (rather than the energy or capacity constraints) is binding.

6. Since the electric engine is more energy efficient, grades or other factors exist which cause

increased expenditures of energy (but where the battery energy constraint is not binding).

7. The planning horizon is extended beyond ten years.

The other paper, Impacts of Economic, Technological and Operational Factors on the Economic Competitiveness of Electric Commercial Vehicles in Fleet Replacement Decisions, employed a fleet replacement optimization framework to analyze the competitiveness of ECVs. Scenarios with different fleet utilization, fuel efficiency and sensitivity analysis of ten additional factors indicate that ECVs are more cost effective when conventional diesel vehicles’ fuel efficiency is low (8.2 miles/gallon) and daily utilization is more than 54 miles. Six scenarios were evaluated to reflect demand and operating environment variability between fleets. Results show that when diesel trucks are operated in an environment with 8.2mi/gal (or 13.46mi/gal) fuel efficiency and annual utilization is higher than 14,138 mi/year/truck (or 22,272 mi/year/truck), electric trucks can be more economic competitive than conventional diesel trucks. These annual utilization levels are within a realistic electric vehicle range of battery capacity (54 and 86 miles/day/truck).

See Dr. Figliozzi's website for papers: http://web.cecs.pdx.edu/~maf/publications.html#Forthcoming

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PSU MBA Capstone Project Examines The Adoption of Electric Vehicles In Oregon

Posted on January 3, 2012

Oregon’s reputation as an early adopter of green technologies has led several automakers and the U.S. Department of Energy to choose the state as one of the first test markets for deployment of electric vehicles and the associated infrastructure. However, significant barriers exist to the widespread adoption of plug-in electric vehicles (PEVs): PEVs are more expensive than their established competition, consumers face a relatively steep learning curve to become familiar with PEVs, and the adoption of PEVs requires consumers to change their established behaviors and habits. Yet widespread consumer adoption is crucial to the success of PEVs.

A Portland State University School of Business Administration MBA Capstone project explored the barriers and needs to develop a comprehensive education and awareness campaign.  The report, Driving Adoption of Electric Vehicles to the Early Majority, details who are the early majority PEV buyers in Oregon and identifies the barriers to and enablers for adoption for this group.  The report also describes a seven-part campaign to support PEV adoption in Oregon with three key messages. The primary messages that should be included wherever possible in a campaign are the following:

1.            Buying an electric car is more than another vehicle purchase; it is a way to join a movement for positive change.

2.            While the up-front cost of a PEV is above that of many ICE vehicles, consumers should be encouraged to consider the total cost of ownership.

3.            Current range limitations can be dealt with by planning, trip chaining, and other practices that organizations like Metro have already encouraged drivers to adopt.

The campaign to be developed will need to provide opportunities to explicitly address these messages (through promotional materials and advertising) and to implicitly address them (for example, through creating opportunities for people to observe and try PEVs). The seven elements of this campaign are as follows:

1.            Survey consumers about PEVs.

2.            Develop educational and awareness-building materials.

3.            Empower people to be PEV influencers.

4.            Create and implement a cost-effective advertising campaign.

5.            Cultivate partnerships with organizations that can help promote PEVs.

6.            Create opportunities for potential buyers to try PEVs.

7.            Promote public and private fleet adoption.

Together, the elements of this campaign address many of the challenges to widespread electric vehicle adoption in Oregon. Many other actions must be taken to enable PEV adoption in Oregon—such as building a robust infrastructure to support them. This outline of an education and awareness campaign can play an important role in the widespread adoption of PEVs in Oregon.

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Electric Vehicles and the Oregon Tourism Industry

Posted on December 23, 2011

Oregon is one of the leading launch markets for electric vehicles (EVs) in the United States.  Because tourism plays an important part of the state economy and Oregon’s tourism and hospitality industry are striving to become more sustainable, EVs can play a central role.  What are the opportunities and challenges for this industry to embrace EVs over the next couple years?  The white paper “Electric Vehicles and the Oregon Tourism Industry” explorers how EVs can be integrated in the current tourism framework.

The Oregon tourism industry has much to gain from electric vehicle adoption. Establishing EV support as part of an individual business’ offerings or as a state at­traction will capture this new market in its infancy. Do­ing so will build loyalty within an existing green tourism market, and attract new EV drivers as the cars begin to proliferate. Building a strong support network for EVs will also send a strong message to visitors that driving an EV can be an easy, attractive and green way to travel. Oregon has many assets and attractions that lend themselves to EV travel, and a supportive govern­ment that is committed to providing a robust charging network. By developing convenient charging stations, by providing competitively priced electric car rental services, by creating and distributing critical education­al materials and maps, using positive media coverage, and creating special promotions that feature EV travel to Oregon’s cultural and natural attractions, Oregon tourism and EV adoption can fully leverage this oppor­tunity for mutual gains.

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Welcome to the Transportation Electrification Initiative.

Posted on September 22, 2011

This initiative is still under contruction, but once finished it will be home to everything Transportation Electrification Initiative. 

read more

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News

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Infographic highlights e-bike use in North America

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