MN: In recent weeks automakers have put their 2008 models on display at the Los Angeles and San Francisco auto shows. How would you score the overall environmental performance of automakers’ 2008 offerings?

FK: I think carmakers have just not budged sufficiently from where we were in the 1970s. The most dramatic illustration is that Ford offered a 25-mpg vehicle in 1925, and that’s still where the fleet average is now. Now obviously the 1925 Ford was a very lightweight car compared to what we have now, but to say that we’ve gone no further in 80 years is a telling comment. All the engineering and benefits of efficiency have gone into bigger cars and cars with more muscle and not into efficiency or safety at reduced weights. There are obviously a few model exceptions, but the fleet is disgraceful.

MN: What benchmarks do you think car buyers should use toward evaluating how green cars are becoming?

FK: I would say they ought to look at the kind of cars that are meeting European CO2 emission requirements and are meeting the miles per gallon requirements that China is about to put in. So we’re talking about 30 to 40 mile per gallon vehicles, of which there’s a handful. That’s a minimum.

MN: Would you recommend those benchmarks to policy makers as well?

FK: No, because I think that the point these days is not to focus on making cars more efficient users of gasoline. The point is getting off fossil fuels. That’s a different goal. I personally think the best way to do that is to displace oil with electricity.

MN: Where does electricity fit in with what appears to be a coming explosion of automotive technology choices, i.e., flex fuels, biodiesel, hybrid, plug-in hybrid, all-electric, natural gas, hydrogen…

FK: Actually I think the choices are narrowing down, and there won’t be such an explosion. I think a lot of the solutions are gradually being excluded now. When people were talking about clean cars in the 1990’s, they looked simply at tailpipe emissions. From that point of view, a fuel cell car was great, because all it produced out of its tailpipe was water. But in 2008 what we’re considering is well-to-wheel emissions and well-to-wheel efficiency. From that point of view I don’t think fuel cell cars will ever be viable. I don’t think natural gas is a particularly strong contender. I don’t think corn ethanol has any credibility over gasoline. We don’t have cellulosic ethanol yet. So what that leaves you with, if you’re trying to reduce greenhouse gasses, is limited biofuels like biodiesel, where there are still supply and infrastructure issues, and ultimately you have electricity, which is the most promising one. I think electricity is just getting more attention for that reason.

MN: With that in mind, does CalCars advocate a specific evolution of technologies over the next 10 years?

FK: I’m hoping what will happen, and I think it’s realistic, is that the platform for development of future cars is going to be electricity as the primary fuel source and evolving biofuels as a range extension fuel. So for single-car families that want a car that can do everything they need, I think it will be the plug-in hybrid for the next decade or longer. For families that have multiple cars, I think quite soon it will be compelling to use as a second car an all-electric vehicle with enough range for most people’s use 365 days a year. That’s where I think we’re heading.

MN: CalCars and others help people make PHEV conversions today. In today’s market, what types of buyers do you think are the best candidates to consider a PHEV?

FK: It’s a select group of people that consider a plug-in hybrid conversion. It basically boils down to the individuals and the fleets that for personal reasons or environmental reasons want to have the world’s cleanest extended range vehicle. They’re not talking about the cost of the vehicle or other considerations because PHEVs are not mass-produced. When PHEVs are mass-produced it will be another game. So conversions are only a strategy. They’re a way of enabling people to experience what a plug-in hybrid is, increasing awareness and building support and excitement.

MN: So would you say that owning a PHEV today is primarily motivated by one’s conscience or passion?

FK: I’d say so. The people who want conversions right now are willing to spend maybe $10,000 more and are people who don’t have to ask how much it will cost. They just want the best car, and they are willing to pay whatever is needed. It’s important to recognize that the whole payback issue on cars is kind of a red herring. It just happens that you can calculate payback for alternative fuel vehicles, especially PHEVs and electric vehicles, but many studies have shown that hybrid buyers don’t calculate payback; they are buying the environmental feature. They are willing to pay for the environmental feature just like people pay for sunroofs or leather seats. They don’t ask what’s the payback, because it’s incalculable. Of course when a Toyota Prius becomes available for say $3000 more as a factory-built PHEV, there will be a payback.

We also think the initial premium is going to be subsidized very likely by corporate and government incentives. Some, or all, of that premium will go away. The companies that are currently incentivising their employees and fleets to go hybrid are also all saying when PHEVs are available they want to shift those incentives over. Plus there are several proposals at state and federal levels to provide incentives for PHEVs.

MN: We’ve heard automakers say that today’s battery technology is not reliable enough or will require costly early replacements, which is what prevents them from offering PHEVs today. How do you respond to that?

FK: We think today’s batteries are good enough to get started. They’ll always get better. But if the carmakers were to use the batteries available today, they could sell as many PHEVs as they could produce. And they would sell them to people who understood the limitations of the batteries. The battery technology is changing quite rapidly right now, and I think that in the time it would take manufactures to tool for mass-producing PHEVs the technology would meet customers’ criteria. But at the moment the manufacturers criteria are set a little high.

MN: What would you estimate is the life of the batteries you’re recommending for PHEV conversions today?

FK: It remains unknown actually. It’s likely that today’s batteries will last 50,000 to 75,000 miles and they may last longer. Toyota built RAV4 EVs in the late 90s using a much earlier generation of nickel-metal-hydride batteries, and those vehicles are still on the road with over 100,000 miles on them. But we don’t think that carmakers need to set goals as high as 150,000 miles, which is what they’re currently doing. There are a number of different battery companies that are currently working with carmakers that say they expect to guarantee that the battery will last the life of the car.

MN: What would be the recharge times and range on those batteries?

FK: The recharge time on a PHEV is irrelevant, because most people plug in overnight and are in no hurry. The longer range you require on your PHEV, the larger the battery. Take the GM Volt for instance; they have designed that car with a 40-mile battery range because they wanted to meet the daily driving needs of 80% of the population. If they had chosen a 30-mile range, they still would have covered the needs of 70% of the population, and if they had gone down to 20 miles, they probably would have covered the needs of about 50% of the population. So 40 miles was an arbitrary decision that we think was set too high to start with. If they had said 30 miles, they would be able to use a lighter battery and spend less money on batteries.

MN: Do you think people considering PHEVs or full-electric vehicles will be limited in any way by the availability of plug-in stations where they live, work or shop?

FK: It’s different for PHEVs and EVs. For a PHEV the availability of charging stations is almost irrelevant. It’s one of the strong points of the PHEV is that we don’t need any new infrastructure. We have the electrical infrastructure in our garages and an estimated 75% of the population has access to a plug. We want people to primarily charge off-peak at night. Daytime charging for a PHEV is not necessarily a great idea. For EVs, a number of companies plan to offer 100-plus miles range, which is already what the previous generation of EVs offered. The GM EV1 and Toyota EV Rav4 both had a range of over 100 miles a day. Drivers found that those cars, as second cars, got by fine with no charging stations outside their homes. But there is also a lot of discussion about charging stations. There are a number of very innovative proposals coming around these days on that and there are a lot of innovative ideas about battery swapping and various other things.

MN: With all of that in mind, how big do you feel the market for PHEVs looks today and a few years from now?

FK: I think most Americans could be buyers of plug-in cars. I think the decision is becoming easier these days when they look at the choice of buying a high CO2 emissions vehicle using expensive, imported fuel versus a clean, cheap, quiet electric car.

I think we’ve come a long way since the 90s. Today everybody’s become accustomed to charging a cell phone. It’s not a big deal, and the technology has gotten a lot better. I think that plug-in vehicles will take over, and once they’re introduced they’ll start to really penetrate into the market.

The CalCars.org home page provides a link to a report by Alliance Bernstein, which is an international investment company. They looked at estimates from the International Energy Agency, which say that by 2030 a few percentages of the cars of the world will be hybrids or plug-in hybrids. Then Alliance Bernstein, predicating that we’ve reached the end of business as usual, said no, by 2030, 72% of the world’s cars and 82% of new cars sold will be hybrids and plug-in hybrids. It’s a completely different way of looking at it, and we think there’s something compelling there.

MN: I’m going to name a few types of car buyers. Could you tell me what type of vehicle you would recommend they consider and why? Lets start with urban professionals.

FK: Any of them may go for car sharing because most cities have decent mass transit. When they need a car they can rent, and these days with the merger of the two major car share companies, it’s become more of a viable alternative.

MN: How about construction workers?

FK: An individual construction worker these days drives a pickup truck and often tows or carries around an electric generator. Once PHEVs are established, they’re going to have their own independent power. There’s a real advantage there. But also if you must drive a bigger vehicle, electrification represents a larger overall benefit. To explain that, I’ll give you an example. If you have a 50-mpg hybrid, and you make it a PHEV that gets over 100 mpg, you’ve doubled the mpg of the car. If you have a 10-mpg pickup and you make it a 20, you’ve also doubled it. So it appears the same, but it isn’t. If you ask how much gasoline will be used in 100 miles of driving, that hybrid instead of using 2 gallons will use 1 gallon. But the pickup instead of using 10 gallons will use five. So it’s not immediately obvious, but when you think about it, the worse the car is the greater the benefit of electrifying it and displacing gasoline with electricity. So GM, which recently got some attention for making their Tahoe SUV a hybrid, said that they’re concentrating on the cars that are currently least efficient, and there’s something to what they’re saying.

MN: Would the same apply to soccer moms?

FK: There ought to be hybrid and PHEV minivans, absolutely. And the soccer mom and the school bus both are great PHEV candidates because of emissions. Currently school busses are heavy diesel emitters. There are now 18 PHEV school busses in the country, and those vehicles are giving kids a lot less fumes. So a lot of people are very happy about that. The soccer mom is typified by a lot of very short trips. Every internal combustion engine vehicle that does a lot of short trips gets its worst miles per gallon that way and has the most cold starts, which is the dirtiest part of the emissions cycle. And parents are perfect for PHEVs because all those short trips can be electric.

MN: What would you recommend for people living in mountains or heavy snow regions?

FK: There’s no reason why you can’t have four-wheel-drive PHEVs. The main customer who is least well served today by a PHEV or EV is the long-distance traveler, because the PHEV is most beneficial for commuter miles. If you have a PHEV and you say I’m going to drive it across the country, the first 20, 30, or 50 miles you’ll see great mileage, and after that you’ll be back to a regular hybrid until you have a chance to recharge. So the only way a plug-in hybrid would look good on a cross-country trip is if you stopped and plugged in every 100 miles.

MN: What do you think will ultimately drive the adoption of electrified automobiles?

FK: The most distinctive feature of plug-in hybrids and of the displacement of gasoline with electricity is electricity’s characteristics. Electricity is cleaner, cheaper and domestic. These are all big benefits, and each one has a constituency supporting it: The “cleaner” group is concerned about environment and climate change. The “cheaper” set says we ought to spend less of our budgets on transportation. The “domestic” crowd wants to be independent of imported oil, and as it turns out, that’s already how we generate electricity in this country. Those three benefits drive everything that’s happening about PHEVs both independently and together.

MN: Do you have any concerns about loading on the energy grid?

FK: There have been a number of studies that have shown that the power grid has enough capacity that if every car in America turned into a PHEV overnight, we could today fuel 82% of them on the grid if we charged at night. We won’t have to build more power plants to power electric vehicles. The natural growth of the power grid will cover our needs.

MN: What would you hope to be the biggest headline in 2008 automotive news?

FK: I’m looking for more developments in the great automotive car race of the 21st century, which is already underway, where GM says it intends to be first on PHEVs. There are also a number of other entrants that may come in there and beat them to it. I want to see a winner in that race.