U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

37–987PS 2008

ENERGY STORAGE TECHNOLOGIES:

STATE OF DEVELOPMENT FOR

STATIONARY AND VEHICULAR

APPLICATIONS

HEARING

BEFORE THE

SUBCOMMITTEE ON ENERGY AND

ENVIRONMENT

COMMITTEE ON SCIENCE AND

TECHNOLOGY

HOUSE OF REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

OCTOBER 3, 2007

Serial No. 110–61

Printed for the use of the Committee on Science and Technology

(

Available via the World Wide Web: http://www.science.house.gov

(II)

COMMITTEE ON SCIENCE AND TECHNOLOGY

HON. BART GORDON, Tennessee, Chairman

JERRY F. COSTELLO, Illinois

EDDIE BERNICE JOHNSON, Texas

LYNN C. WOOLSEY, California

MARK UDALL, Colorado

DAVID WU, Oregon

BRIAN BAIRD, Washington

BRAD MILLER, North Carolina

DANIEL LIPINSKI, Illinois

NICK LAMPSON, Texas

GABRIELLE GIFFORDS, Arizona

JERRY MCNERNEY, California

LAURA RICHARDSON, California

PAUL KANJORSKI, Pennsylvania

DARLENE HOOLEY, Oregon

STEVEN R. ROTHMAN, New Jersey

JIM MATHESON, Utah

MIKE ROSS, Arkansas

BEN CHANDLER, Kentucky

RUSS CARNAHAN, Missouri

CHARLIE MELANCON, Louisiana

BARON P. HILL, Indiana

HARRY E. MITCHELL, Arizona

CHARLES A. WILSON, Ohio

RALPH M. HALL, Texas

F. JAMES SENSENBRENNER JR.,

Wisconsin

LAMAR S. SMITH, Texas

DANA ROHRABACHER, California

ROSCOE G. BARTLETT, Maryland

VERNON J. EHLERS, Michigan

FRANK D. LUCAS, Oklahoma

JUDY BIGGERT, Illinois

W. TODD AKIN, Missouri

JO BONNER, Alabama

TOM FEENEY, Florida

RANDY NEUGEBAUER, Texas

BOB INGLIS, South Carolina

DAVID G. REICHERT, Washington

MICHAEL T. MCCAUL, Texas

MARIO DIAZ-BALART, Florida

PHIL GINGREY, Georgia

BRIAN P. BILBRAY, California

ADRIAN SMITH, Nebraska

PAUL C. BROUN, Georgia

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

HON. NICK LAMPSON, Texas, Chairman

JERRY F. COSTELLO, Illinois

LYNN C. WOOLSEY, California

DANIEL LIPINSKI, Illinois

GABRIELLE GIFFORDS, Arizona

JERRY MCNERNEY, California

MARK UDALL, Colorado

BRIAN BAIRD, Washington

PAUL KANJORSKI, Pennsylvania

BART GORDON, Tennessee

BOB INGLIS, South Carolina

ROSCOE G. BARTLETT, Maryland

JUDY BIGGERT, Illinois

W. TODD AKIN, Missouri

RANDY NEUGEBAUER, Texas

MICHAEL T. MCCAUL, Texas

MARIO DIAZ-BALART, Florida

RALPH M. HALL, Texas

JEAN FRUCI Democratic Staff Director

CHRIS KING Democratic Professional Staff Member

MICHELLE DALLAFIOR Democratic Professional Staff Member

SHIMERE WILLIAMS Democratic Professional Staff Member

ELAINE PAULIONIS Democratic Professional Staff Member

ADAM ROSENBERG Democratic Professional Staff Member

ELIZABETH STACK Republican Professional Staff Member

STACEY STEEP Research Assistant

(III)

C O N T E N T S

October 3, 2007

Page

Witness List ............................................................................................................. 2

Hearing Charter ...................................................................................................... 3

Opening Statements

Statement by Representative Bart Gordon, Chairman, Committee on Science

and Technology, U.S. House of Representatives ............................................... 8

Written Statement ............................................................................................ 9

Statement by Representative Nick Lampson, Chairman, Subcommittee on

Energy and Environment, Committee on Science and Technology, U.S.

House of Representatives .................................................................................... 6

Written Statement ............................................................................................ 7

Statement by Representative Bob Inglis, Ranking Minority Member, Subcommittee on Energy and Environment, Committee on Science and Technology, U.S. House of Representatives ............................................................... 7

Written Statement ............................................................................................ 8

Statement by Representative Jerry F. Costello, Member, Subcommittee on

Energy and Environment, Committee on Science and Technology, U.S.

House of Representatives .................................................................................... 10

Panel I:

Ms. Patricia A. Hoffman, Deputy Director R&D, Office of Electricity Delivery

and Energy Reliability, Department of Energy

Oral Statement ................................................................................................. 10

Written Statement ............................................................................................ 12

Biography .......................................................................................................... 16

Mr. Bradford P. Roberts, Chairman, Electricity Storage Association

Oral Statement ................................................................................................. 16

Written Statement ............................................................................................ 18

Biography .......................................................................................................... 20

Mr. Larry Dickerman, Director, Distribution Engineering Services, American

Electric Power

Oral Statement ................................................................................................. 20

Written Statement ............................................................................................ 21

Biography .......................................................................................................... 29

Mr. Thomas S. Key, Technical Leader, Renewables and Distributed Generation, Electrical Power Research Institute

Oral Statement ................................................................................................. 29

Written Statement ............................................................................................ 31

Biography .......................................................................................................... 33

Discussion

Energy Storage to Reduce Electricity Congestion ............................................. 34

Government Role in Energy Storage Deployment ............................................. 35

Grid Modernization .............................................................................................. 35

Ancillary Power Services ..................................................................................... 35

State Energy Storage Policies ............................................................................. 36

Fuel Cells for Energy Storage ............................................................................. 36

Ultracapacitors and Fuel Cells ........................................................................... 37

Rating Storage Technology .................................................................................. 39

Foreign Energy Storage ....................................................................................... 40

Page

IV

NAS Battery Technology ..................................................................................... 41

Preventing Others From Capitalizing on U.S. Inventions ................................ 41

Deploying Technology in the U.S. ....................................................................... 42

Alternative Energies ............................................................................................ 42

Thermal Storage Technologies ............................................................................ 42

Recycling Battery Technologies and Environmental Issues ............................. 44

Twenty in Ten Plan ............................................................................................. 45

Solar Technology and Energy Trading ............................................................... 46

Hybrid Electric Development Time .................................................................... 47

The Proposed Legislation .................................................................................... 47

Status of Battery Technology .............................................................................. 48

Panel II:

Ms. Lynda L. Ziegler, Senior Vice President, Customer Service, Southern

California Edison

Oral Statement ................................................................................................. 49

Written Statement ............................................................................................ 51

Biography .......................................................................................................... 52

Ms. Denise Gray, Director, Hybrid Energy Storage Systems, General Motors

Corporation

Oral Statement ................................................................................................. 53

Written Statement ............................................................................................ 54

Biography .......................................................................................................... 57

Ms. Mary Ann Wright, Vice President and General Manager, Hybrid Systems

for Johnson Controls; Leader, Johnson Controls–Saft Advanced Power Solutions Joint Venture

Oral Statement ................................................................................................. 58

Written Statement ............................................................................................ 59

Biography .......................................................................................................... 65

Discussion

Government Accelerating Industrialization ....................................................... 65

Government and Battery Manufacturer Partnerships ...................................... 66

Participants in Vehicle-related R&D .................................................................. 66

Chevy Volt ............................................................................................................ 67

GM Allocation of Resources ................................................................................. 68

Energy Storage Devices ....................................................................................... 68

Simplifying Hybrid Systems ................................................................................ 69

Southern California Edison Partnerships .......................................................... 70

Domestic Manufacturing of Batteries ................................................................. 70

Purchasing Plug-in Hybrids ................................................................................ 73

Plug-in Hybrids for Consumers .......................................................................... 74

Hybrid Emissions ................................................................................................. 74

Raw Material Supplies for Batteries .................................................................. 75

Appendix: Additional Material for the Record

Discussion Draft, October 1, 2007 .......................................................................... 78

(1)

ENERGY STORAGE TECHNOLOGIES: STATE OF

DEVELOPMENT FOR STATIONARY AND VEHICULAR APPLICATIONS

WEDNESDAY, OCTOBER 3, 2007

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON ENERGY AND ENVIRONMENT, COMMITTEE ON SCIENCE AND TECHNOLOGY, Washington, DC.

The Subcommittee met, pursuant to call, at 10:10 a.m., in Room

2318 of the Rayburn House Office Building, Hon. Nick Lampson

[Chairman of the Subcommittee] presiding.

2

3

HEARING CHARTER

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

COMMITTEE ON SCIENCE AND TECHNOLOGY

U.S. HOUSE OF REPRESENTATIVES

Energy Storage Technologies:

State of Development for

Stationary and Vehicular

Applications

WEDNESDAY, OCTOBER 3, 2007

10:00 A.M.–12:00 P.M.

2318 RAYBURN HOUSE OFFICE BUILDING

PURPOSE

On Wednesday, October 3, 2007 the Subcommittee on Energy and Environment

of the Committee on Science and Technology will hold a hearing to receive testimony on the state of developing competitive energy storage systems for both stationary and vehicular applications and the role for the Department of Energy’s

(DOE) research and development programs in supporting the development of these

systems.

There are significant economic and environmental benefits for improving the Nation’s energy storage capability. Broad deployment of energy storage technologies

can help to improve the operational efficiency and reliability of our electricity delivery system, and allow for more diversified electricity sources and vehicle models

that utilize less conventional liquid fuel, have lower emissions, and address concerns

about global climate change. However, there is concern that the U.S. is falling behind in the race to develop and manufacture a wide range of energy storage technologies, and a significant effort is underway to build up a domestic energy storage

industry for both stationary and vehicular applications.

The Subcommittee will hear testimony from two panels of witnesses. The first

panel will focus primarily on stationary energy storage technologies, and the second

panel will emphasize the state of storage technologies for applications in vehicles.

The first panel will be comprised of representatives from the Department of Energy,

the Electricity Storage Association, an electric utility, and the Electric Power Research Institute. The second panel will consist of representatives from the automobile and battery manufacturing industries, as well as a second electric utility witness who can speak to the potential for integrating the electricity and vehicles sectors.

WITNESSES

Panel One:

Ms. Patricia Hoffman, Deputy Director Research and Development, U.S. Department of Energy Office of Electricity Delivery and Energy Reliability.

She will discuss the Department’s programs to advance stationary electricity storage

and how it relates to the electric grid. She will also provide information regarding

the Department’s activities on storage technologies for automobiles.

Mr. Brad Roberts, Chairman, Electricity Storage Association. He will discuss

the state of stationary storage technologies and the various benefits of developing

and commercializing storage technologies on a wider scale.

Mr. Larry Dickerman, Director Distribution Engineering Services for

American Electric Power. He will speak to AEP’s announcement to expand use

of stationary electricity storage and the main benefits realized by storage investment.

Mr. Tom Key, Technical Leader, Renewable and Distributed Generations,

Electric Power Research Institute. He will discuss the role that electric energy

storage plays in the power delivery system today and in the future.

4

Panel Two:

Ms. Lynda Ziegler, Sr. Vice President for Customer Services, Southern California Edison. She will discuss the company’s initiatives to advance electric vehicles in the marketplace.

Ms. Denise Gray, Director Hybrid Energy Storage Systems, General Motors.

She will speak to the state of battery technology development for vehicles, as well

as General Motors views as to how vehicle electrification fits into a portfolio of advanced vehicle technologies

Ms. Mary Ann Wright, Vice President and General Manager Hybrid Systems

for Johnson Controls, Director of Advanced Power Solutions, a Johnson

Controls and Saft joint venture. She will discuss the electrification of vehicles

through advanced battery systems, and reducing their costs through advances in

manufacturing technology, enhancing our domestic supply base, and establishing

demonstration fleets.

BACKGROUND

Stationary Storage Technologies

Today, electricity is generated as it is used, with very little electricity being stored

for later use. While this system has worked for decades, it is not very efficient. Demand for power varies greatly throughout the day and throughout the year as demands for lighting, heating and cooling fluctuate through the seasons. Because the

capacity for generation of power matches the consumption of power, the electricity

supply system must be sized to generate enough electricity to meet the maximum

anticipated demand, or peak demand. This inefficiency becomes more evident when

considering that it is possible that the peak electricity demand for any given year

could be for a very short period—a few days or even hours. Rather than maintain

massive generation systems that are designed around a short-lived peak demand,

energy storage technologies would provide a means to stockpile energy for later use

and essentially reduce the need to generate more power during times of peak electricity demand. Generally, energy storage systems could be charged at night during

off-peak consumption hours and then discharge the energy during peak demand.

Using our generation capacity at night time to store energy for use during the day

is more efficient, cheaper, and helps to equalize the demand load.

The expanded use of energy storage would also help to avoid the need to upgrade

transmission and distribution facilities as well as reduce the need to run certain

generation plants that may have higher operating costs and/or have a poor emissions profile. Energy storage also can improve reliability by providing an alternate

source of power during an outage of the primary power source.

Advances in energy storage technologies are often regarded as key to increasing

the reliability and widespread use of many renewable energy technologies. Renewables such as wind and solar produce electricity only when wind speeds are high

enough and sunlight is bright enough to generate power. Strategically distributed

storage would permit electricity from these renewable sources to be stored and used

during times of high demand or low resource availability.

Together, all of these potential benefits from broad deployment of energy storage

technologies would help to improve our energy security. Because our economy relies

heavily on an affordable and reliable electricity delivery system, the energy security

benefits achieved from greater use of energy storage systems could be significant.

There are a number of promising energy storage technologies being developed, but

they are not all at the same stage of development and certain storage systems are

better suited for specific purposes. Described below are some of the more promising

technologies:

Pumped Hydropower—water is pumped into a storage reservoir at high elevation

during times when electricity is in low demand and relatively inexpensive. When

demand is high, the water is released and used to power hydroelectric turbines. It

is well-suited for applications requiring large power levels and long discharge times.

Compressed Air Energy Storage—this technology uses high efficiency compressors to

force air into underground reservoirs, such as mined caverns. When demand for energy is high, the stored air is allowed to expand to atmospheric pressure through

turbines connected to electric generators that provide power to the grid. In Alabama

and Germany, compressed air energy storage has dispatched power to meet load demands and keep frequency and voltage stable.

Batteries—there are different types of battery systems for energy storage. With conventional batteries, chemical reactions within the battery generate electrons that

5

1Pacific Northwest National Lab—Impacts Assessment of Plug-in Hybrid Vehicles on Electric

Utilities and Regional U.S. Power Grids, http://www.pnl.gov/energy/eed/etd/pdfs/

phev¥feasibility¥analysis¥combined.pdf

Electric Power Research Institute and Natural Resources Defense Council—Environmental Assessment of Plug-in Hybrid Vehicles, http://www.epri-reports.org

travel from the negative terminal through a wire to an application, thus providing

electric power, and then return to its positive terminal. A different battery system

such as flow batteries store electrolytes outside the battery and circulate them

through the battery cells as needed. Batteries have great potential for use in a

range of energy storage applications.

Flywheels—these energy storage systems consist of a rotating cylinder on a metal

shaft which stores rotational kinetic energy. Flywheels are suitable for stabilizing

voltage and frequency.

Electrochemical Capacitors—electrochemical capacitors store energy in the form of

two oppositely charged electrodes separated by an ionic solution. They are suitable

for fast-response, short-duration applications such as backup power during brief outages.

Power Electronics—power conversion systems are not explicitly a storage device, but

are a critical component of any electricity storage system as they serve as the communication device between the storage system and the electric grid.

Smaller energy storage systems may also be deployed in stationary applications,

such as a residence or in a neighborhood, in order to supply back-up energy and

level the load on the electric grid. Advances in smaller energy storage systems, specifically batteries, may also allow for entirely new vehicles such as plug-in hybrid

vehicle technologies to enter the mass market.

Energy Storage Technologies for Vehicles

Concerns about energy independence and climate change have caused a renewed

interest in enhancing the role of electricity in the transportation sector. The benefits

of this have been seen to some degree in the rise in popularity of Hybrid Electric

Vehicles (HEV) because of their high fuel efficiency and lower emissions. Switching

vehicles’ primary energy source from petroleum-based fuels to electric batteries reduces overall consumption of conventional liquid fuels. Additionally, several recent

studies1 have shown that, regardless of its source, electricity used as a vehicle fuel

reduces greenhouse gas emissions. However, greater electrification of the vehicles

sector is constrained by the technological limits of energy storage technologies used

in conventional hybrids, specifically the Nickel Metal Hydride (NiMH) batteries.

Plug-In Hybrid Electric Vehicles (PHEV’s) are seen by some as the next logical

step towards greater electrification of the transportation sector, and the eventual

move towards market acceptance of all-electric drive vehicles. PHEV’s allow for electricity to be used as an additional or even primary source of power for a vehicle,

with a secondary role for the gasoline engine as a back-up power system. Advocates

claim that 100 miles per gallon would be reasonable for PHEV’s, approximately

twice the gasoline mileage of today’s hybrids. However, current NiMH batteries for

conventional hybrids are not optimal for this application.

While significant technological advances are still likely in NiMH, and even the

ubiquitous Lead Acid batteries, many in the industry believe the future of PHEV’s

depends on breakthroughs in new battery technologies, such as the lithium ion (LiIon) batteries. To expand the use of electricity in the vehicles sector batteries must

be smaller, lighter, more powerful, higher energy and cheaper—all of which require

considerable research and development. Achieving these needed breakthroughs will

require meaningful federal support and public-private partnerships with a range of

stakeholders.

6

Chairman LAMPSON. This hearing will now come to order, and I

want to wish you a good morning, and welcome to our subcommittee’s hearing on one of the oldest and most important energy technologies available, advanced batteries and other storage devices.

As long as people have been gathering energy or generating energy, we have had an interest in storing it, because so often the

rate at which we produce energy doesn’t match the rate at which

we use it. Also, there are times when we need portable power. We

would not be able to converse on cellular telephones, work remotely

on laptop computers or shine a flashlight where we needed it without batteries.

As our distinguished panel of witnesses will discuss today, batteries are not only the technology for energy storage. There are others that are not as commonplace, but have the potential to help us

achieve a better match between energy production and energy consumption.

Why is this important? Because renewable energy, like wind and

solar, do not produce energy on a continuous basis. These sources

will become more viable if we can store the excess energy produced

during times of peak wind and sun and release it as needed.

Better energy storage technologies will also enable us to operate

electric utilities in a more flexible and efficient manner. Energy

storage can also help us respond to power outages more efficiently,

providing greater electricity reliability. This could be vital for

maintaining operations at critical facilities, such as hospitals, during a natural disaster.

We are all aware of the high costs and delicate negotiations involved when building new electric generating capacity or transmission lines, especially when plants must be built to meet the

power requirements of peak demand. With better energy storage

options, we can expand our options for new electricity generation

and transmission.

Energy efficiency is the key to progress on three important goals:

economic growth, energy independence, and a cleaner, healthier environment. New hybrid engines for vehicles have demonstrated

how greater use of battery power can reduce fuel consumption and

emissions.

We can gain further fuel efficiencies and emission reductions, but

this requires advances in better technology and manufacturing far

beyond what we see today, even in conventional hybrids. This

would also allow for more advanced vehicles, such as Plug-in Hybrid Electric Vehicles to enter the market and finally bridge the

gap between the electricity and transportation sector.

With both stationary and mobile energy storage, we cannot let an

opportunity to establish a domestic manufacturing base for these

technologies pass us by. And unfortunately, we may already be losing that race. New R&D activities with the Department of Energy

are critical to advancing energy storage technologies, and we

should pursue this aggressively to ensure U.S. participation in this

field.

Chairman Gordon is working on legislation to support these programs at DOE, and the witnesses have been provided a copy of the

discussion draft of that legislation. I look forward to their comVerDate 11-MAY-2000 10:14 Jun 08, 2008 Jkt 037987 PO 00000 Frm 00010 Fmt 6633 Sfmt 6601 C:\WORKD\E&E07\100307\37987 SCIENCE1 PsN: SCIENCE1
7

ments and suggestions to strengthen this bill and to accelerate our

progress in energy storage technology.

[The prepared statement of Chairman Lampson follows:]

PREPARED STATEMENT OF CHAIRMAN NICK LAMPSON

Good afternoon and welcome to our subcommittee’s hearing on one of the oldest

and most important energy technologies available—advanced batteries and other

storage devices. As long as people have been generating energy we have had an interest in storing it because so often, the rate at which we produce energy doesn’t

match the rate at which we use it. Also, there are times when we need portable

power. We would not be able to converse on cellular telephones, work remotely on

laptop computers, or shine a flashlight where we needed it without batteries.

As our distinguished panel of witnesses will discuss today, batteries are not the

only technology for energy storage. There are others that are not as commonplace,

but have the potential to help us achieve a better match between energy production

and consumption.

Why is this important? Because renewable energy sources—wind and solar—do

not produce energy on a continuous basis. These sources will become more viable

if we can store the excess energy produced during times of peak wind and sun and

release it as needed.

Better energy storage technologies will also enable us to operate electric utilities

in a more flexible and efficient manner. Energy storage can also help us respond

to power outages more efficiently, providing greater electricity reliability. This could

be vital for maintaining operations at critical facilities such as hospitals during a

natural disaster.

We are all aware of the high costs and delicate negotiations involved when building new electric generating capacity or transmission lines, especially when plants

must be built to meet the power requirements of peak demand. With better energy

storage options, we can expand our options for new electricity generation and transmission.

Energy efficiency is the key to progress on three important goals—economic

growth, energy independence, and a cleaner, healthier environment. New hybrid engines for vehicles have demonstrated how greater use of battery power can reduce

fuel consumption and emissions.

We can gain further fuel efficiencies and emission reductions, but this requires

advances in battery technology and manufacturing far beyond what we see today

even in conventional hybrids. This would also allow for more advanced vehicles such

as Plug-In Hybrid Electric Vehicles to enter the market, and finally bridge the gap

between the electricity and transportation sectors.

With both stationary and mobile energy storage, we cannot let an opportunity to

establish a domestic manufacturing base for these technologies pass us by. And unfortunately, we may already be losing this race. New R&D activities with the Department of Energy are critical to advancing energy storage technologies, and we

should pursue this aggressively to ensure U.S. participation in this field.

Chairman Gordon and Ranking Member Hall are working on legislation to support these programs at DOE, and the witnesses have been provided a copy of the

discussion draft. I look forward to their comments and suggestions to strengthen

this bill and accelerate our progress in energy storage technology.

Chairman LAMPSON. At this time, I would like to recognize our

distinguished Ranking Member, Mr. Inglis, of South Carolina, for

his opening statement.

Mr. INGLIS. Thank you Mr. Chairman, and thank you for holding

this hearing on the status of technologies that can accelerate the

arrival of clean, renewable energy.

General Electric manufactures wind turbines in South Carolina’s

Fourth District. Inside that facility, as soon as one of the nacelles

is finished, it is put on a truck and shipped out. GE tells me that

the production line isn’t slowing down. In fact, they are trying to

add production capacity to meet increased demand, which is a very

good thing for Greenville, South Carolina.

These wind turbines and other technologies, such as solar panels

and vehicle batteries, can speed the growth of our renewable enVerDate 11-MAY-2000 10:14 Jun 08, 2008 Jkt 037987 PO 00000 Frm 00011 Fmt 6633 Sfmt 6601 C:\WORKD\E&E07\100307\37987 SCIENCE1 PsN: SCIENCE1
8

ergy sector, but the energy storage question is a significant hurdle

that stands in the way. There is no doubt that we can cross that

hurdle, and there is no question that it will just—that it will be

worth it. Getting over the hurdle means not just clean exhaust

from our cars, but consistent and stable energy supply to the grid,

even when the sun isn’t shining and the wind isn’t blowing. That

kind of reliability is what is necessary before these sources become

commercially viable as alternatives to oil and gas, both at our

power plants and in our cars and trucks.

I am looking forward to learning from these two expert panels

about how the Federal Government can help clear that energy storage hurdle. In addition, I am also interested in fuel cells as batteries, and I shall return to that in question time.

Thank you, Mr. Chairman, for this hearing, and I look forward

to hearing from our witnesses.

[The prepared statement of Mr. Inglis follows:]

PREPARED STATEMENT OF REPRESENTATIVE BOB INGLIS

Good morning. Thank you, Mr. Chairman, for holding this hearing on the status

of technologies that can accelerate the arrival of clean, renewable energy.

General Electric manufactures wind turbines in South Carolina’s Fourth District.

Inside the facility, as soon as one of these nacelles is finished, it’s put on a truck

and shipped out. GE tells me that that production line isn’t slowing down. In fact,

they’re trying to add production capacity to meet increased demand.

These wind turbines, and other technologies, such as solar panels and vehicle batteries, can speed the growth of our renewable energy sector. But the energy storage

question is a significant hurdle that stands in the way. There’s no doubt that we

can cross that hurdle, and there’s no question that it will be worth it. Getting over

that hurdle means not just clean exhaust from our cars, but consistent and stable

energy supply to the grid, even when the sun isn’t shining and the wind isn’t blowing. That kind of reliability is what is necessary before these sources become a commercially viable alternative to oil and gas, both at our power plants, and in our cars

and trucks.

I’m looking forward to learning from these two expert panels how the Federal

Government can help clear the energy storage hurdle.

In addition, I’m also interested in fuel cells as ‘‘batteries.’’ I’ll return to that in

my questions.

Thank you again, Mr. Chairman and I look forward to hearing from our witnesses.

Chairman LAMPSON. Thank you, Mr. Inglis. And now, I am honored to recognize the author of this legislation, Chairman Bart Gordon, for his opening statement.

Mr. Gordon.

Chairman GORDON. Thank you, Chairman Lampson. I want to

really congratulate you and Ranking Member Inglis. We have had

almost a forced march the first part of this year. Our Ranking, as

well as Majority, staff have done an excellent job. You have turned

out good legislation, and I hope that this could maybe be one more

element that we can put on the menu for an energy bill for the future. And so again, I thank you for your past work, and I thank

you for holding this hearing, ensuring that the United States is

competitive in energy storage technologies.

And I understand the witnesses have seen a discussion draft of

the legislation I am working on to accelerate the Department of

Energy’s energy storage programs, and I look forward to your comments.

Many of us here agree that energy storage technologies offer significant economic, environmental, and security benefits.

9

A recent study from Lawrence Berkley National Laboratory determined that the short-term power interruptions cost the United

States economy over $50 billion annually.

Strategic deployment of energy storage systems could increase

reliability of the grid and reduce the impact of these outages. Energy storage systems can also enhance the use of renewable energy

sources, diversify our energy mix, and lower emissions.

Broad deployment of energy storage technologies also can improve overall efficiency of the energy grid—or the electric grid.

Storing low cost energy generated at nighttime for houses during

high demand in the daytime makes sense.

Energy storage is also critical for the next generation of vehicles,

which will help reduce our dependency on foreign oil and lower

greenhouse gas emissions.

There is more work to be done to ensure batteries for electric

cars are lighter, more powerful, and less costly.

I also think that public-private partnerships can improve the production process for advanced vehicle components so the U.S. becomes a leader in manufacturing these breakthrough technologies.

With so many benefits of energy storage technologies, I think additional federal investment to research, test, and advance these

systems should be a priority, and I am very pleased that Ranking

Member Hall has also been interested in these issues, and we look

forward to working with him to accommodate his interests in getting a good bill together.

And again, I thank the witnesses for joining us today.

[The prepared statement of Chairman Gordon follows:]

PREPARED STATEMENT OF CHAIRMAN BART GORDON

Thank you Chairman Lampson. I am very pleased that the Energy and Environment Subcommittee is holding this hearing today to receive testimony on what I

view to be a critical objective—ensuring the United States is competitive in energy

storage technologies.

I understand the witnesses have seen a discussion draft of legislation I am working on to accelerate the Department of Energy’s energy storage programs, and I look

forward to your comments.

Many of us here agree that energy storage technologies offer significant economic,

environmental and security benefits.

A recent study from Lawrence Berkeley National Laboratory determined that

short term power interruptions cost the U.S. economy over 50 billion dollars annually.

Strategic deployment of energy storage systems could increase the reliability of

the grid and reduce the impact of these outages. Energy storage systems also can

enhance the use of renewable energy sources, diversifying our energy mix and lowering emissions.

Broad deployment of energy storage technologies also can improve overall efficiency of the electric grid. Storing low cost energy generated at nighttime for use

during high demand in the daytime makes sense.

Energy storage is also critical for the next generation of vehicles, which will help

reduce our dependence on foreign oil and lower greenhouse gas emissions.

There is more work to be done to ensure batteries for electric cars are lighter,

more powerful and less costly.

I also think public-private partnerships can improve the production process for advanced vehicle components so that the U.S. becomes a leader in manufacturing

these breakthrough technologies.

With so many benefits of energy storage technologies, I think additional federal

investment to research, test and advance these systems should be a priority.

I thank the witnesses for testifying today and I look forward to your comments

on the draft legislation.

10

Chairman LAMPSON. Thank you, Chairman Gordon. I acknowledge the presence of a number of other Members of the Committee,

and I ask unanimous consent that all additional opening statements submitted by Subcommittee Members be included in the

record. Without object, so ordered.

[The prepared statement of Mr. Costello follows:]

PREPARED STATEMENT OF REPRESENTATIVE JERRY F. COSTELLO

Good morning. Mr. Chairman, thank you for calling this important hearing to examine the benefits and challenges of energy storage systems and to identify necessary research to overcome the challenges of commercialization and deployment of

such systems.

The potential impacts of insufficient power storage range from simply inconvenience to life-threatening, and affect individuals, businesses, and industries. Today’s electricity generation system has little ability to store electricity on the grid. Because of this, the electric power system must constantly be adjusted to ensure that

the generation of power matches the consumption of power. I believe it is vital for

the Congress, the Department of Energy, utilities and the private sector to work on

a comprehensive solution to upgrade the electricity grid that will meet the electricity needs of today as well as the future to reduce our dependence on foreign resources and maintain our environment and economy.

When looking at potential options for energy storage, we must realize that no option will replace fuel generated electricity, which is primarily produced from coal.

In fact, nine out of every ten tons of coal mined in the United States today is used

to generate electricity, and about 56 percent of the electricity used in this country

is coal-generated electricity. Therefore, I firmly believe it is imperative to continue

our efforts to develop clean coal technologies as part of the solution to achieving

U.S. energy dependence, continued economic prosperity and improved environmental stewardship. We must also continue to work on a diverse energy portfolio

and recognize the technology that exists today so that we can utilize this technology

while developing energy solutions for the future.

Again, I look forward to hearing from our witnesses on these issues.

Chairman LAMPSON. Now, it is my pleasure to introduce our first

panel of witnesses we have here with us. First is Ms. Patricia Hoffman, who is the Deputy Director for Research and Development

and the Acting Chief Operating Officer at the Office of Electricity

Delivery and Energy Reliability at the U.S. Department of Energy—long title. Mr. Brad Roberts is the Chairman of the Electricity Storage Association. Mr. Larry Dickerman is the Director of

Distribution Engineering Services at American Electric Power, and

Mr. Thomas Key is the technical leader for the Renewables and

Distributed Generation at the Electric Power Research Institute.

Welcome each and every one of you.

Now, you will each have five minutes for your spoken testimony.

Your written testimony will be included in the record for the hearing. When all four of you have completed your testimony, we will

then begin questioning. Each Member will have five minutes to

question the panel.

Ms. Hoffman, we will begin with you.

Panel I:

STATEMENT OF MS. PATRICIA A. HOFFMAN, DEPUTY DIRECTOR R&D, OFFICE OF ELECTRICITY DELIVERY AND ENERGY

RELIABILITY, DEPARTMENT OF ENERGY

Ms. HOFFMAN. Mr. Chairman and Members of the Subcommittee,

thank you for this opportunity to testify on behalf of the Department of Energy on energy storage technologies.

11

The Department of Energy places great emphasis on the promise

of energy storage and is researching a variety of storage technologies. Within DOE, applied research into energy storage technology primary occurs within two offices, the Office of Energy Efficiency and Renewable Energy (EERE), and the Office of Electricity

Delivery and Energy Reliability (OE). The Department is committed to developing technologies that can help advance President

Bush’s Twenty in Ten Plan, a legislative proposal to displace 20

percent of expected gasoline usage in 2017 through the greater use

of clean, renewable fuels and increased vehicle efficiency. The development and use of Plug-in Hybrid Electric Vehicles (PHEVs)

will help us work toward the goal of this Plan. PHEVs present a

unique opportunity for the Nation to transition from using exclusively oil, much of which comes from foreign sources, to fueling our

vehicles, in part, with domestically produced electricity from the

grid.

High energy density batteries are key to the successful commercial deployment and development of these vehicles. Thus, EERE is

researching lithium ion batteries, which have two to three times

the energy density compared to the nickel-metal hydride batteries

currently in use for todays hybrid electric vehicles.

It is clear that Plug-in Hybrid Electric Vehicles will have impacts

far beyond the transportation sector and become an integral, although not always connected, element of our ‘‘stationary’’ electric

system. When considering the potential impact of widespread use

of PHEVs on our nation’s energy demand, it is essential to understand and address broader electric system impacts. For example,

although ample generation capacity may exist on an aggregate

scale to meet charging needs, how would PHEVs impact voltageregulation requirements? Or, how would that generation capacity

vary by region? Preparing answers today to questions such as these

will allow PHEVs to successfully evolve from functioning solely as

‘‘people-movers’’ to becoming ‘‘stationary power’’ sources for residential customers to level the load and ultimately be a resource for

the local utility.

Stationary storage systems provide energy management, complement renewable resources, and can improve power quality and

reliability. This includes ‘‘ride-through’’ of power quality events

such as voltage sags that range in length from cycles to seconds,

often seen as the dimming or flickering of lights. Additionally, energy storage can be an uninterrupted power source, providing minutes to hours of electricity, and as such, can be viewed as ‘‘insurance coverage,’’ mitigating risk.

Whether an energy storage device is paired with a renewable

technology or simply installed alone at a residential, commercial, or

industrial site, it can serve a number of valuable functions: acting

as a balancing technology to solve intermittence issues, serving as

an uninterruptible power supply, or leveling consumers’ demand.

Energy storage and photovoltaic (PV) hybrid systems, for example,

would provide customers the flexibility to charge their storage device and charge their stored power in combination with the PV system to satisfy their peak demand requirement.

To date, large-scale utilitarian applications of energy storage in

the electric system have not been extensive. Roughly 2.5 percent of

12

the total electric power currently delivered in the United States

passes through energy storage devices, and is primarily limited to

pumped hydroelectric storage. The percentages are somewhat

greater in Europe and Japan, at 10 and 15 percent respectively.

The strategic placement of energy storage systems could provide

load leveling within a regional control area, reduced transmission

congestion, and provide ancillary services such as spinning reserve,

voltage, and frequency regulation.

Energy storage is just one way to increase the reliability and resiliency of the electric grid. When storage devices are paired with

so-called ‘‘intelligent’’ smart grid technologies, the grid could fully

take advantage of renewable technologies, allow for an increased

number of PHEVs, and enable demand response. Like storage,

smart grid technologies could have a revolutionary impact on our

electric system. Smart grid technologies include smart appliance

chips, advanced meters, and energy management systems located

at the customer’s site. Intelligent agents and controls on the distribution system and wide-area system monitoring on the transmission system are also considered smart grid technologies.

The Department also recognizes that fundamental, basic research into the future of energy storage materials and systems is

still required and can be a critical asset that accelerates our

progress. One key opportunity the Department is pursuing is a new

approach combining theory and synthesis of nanostructured materials, which have been identified as a key to enabling the design

of radically improved electrode architecture for superior power and

energy densities and increased lifetimes of energy storage systems.

Portable electronic devices, which are enabled by batteries, are

a form of energy storage now ubiquitous throughout society. When

considering how widely accepted these devices have become in a

relatively short period of time, one can only imagine the potential

for storing energy at a much larger scale. Energy storage has the

capability to reshape the way we fuel our cars, power our homes,

and impact our nation’s economic future. Federal investment and

research in the development and deployment of energy storage

technologies in combination with innovative policies and infrastructure investment, has the potential to improve grid performance, reduce our dependence on oil, and promote our energy security, economic competitiveness, and environmental well-being.

I am privileged to contribute to these research efforts, and thank

you for the opportunity to testify today. This concludes my statement, Mr. Chairman, and I look forward to answering any questions you and your colleagues may have.

[The prepared statement of Ms. Hoffman follows:]

PREPARED STATEMENT OF PATRICIA A. HOFFMAN

Mr. Chairman and Members of the Subcommittee thank you for this opportunity

to testify on behalf of the Department of Energy (DOE) on ‘‘Energy Storage Technologies: State of Development for Stationary and Vehicular Applications.’’

The Department of Energy places great emphasis on the promise of energy storage and is researching a variety of storage technologies. Within DOE, applied research into energy storage technologies primarily occurs within two offices: the Office of Energy Efficiency and Renewable Energy (EERE) and the Office of Electricity

Delivery and Energy Reliability (OE). EERE supports the Advanced Energy Initiative by advancing technologies such as biomass and biofuels, solar power, wind

power, advanced vehicles, and hydrogen fuel cells. Moreover, OE performs research

13

and development, and conducts demonstrations on stationary storage applications

related to the electric system. OE leads national efforts to modernize the electricity

delivery system; enhance the security and reliability of America’s energy infrastructure; and facilitate recovery from disruptions to energy supply. Additionally, basic

research supported by the Office of Science can lead to solutions to technology challenges and enhance the energy, power, shelf life, cycle life, cost, and reliability of

energy storage systems. These functions can help DOE achieve its strategic goal of

promoting a diverse supply and delivery of reliable, affordable, and environmentally

responsible energy.

Vehicular Storage

The Department is committed to developing technologies that can help advance

President Bush’s Twenty in Ten Plan, a legislative proposal to displace twenty percent of expected gasoline usage in 2017 through greater use of clean, renewable

fuels and increased vehicle efficiency. The development and use of Plug-in Hybrid

Electric Vehicles (PHEVs) will help us work toward the goal of this Plan. PHEVs

present a unique opportunity for the Nation to transition from using exclusively oil,

much of which comes from foreign sources, to fueling our vehicles, in part, with domestically-produced electricity from the grid. High energy-density batteries are key

to the successful commercial development and deployment of these vehicles. PHEVs

have the potential to displace a large amount of gasoline if they deliver up to 40

miles of electric range without recharging—a distance that would include most daily

round-trip commutes, since more than 70 percent of Americans drive less than 40

miles per day. That is why EERE is increasing its investment in this technology.

Propulsion over a 40, or even a 20-mile range, will require storage technologies with

high specific power and energy, deep discharge, and long cycle life. Thus, EERE is

researching lithium ion batteries, which have two to three times the energy density

(300–400 kWh/L) compared to the nickel-metal hydride batteries currently in use for

today’s hybrid electric vehicles.

The Department has also made progress on the issue of safety in lithium ion batteries for automobiles; however, other interrelated factors such as durability, power

density, and cost must also be addressed before the technology can become commercially viable. Currently, the program is focusing on researching materials and nonflammable electrolytes so future lithium ion technologies will become more tolerant

to abuse. The FY 2008 Congressional Budget includes $42 million to support advanced battery R&D, compared to $41 million in the FY07 operating plan.

Over the next three years, pending appropriations from Congress, DOE plans to

invest $17.2 million in PHEV battery development projects that aim to address critical barriers to the commercialization of PHEVs, specifically battery cost and battery

life. Five projects were recently selected for negotiation of awards under DOE’s collaboration with the United States Advanced Battery Consortium. DOE will also

spend nearly $2 million on a study exploring the future of PHEVs. The study will:

evaluate how PHEVs would share the power grid with our nation’s other energy

needs; monitor the American public’s evolving view of PHEVs; and provide the first

national-level empirical data on how driving behavior differs with these vehicles

compared to conventional gasoline, diesel, and hybrid vehicles. It will also assess a

possible reduction of greenhouse gas emissions with the increased use of PHEVs

and identify how automakers could optimize PHEV design to increase performance

while also reducing cost. As part of the study, researchers and auto industry partners will build a simulation model to test different PHEV design concepts.

The possibility of increasingly providing fuel for the Nation’s cars and light trucks

with domestically-produced electricity and reducing the use of oil, much of which is

imported, is very exciting. A previous study from DOE’s Pacific Northwest National

Laboratory suggests that up to 84 percent of U.S. cars, pickup trucks, and sport utility trucks could be powered by plugging into the existing electricity infrastructure

and by utilizing this battery capacity to level loads.

It is clear that PHEVs will have impacts far beyond the transportation sector and

become an integral, although not always connected, element of our ‘‘stationary’’ electric system.

When considering the potential impact of widespread use of PHEVs on our Nation’s energy demand, it is essential to understand and address broader electric system impacts. For example, although ample generation capacity may exist on an aggregate scale to meet charging needs, how would PHEVs impact voltage regulation

requirements? Or, how would that generation capacity vary by region? Preparing

answers today to questions such as these will allow PHEVs to successfully evolve

from functioning solely as ‘‘people movers’’ to becoming ‘‘stationary’’ power sources

for residential consumers that can also support utilities.

14

Further studies will be conducted in partnership with the automotive manufacturers, national laboratories, utilities, and universities to define PHEV battery requirements; consumer behavior for charging vehicles and managing residential loads;

grid interface and interconnection requirements; and the effects PHEVs would have

on the grid. The Department is expecting preliminary results from these studies in

the summer of 2008.

Finally, through Executive Order 13423 Strengthening Federal Environmental

and Energy Management, the President has committed the Federal Government to

add PHEVs to its own fleet as the vehicles become commercially available at a cost

reasonably comparable, on the basis of life cycle cost, to non-PHEVs.

Stationary Storage

Stationary storage systems provide energy management, complement renewable

resources, and can improve power quality and reliability. This includes ‘‘ridethrough’’ of power quality events such as voltage sags that range in length from cycles to seconds to providing minutes to hours of electricity as an uninterruptible

power source. A study by the Electric Power Research Institute found that 98 percent of power quality events last less than 15 seconds. Power quality problems are

defined as subtle deviations in the quality of delivered electricity (sometimes lasting

only tens of milliseconds in length), often seen as the dimming or flickering of lights.

Short-term events lasting up to five minutes can cause hours of downtime in operations. A detailed survey of cost and outage data throughout the U.S. conducted by

Lawrence Berkeley National Laboratory estimates the cost of such outages to be

some $53 billion annually (LBNL 55718). Energy storage can be drawn upon to mitigate power quality problems and prevent momentary outages, and as such, can be

viewed as ‘‘insurance coverage,’’ mitigating risk. Stationary storage systems that are

currently being used include conventional batteries (Ni-Cd, lead acid), compressed

air, pumped hydro, flow batteries, sodium sulfur and metal-air batteries, fly wheels,

and capacitors. These systems are critical bridging technologies whose applications

including load balancing and improving overall system performance.

Stationary Storage—Residential, Commercial or Industrial Applications

Varying storage technologies can be used in residential, commercial, or industrial

applications. Whether an energy storage device is paired with a renewable technology or simply installed alone at a customer’s site, it can serve a number of valuable functions: acting as a balancing technology to solve intermittence issues, serving as an uninterruptible power supply (UPS), or leveling consumer’s demand. Energy storage and photovoltaic (PV) hybrid systems, for example, would provide customers the flexibility to charge their storage device and discharge their stored power

in combination with the PV system to satisfy their peak demand requirement. This

system can begin to address power quality issues.

Many demonstrations are ongoing. The Department, in partnership with New

York State Energy Research and Development Agency (NYSERDA), has funded a

residential energy storage and propane fuel cell demonstration project that uses an

11kW, 20 kWh Gaia Power Technologies ‘‘PowerTower’’ energy storage system in

conjunction with a Plug Power ‘‘GenSys’’ propane fuel cell. The demonstration illustrated demand reduction 1) when the ‘‘PowerTower’’ provides an energy boost if the

user load exceeds a preset threshold and 2) when the PlugPower propane fuel cell

becomes a primary electricity source in conjunction with the PowerTower. This system was in operation from January 2006 to July 2006. The partners include the

Delaware County Electric Cooperative, Gaia Power Technologies and EnerNex Corporation.

Another project being funded by DOE and NYSERDA is the ongoing FlywheelBased Frequency Regulation Demonstration project (FESS), located at an industrial

site in Amsterdam, New York. It regulates grid frequency by utilizing a high-energy

flywheel storage system consisting of seven Beacon Power flywheels that have been

adapted to operate on the National Grid (formerly Niagara Mohawk) distribution

system. This system will be capable of providing 100 kW of power for frequency regulation, about one-tenth the scale of the needed final product. Frequency regulation

can serve to balance the ever-changing differences between electricity generation

and load. Using flywheels to provide frequency regulation will allow demand to be

met quickly and will allow generators to operate at higher output for optimum efficiency and lower emissions.

Stationary Storage—Utility Applications

As it exists today, the U.S. electric utility infrastructure consists of a vast network

of power plants and transmission and distribution lines that span the entire continent. This system requires that the generation and consumption of electric energy

be instantaneously balanced. As the load changes, generators must ramp up or

15

down to meet demand for electricity. Yet an equipment failure can cause an instantaneous imbalance between generation and load, which could potentially lead to

other system damage or a power outage. Using advanced storage technologies to

compensate for changes in demand for electricity could improve grid reliability and

stability.

To date, large-scale applications of energy storage to the electric system have not

been extensive. Roughly 2.5 percent of the total electric power currently delivered

in the United States passes through energy storage devices, and it is primarily limited to pumped hydroelectric storage. The percentages are somewhat greater in Europe and Japan, at 10 percent and 15 percent, respectively. The strategic placement

of electricity storage systems could provide: 1) load leveling (within a regional control area), allowing generators to operate closer to their optimum economical and

environmental set points; 2) reduce electric transmission congestion; 3) provide stabilizing energy to minimize disturbances on the transmission and distribution system; and 4) provide ancillary services such as spinning reserve, voltage, and frequency regulation.

The Department has also invested in several storage demonstrations for utility

applications. For example, in partnership with the California Energy Commission

and ZBB Energy Corporation (Menomonee Falls, Wisconsin), DOE is planning to

demonstrate a 2MW, 2MWh zinc-bromine battery at a Pacific Gas & Electric substation that reduces distribution system congestion. The battery installation operates in stand-by mode to supply extra power when the substation reaches overload

conditions. The installation will be mobile so that it can be deployed to wherever

the most serious peaking loads occur.

In partnership with Palmdale Water District (Palmdale, California), the Department is demonstrating a 450 kW supercapacitor device that will minimize the impact of variable winds on a 950 MW wind turbine attached to the microgrid for the

Palmdale, California, Water District’s treatment plant. During power outages, this

energy storage will also provide ride-through for critical loads until emergency generation can be brought online. In addition to providing reliable energy for the

microgrid, the project will also help reduce transmission and distribution congestion

in the area.

Energy storage is just one way to increase the reliability and resiliency of the

electric grid. When storage devices are paired with so-called ‘‘intelligent’’ smart grid

technologies, the grid could fully take advantage of renewable technologies, allow for

increased numbers of PHEVs, and enable demand response. Like storage, smart

grid technologies could have a revolutionary impact on our electric system. The result will be new innovative tools and techniques, better sensors, improved

diagnostics, and enhanced equipment design and operation that will increase energy

efficiency, system utilization, reliability, and security. Smart grid technologies such

as smart appliance chips, advanced meters, and energy management systems would

be located at the customer level. The distribution system would have to include

smart grid technology through intelligent agents and controls and the transmission

system would have to incorporate wide area system monitoring.

Collaboration with the Office of Science

The Department recognizes that fundamental, basic research into the future of

energy storage materials and systems is still required and can be a critical asset

that accelerates our progress. We still seek: a greater understanding of storage device performance degradation and failure mechanisms; the achievement of higher

power density and longer life; enhanced energy density; new electrolytes for highefficiency and high-current operation; and safety and abuse tolerance. Developing

solutions to these technology challenges could enhance the energy, power, shelf life,

cycle life, cost, and reliability of energy storage systems.

Thus, the OE and EERE continue to coordinate with the Office of Science in several research areas, including storage, to ensure the transfer of basic research to

applied R&D. OE would like to expand this coordination in target materials research for electrical energy storage (EES). This R&D focus area was the subject of

an Office of Basic Energy Sciences workshop held by EERE, OE, and the Office of

Science during April 2–4, 2007, to explore research needs and opportunities. The

findings, which noted that revolutionary breakthroughs in EES have been singled

out as perhaps the most crucial need for the Nation’s secure energy future, can be

found in the workshop report, Basic Research Energy Needs for Electrical Energy

Storage.

The proposed coordinated basic-applied EES research effort aims to underpin the

applied technology research with transformational basic sciences, while at the same

time energizing the basic research with insights and opportunities that come from

advances in applied research programs. This process will be initiated in FY 2008

16

and result in designated research projects in FY 2009. The goal is to facilitate the

successful translation of breakthrough knowledge gained in basic research to applied technologies, and to cultivate the U.S. capabilities to maintain a global leadership in energy storage systems for transportation and electricity transmission and

distribution.

One key opportunity DOE’s Office of Science is pursuing is a new approach combining theory and synthesis of nanostructured materials, which have been identified

as key to enabling the design of radically improved electrode architectures for superior power and energy densities and increased lifetimes of energy storage systems.

An essential part of this integrated research activity is the development of methods of analysis that will help elucidate structure activity relationships that serve as

the underpinning for predictive model development and validation. Basic research

will provide proof of novel concepts, which will lead to module level applied research

for successful approaches. Introduction of promising concepts to industry will enable

advances in manufacturing, cost and commercial perspective to continued development of commercially viable EES technologies.

CONCLUSION

Portable electronic devices, which are enabled by batteries, a form of energy storage, are now ubiquitous throughout society. When considering how widely accepted

these devices have become in a relatively short period of time, one can imagine the

potential inherent in storing energy at a much larger scale. Energy storage has the

capability to reshape the way we fuel our cars, power our homes, and impact our

Nation’s economic future. Federal investment in the research, development, and deployment of energy storage technologies in combination with innovative policies and

infrastructure investment, has the potential to improve grid performance, reduce

our dependence on oil, and promote our energy security, economic competitiveness,

and environmental well-being. I am privileged to contribute to these research efforts

and thank you for the opportunity to testify today.

This concludes my statement, Mr. Chairman. I look forward to answering any

questions you and your colleagues may have.

BIOGRAPHY FOR PATRICIA A. HOFFMAN

Patricia Hoffman is the Deputy Director for R&D and the acting Chief Operating

Officer for the Office of Electricity Delivery and Energy Reliability at the U.S. Department of Energy. The Office of Electricity Delivery and Energy Reliability leads

the Department of Energy’s (DOE) efforts to modernize the electric grid through the

development and implementation of national policy pertaining to electric grid reliability and the management of research, development, and demonstration activities

for ‘‘next generation’’ electric grid infrastructure technologies.

As Deputy Director for R&D, Patricia Hoffman responsible for developing and implementing a long-term research strategy for modernizing and improving the resiliency of the electric grid. Patricia directs research on visualization and controls, energy storage and power electronics, high temperature superconductivity and renewable/distributed systems integration.

As the acting Chief Operating Officer, Patricia Hoffman is responsible for the

business management of the office including human resources, budget development,

financial execution, and performance management.

Before joining the Office of Electricity Delivery and Energy Reliability, Patricia

Hoffman was the Program Director for the Federal Energy Management Program

which implements efficiency measures in the federal sector and the Program Manager for the Distributed Energy Program that developed advanced natural gas

power generation and combined heat and power systems.

Before this, Patricia managed the Advanced Turbine System program resulting in

Solar Turbine Incorporated’s Mercury 50 industrial gas turbine product.

Patricia holds a Bachelor of Science and a Master of Science in Ceramic Science

and Engineering from Penn State University.

Chairman LAMPSON. Thank you, Ms. Hoffman.

Mr. Roberts.

STATEMENT OF MR. BRADFORD P. ROBERTS, CHAIRMAN,

ELECTRICITY STORAGE ASSOCIATION

Mr. ROBERTS. Good morning, Mr. Chairman and Members of this

subcommittee. It is a privilege to be invited here today and be

17

given the opportunity to offer views and perspectives of the Electricity Storage Association on the value of deploying energy storage

in the electrical grid of the United States.

My name is Bradford Roberts, and I am the current Chairman

of the Board of the Electricity Storage Association. The ESA was

founded from the Utility Battery Group, a utility group focusing on

the benefits of using large-scale storage in their systems. ESA

memberships currently number approximately 100 member organizations, which includes most of the major utility companies in the

U.S., leading manufacturers of energy storage systems around the

world, technologies from academia, at engineering firms, plus potential investors in energy storage.

Over this period, ESA has worked very closely with DOE’s Energy Storage Program, Sandia National Labs, and various state

agencies, such as the California Energy Commission, the New

State Energy research and development authority, and the Electric

Power Research Institute that is here today. ESA members have

contributed key advancement to electricity storage technology using

the very limited funds that have been available from DOE in the

past. These activities have helped build a strong foundation for

meeting the needs of a growing electric grid that must now capitalize on the use of renewable sources and become more reliable,

take advantage of smart-grid technology and be more resilient to

threats of any kind.

This brochure that was in the package that was given to you

shows examples of storage projects done around the world by ESA

members. Studies and projects funded by DOE and state agencies

have helped define the most significant use of energy storage. The

most compelling are: help control power cost volatility, make more

efficient use of fossil fuels like natural gas and oil to reduce dependency on foreign sources; benefit the performance of the transmission and distribution system, nationwide; enhance the use of renewable energy sources and make them more dispatchable; help

improve the overall performance of combined heat and power systems; improve the grid’s stability, reliability, and security.

Very large-scale systems like pumped hydro have been successful

in providing bulk storage for the overall grid for some time. But

only recently, in the last few years, have practical and affordable

distributed energy systems begun to appear. Storage systems can

capture low-cost energy at night and discharge it during peak daytime periods to help control price volatility. Storage systems can

peak shave at the substation level and defer system upgrades.

Small fast-acting dynamic energy storage systems such as

flywheels can provide vital ancillary services to the grid such as

spinning reserve and frequency control. Wind energy generation at

night can be transported on lightly loaded transmission systems to

load centers and discharged at peak times the next day.

Other great amounts of electrical storage in the grid can provide

protective power to vital assets in the community, such as hospitals, airports, critical industries, such as data centers, communications facilities and so on. As the amount of storage grows and

these resources become more widely distributed, the entire grid will

become more secure and less vulnerable to manmade or natural

disasters. Storage has been identified as a critical component for

18

the future of smart grids and will play a vital role in demand side

management programs and make them work more effectively.

The groundwork developed by ESA members working with DOE

and Sandia has identified what we can realize with an expanded

incentive program at this time. Many technologies have the proofof-concept stage and are ready for commercial application and will

provide real benefits to the grid.

Some of the recommendations we make are: expand the scope

and size of government funding for storage programs that interact

with the grid; provide incentives to national producers of storage

systems and key sub-entities of those systems; provide funding to

demonstrate the benefit of both large-scale and short-term balancing effect on wind power; provide funds to demonstrate the advanced storage to provide reliability enhancement for the grid; develop legislation to treat energy storage as a necessary component

of renewable sources and provide federal financial support to incent

end-users to develop and deploy storage systems; also ask FERC to

require independent system operators to allow new energy-store

technologies to compete in the commercial markets and take advantage of their faster response.

Thank you for this opportunity to be here, and I look forward to

your questions.

[The prepared statement of Mr. Roberts follows:]

PREPARED STATEMENT OF BRADFORD P. ROBERTS

Good morning, Mr. Chairman and distinguished Members of the Subcommittee on

Energy and Environment. It is a privilege to be invited here today and be given the

opportunity to offer views and perspectives of the Electricity Storage Association

(ESA) on the value of deploying energy storage in the electrical grid of the United

States.

My name is Bradford Roberts, and I am the current Chairman of the Board of

the Electricity Storage Association (ESA). The ESA is a trade organization founded

17 years ago to promote the value of electrical energy storage in our nation’s grid

and other electrical systems around the world. The ESA was founded from the Utility Battery Group (UBG), a utility group focusing on the benefits of using large-scale

storage in their systems. ESA membership currently numbers approximately 100

member organizations encompassing most of the major utility companies in the

U.S., leading manufacturers of energy storage systems around the world and leading technologists from academic and engineering firms with interest in designing

storage applications.

Over the last 17 years the ESA has worked closely with the Department of Energy’s Energy Storage Program, Sandia National Laboratories and various State agencies such as the California Energy Commission (CEC), the New York State Energy

Research and Development Authority (NYSERDA) and the Electric Power Research

Institute (EPRI).

ESA members have contributed key advancements to electricity storage technologies using the very limited funds in the DOE Energy Storage program. These

activities have helped build a strong foundation for meeting the needs for the growing electricity grid that must now capitalize on the use of renewable energy sources,

become more reliable, take advantage of smart grid technology and be resilient to

threats of any kind. Storage of electricity is able to address these needs by reducing

the need for fossil fuels, reducing cost of electricity and at the same time increase

the reliability and robustness of the electric power system.

Primary Benefits of Storage in the Grid

Studies and projects funded by the DOE Energy Storage Program have helped define the most significant uses of electric energy storage. The most compelling of

these uses are:

• Control power cost volatility

• Make more efficient use of fossil fuels like natural gas and oil to reduce dependency on foreign sources

19

• Benefit the transmission and distribution systems

• Enhance the use of renewable energy sources

• Improve the overall performance of combined heat and power systems

• Improve the grid’s stability, reliability and security.

Very large-scale systems like pumped hydro plants have been successful in providing bulk storage for the overall grid’s use but only in the last few years have

practical and affordable distributed storage systems begun to appear. Other smaller

electricity storage technologies, many of them marketed and deployed by our members, offer more flexibility in deployment on a distributed basis throughout the grid.

These technologies offer a variety of benefits to the key items mentioned above.

Storage systems can capture low-cost energy at night and discharge it during

peak daytime periods to control price volatility. Some storage systems can peak

shave at the substation level and defer system upgrades. These large systems and

smaller fast-acting dynamic energy systems such as flywheels can provide vital ancillary services to the grid such as spinning reserve and frequency regulation. Wind

energy generated at night can be transported on a lightly loaded transmission system to load centers and discharged at peak times. Excess electricity from combined

heat and power (CHP) systems can be used to charge local storage systems and further improve total grid efficiency. Further, greater amounts of stored electrical energy in the grid can provide protected power to vital assets in the community such

as hospitals, airports and critical industries such as data centers and communications facilities. As the amount of storage grows and these resources become more

widely distributed, the entire grid will become more secure and less vulnerable to

man-made or natural disasters. Storage has been identified as a critical component

in all projected and studied future power systems including smart grids and will

also play a vital role in enabling demand-side management schemes without compromising end-users’ interest.

ESA Recommendations for an Expanded Electricity Storage Program

The groundwork developed by ESA member companies working with the DOE and

Sandia National Labs energy storage program has identified the value that can be

realized with an expanded incentive program at this time. Many technologies have

passed the ‘‘proof-of-concept’’ stage and are ready for commercial applications that

will provide real benefit to the grid. At a time of growing concern for the environment, expanded storage applications can begin to pay dividends. The following recommendations are made:

1. Expand the scope and size of government funding of storage programs that

will interact with the grid at all levels from residential to substation sizes.

2. Provide incentives for national producers of storage systems and key subcomponents.

3. Provide funding to demonstrate the benefits of both large-scale storage and

short-term balancing of wind energy to improve overall system performance.

4. Provide funding to demonstrate the use of advanced storage to provide reliability enhancement of grid power to critical load customers (hospitals, data

centers, critical process manufacturers).

5. Develop legislation to treat energy storage as a necessary component of renewable generation source and provide federal financial support to incent

end-users and utilities to develop and deploy electricity storage systems. This

should be a tax credit on a significant portion of total storage system investment to help deploy more installations nationwide.

6. Ask FERC to require Independent System Operators (ISOs) to update Market Rules to allow newer energy storage technologies to compete in commercial energy markets and take advantage of the faster response these systems

can offer.

Summary

The Electricity Storage Association appreciates the efforts of the Energy Storage

Programs at DOE and Sandia Labs. Our members remain committed to accelerating

the application of storage at all levels to benefit the environment and improve our

lives as we learn to use electricity more efficiently and responsibly in the 21st century.

20

BRADFORD P. ROBERTS

Brad Roberts is employed as the Power Quality Systems Director for the Power

Quality Products Division of S&C Electric Company which specializes in low and

medium voltage power protection systems.

Brad has over 35 years experience in the design and operation of critical power

systems, ranging from single phase UPS systems to medium voltage applications.

He began his engineering work as a systems reliability engineer in the Apollo Lunar

Module Program at Cape Kennedy. He held senior management positions in two of

the major UPS manufacturers during his career. Brad is a senior member of IEEE

and has published over 40 technical papers and journal articles on critical power

system design and energy storage technology.

Brad is a registered professional engineer and has a BSEE (Bachelor of Science

in Electrical Engineering) degree from the University of Florida. He is Past-Chairman of the IEEE Power Engineering Society’s Emerging Technologies Committee

and Chairman of the Board of Directors for the Electricity Storage Association. He

has been a member of the ESA Board for 10 years.

Brad is the 2004 recipient of the John Mungenast International Power Quality

Award.

Chairman LAMPSON. Thank you, Mr. Roberts. Mr. Dickerman,

you may proceed.

STATEMENT OF MR. LARRY DICKERMAN, DIRECTOR, DISTRIBUTION ENGINEERING SERVICES, AMERICAN ELECTRIC

POWER

Mr. DICKERMAN. Good morning Mr. Chairman and distinguished

Members of this subcommittee. Thank you for inviting me here

today. And also, I thank you for the opportunity to provide the

views of American Electric Power (AEP) on the significance of deploying energy storage to improve security, reliability and performance of America’s electricity infrastructure.

My name is Larry Dickerman. I am the director of distribution

engineering services for American Electric Power. American Electric Power is a 5,000,000-customer utility in 11 states. We are one

of the largest generators in the country, having 38,000 megawatts

of capacity. We are the largest transmission utility in the country

with 39,000 miles of transmission line. We are the largest distribution company in the country with 207,000 miles of distribution.

But of particular importance for the Committee Members here

today, AEP is leading the utility in U.S. deployment of large-scale

energy storage. Of particular note is a success: AEP installed the

first-ever megawatt-sized scale NAS battery, sodium sulfide battery, in the Western Hemisphere in 2006. Based on our experience,

AEP believes that storage has an important role in the grid of the

future in that it can defer capital projects by improving the utilization of existing assets. It can improve security and reliability. It

can be deployed quickly, and it can work well with renewable resources such as wind.

As we believe storage should be incented through mechanisms

such as a federal tax credit in the range of 30 percent, to accelerate

widespread deployment. Over the last 100 years, AEP has been an

industry leader in development, advancing and deploying new technology, and has always recognized the value of storage, as is evidenced by our Smith Mountain Pump-Hydro Facility. Over the last

decade, AEP tested and evaluated the feasibility of new battery

and super-capacitor technologies in our engineering laboratories.

Based on those tests, AEP decided to move it from the laboratory

21

and into further prototype testing with the sodium sulfide batteries

for distributed energy storage system to support our grid.

The major actors in selecting the NAS technologies over alternative technologies were its safe and reliable commercial operation

experience in Japan, compact footprint, about the size of a doubledecker bus, high efficiency and zero emissions, and you can relocate

it if you need to.

Based on successful laboratory and demonstration projections,

AEP worked with NGK and with S&C Electric Company to deploy

AEP’s first commercial one-megawatt NAS battery in 2006 on a 12-

kv distribution feeder in Charleston, West Virginia. This battery

can provide enough energy for about 600 homes for seven hours.

As a next step, AEP also recently announced a new initiative to

deploy more energy storage on its system, and this initiative includes six megawatts of additional NAS-based energy storage by

the end of next year, at least 25 megawatts of NAS-battery capacity by the end of the decade, and adding another 10,000 megawatts

of advanced storage technology in the decade after that.

The aim of these initiatives is to achieve many benefits, including reducing peak load on lines and equipment, providing backup

energy to improve security and reliability, offering shorter deployment time versus traditional solutions, complimenting the modern

grid concept, and enhancing the use of wind generation at peak demand.

Although this technology, in most cases, rests on the distribution

side—that is physically where it is at on a distribution system— other benefits of energy storage extend to all parts of the electricity

infrastructure, including helping to optimize generation.

The Department of Energy played a critical role in helping to deploy AEP’s project in West Virginia, by covering the one-time engineering costs that were needed for this first-of-a-kind installation

in the Western Hemisphere. The partnership of DOE and AEP to

deploy the first ever megawatt sized battery facility in the United

States was an ideal way of taking a new technology from research

and development to real-world operation to accomplish something

for a utility like AEP.

Given the benefits of storage, AEP supports the continuous development of storage technology and the adoption of incentives

such as a 30 percent federal tax credit for deployment of distributed energy storage to accelerate the widespread use of storage to

improve security, reliability, and performance of the United States’ electric grid infrastructure.

Again, thank you for inviting me here today.

[The prepared statement of Mr. Dickerman follows:]

PREPARED STATEMENT OF LARRY DICKERMAN

Summary

American Electric Power is one of the largest electric utilities in the

United States, delivering electricity to more than five million customers in

11 states. AEP ranks among the Nation’s largest generators of electricity, owning

more than 38,000 megawatts of generating capacity in the U.S. AEP also owns the

Nation’s largest electricity transmission system, a nearly 39,000-mile network that

includes more 765 kilovolt extra-high voltage transmission lines than all other U.S.

transmission systems combined. AEP’s utility units operate as AEP Ohio, AEP

Texas, Appalachian Power (Virginia, West Virginia), AEP Appalachian Power (Tennessee), Indiana Michigan Power, Kentucky Power, Public Service Company of

22

Oklahoma and Southwestern Electric Power Company (Arkansas, Louisiana and

east Texas). Combined, these utility units operate and maintain over 207,000 miles

of distribution lines in service territory covering approximately 197,500 square

miles.

AEP is the leader among U.S. utilities for deployment of large-scale battery-based energy storage. Over the last 100 years, AEP has been an industry

leader in developing, advancing and deploying new technologies and has always recognized the value of energy storage. In 1965, AEP’s Smith Mountain, a 600MW

pumped hydro energy storage facility in Virginia, came on line with the ability to

provide peaking power within minutes and thereby better utilize the company’s existing generation and transmission assets.

Over the last decade, AEP tested and evaluated the feasibility of new battery and

supercapacitor technologies in its engineering laboratories. Based on those tests,

AEP decided to use sodium sulfide (NAS) batteries for a distributed energy storage

system to support its distribution grid. The major factors in selecting the NAS technology over the alternative storage technologies were its commercial operation experience, compact footprint, high efficiency, zero emissions and relocation ability.

Based on successful laboratory and demonstration projects, AEP worked with

NGK Insulators and S&C Electric Company to deploy AEP’s first commercial 1MW

NAS battery in 2006 on a 12kV distribution feeder in Charleston, WV, and recently

announced a new initiative to deploy more energy storage on its system including

6MW of additional NAS-based energy storage by the end of 2008; at least 25MW

of NAS battery capacity in place by the end of this decade and adding another

1,000MW of advanced storage technology in the next decade.

Energy storage technologies, such as the NAS battery, offer many benefits to improve the reliability and performance of the distribution system. These benefits include reducing peak load, providing backup energy and offering shorter deployment.

In addition, energy storage also complements the ‘‘modern grid’’ concept. Although

this technology in most cases rests on the distribution side, other benefits of energy

storage extend to all parts of the electric utility infrastructure, including helping to

optimize generation.

The Department of Energy (DOE) played a critical role in helping deploy AEP’s

project in West Virginia by covering the non-repeat engineering costs that were

needed for this first-of-a-kind installation in North America.

AEP supports the adoption of incentives for deployment of distributed

stationary energy to improve security, reliability and performance of the

United States electric grid infrastructure.

Good morning Mr. Chairman and distinguished Members of the House Committee

on Science and Technology. Thank you for inviting me here today. Also, thank you

for this opportunity to offer the views of American Electric Power (AEP) and for soliciting the views of our industry and others on the significance of deploying energy

storage for improvement in security, reliability and performance of America’s electricity infrastructure.

My name is Larry Dickerman, and I am the Director of Distribution Engineering

Services of American Electric Power (AEP). Headquartered in Columbus, Ohio, we

are one of the Nation’s largest electricity generators—with over 38,000 megawatts

of generating capacity—and serve more than five million retail consumers in 11

states in the Midwest and south central regions of our nation. In addition, AEP also

owns the Nation’s largest electricity transmission system, a nearly 39,000-mile network that includes more 765 kilovolt extra-high voltage transmission lines than all

other U.S. transmission systems combined. We also operate and maintain over

207,000 miles of distribution lines in a service territory covering approximately

197,500 square miles. But of particular importance for the Committee Members

here today, AEP is the leading utility in the U.S. for deployment of large-scale energy storage, which improves the security, reliability and performance of our distribution grid. Of particular note, AEP installed the first-ever, megawatt (MW)-scale

NAS battery in the Western hemisphere in 2006.

Over the last 100 years, AEP has been an industry leader in developing, advancing and deploying new technologies and has always recognized the value of energy

storage. In 1965, for example, AEP’s Smith Mountain, a 600MW pumped hydro energy storage facility in Virginia, came on line with the ability to provide peaking

power within minutes, thereby reducing peak demand and better utilizing the company’s generation and transmission assets.

23

1 7.2MWh can feed 1MW of electricity for 7.2 hours.

Grid Modernization and Energy Storage

In many respects, the distribution grid of 2007 is not much different than the grid

of 1965. Consequently, many associated with the electric utility industry are talking

about developing a ‘‘smart grid,’’ ‘‘modern grid’’ or ‘‘the grid of the future.’’ I first

want to address what is meant by these terms and how energy storage fits into the

concept of a ‘‘modern grid.’’ One clear analogy is the progress that has been made

with automobiles since 1965. In 1965, automobile builders compromised on components so cars could meet a variety of demands such as acceleration and steady state

driving. In addition, the components could not communicate and had limited adaptability to meet different demands. An automobile built in 2007 is far different in

that a communication system provides information to on-board computers and components have the ability to adapt how they operate based on input about varying

conditions. Consequently, a modern car performs better, stops better, pollutes far

less and gets better gas mileage. More recently, this dynamic optimization has been

taken a step further with on board batteries in Hybrid Electric Vehicles. The onboard batteries provide further opportunities to size the engine for steady state conditions, while the battery provides power for acceleration and other peak demands.

The utility grid in the United States is an enormously complex system that like

automobiles can benefit from a modern communication infrastructure, interconnected computers, devices that can dynamically change and store energy. To

achieve dynamic optimization similar to what has been achieved in the automotive

industry, the ‘‘modern grid’’ will require:

• Inexpensive communication systems that work over large areas;

• Computer protocols determining how each connects/communicates with various pieces of equipment;

• Equipment from suppliers that can receive communication and dynamically

adapt; and

• Electricity storage devices to optimize use of assets and improve reliability.

A ‘‘modern grid’’ using this technology would improve reliability, improve the utilization of existing assets, move demand off peak, help customers reduce usage, and

help with the integration of distributed resources.

AEP Efforts to Deploy Energy Storage

A key component of the ‘‘modern grid’’ and of particular interest today is energy

storage. Over the last decade, AEP tested and evaluated the feasibility of new battery and supercapacitor technologies in its engineering laboratories. Based on those

tests, AEP decided to use sodium sulfide (NAS) batteries for a distributed energy

storage system to support its distribution grid. The major factors in selecting the

NAS technology over the alternative storage technologies were:

• 15 years of commercial operational experience in Japan at sizes over 1MW

(1MW produces enough energy to power 600 homes).

• The ability to have high energy and power density in a compact footprint the

size of a double-decker bus.

• High efficiency through the charge/discharge cycle.

• No emissions, vibrations or noise concerns.

• Ability to economically relocate and recycle.

AEP first tested a small 12.5kW module (enough power to feed seven homes) in

our laboratories and installed a 100kW demonstration unit (enough power to feed

60 homes) for peak shaving and backup power to one of our office buildings in 2002.

As a next step, AEP worked with NGK Insulators (manufacturer of NAS batteries)

and S&C Electric Company (manufacturer of the system to connect DC battery to

an AC power grid) to deploy its first commercial 1MW, 7.2MWh1 NAS battery in

2006 on a 12kV distribution feeder in Charleston, WV. This site was chosen to alleviate overloading of an existing distribution transformer. By installing the battery,

AEP was able to reduce its daily peak load and, therefore, defer substantial capital

investment on a new distribution substation. Department of Energy (DOE) played

a critical role in this project by covering the non-repeat engineering costs that were

needed for this first-of-a-kind deployment in North America and we deeply appreciate their assistance.

Following the successful operation of the NAS battery in West Virginia, AEP recently announced a new initiative to deploy more energy storage on its system including (see the attached press release):

24

• An additional 6MW added of NAS-based energy storage by the end of 2008.

• At least 25MW of NAS battery capacity in place by the end of this decade.

• Adding another 1,000MW of advanced storage technology in the next decade.

AEP, NGK and S&C are now in the process of further developing NAS battery

technology by implementing an ‘‘islanding’’ feature to improve distribution reliability. With ‘‘islanding,’’ the battery can be deployed at the end of a long remote

distribution line and provide power even when the normal feed is interrupted. AEP

will demonstrate the ‘‘islanding’’ technology with four megawatts of the six

megawatts planned for 2008. The islanding feature will also demonstrate the use

of communication and control systems necessary for the deployment of a ‘‘modern

grid.’’ The other two megawatts scheduled for 2008 will be deployed at a site near wind

generation that will help AEP understand how electrical storage can enhance wind

generation. NAS batteries can help by storing energy whenever the wind does blow

and giving the energy back when needed most during times of peak demand. NAS

batteries can be utilized with wind and all forms of generation today, but likely will

become even more attractive as the price for NAS batteries decreases through greater volumes and the need increases due to a greater number of wind generators.

Electricity Storage Benefits

Energy storage technologies, such as the NAS battery, offer many benefits to improve the reliability and performance of the distribution system. Although this technology in most cases rests on the distribution side, other benefits of energy storage

extend to all parts of the electric utility infrastructure, including helping to optimize

generation. A list of benefits of energy storage includes but is not limited to the following:.

• Improving service reliability and power quality by being a backup energy

source (‘‘islanding’’) during outages.

• Reducing peak load (or lead leveling) and hence reducing the need for other

local capacity upgrades in distribution.

• Complementing ‘‘smart grid’’ or ‘‘modern grid’’ benefits by taking advantage

of the distribution grid’s communication and control features.

• Much shorter deployment time than most conventional solutions to address

many immediate grid problems.

• Enhancing the use of wind generation during periods of peak demand.

Most importantly, in a given application, many of these benefits can be achieved

at the same time.

AEP Perspective on a Federal Energy Storage Research, Development and

Deployment Program

In the past, the United States led the world in pure research on energy storage.

For example, the concept of the NAS battery was pioneered in the United States

in 1965 for electric vehicle applications. Others in the U.S. and Europe continued

to advance the technology. However, in the mid 1980s, the Tokyo Electric Power

Company and NGK, with support from the Japanese government, launched a development and demonstration program that successfully commercialized the technology

for utility-scale applications. Because of this, AEP would suggest and strongly support a federal energy storage research, development and deployment program that

would join technology experts with end-users of energy storage to actively develop,

guide, and implement a government-supported storage program. To do this, federal

funding needs to be balanced between research and ‘‘real world’’ applications to advance the technology. A few sample projects could include:

• Implementing large scale battery ‘‘islanding’’ capability to improve reliability

in rural areas.

• Developing a ‘‘smart’’ or ‘‘modern grid’’ installation and integrate energy storage.

• Using energy storage to improve security to critical infrastructure that includes police, fire stations, water pumps and hospitals.

• Exploring greater benefits of the technology on the entire energy infrastructure, including distribution, transmission and generation.

Legislation to establish federal financial support is needed to encourage end-users

to overcome their respective entry costs to deploy large-scale energy storage systems. For example, an investment tax credit in the range of 30 percent of the initial

investment in an energy storage facility would help accelerate deployment across

25

the industry. (Note that in Japan, the government has subsidized early end-users

of energy storage for grid support and currently covers one third of the cost of energy storage facilities that support the deployment of wind power systems.)

AEP Perspective on Renewable Resources

AEP strongly supports the increased use of renewable energy sources and believes

that further technological advances and commercial deployment of energy storage

technologies will significantly increase the use of renewable energy sources. Today,

we have 467MW of wind generation under purchased power agreements, but we intend and fully expect to increase our renewable portfolio into the future. That said,

we oppose the federal Renewable Portfolio Standard (RPS) recently adopted by the

House (and similar measures) as a costly and unnecessary government mandate.

The RPS adopted by the House, for example, will likely cost electricity consumers

billions of dollars in higher electricity cost without the development of significant

additional renewable generation or, more importantly, without any technological advances. Simply put, many retail electric suppliers will be unable to meet the RPS

through their own generation and will purchase renewable energy credits. As a result, AEP anticipates a wealth transfer from electric consumers in states with little

or no renewable resources to those states with abundant renewable resources (which

would likely be developed without a federal mandate) and/or the Federal Government. In fact, we calculate that this proposal, if implemented, would cost our customers approximately between $6–$8 billion dollars (with some purchases of credits)

in total cumulative costs by 2020.

Rather than focusing on an RPS, the Congress should promote technologies to the

degree where economic and environmental benefits are optimized. For example,

combining energy storage and wind generation will in the long run increase the

availability of this resource and may meet the definition of economic and environmental optimization. Unfortunately, this combination would not help AEP meet the

RPS mandate adopted by the House beyond the original addition of the wind generation. In short, mandates may be well intentioned, but are not always the most

effective way to proceed from both an economic and environmental perspective.

Conclusion

In conclusion, energy storage is an important technology for the transformation

of the existing electricity grid in the United States. A strong and cooperative partnership of industry and government can and will promote research and development

and, ultimately, commercial deployment. AEP is committed to being a part of this

important process, and helping you achieve the best outcome at the most reasonable

cost as quickly as practicable. Thank you again for this opportunity to share these

views with you.

26

27

28

29

BIOGRAPHY FOR LARRY DICKERMAN

Larry Dickerman is the Director of Distribution Engineering Services. Prior to his

present position, Larry led various organizations for AEP including Distribution

Dispatch & Emergency Restoration Planning, Distribution Asset Management and

Operations Improvement. Larry is a 32-year employee with AEP.

Larry graduated from N.C. State University in 1974 with a BSEE and is a registered professional engineer in Virginia. Larry now resides in the Columbus, Ohio

area.

Chairman LAMPSON. Thank you very much. Mr. Key.

STATEMENT OF MR. THOMAS S. KEY, TECHNICAL LEADER, RENEWABLES AND DISTRIBUTED GENERATION, ELECTRICAL

POWER RESEARCH INSTITUTE

Mr. KEY. Thank you, and good morning, Mr. Chairman and distinguished Members. I am representing the Electric Power Research Institute. I shall focus on the role energy storage plays in

the electric grid, both today and in the future.

As a starting point, I want to recognize that electric energy storage is both valuable and expensive. Consider your retail electric

rates at home that are around $.10 per kilowatt hour, yet most of

us will gladly pay dollars when we replace a battery in a flashlight

or cars or a portable appliance. We think it is worth it, and it is

much the same way in the electric power grid. We are generally

willing to pay more to store kilowatt hours of electricity than it

costs us to make them by conventional means. The key is to have

the energy in the right place at the right time, and this is an investment that we are willing to make.

30

Today, our electric energy system delivers about 4,000 terawatt

hours, and it runs with very little storage. I would like to explain

this. We are getting by without much storage because of the ingenious system of interconnecting many generators and consumers,

by forecasting demand, scheduling supply, and maintaining reserve

generation as backup. If the electric load turns off in one place, another one turns on somewhere else. In effect, we are running a

massive just-in-time delivery system, and as we have seen, it can

be tricky to keep this system balanced.

We depend heavily on natural gas, to both regulate up and down

and to cover peak period. Gas currently accounts for 47 percent of

our supply capacity. Pump storage, our only significant method for

electric storage, accounts for a little over two percent. In the future,

we expect this situation to change. It will be increasingly difficult

to operate this grid without additional energy storage. This change

is our response to reducing carbon emissions, higher fossil fuel

prices and to enable more diversified ways of generating and using

electricity.

We need more energy storage to support the new mix of loweremitting and less-controllable electric supply, including solar and

wind, but also nuclear and clean coal. We shall need energy storage

to enable a more effective participation by customers in managing

their own use of electricity. One way storage can benefit the grid

is to improve our use of the generators, the transformers, and the

power lines. Currently, our utilization of these assets is below 50

percent. This is because of large variations in the electricity demand, day to night and seasonally, and because of our practice of

just-in-time delivery.

To find large-scale storage options, EPRI is looking at new ideas

in compressed air systems to supplement existing hydro. This will

allow us to use existing transmission lines much more effectively.

On a smaller scale, distributed storage, using batteries, pumped

water, or compressed air can improve grid asset utilization closer

to the point of use. This is at a substation or feeder level. EPRI

is working on a future, smart distribution grid using distributed resources, including storage, to help manage electricity use. With

more cost-effective storage technologies, we can increase efficiency

and interact better with other new technologies such as rooftop

photovoltaic and plug-in hybrid vehicles. These new storage technologies will be needed to enable future solar and wind, by giving

our operators more options in balancing renewable supply and demand.

Cases are already documented where wind has challenged operators in New Mexico, California, and Hawaii. In all of these cases,

storage is considered as part of the solution.

I would like to point out some challenges for electric storage, related to economics and risk. Costs are very high and siting and permitting can be difficult for large-scale storage. This is illustrated by

the very modest amount of pumped hydro in the U.S. today. Energy storage by its nature, creates value streams for several different stakeholders. With the regulation, it is difficult to aggregate

the value and secure financing. This was illustrated by a compressed air plant that was not built to support West Texas Wind

in 2002.

31

Distributed energy storage will require significant investment for

development and demonstration. The utility industry is usually in

a position to make this investment. We believe that the DOE programs are on the right track to address the utilities interest, but

there are many more opportunities in the future to partner on firstof-a-kind applications in different regions and under different gridoperating condition.

In the future, EPRI shall continue to work with its members and

the Department of Energy to help realize the untapped benefit of

new energy storage technologies in the electric grid.

We believe that the expanded use of energy storage is important

to improving the efficiency, reliability, and security of the electric

power network. Energy storage application in both the transmission and distribution grid will be essential to meet the growing

demand for electricity using low emitting technologies and gaining

the full value of end-use energy management. Thank you, sir.

[The prepared statement of Mr. Key follows:]

PREPARED STATEMENT OF THOMAS S. KEY

Thank you, Mr. Chairman and Members of the Subcommittee. I am Thomas Key,

Technical Leader, Renewable and Hydropower Generation for the Electric Power Research Institute (EPRI), a non-profit, collaborative organization conducting electricity related R&D in the public interest. EPRI has been supported voluntarily by

the electric industry since our founding in 1973. Our members, public and private,

account for more than 90 percent of the kilowatt hours sold in the U.S., and we now

serve more than 1,000 energy and governmental organizations in more that 40 countries.

We appreciate the opportunity to provide testimony on ‘‘Energy Storage Technologies: State of Development for Stationary and Vehicular Applications.’’ My testimony today comes from the viewpoint of the electric power system and focuses on

the role that electric energy storage plays in the power delivery system of today and

in the future.

Today the power delivery system is a complex network of over 450,000 miles of

transmission, five million miles of distribution, and 22,000 substations that tie together electricity supply and demand. At EPRI we partner with our members to ensure that this existing grid infrastructure is working reliably and safely, and that

new technologies are available to meet future requirements. The power delivery system of the future, in a carbon constrained world, will be required to support both

a new generation mix, with lower emissions, and a more effective participation by

consumers in managing their efficient use of electricity. We believe that the ability

to cost-effectively store electric energy will be an important part of this delivery system of the future.

Before I discuss the benefits of energy storage, I feel it would be worthwhile to

explain how we operate the electric power system with only a small amount of electric energy storage today, and why this will change in the future.

The existing grid has operated for nearly a century as a massive just-in-time delivery system, providing electricity to meet demand practically as soon as it is generated and without storing in inventory. This is made possible by the size and diversity of the power grid, which allows system operators to ignore the small fluctuations associated with individual electrical load changes. When an electrical load

turns on in one place, the effect is reduced by another turning off somewhere else.

This characteristic allows system operators to follow load changes by throttling only

a few generators. Large shifts in load occur daily over a period of hours and can

generally be forecast, giving system operators the chance to schedule, dispatch and

gradually ramp generation up and down according to the demand for electricity.

Natural gas fueled turbines are the primary generation resources used to meet peak

demands. Reserve generation, some actually spinning, is required to maintain reliability and to meet system contingencies.

This just-in-time electric delivery system requires that generation, transmission

and distribution capacity are large enough to serve the maximum load that can

occur at any point in time. The maximum load, for example on the hottest days in

summer, can be significantly larger than the average load on the system, but may

occur only once or twice a year. One consequence of the large variation in electricity

32

demand and just-in-time delivery is that the power system assets are often under

underutilized, such as at night and during temperate seasons. The overall utilization of electric generation in 2006, according to EIA data, was 48 percent. Utilization of the power delivery system in this traditional power system model is less than

generation. Natural gas fueled turbines are the primary generation sources used to

meet peak demands, and these plants remain idol most of the time. In effect natural

gas also allows us to operate with only about two percent pumped hydro storage,

a significantly lower supply than in Europe and Japan.

We believe that this traditional model will not work as well in the future as it

has in the past. Our growing economy and rising standard of living continue to push

the demand for electrical power upwards, but social, economic, and environmental

reasons have made the construction of new generation, transmission, and distribution assets unattractive, particularly when those assets are underutilized. Even so

new electric generation and related transmission resources will be needed. The

changing nature of these resources will increase the need for energy storage on both

the supply and demand sides. New electric energy storage technologies coupled with

energy efficiency measures are keys to a better utilization of existing and future

power system assets.

The large scale adoption of renewable energy technologies, with today’s wind at

the transmission level and future roof top solar at the distribution level, change the

way utilities and grid operators will manage power delivery. Unlike conventional

generation systems, which can be controlled by adjusting the fuel input, renewable

energy technologies generate only when the wind is blowing or when the sun is

shining. They cannot be controlled to meet demand and may provide insufficient energy to the grid when it is needed or too much energy to the grid when it is not

needed. Specific cases are already documented where wind has challenged system

operators in New Mexico, California and the Big Island of Hawaii. In all of these

cases energy storage is being considered as a solution.

Another important factor related to the need for storage is the increasing cost of

fossil fuels that has made their efficient use more vital than ever before. This is particularly true with the use of oil in the transportation industry. One important

method of actualizing this improved efficiency is electrification with technologies

such as the plug-in hybrid electric vehicle (PHEV). Energy storage technologies developed for PHEV applications, and made available via the smart electric distribution grid of the future, can provide grid support in the electric distribution system.

In this application energy storage directly improves energy efficiency and reduces

our dependence on foreign oil, with related advantages to security and society.

In the future cost effective energy storage will be needed to increase utility system

asset utilization, support energy efficiency measures and allow the increased use of

renewable energy sources, reducing the carbon intensity of the American economy.

EPRI has identified several specific benefits to the expanded use of energy storage

technologies in the electric grid, including the following:

• Enable integration of renewable energy such as wind and solar with the existing electric power delivery system;

• Improve reliability and security of the electric power delivery system by proving grid support both at transmission level and close to the point of use;

• Increase asset utilization of existing power delivery infrastructure, as well as

potential deferment of the construction of new assets, by shaving peaks;

• Improve utilization of primary fuels and reduce domestic consumption of petroleum through the electrification of transportation; and

• Provide needed load following and regulation services to electricity markets.

A number of different energy storage technologies are being considered to bring

these benefits to fruition. Each technology has advantages and disadvantages, which

make it suitable for certain applications. For instance, sodium-sulfur batteries have

made strong inroads in distribution level peak shaving applications, and lithium ion

batteries are considered the energy storage technology of choice for plug-in hybrid

electric vehicles. For utility-scale load leveling and storage of wind energy, pumped

hydro has been the workhorse for the industry. However, suitable locations for new

pumped hydro are considered to be limited, suggesting a promising opportunity for

large-scale compressed air energy storage (CAES) that can be sited in many areas.

In a CAES system, electrical energy is used to compress air, which is then stored

in a pressurized reservoir. The compressed air can later be used to generate electricity by passing it through an expansion turbine with heat input. The heat input

is often delivered through the combustion of natural gas. Although natural gas is

burned in these systems, the stored heat energy allows efficiencies that are more

than double those of conventional gas turbines, with correspondingly low carbon inVerDate 11-MAY-2000 10:14 Jun 08, 2008 Jkt 037987 PO 00000 Frm 00036 Fmt 6633 Sfmt 6621 C:\WORKD\E&E07\100307\37987 SCIENCE1 PsN: SCIENCE1
33

tensity. CAES systems are usually designed on large scales, with power ratings in

the hundreds of megawatts, and the capability to deliver that power for hours.

Large underground caverns, salt domes or aquifers are used to store the compressed

air. Two such systems have been built, one in Germany and the other in the U.S.,

with at least three others proposed in the U.S. to date.

The hurdles in bringing needed energy storage technologies on line are related

primarily to economics and risk. Specific challenges are different for large scale central systems and for smaller, more distributed, energy storage technology options:

Hurdles to deployment of large-scale, transmission-connected energy storage:

Construction of proven large scale technologies, such as pumped hydro and CAES,

would immediately assist operators in the integration of wind and nuclear energy.

However, the costs of implementing these technologies can be unreasonably large.

For example a 200MW compressed air energy storage plant capable of storing

800MWh of energy can be expected to cost $200 to $250 million, not including the

cost of siting and permitting.

The very modest amount of pumped hydro built in the U.S. illustrates this issue.

Today there are 38 pumped hydro plants with a summer peaking generating capacity of 21GW. Fifteen years ago FERC had license applications for 18GW of new

pumped storage (42 plants total, with 31 in the west). However, deregulation, relatively cheap natural gas, and risk adverse private investors led nearly all developers to back out of construction. Only one large plant was build, the 800MW Rocky

Mountain facility commissioned in 1995 in Northern Georgia.

Another hurdle is the aggregation of energy storage benefits, which are spread

across a number of stakeholders. While there is little doubt that the net social benefits of these large storage plants are positive, the benefits are distributed among

power produces, system operators, distribution companies, end-users, and society at

large. The decision to build a plant, however, must be made by a single entity, and

it is often unclear how that entity can capture enough benefit to justify the investment. A specific case in point is a CAES plant proposed to support wind development in West Texas in 2002. In a study commissioned by the Lower Colorado River

Authority the sum total of all benefits for this large scale plant were clearly shown

to exceed the cost. However, benefits were shared by wind plant operators, local

power distributors, an independent system operator and rate payers. Not any single

value stream, by itself, could secure financing.

Also impeding investment in large scale energy storage is that current situation

where electric storage is not clearly defined as either a generation or a T&D asset

in most jurisdictions. This presents a problem for deregulated utilities who would

like to invest in storage. If a transmission utility invests in a system, and a ruling

subsequently classifies that system as generation, the utility will have made a large

investment it cannot recover.

Hurdles to deployment of smaller-scale, distributed electric energy storage:

Distributed energy storage holds great promise for improving utilization of distribution assets and enabling a future grid with PHEV, roof top solar and distributed power system communication and control (‘‘smart grid’’). The actualization of

this potential requires significant investment to develop, demonstrate and deploy

new technologies. The utility industry is generally not in a position to make this

initial investment, although there is high interest for trying out promising grid-connected technologies. Department of Energy programs to develop, test, and demonstrate energy storage technologies are believed to be right on target regarding

utility industry interests in the distributed systems. More opportunities to partner

on first-of-a-kind applications in different regions, and under different grid operating conditions, will be welcomed.

In the future EPRI will continue to work with its members and the Department

of Energy to help realize the untapped benefit of new energy storage technologies

in the electric power industry. We believe that the expanded use of energy storage

is important to improving the efficiency, reliability and security of the electric power

delivery network. Energy storage applications in both the transmission and distribution grid will be essential to meet the growing demand for electricity, using low

emitting generation technologies, and gaining the full value of end-use energy management.

BIOGRAPHY FOR THOMAS S. KEY

Mr. Key directs R&D in the Renewable Program at EPRI.

34

Experience

A nationally recognized leader in electric power system research, application of

distributed generation and energy storage, and related testing, Mr. Key is credited

as the father of the ‘‘CBEMA’’ curve for compatibility of electronic equipment. He

has been a catalyst and major contributor IEEE standards for compatible interface

of end-use equipment and distributed power systems.

Prior to joining EPRI he was a member of the technical staff at Sandia National

Laboratory in Albuquerque where he pioneered some of the early work on grid integration of distributed solar electric systems. This included design and testing of photovoltaic power systems, development of grid-connected inverters for conditioning

and control of distributed energy sources, and creation of power system design practices for grounding, and protection.

Since joining EPRI in 1990 he has developed criteria for a utility grid-compatible

interface, characterized high-performance dc/ac inverters and electronic appliances,

analyzed effects of power disturbances on sensitive electronic equipment, and developed design criteria and recommended practices for cost-effective application of

power-enhancement equipment.

He is the author of more than 100 professional papers, reports, and technical articles.

Professional Affiliations and Activities

• Institute of Electrical and Electronics Engineers (IEEE)

• Proposed and chaired the first IEEE Recommended Practice for Powering and

Grounding of Sensitive Electronic Equipment

• Initiated IEEE Standards Coordinating Committee for Power Quality

• Lecturer for Univ. of Wisc., EPRI, and IEEE Standards Board Seminars

• United States Navy, Civil Engineer Corps (Seabees), Retired

Achievements

• IEEE Fellow for Advancements in the field of Electric Power Quality

• John Mungenast International Power Quality Award distinguished power

quality research.

• IEEE Outstanding Engineer Award, Region 3

• Originated and directed the EPRI Power System Compatibility Research Program

Education

• Master of Science in Electrical Power Engineering and Management,

Rensselaer Polytechnic Institute, 1974

• Bachelor of Science in Electrical Engineering, University of New Mexico, 1970

DISCUSSION

Chairman LAMPSON. Thank you. I appreciate the testimony, and

we will now enter into periods of questioning by Members. I shall

recognize myself, as Chairman, for the first five minutes, and I

would like to start with Mr. Roberts.

ENERGY STORAGE TO REDUCE ELECTRICITY CONGESTION

The Department of Energy has designated two national-interest

electric-transmission corridors, the Mid-Atlantic Area and the

Southwest Area. They include areas of growing population and

growing electricity congestion. These designations have not been

without controversy.

Do you think that advanced energy storage systems could help

reduce some or much of the need to build more electric generation

and transmission lines?

Mr. ROBERTS. Thank you, Mr. Chairman.

35

I think it is essential that storage be applied in the load centers

in the larger cities in those regions. It will help relieve that congestion in the peak periods and will be very essential in making that

happen and hopefully delaying those upgrades for a long period of

time, hopefully.

GOVERNMENT ROLE IN ENERGY STORAGE DEPLOYMENT

Chairman LAMPSON. Mr. Key, in your testimony you state that

another hurdle to energy storage deployment is the fact that the

benefits are spread across a number of stakeholders, including

power producers, system operators, distribution companies, endusers, and society at large. Is there a role for the Federal Government to help bring stakeholders together to encourage investment

in energy storage systems so the investment burden doesn’t lie

with one entity?

Mr. KEY. I think we need help in these areas. I haven’t prepared

any recommendation related to how the Federal Government might

help, but it is very difficult to build large plants, and there are

clearly benefits, aggregate benefits to the public to do this, and we

have seen that with our few existing plants that are still valuable

today, and we are going to need more in the future.

GRID MODERNIZATION

Chairman LAMPSON. Mr. Dickerman, in your testimony, you discussed what is needed to modernize the grid, including electricitystorage devices and communication systems. In your opinion, do we

need a new government body dedicated to facilitating or overseeing

the modernization of the electric grid?

Mr. DICKERMAN. I think that, clearly, what is needed in this

whole area is some clear thinking about how all of it fits together.

If I might take a minute, I think the kind of transition we are talking about here is very much like what happened with vehicles,

where a vehicle in 1985 and one today is very different, and there

is a lot of communication protocol, and there is a lot of computer

capability, and there is a lot of control of various devices that have

optimized an automobile today.

Now, we are talking this afternoon about the importance of storage and further optimization. It is a very complex thing that we

are talking about doing in an automobile. And electric utility grid

is far more complex in many respects that there is so much of it,

and it all operates together, and it operates in real time. So we can

improve the operation of the electric utility grid substantially with

communication and with control and with dynamic optimization

and storage. But to do all of that, there are a lot of technologies

that have to come together, and they have to come together in a

way that is common across the entire nation, and so I do think that

there needs to be some kind of group that comes together to really

work through what does this look like and how do the technologies

work together?

ANCILLARY POWER SERVICES

Chairman LAMPSON. Thank you. And for Mr. Roberts and Ms.

Hoffman, several questions: as you know power generators provide

36

a number of ancillary services to the grid to help it meet reliability

and operating standards. You both mentioned spinning reserves

and frequency regulations in your testimony. Ms. Hoffman also describes the Department’s frequency demonstration project in New

York. In the future, do either of you anticipate energy storage systems playing a large role in providing vital ancillary services to the

grid?

Ms. HOFFMAN. Mr. Chairman, yes, I agree that storage systems

will provide a large source for frequency voltage regulation and expanding reserves in the future.

Mr. ROBERTS. Mr. Chairman, I agree. One of the issues at stake

here is, today, the response time for the generating systems to respond to frequency-regulation signals can be three or four minutes.

Whereas fast-acting storage systems could respond in cycles, which

would be more beneficial. It is stressful on many large plants to do

this up-and-down regulation, and I think the power electronics that

go with these types of systems adds R-control, which is reactivepower control as a side benefit of providing real power, so there is

a real opportunity here, I think, to take care of these devices to do

these functions.

STATE ENERGY STORAGE POLICIES

Chairman LAMPSON. I shall ask these last two things, and you

can all just comment on them: outside of the Department of Energy’s demonstration projects, are states or regions adopting policies

to encourage the use of energy storage systems to provide ancillary

services to the grid, and are there benefits to broad adoption of

policies that encourage the use of them?

Ms. HOFFMAN. Both New York and the California Energy Commission have strong programs looking at energy storage demonstration projects as well as some of the demonstration projects

that you have heard here from AEP and the Electric Power Research Institute. I believe those are very strong programs in looking at the strategy for appropriate placement of energy storage systems.

Mr. ROBERTS. I would agree with her comments. Those two

states have taken a leadership role in this. I think other states are

looking at how they might get involved, and I think the message

is starting to spread around that there is real benefit here at the

state level at the operation of the grids in those regions, and it is

going to improve.

Chairman LAMPSON. Thank you very much. I shall now recognize

Mr. Inglis for five minutes.

FUEL CELLS FOR ENERGY STORAGE

Mr. INGLIS. Thank you, Mr. Chairman. I am particularly interested in the storage of energy for transportation purposes, and in

the discussion draft we have before us of the bill that we may be

marking up soon, we talk about research on ultra-capacitor,

flywheels, batteries and battery systems, including flow batteries,

compressed air energy systems, power conditioning electronics,

manufacturing technologies for energy storage systems and thermal management systems. I wonder if fuel cells are appropriately

37

in that list. Ms. Hoffman, do you think so? Is a fuel cell appropriately in a list of batteries? Is it essentially a battery, you just

put something in it and then it runs through and creates electricity. Should it be on the list?

ULTRACAPACITORS AND FUEL CELLS

Ms. HOFFMAN. A fuel cell is a type of exchange, so for storing energy, it does use hydrogen as part of the fuel cell component. I

shall have to get back to you on that.

[The information follows:]

INFORMATION FOR THE RECORD

Fuel cells are not really an energy storage system. They can be considered generators that produce energy similar to solar energy, wind energy, and other distributed

generation. Research on fuel cells is conducted by other DOE programs.

Mr. INGLIS. I just wonder if it might appropriately be in there.

It is—of course, I have talked a lot about hydrogen and I am very

excited about its potential applications to transportation. It is also

true that batteries could be the competitor that wins the race to

the car of the future. You know, if you have a really good battery,

then perhaps you don’t need hydrogen, either burning in an internal combustion engine like BMW wants to do it, or in a fuel cell,

like General Motors wants to do it. And I was very interested in

this story recently about Lynn Motor Company using an ultra-capacitor. I think they are based in Austin, Texas, and maybe manufacture in Canada—I saw the story, but they say that they have

an ultracapacitors kind of concept that will enable a battery to be

recharged in five minutes and to take a car 500 miles on a charge.

Are you familiar with that or—I read the article and I thought,

wow, this could be fabulous, and then I saw some questions about

whether it would really work. Do you have any thoughts about

that?

Ms. HOFFMAN. I don’t have any comments on your specific example. I shall have to get back to you for the record on that specific

example, but with respect to your comments on the types of vehicles and what horse is going to win the race, I think that

versatility is an important aspect of having for our vehicle fleet as

well as our stationary sources, and I believe that in that diversity,

there are options for fuel cell cars as well as plug-in hybrid electric

vehicles in providing the diversity that the country needs.

[The information follows:]

INFORMATION FOR THE RECORD

Zenn Motor Company, a Toronto-based producer of battery powered cars, has a

technology agreement with EEstore, Inc. of Austin, TX and holds an exclusive license for EEstore batteries. The device, which is a type of supercapacitor, is not yet

in production. EEstore claims that their batteries, when inserted in the Zenn motor

Company’s 25mph vehicle, would allow a range of 500 miles and would recharge in

five minutes. Sandia National Laboratories, acting for DOE’s Energy Storage Program, has requested a sample product and offered to test their device in order to

verify these claims. The company has declined to provide a sample. The Department

is not aware that any authoritative experts have verified the claims of the device.

Mr. INGLIS. And certainly, it really doesn’t much matter who

wins the race, does it? I mean as long as we can get away from

what we have got now which is a terrible way to get around, in

38

terms of the environmental benefits and national security risk that

we are running, and the job creation opportunity by creating these

new technologies. So do you think that—I don’t know if anybody

else wants to comment on whether they have seen that—or looked

at the ultracapacitor technology involving that car. Mr. Roberts,

have you seen that?

Mr. ROBERTS. Congressman, I have done some research, my company has done some research on that particular thing you read

about in that article, and a lot of money has been invested in waiting to see when a prototype is finally delivered to see if these

claims can be met, because they are pretty broad.

Mr. INGLIS. Yes.

Mr. ROBERTS. And so it is kind of stretching the boundaries right

now, but until some demonstration is done to see, we won’t really

know.

I have a comment on the fuel-cell usage in stationary application.

Fuel cells are—work very well, but they have no energy behind

them. They have no punch. To make a stationary fuel cell really

work effectively, you need to add some from of storage to it to give

it the immediate energy it needs if there is a sudden load change

or something, if you are applying it in an office building or something and the air conditioning turns on, a fuel cell can’t deliver

that surge of energy, and so storage actually enables fuel cells to

work better.

Mr. KEYS. We have tested ultracapacitors and applied them, and

I would just say that to drive a vehicle 500 miles, there must be

some other fuel involved. There is just not energy, I think, today,

although the research is very interesting in this area—and in fact,

we have done a lot of it. Regarding fuel cells, I don’t think they are

really treated as a battery or as a storage system. The storage, of

course is the hydrogen—or the natural gas or the fuel that goes

into the hydrogen. So I think one problem with treating a fuel cell,

because it uses hydrogen as energy storage, it is like we have used

hydrogen in internal-combustion engines from a tank of hydrogen,

so there is a bit of a problem, I think, if you go down that route.

Mr. DICKERMAN. I might offer a couple of comments as well. AEP

has been involved with supercapacitors, and we have not seen results anything close to that, but what we have seen is that they

have a real advantage in the fact that they can go through a lot

of charge-discharge cycles, and we don’t even know the limits yet.

We have not been able to wear one out, so it is very positive in that

regard.

In terms of fuel cells, I think fuel cells in storage, as Brad Roberts was alluding to, are a really great marriage, because we are

also working with fuel-cell technology with Rolls Royce, one-megawatt-sized fuel cells for deployment on a utility grid. And the thing

about the fuel cell is that it really likes to run flat out. In other

words, you turn it on, and you run it at a megawatt, and it doesn’t

want to vary. If you put a storage device with it, then you can take

up all of the variation and load with the storage device, so a twomegawatt unit—one megawatt, a fuel cell; a megawatt of storage—

and then you have got something that can sort of follow the load

and the efficiency of the fuel cell is very high. So I think it is an

39

important technology related to this, and it is a technology that

benefits from this.

Mr. INGLIS. Thank you.

Chairman LAMPSON. I would recognize Chairman Gordon at this

time. He has stepped out, but in the interest of time, Mr.

McNerney for five minutes.

RATING STORAGE TECHNOLOGY

Mr. MCNERNEY. Thank you, Mr. Chairman. I want to thank the

panel for coming in today with your testimony. Storage is, I think,

critical to global warning issues because storage is going to allow

us to utilize wind energy, solar energy, and other forms of intermittent renewable energies on a large scale. Right now, we are not

able to do that because of the intermittency problems. So I want

to see what we can do in terms of the Federal Government encouraging this type of research.

Mr. Dickerman, you mentioned—well, I would like to know how

you rate storage. Now, there are two ways to rate, by the installed

capacity so to speak, how much power it can generate and how

much energy it can store, and then how would you use that to— how would you use that, economically, to decide whether a storage

technology is viable for a particular application?

Mr. DICKERMAN. That is a great question. I think one of the

issues with a technology like storage is that it is a fairly complex

set of economics, because you are talking about multiple benefits

at the same time, so we can deploy a storage device to just shave

a peak, so essentially what that gives you is about enough energy

to serve 600 homes for seven hours, if it is a megawatt. We are

probably going to tend to be deploying more in the two megawatt

size, so about 12,000 homes for about seven hours. So that is the

basic grading. You can use it for just peak shaving, and in that

case, it might defer capital like a new station transformer or line

upgrades or things of that nature.

But we are also working now to island the technology, that is to

make it such that if you lose the feed to an area—imagine a remote

rural area with relatively poor reliability, single-feed. You lose the

feed because a tree comes across a line. Then, the battery can continue to feed that area. So that has a value as well. And then there

is this value that is much harder for us to get our arms around

that we were talking about. As it sits, there are regulation values

for generation and that type of thing, so there are several things

happening at the same time in terms of building up the value, so

each of the projects we are looking at, we are sort of tailoring the

economics and saying how much do we save in terms of differing

capital because it reduces the load of peak. What is the value of

the reliability that we are gaining? And basically, those are the two

factors. We are not really yet to the point of trying to decide what

is the value of some of those other aspects that might benefit generation.

Mr. MCNERNEY. Well, that is right. With wind energy, which I

am familiar, you have, say, $1,500 a kilowatt installed, and then

you have $.05 to $.06 per kilowatt hour produced. And I don’t have

a clear idea of how storage impacts those economics.

Mr. DICKERMAN. Specifically on wind generation?

40

Mr. MCNERNEY. Well, wind, but it would be, you know, certainly

the analysis would be transferable, I am sure.

Mr. DICKERMAN. Well, in the case of wind, for example, wind can

probably be best thought of as a negative load. So load is something that you can predict somewhat, and you can follow load with

the generation that you have got. But the generation that we are

used to dispatching, you know what it is. You know you can dispatch it. If it is 100 megawatts, you know it is available; you turn

it on, and it meets the need. Wind generation, you don’t know if

it is going to be there, because you don’t know when the wind is

going to blow, so there is an uncertainty. So it is uncertain in the

same way that load is uncertain, and you have to follow load, and

you also have to follow wind generation because you don’t know

what is going to happen. What the battery does is it enables you

to store it and then make it available on peak when it means the

most to you. And obviously, the price—the real price of producing

energy goes up as the demand goes up throughout the day.

FOREIGN ENERGY STORAGE

Mr. MCNERNEY. Ms. Hoffman, you had said something that

peaked my interested, that we have—2.5 percent of our energy in

this country goes through storage, and 10 to 15 percent goes in Europe. What are the technologies they use in Europe that allow that

high a percent of their electric power to go through storage? How

economic is that?

Ms. HOFFMAN. I believe I had mentioned Japan. Japan did the

first sodium-sulfur battery, so they do have—it is the same suite

of storage technologies that we are talking about here for the

United States.

And I am sorry. I missed the other part of your question.

Mr. MCNERNEY. Well, what is the economics of that? How much

do they pay, premium, for that storage capacity.

Ms. HOFFMAN. I shall have to get back to you on that for the

record.

[The information follows:]

INFORMATION FOR THE RECORD

The primary storage technology in Japan, as in the U.S., is pumped hydro. However, as Japanese government mandates increasingly require more storage to offset

intermittent wind generation, sodium-sulfur storage systems are being widely deployed there. Due to the success of this technology in Japan, U.S. companies such

as American Electric Power and the NY Power Authority have chosen to install pioneering field tests in the U.S. The Department supports these tests through collaboration on facility design, monitoring, and economic analysis of the systems.

At approximately $1,500/kWh, the price of NAS batteries is about three times

that of conventional lead acid batteries. However, because their lifetime is considerably longer, the cost per cycle is only a third of the cost for lead acid batteries.

Maintenance costs are also considerably lower for NAS batteries.

Mr. MCNERNEY. Thank you. Thank you, Mr. Chairman.

Mr. KEY. Well, the storage in Japan and in Europe is pump storage, sir. There is very little battery storage, you know, that would

add up to that percentage in the world.

Mr. MCNERNEY. Thank you, Mr. Chairman.

Chairman LAMPSON. Thank you, Mr. McNerney. Ms. Biggert, five

minutes.

41

NAS BATTERY TECHNOLOGY

Ms. BIGGERT. Thank you, Mr. Chairman. Ms. Hoffman, what are

the origins of the NAS battery technology? I thought that this technology was developed in the United States. And did the government play a role in that development?

Ms. HOFFMAN. I am going to defer to Mr. Dickerman for that.

Mr. DICKERMAN. The NAS battery technology was developed in

1965 and Ford Motor Company was involved, and it was a technology that was, of course, considered at that time as having possible application in vehicles. It was taken to a certain extent, and

basically the technology, then, was picked up by the Japanese and

a combination of NGK with support of Tokyo Electric, the Japanese

government continued to develop it and brought it to the kind of

maturity to where it could be used in the Japanese electric-grid infrastructure.

Ms. BIGGERT. Was it ever used by the government, do you know,

or Department of Energy had any research on that?

Mr. DICKERMAN. That, I don’t know.

PREVENTING OTHERS FROM CAPITALIZING ON U.S.

INVENTIONS

Ms. BIGGERT. I guess I am just wondering because it seems like

this is another example where technology was developed in the

U.S., and then commercialized and deployed by foreign companies

and governments. Just like we have developed the nuclear technologies, particularly the recycling, and then it has been commercialized by France, and now they are selling this back to the United

States, so—and we are having to buy from overseas because we

have failed to capitalize on the inventions and the technology here,

so do you have—anybody have any ideas about how to prevent

this? How we can make sure—Mr. Roberts?

Mr. ROBERTS. I would like to comment on that. That part is true,

but taking that battery energy and delivering it into the grid requires very sophisticated power electronic equipment, and we are

in a leadership position in that field in the United States, and we

have been very fortunate that we have developed that marketplace.

And we are one of the leaders, my company is one of the leaders

in that arena. And our initial developments and all of our work are

a very good example of DOE programs that go back about ten years

ago, so——

Ms. BIGGERT. Mr. Dickerman.

Mr. DICKERMAN. Yes, I think there is really four stages to development of any technology. There is the basic research, and quite

often that involves academic institutions, pure-research kind of

programs in various places around the country. And then there is

applied research, where you start thinking about what you can do

with it. Then, I think where things tend to break down is there is

a need for demonstration projects, and at that point, you have to

take the technology from something that is applied research, like

we did with this NAS battery, or like we are doing with the

islanding aspect of the NAS battery, and actually do something

that has to work and actually serve a useful purpose. And at that

point, there needs to be a greater collaboration between industry

42

and between the organizations that are doing the research and understand the technology to create the real handoff as to how can

you use this technology in a real way to accomplish a real purpose.

And then, once that happens, I think there has to be incentives for

widespread use, and what happens is, quite often, the technology,

initially, even if it works, is at a price point where it really isn’t

competitive yet, and it needs an incubation period through some

type of incentive. So basic research, applied research, demonstration projects, incentives for widespread use: I think that is what is

needed, and where things break down is in the demonstration

project phase with industry, I think.

DEPLOYING TECHNOLOGY IN THE U.S.

Ms. BIGGERT. Well, why did AEP, then, need DOE’s help when— deploying that technology here when it has been in use for 15 years

in Japan.

Mr. DICKERMAN. Because it had not been employed on a U.S. infrastructure, and the U.S. infrastructure had some fundamental

differences in the power electronics that Brad Roberts was talking

about, and our vision from the start was to take it to a different

level. So in Japan, the technology just sits there and peak shaves.

And to even do that, we needed to develop the technology further

to apply it on a U.S. system. The thing that hasn’t been done anywhere in the world is to island this kind of technology so that it

can improve reliability and function with no connection to the electrical grid. That we are doing for the first time in the United

States anywhere in the world.

ALTERNATIVE ENERGIES

Ms. BIGGERT. And Ms. Hoffman, in your testimony, you talked

about replacing imported oil to use domestically produced fuel electricity to fuel our cars. But if we continue to, in this country—a

trend I am not encouraging—gas or coal or nuclear for energy and

not allowing drilling for natural gas on the outer continental shelf

or in ANWAR, don’t we run the risk of being more dependent on

foreign gas? It seems like so much of this is based on natural gas

which is really a commodity that we will run out of, and I think

we need to keep it for, you know, the things that are really—plastics and fertilizers and things.

Ms. HOFFMAN. Thank you, Congresswoman. The Department is

looking at advancing all of the generation types that I think the

United States is going to acquire in the future to meet that demand for electricity, and we will continue to look at clean coal concepts, advanced nuclear, and renewable technology to the maximum extent possible. Thank you.

Ms. BIGGERT. Thank you, Mr. Chairman.

Chairman LAMPSON. You are welcome. The Chair now recognizes

Ms. Giffords for five minutes.

THERMAL STORAGE TECHNOLOGIES

Ms. GIFFORDS. Thank you, Mr. Chairman, and thank you to our

panelists who have come in today to talk about energy storage

technologies. I am exited, Mr. Chairman, about this topic, because

43

when I think about the challenges that we face as a nation and

that the world faces, I think a lot of the solution to our energy

needs can be talked about here in this room and hopefully put into

action in terms of policy.

This technology is important, not just because of global warming,

but because of our dependency on foreign oil. As you know, figuring

this piece of the puzzle out is going to be critical. I am also really

concerned, and Congresswoman Biggert talked about it, is this

competitiveness issue that we are facing. We put money into research and development here in the United States, and then we see

that technology furthered in other places, and that has got to

change, and hopefully this Congress can be part of making that a

reality.

A couple of questions: I am from Arizona, and everybody here on

this committee knows because I always talk about Arizona. I am

very proud of my state, and one of the beauties that we have in

this state, of course, is our abundant supply of sunshine. We have

over 350 days of sunshine every year. So it is really solar energy

that has the greatest potential for renewable energy in Arizona. I

noticed, Ms. Hoffman in your written testimony, and even in the

testimony provided by the other panelists that there was no mention of thermal storage technologies, and that is obviously going to

be critical for the development of solar power. So I was hoping that

you would talk about this form of technology, what the Department

of Energy is doing, and in each of your individual, respective area,

where you see thermal storage development coming from and

whether or not these applications can be used in other areas beside

the concentration of solar power, which we are seeing developed

out in areas like Arizona.

Ms. HOFFMAN. Thank you, Congresswoman. Thermal storage is

an opportunity but the Department does not currently have any research programs in the area of thermal storage that I am aware

of. I shall check on that and get back to you for the record. But

it does have potential for residential usage for thermal storage, and

it can provide a balance with your photovoltaic system.

Ms. GIFFORDS. Ms. Hoffman, let me clarify, so you are not aware

of DOE having any research or any development into this area?

Ms. HOFFMAN. At this time. I shall check for the record, yes.

[The information follows:]

INFORMATION FOR THE RECORD

The Department of Energy is investing in the use of thermal storage with solar

technology applications through a number of projects. The storage of solar energy

in this manner removes the intermittency of sunlight, enabling concentrating solar

power (CSP) systems to provide energy to homes and businesses day or night.

In the mid-1990s, the Department retrofitted the 10-megawatt Solar One Power

Tower in Barstow, California with molten salt storage to demonstrate the

functionality of solar power. That project, ‘‘Solar Two,’’ succeeded in proving the viability of molten salt storage, at one point producing power around the clock for 150

hours in one test.

The Department strongly supports development of technology that dramatically

reduces the cost of CSP power and emphasizes the development of storage technologies. Toward that end, the Department recently announced that it had selected

twelve projects for further negotiations to enable DOE to invest up to $5.2 million

to energize the U.S. market for CSP systems with a major focus on thermal storage.

Also, both Sandia National Laboratories and the National Renewable Energy LabVerDate 11-MAY-2000 10:14 Jun 08, 2008 Jkt 037987 PO 00000 Frm 00047 Fmt 6633 Sfmt 6621 C:\WORKD\E&E07\100307\37987 SCIENCE1 PsN: SCIENCE1
44

oratory are working to develop more efficient and lower cost thermal energy storage

technologies for parabolic trough and advanced higher-temperature CSP systems.

Even though solar technologies are largely load following, as peak power production coincides with peak air conditioning loads in the southwest, without thermal

storage the capacity factor is only about 25 percent. However, with storage, CSP

technology can reach capacity factors exceeding 65 percent, making this a highly attractive power option for utilities looking for reliable renewable power to meet their

intermediate and even baseload power needs. The Department’s goals in the area

of CSP include reducing the cost of solar power to be regularly available at less than

10 cents per kilowatt-hour by 2015.

Mr. ROBERTS. A comment on solar energy and storage: typically,

around the county, solar energy peaks two to three hours before

the load peaks, and if you apply storage, you can extend—capture

all of that energy and extend it into the evening and take advantage of that sunshine that was shining brightly in the afternoon

when everybody was still at work, and so that is one of the areas

storage can level out, solar energy, and extend that peak period to

meet the peak period of the actual load itself.

Mr. KEY. Thermal storage is of great interest to a number of our

Members in the west because of concentrated photovoltaic. In fact,

we expect as much as five gigawats of that type of generation, and

the thermal storage is a very natural part of a power tower, and

it is also being looked at and tried out for the trough technology.

It is limited, pretty much to the Southwest. It is great, and it will

be a big help with solar, and in fact, with just balancing the Western system which has such long distances and issues with stability.

Ms. HOFFMAN. Congresswoman, I shall clarify that there is a

thermal storage program with concentrating solar power in our Energy Efficiency Office. I shall have to get back to you with more details on that program.

Ms. GIFFORDS. Please because, you know, here, again, in Arizona,

you have an area with large tracks of lands, terrific sunlight, and

also the scientist at the University of Arizona and other research

institutions as well. The University of Arizona just announced a

specific program that is going to go for building a center for solar

excellence, and I think if we use that technology and we use the

resources we have, we are able not just to help the fastest growing

in the Nation, but also export that energy as well.

RECYCLING BATTERY TECHNOLOGIES AND ENVIRONMENTAL

ISSUES

Let me just switch to another topic really quickly, which is the

environmental impact of the storage in general and batteries in

particular. You know, as we try to develop more and more of this

technology, and again, in a state like Arizona where we have a lot

of hard rock mining and a lot of the environmental impacts, I was

just hoping that the panel could address the ability to recycle this

technology and also the increased demand for some of these precious and rare metals that are going to go into the storage capacity.

Mr. ROBERTS. I shall start the responses, Congresswoman. All of

the technologies, the battery technologies that are being used today

are based on 100 percent recycling taking place at end of life in

those technologies. That is something that is very important. The

sodium-sulfur battery is a medically sealed box, so there is no

45

emissions associated with it, and at the end of its life, it is totally

recycled.

Mr. DICKERMAN. And for the years of operation in Japan, there

haven’t been any environmental or safety issues. Most of what is

in that big box the size of a double-decker bus is sand, and that

is most of the weight, but there really aren’t any environmental

issues that we have seen, and as I said, at the end of life, we expect to recycle the components.

Chairman LAMPSON. I recognize Mr. Bartlett.

TWENTY IN TEN PLAN

Mr. BARTLETT. With 10 kids, 16 grandkids, and two greatgrandkids, I ask what I think is a rational question to those who

would like to drill in ANWAR and offshore. If you could pump

ANWAR and the offshore tomorrow, what would you do the day

after tomorrow? And there will be a day after tomorrow. Wantonly

consuming the small additional reserves that we have is not a prescription of security for tomorrow.

Mr. Key mentioned the challenge we have in getting batteries for

cars that will get us very far, and that, of course, is because of the

incredible energy density in our fossil fuels. One gallon of gasoline,

it is a little, still cheaper than water in the grocery store, carries

my Prius car 50 miles. How long would it take me to pull my Prius

car 50 miles? This is incredible energy density. And to provide

that—even anything approaching that energy density in batteries

is a horrendous challenge, and that is why this is such a difficult

challenge.

You know, in our aspiration for the future, we really need to be

rational, and Twenty in Ten is not rational. There isn’t even a

prayer unless we have a devastating worldwide depression with demand destruction that we can even come close to displacing 20 percent of our gasoline in ten years. That is not going to happen if all

of our corn was used for ethanol and just countered for fossil fuel

input, it would displace 2.4 percent of our gasoline. If all of our soybeans were converted to diesel fuel, they would displace 2.9 percent

of our gasoline. Those aren’t my numbers. Those are National

Academy of Science numbers. And if we use all of our wastelands

to plant a mixture of grasses and use the cellulosic ethanol, that

might produce as much displacement of fossil fuels as all of our

corn. So you add up these three things, and you are way short of

even ten percent.

You know, I am all for doing something rational, but you know,

this is an impossible dream, and I don’t want to set us up for disappointment. We are going to be enormously disappointed if we

think we can even come close to displacing 20 percent of our gasoline in ten years. We can certainly reduce by far more than 20 percent of consumption of gasoline in 10 years by conservation. I was

in France at the last election—and by the way, it is interesting

that the new French president is the son of a Hungarian immigrant. He is doing a pretty good job, isn’t he? And I looked there

for people riding in a pickup truck as personal transportation. I

saw not one, and I looked for people riding in an SUV. The only

SUV I saw in Paris was parked behind a church. I did not see one

on the street. If we really want to reduce our consumption of gasoVerDate 11-MAY-2000 10:14 Jun 08, 2008 Jkt 037987 PO 00000 Frm 00049 Fmt 6633 Sfmt 6601 C:\WORKD\E&E07\100307\37987 SCIENCE1 PsN: SCIENCE1
46

line, we need to approach it rationally, not with some impossible

dream, and continue to drive these huge SUVs and pickup trucks,

one person in them, for personal transportation and displace 20

percent of our gasoline in ten years. Am I wrong?

Mr. ROBERTS. I would like to, Congressman, make one comment.

I think everybody agrees that conservation and changing our ways

has to take place. Along that way to that process, we need to use

the energy resources we have much more efficiently—we are adding a lot of wind into the system—and to try to utilize it more effectively as quickly as we can. These programs that are listed in this

bill, I think, would go a long way to helping that, but the real problem is, I think, as you suggested, that things have to change and

attitudes have to change.

Mr. BARTLETT. I am a huge fan of wind and solar. I have an offgrid home. All of my electricity is produced by wind and solar, and

I have a big bank of batteries to supply. But you must be very frugal in the way you use electricity if you are providing for yourself.

There is nothing that will make you a better convert to conservation than producing your own electricity with wind machines and

solar panels and watching how quickly that disappears if you are

at all proliferate.

Thank you all very much for your testimony and your helping to

move us forward. Thank you, Mr. Chairman, I yield back.

Chairman LAMPSON. Thank you, Mr. Bartlett. The Chair now

recognizes Mr. McCaul for five minutes.

SOLAR TECHNOLOGY AND ENERGY TRADING

Mr. MCCAUL. Thank you, Mr. Chairman. Roscoe, I want to congratulate you on ten children. I have five children, but you manage

to double the amount that I have. That is an incredible accomplishment.

I want to pick on an issue that was discussed earlier, and that

is solar. My home state of Texas also has a lot of sunshine. Applied

Materials in my district is working on solar panels, making great

progress with those, and the real issue is storage, as you know.

They tell me that the power grid can be used to—or their theory

where they are going with all of this is to store the solar energy

from the panels into the power grid, and then be able to draw upon

the power grid, in other words, sort of getting credits for that. Is

that a realistic technology? Anybody can answer.

Mr. DICKERMAN. Well, I think that is. What we were saying to

complement storage and wind is that you simply are taking it from

something where you can’t be sure when it is available, and you

are storing it an making it available on peak, which clearly has a

value. It sounds like that is exactly what they are talking about

doing with the solar, and so it is the same value proportions. Simply making sure that it is available and dispatchable resource on

peak when needed most.

Mr. MCCAUL. Mr. Key.

Mr. KEY. The point that we will use the electric grid to buy and

sell and trade solar and wind energy is critical. As I described in

my testimony, we are limited, I think, in doing that, especially as

we take our regulation-type generation, natural gas, and we try to

move toward more nuclear and clean coal, and we add wind, and

47

then it is going to be more difficult to do this trading and keep this

system in balance. So I think it is a correct statement, but it is a

matter of how long we can continue to do that as these renewable

resources come into play.

Mr. MCCAUL. And Ms. Hoffman, as I recall, in your testimony,

you are not aware of any thermal storage research and development programs at the Department of Energy.

Ms. HOFFMAN. Congressman, I was actually thinking of ice storage and some of those technologies when we were talking about

thermal storage. We do have a concentrating solar power program

that is tied with thermal storage, but I shall have to get back, for

the record, on details of that program.

HYBRID ELECTRIC DEVELOPMENT TIME

Mr. MCCAUL. One more, I have limited time. The hybrid plugins, you know, we have hybrid vehicles, we have batteries, why—

just explain to me—I am not a scientist—why it takes so long to

get a hybrid plug-in vehicle that could be available to the average

consumer, if anybody knows the answer to that one.

Ms. HOFFMAN. The next panel may be able to address that

with——

Mr. MCCAUL. Ms. Hoffman, you would probably be the best person to try to venture at that. I won’t be around for the next panel.

Ms. HOFFMAN. From the Department’s perspective, in developing

a vehicle, there is a development cycle that the manufacturers have

to put plans for future vehicles, and I understand that cycle is

somewhere around eight years to ten years, and so they are looking

now for technologies that they will introduce in the marketplace at

a later time. For the record, I can find more on the cycle development for introducing new technologies into vehicle application.

Mr. MCCAUL. I know we sponsored legislations for tax credits for

that. It just seems to me that should be more in the short-term

than in the long-term.

THE PROPOSED LEGISLATION

And finally, Ms. Hoffman, have you had a chance to look at the

proposed legislation here before us? There are two sections, section

6 and 7, that deal with demonstration projects at the Department

of Energy. Can you comment on these two sections and also whether there is any duplication between these two programs?

Ms. HOFFMAN. From a technical perspective on the content of

that, I think it is very synergistic to where the Department is

heading, where the states are heading, and where other research

programs are going for this type of demonstration project. So for

an area of completeness, I think the bill does capture both of those

aspects.

Mr. MCCAUL. So you see them as complementing and not duplicating. Is that fair?

Ms. HOFFMAN. Yes, sir.

Mr. MCCAUL. And then, finally, intellectual property is going to

be a real issue if advanced technologies are discovered through

these joint activities. Do you have anything in place to protect intellectual property?

48

Ms. HOFFMAN. The Department does, and I would have to get

back to you for the record on that one.

[The information follows:]

INFORMATION FOR THE RECORD

Protecting intellectual property rights (IP) is a matter of high priority for DOE.

The policy and procedures for protecting IP in DOE’s Research, Development and

Demonstration Program is well developed and in accord with applicable statutes

and the practices followed by all government agencies. First, a private partner’s preexisting IP is respected and under the terms of any award, the preexisting private

partner’s IP remains owned by the private partner. Next, while the government retains some rights to new inventions that are created through DOE awards, such as

a government use license, the Bayh-Dole Act (35 U.S.C. 200 et seq.) permits small

business and nonprofit organizations to retain ownership of their new inventions.

Pursuant to a statutory procedure, other organizations can petition DOE to retain

ownership of their new inventions and such petitions are usually granted subject

to the government obtaining some rights. Finally, while technical data first produced under an award is normally required to be publicly disseminated, in appropriate circumstances DOE may grant up to five years of protection from public release of some data from a research award at the discretion of the DOE program office.

Mr. MCCAUL. Okay, that will be fine. Thank you, Mr. Chairman.

Chairman LAMPSON. Mr. Akin, I recognize you for five minutes.

STATUS OF BATTERY TECHNOLOGY

Mr. AKIN. Thank you, Mr. Chairman. Just—I didn’t know of the

different witnesses, do we have anybody that is on top of where we

are in terms of battery technology and that developmental process?

My background is in engineering. My sense is that maybe one of

the shortest paths to solving some of the dependence on foreign oil

is using the off-peak power from the—whether it is coal or nuclear

generation, and being able to put that right into a car. It also has

the added benefit of not paying any fuel tax, which I like. But anyway, what is the status of battery technology? I understand, basically, the answer to my friend’s question is that it is too expensive.

The batteries are too expensive. They don’t last too long, and just,

economically, it is cheaper to burn gas. But the question is where

is that technology, because certainly, it has come a long way in ten

years. I mean I remember when they came out with that first electric-powered, you know, screw gun or drill, and the thing was not

much power. Now, they have got, you know, these big hammerdrills are running on batteries. Is that continuing to move or not?

Mr. ROBERTS. Congressman, unfortunately, in the afternoon session, there is a battery manufacturer that is here that could address that probably a little better, but there is a lot of activity and

research and development of advanced batteries, particularly for

vehicle application, going on in this country right now, and——

Mr. AKIN. But that is not your expertise, particularly.

Mr. ROBERTS. No.

Mr. AKIN. Well, that is all I had for questions. Thank you, Mr.

Chairman.

Chairman LAMPSON. You are welcome. I think everyone has had

an opportunity to ask questions, and we do have a second panel.

We want to thank you very much for coming. I shall, in closing, ask

are any of you aware of anything that has to do with wireless

transmission of energy, and if so, I would like to talk with you. And

49

again, I thank you all for coming. We will take a short break. We

shall be in recess before our next panel comes up.

[Recess].

Chairman LAMPSON. Come back to order, and we will now hear

from our second panel. That includes Ms. Lynda Ziegler who is the

senior vice president for customer services at Southern California

Edison; Ms. Denise Gray, who is the director for hybrid energy

storage systems at General Motors; Mary Ann Wright is the vice

president and general manager for Hybrid Systems Power Solutions at Johnson Controls. You will each have five minutes for your

spoken testimony. Your written testimony will be included in the

record for the hearing, and when all three of you have completed

your testimony, we will begin with questions. Each Member will

have five minutes to question the panel.

Ms. Zeigler, we will begin with you.

Panel II:

STATEMENT OF MS. LYNDA L. ZIEGLER, SENIOR VICE PRESIDENT, CUSTOMER SERVICE, SOUTHERN CALIFORNIA EDISON

Ms. ZEIGLER. At Southern California Edison, we are the largest

purchaser of wind. We purchase over 2,700 megawatts, and we also

purchase 90 percent of the solar generation in the country. My

company has been committed to the electrification of transportation

for 20 years. We operate the Nation’s largest and most successful

fleet of electric vehicles, a fleet that has traveled nearly 15 million

miles on electric power. Our Electrical Vehicle Technical Center,

unique in the utility industry is one of only several facilities recognized by the Department of Energy to evaluate all form of electrodrive technology. We have ongoing research collaborations with

major automakers, battery suppliers and both the Federal and

State governments. We believe that with continued engineering advances and appropriate public-policy support, the widespread use of

advanced batteries in plug-in vehicles and in stationary storage

will become one of the Nation’s most effective strategies in the

broader effort to address energy security, reduce greenhouse gas

emission, and reduce air pollutant.

In fact, the Electric Power Research Institute, which we heard

form earlier, and the Natural Resources Defense Council recently

partnered to publish one of the most comprehensive studies to date

on Plug-in Hybrid Electric Vehicles. One key finding was that

widespread adoption of plug-in hybrids could reduce annual emissions of greenhouse gases by more than 450 million metric tons by

2050, or the equivalent of removing 82 million passenger cars form

the road. That kind of reduction is obviously a long way off, but

it provides all the more incentive for us to begin today.

Electricity is virtually petroleum free, is about 25 to 50 percent

of the cost of a gasoline equivalent and is the only alternative

transportation fuel today with a national infrastructure already in

place. A recent study by the U.S. Department of Energy estimates

that a little over 70 percent of the light-duty cars and trucks on

the road today could be fueled by the excess off-peak capacity that

50

exists in the electricity system, without building a single new

power plant.

For utilities such as Southern California Edison, the challenge

and the opportunity is to integrate electric transportation and their

advanced batteries into a total energy system.

In the near-term, the advanced high-energy battery in a plug-in

vehicle could serve as a source of temporary energy power for the

home, or to occasionally help customers avoid high electricity costs

during peak pricing time. We call this vehicle-to-home. These same

advanced high-energy batteries could also be used in stationary applications. Home owners could fill a home energy battery at night

using lower cost electricity and then draw from it during the highcost part of the day to help lower the monthly utility bill.

In the mid-term, as plug-in vehicles increase in volume, using

the grid’s off-peak capacity at night to charge these vehicles may

actually help lower customer’s rates by increasing the utilization of

our generating plants. In effect, utilities would spread their fixed

costs over more kilowatt-hour sales.

We evaluate new business models on these and other applications. Edison recently launched a partnership with Ford Motor

Company to demonstrate and evaluate purpose built plug-in hybrid

Ford Escapes. Our goal is to explore the future customer values believed through plug-in vehicles and stationary energy storage.

At the same time as the emergence of plug-in vehicles and home

energy storage is the advance of advanced utility meters. Over the

next five years, Southern California Edison will install five million

next-generation advanced meters called Edison SmartConnect in

the home of every customer in our service territory. These meters

will offer our customers better information and enhanced control

over their electricity usage. Our Electric Vehicle Technical Center

is working with industry stakeholders to integrate the vehicles and

the home and the advanced meter.

Finally, in the long-term, we can imagine the potential of socalled vehicle-to-grid systems, or the ability to move stored energy

from many plug-in vehicles back to the grid. The potential, however, for vehicle-to-grid is many years away and will depend on the

development of all new control technologies as par of the smart

grid of the future.

Is that anything I should worry about?

Now, let me conclude with our view on the important role the

Federal Government can play to bring the promise of electric transportation closer to reality. In our opinion, large-scale domestic

manufacturing capacity for high energy advanced batteries is crucial to the expansion of plug-in hybrid vehicle application and complementary stationary energy storage uses. There currently exists

no such capacity on a significant scale in the United States today.

The Federal Government should provide near-term incentives to

help nurture U.S. production of this critical technology.

And earlier this year, H.R. 670, the DRIVE Act, included important measures to support research, development, and demonstration of advanced batteries in plug-in hybrids, battery EVs and stationary applications, as well as R&D for other aspects of electric

drive technology. This language was then improved this summer by

battery makers, automakers and other stakeholders and now

51

passed the Senate as H.R. 6, and part of the DRIVE Act have

passed the House as H.R. 3221.

We support this language and look forward to working with your

committee to explore other effective national manufacturing and

consumer incentives to set the stage for the breakthrough of plugin vehicles and energy storage in the U.S. marketplace.

Mr. Chairman and Members of the Committee, we stand committed to partnering with all automakers, battery suppliers, stakeholders and government to help realize the vision I have laid out

for you today. Thank you very much.

[The prepared statement of Ms. Ziegler follows:]

PREPARED STATEMENT OF LYNDA L. ZIEGLER

Thank you Mr. Chairman (Lampson) and Ranking Member Inglis.

My name is Lynda Ziegler and I am Senior Vice President of Customer Service

at Southern California Edison. Thank you for the opportunity to lend our support

today to your important efforts to promote advanced battery technology.

My company has been committed to the electrification of transportation for twenty

years. We operate the Nation’s largest and most successful fleet of electric vehicles,

a fleet that has traveled nearly 15 million miles on electric power. Our Electric Vehicle Technical Center, unique in the utility industry, is one of only several facilities

recognized by the Department of Energy to evaluate all forms of electro-drive technology. We have ongoing research collaborations with major auto makers, battery

suppliers, and both the Federal and State governments.

We believe that with continued engineering advances and appropriate public policy support, the widespread use of advanced batteries in plug-in vehicles and in stationary storage applications will become one of the Nation’s most effective strategies

in the broader effort to address energy security, reduce greenhouse gas emissions

and reduce air pollutants.

In fact, the Electric Power Research Institute and the Natural Resources Defense

Council recently partnered to publish one of the most comprehensive studies to date

on plug-in hybrid electric vehicles. One key finding was that widespread adoption

of plug-in hybrids could reduce annual emissions of greenhouse gases by more than

450 million metric tons by 2050, or the equivalent of removing 82 million passenger

cars from the road. That kind of reduction is obviously a long way off, but it provides all the more incentive for us to begin today.

Electricity is virtually petroleum free, is about 25–50 percent the cost of a gallon

of gasoline equivalent and is the only alternative transportation fuel today with a

national infrastructure already in place. A recent study by the U.S. Department of

Energy estimated that a little over 70 percent of the light duty cars and trucks on

the road today could be fueled by the excess off-peak capacity that exists in the electricity system—without building a single new power plant.

For utilities such as Southern California Edison, the challenge and the opportunity is to integrate electric transportation and their advanced batteries into a

total energy system.

Near-term

In the near-term, the advanced high-energy battery in a plug-in vehicle could

serve as a source of temporary emergency power for the home, or to occasionally

help customers avoid high electricity costs during peak pricing times. We call this

‘‘vehicle-to-home.’’

These same advanced high-energy batteries could also be used in stationary applications. Home owners could fill a home energy battery at night using low-cost electricity and then draw from it during the high-cost part of the day to help lower their

monthly utility bill.

Mid-term

In the mid-term as plug-in vehicles increase in volume, using the grid’s off-peak

capacity at night to charge these vehicles may actually help lower customer rates

by increasing the utilization of our generating plants—in effect utilities would

spread their fixed costs over more kilowatt hour sales.

To evaluate new business models on these and other applications, Edison recently

launched a partnership with Ford Motor Company to demonstrate and evaluate

‘‘purpose built’’ plug-in-hybrid Ford Escapes. Our goal is to explore the future customer values delivered through plug-in vehicles and stationary energy storage.

52

At the same time as the emergence of plug-in vehicles and home energy storage

is the advent of advanced utility meters. Over the next five years SCE will install

five million ‘‘next generation’’ advanced meters called Edison SmartConnect in the

home of every customer in our service territory. These meters will offer our customers better information and enhanced control over their electricity usage. Our

Electric Vehicle Technical Center is working with industry stakeholders to integrate

the vehicle and the home and the advanced meter.

Long-term

Finally, in the long-term we can imagine the potential of so-called ‘‘vehicle-to-grid’’ systems or the ability to move stored energy from many plug-in vehicles back up

to the grid. The potential however of vehicle-to-grid is many years away and will

depend on the development of all-new control technologies as part of the ‘‘smart

grid’’ of the future.

The Role of the Federal Government

Now let me conclude with our view on the important role the Federal Government

can play to bring the promise of electric transportation closer to reality.

In our opinion, large-scale domestic manufacturing capacity for high-energy advanced batteries is critical to the expansion of plug-in hybrid vehicle applications

and complementary stationary energy storage uses. There currently exists no such

capacity on a significant scale in the United States today. The Federal Government

should provide near-term incentives to help nurture U.S. production of this critical

technology.

And earlier this year H.R. 670, the DRIVE Act, included important measures to

support research, development and demonstration of advanced batteries in plug-in

hybrids, battery EVs and stationary applications, as well as R&D for other aspects

of electric drive technology. This language was then improved this summer by battery makers, automakers and other stakeholders, and has now passed the Senate

as H.R. 6, and parts of the DRIVE Act have passed the House as H.R. 3221.

We support this language and look forward to working with your committee to

explore other effective national manufacturing and consumer incentives to set the

stage for the breakthrough of plug-in vehicles and energy storage in the U.S. marketplace.

Mr. Chairman and Members of the Committee, we stand committed to partnering

with all automakers, battery suppliers, stakeholders and government to help realize

the vision I have laid out before you today.

Thank You.

BIOGRAPHY FOR LYNDA L. ZIEGLER

Lynda Ziegler is Senior Vice President of the Customer Service business unit of

Southern California Edison (SCE), one of the Nation’s largest investor-owned electric utilities. She is responsible for customer services to SCE’s 4.7 million customers,

including customer experience, industry-leading demand-side management programs and advanced metering, as well as customer-facing operations, phone center

activities, field services, account management, and local public affairs. She was

elected to the position on March 1, 2006.

Ziegler began her career at SCE in 1981 as a conservation-planning consultant.

She held a variety of positions including service planner and manager of energy efficiency, customer service and major accounts. She was most recently the Director of

the Customer Programs and Services Division until she was elected as Vice President of Customer Service on May 1, 2005.

Ziegler is a member of the EEI Customer and Energy Services Executives Advisory Committee, and is a member of the Marketing Executives Conference. Ziegler

also serves on the board of directors of Leadership California, an organization dedicated to educating high-level women on the issues in California and encouraging

women’s leadership in policy and public office. She also serves as Secretary on the

board of Partners in Care Foundation, an organization dedicated to improving

health care policy through demonstrating success.

She received her M.B.A. at California State University, Fullerton, and her Bachelor of Science degree in marketing from California State University, Long Beach.

In addition, she has participated in two special management development programs

at Southern California Edison.

Chairman LAMPSON. You are welcome and thank you. For those

of you who don’t know, those were our equivalent in the Science

Committee for bells for votes, so we will have votes in just a few

53

minutes. We shall proceed on until we have to leave, and we will

be watching the number of people for those votes.

So at this time, we will call on Ms. Gray for five minutes.

STATEMENT OF MS. DENISE GRAY, DIRECTOR, HYBRID ENERGY STORAGE SYSTEMS, GENERAL MOTORS CORPORATION

Ms. GRAY. Mr. Chairman and Members of the Committee, thank

you for the opportunity to testify today on behalf of General Motors. I am Denise Gray, director of the Hybrid Energy Storage Systems Department. I direct the development and the production of

energy storage systems for GM, with a focus on developing and

qualifying new battery-technology solutions.

For 100 years, the global automotive industry has run almost exclusively on oil. Tomorrow’s industry will not. The solution: alternative sources of energy, along with new technology to allow automobiles to run on tomorrow’s fuels. But what fuels? And what technology?

At GM, we believe that no one solution is right for part of the

world, or even every consumer in any given market, so our approach is simple: offer as many choices to as many consumers as

possible everywhere we do business, while offering the best possible fuel economy for whatever type of vehicles our customers

choose.

Our vision moving forward is to reduce petroleum dependency

and greenhouse gas emissions by displacing oil with biofuels and

electricity as well as enhancing vehicle efficiencies. And we have

developed a comprehensive advance-prolusion strategy to meet

these challenges. We are continuing to make incremental improvements in the efficiency of conventional vehicles. We are continuing

to expand the portfolio of flex-fuel vehicles, ramping up to 50 percent by 2012, provided the fuel infrastructure and supplies are

available.

We are continuing to expand the portfolio of hybrids we offer

with five hybrid offers available this year, and more coming next

year.

Most relevant to this hearing, we have started a plug-in program

for our Saturn VUE Greenline two-mode hybrid, followed by the introduction of our Chevrolet Volt concept vehicle.

And finally, we are continuing to develop hydrogen-powered fuelcell vehicles and the infrastructure needed to support such vehicles

with the largest market test of fuel-cell vehicles today, beginning

later this month.

As I mentioned earlier, this year brought the announcement of

a game-changing Chevy Volt, our first demonstration of an innovative new GM propulsion system called E–Flex. The ‘‘E’’ stands for

electric because all of the E–Flex vehicles will run on electricity.

The ‘‘Flex’’ in E–Flex is flexible because the electricity can come

from many different sources. GM E–Flex system is simpler than

hybrids, because it is purely electrically driven. Electricity is stored

in the battery pack, and used with electric motors to drive the car,

with the electricity from the battery obtained in two different ways.

First, you can plug in your vehicle in your common electrical outlet

to recharge the battery. This allows the vehicle to operate as a batVerDate 11-MAY-2000 10:14 Jun 08, 2008 Jkt 037987 PO 00000 Frm 00057 Fmt 6633 Sfmt 6601 C:\WORKD\E&E07\100307\37987 SCIENCE1 PsN: SCIENCE1
54

tery-electric vehicle. Second, once the battery charge from the electric utility grid is depleted, the battery can also be recharged by

a simple engine generator set or fuel cells. This allows you to extend your vehicle’s electric driving range to several hundred miles.

Let me turn to our battery technologies. There are really two

types of batteries that we require. The one most people are familiar

with is charge depletion. Think of this as a flashlight that depletes

its energy when used. And then you can either dispose of it, or you

can recharge it. It is the rechargeable version of this battery that

we are most interested in for plug-in hybrids. This is a new area

of focus for the U.S. Advanced Battery Consortia (USABC).

The other type of battery is known as charge sustaining. These

batteries are designed to accept and deliver power while maintaining a constant state of charge. They never deplete. Charge sustaining batteries are used in hybrids on the roads today, such as

our Saturn Aura hybrid. They store up energy captured during

breaking and reapply it to help the vehicle accelerate. Charge sustaining batteries have progressed to the point where many OEMs

are able to offer these hybrid vehicles. We owe much of this success

to the work of DOE and USABC with the supplier community.

For plug-in vehicles, what we really need are high-energy chargedepletion batteries that also have power, so we are looking for both

of those attributes. To bring these new hybrid batteries to market,

GM is using a multi-phase process that starts with qualifying these

lithium ion cells. Then we develop these, and we go through a

number of different tests as a battery pack, with performance attributes such as life, durability, reliability, and finally we work

through our vehicle integration process to make sure that these

batteries can live in our vehicles.

Again, I must make sure that with these points in mind, we have

to follow the various concepts, if you will, that are outlined in our

various plans. Again, with this, I stop and look forward to your

questions. Thank you so very much.

[The prepared statement of Ms. Gray follows:]

PREPARED STATEMENT OF DENISE GRAY

Mr. Chairman and Members of the Committee, thank you for the opportunity to

testify today on behalf of General Motors. I am Denise Gray, director of Hybrid Energy Storage Systems. I direct Development of Hybrid Energy Storage Systems for

GM with a focus on developing and qualifying new battery technology solutions. It’s a daunting task for our team (and all of us as an industry) to develop and produce

vehicles with these advanced battery systems in a robust and timely manner.

For 100 years, the global auto industry has run almost exclusively on oil. Tomor- row’s industry will not. The solution: alternative sources of energy, along with new

technology to allow automobiles to run on tomorrow’s fuels. But what fuels? And

what technology?

At GM, we believe that no one solution is right for every part of the world, or

even every consumer in any given market. So our approach is simple: offer as many

choices as possible, to as many consumers as possible, everywhere we do business.

And regardless of the fuel, regardless of the technology, our goal remains the

same—the best possible fuel economy for whatever type of vehicle our customers

choose. That’s why we offer more cars that get 30 mpg highway than any other

automaker.

Our vision moving forward is to reduce petroleum dependency and greenhouse gas

emissions by displacing oil with biofuels and electricity, as well as enhancing vehicle

efficiencies. Over time, the goal is to reduce vehicle emissions to zero and make personal mobility truly sustainable, but it will take a variety of powertrain and fuel

technologies to get there. And we have developed a comprehensive advanced propulsion strategy to meet these challenges.

55

First, we’re continuing to make incremental improvements in the conventional vehicles that we produce (e.g., six-speed transmissions, active fuel management). Currently, we have over two and one-half million flex fuel vehicles ‘‘FFVs’’ on the road

today with 16 FFV offerings in the 2007 model year. We’re continuing to expand

the portfolio of FFVs, ramping up to over two million vehicles a year by 2012—provided the fuel infrastructure and supplies are available.

Second, we’re continuing to expand the portfolio of hybrid vehicles that we offer.

For 2007, GM hybrids include: the Saturn VUE Green Line, and Saturn Aura Green

Line and beginning next month, the Chevy Malibu, the Chevrolet Tahoe and GMC

Yukon will offer hybrid models using our advanced two-mode system. For 2008, the

two-mode hybrid system will be added to the Chevrolet Silverado and GMC Sierra

pickup trucks and to the Cadillac Escalade. The Saturn Vue Green Line will also

get the advanced two-mode hybrid system.

And third, beginning with the Los Angeles and Detroit auto shows, we created

quite a stir with the announcement that we have started a plug-in program for the

Saturn VUE Green Line two-mode Hybrid, followed by the introduction of the Chevrolet Volt concept car.

We’re also continuing to develop the fuel cell capabilities needed to produce hydrogen powered fuel cell vehicles and the infrastructure needed to support such vehicles. Later this month, we will roll out the first of a fleet of 100 Chevy Equinoxes

for Project Driveway, the largest market test of fuel cell vehicles to date.

The E–Flex Architecture

The Volt is our first demonstration of an innovative new GM propulsion system

called ‘‘E–Flex.’’ The ‘‘E’’ stands for ‘‘electric,’’ because all E–Flex vehicles will run

on electricity. And E–Flex is ‘‘flexible’’ because the electricity can come from many

different sources. The Volt is designed as a flex fuel vehicle capable of running on

gasoline or E–85 ethanol. In Shanghai, we showed the fuel cell variant of E–Flex

in a fuel cell Volt. And most recently, in Frankfurt, we showed the bio-diesel variant

of E–Flex in the new ‘‘Flextreme’’ concept car. By offering a system that drives vehicles with any of these fuels, E–Flex will provide our customers around the globe

with a single elegant solution to tomorrow’s energy future.

E–Flex consists of a common drivetrain that uses electricity created and stored

on board the vehicle in a variety of ways. This includes creating electricity with a

simple engine and generator, creating electricity from a hydrogen fuel cell, and storing electricity in an advanced battery by plugging the car into the electric utility

grid. E–Flex enables energy diversity because electricity and hydrogen can be generated from a wide range of energy sources.

GM’s E–Flex system is simpler than a hybrid because it is purely electrically driven. Electricity is stored in a battery pack and used with electric motors to drive the

car, with the electricity for the battery obtained in two ways. First, you can plug

the car into a common electrical outlet to recharge the battery. This allows the vehicle to operate as a battery-electric vehicle. Second, once the battery charge from the

electric utility grid is depleted, the battery can also be recharged by a simple engine/

generator set. This allows you to extend your vehicle’s electric driving range to several hundred miles.

Battery Technology

There are really two types of batteries that we require. The one most people are

familiar with is called ‘‘charge depletion.’’ Think of this as a flashlight battery that

depletes it energy with use, and then is either disposed of or recharged. It is the

rechargeable version of this battery that we are interested in for plug-in hybrids.

This is a new area of focus for USABC.

In addition to charge depletion, there is another type of battery known as ‘‘charge

sustaining.’’ These batteries are designed to accept and delivery power while maintaining a constant state of charge—they never deplete. These charge sustaining batteries are in use in hybrid vehicles on the road today, such as our Chevy Malibu

and Saturn Aura hybrids. They store up the high power energy captured during

braking and reapply that energy to help the vehicle accelerate. Although charge sustaining batteries have not yet met their cost and durability targets as defined by

USABC, they have progressed to the point where many OEMs are able to offer a

limited number of hybrid vehicles. We owe much of this success to the work of DOE

and USABC with the supplier community.

For the future, what we really need are high energy ‘‘charge depletion’’ batteries

necessary for plug-ins that also have the ‘‘power’’ of charge sustaining batteries to

handle the re-generative braking and other high power situations of conventional

hybrid vehicles.

56

To bring these new energy hybrid batteries to market GM is using a multi-phase

process which starts at qualifying Lithium Ion cells, proving out key performance

cycle life, power, calendar life, and then developing and testing battery packs to

evaluate system performance attributes. Finally we work through important integration issues at the vehicle level such as thermal, interaction with hybrid controls,

and durability.

All this work is necessary as a precursor to declaring a solution ‘‘implementation

ready’’ and planning it into a production program. While this is a sequential process

with some overlap it can take up to five years. Currently, our challenge is to parallel

path key work streams to develop the battery solutions and vehicle in a faster timeframe.

In a traditional hybrid, the battery provides electric vehicle operation at low

speeds, recharges only while driving, and is designed for very limited electric only

drive. A plug in version of a traditional hybrid, such as our design for the Saturn

VUE two-mode hybrid would need to provide over 10 miles all electric drive, charges

while driving and when plugged in. In our design for the Volt Range Extended Electric Vehicle, the battery would provide at least 40 miles in city driving. It would

be charged through and on-board generator, regenerative braking and when plugged

in. Each of these carries a very challenging goal of being ‘‘life of vehicle’’ solutions.

For example, the discharge power for two-mode plug in hybrid is marginally higher than for a traditional hybrid. However, the Volt would require roughly three

times more than traditional hybrids. In terms of energy, the difference is even more

drastic. Range Extended Electric Vehicles like the Volt require significantly more

energy than traditional hybrids.

Currently, NiMH batteries typically provide about 70 whrs/kg. Lithium-ion batteries represent a significant improvement over NiMH in terms of both power and

energy. Energy formulations of Lith-Ion can provide higher specific energy, but

lower power. Range Extended EVs, like the Volt, would need a more optimized balance of power and energy. Big challenges also remain in terms of thermal management & life.

GM has awarded advanced battery development contracts to two suppliers to design and test lithium-ion batteries for use in the VUE plug-in hybrid: the first to

Johnson Controls and Saft Advanced Power Solutions, and a second to Cobasys and

A123Systems. Both teams are being challenged to prove the durability, reliability

and potential cost at mass volumes of their technology. The two test batteries will

be evaluated in the prototype VUE plug-in hybrid beginning later this year.

In developing advanced batteries, OEMs and component suppliers have many

similar objectives and needs. Auto OEMs need to determine which technologies and

pack solutions are most promising. We need to develop strategies that maximize bill

of materials reuse and move toward more plug and play solutions. As technology

evolves, suppliers are looking for revenue stream quickly, reducing the amount of

OEM specific work and not have to burden the entire risk of introducing new battery technology in the market. Both OEMs and suppliers should focus on the things

they are good at and leverage others for things they are not.

Qualification of design solutions is the first big hurdle to enable both charge sustaining and charge depleting hybrids with Lithium Ion batteries. Once these solutions have met ‘‘design readiness’’ we need to quickly and in parallel, move toward

high reliability and high volume battery ‘‘manufacturing readiness’’ as a parallel

path that needs significant focus and funding support. Many of the leading battery

suppliers have shared that it takes up to two years to ramp up high volume production once the high volume manufacturing process and equipment have been developed.

As an automotive industry, we are reliant on these rapid advancements in order

to consider scaling to high volume the vehicle solutions that will use these batteries.

Legislation

As we assess pending legislation, we believe that as a general matter Congress

should support initiatives that will accelerate the process and industrialization

needed to ramp to high volume Lithium Ion battery manufacturing and subsequent

access to these developed products that will help us together bring to life the sustainable mobility vision for our industry and for our nation. The additional funding

for energy battery development that Congress has provided DOE and USABC is a

good start. It will help our suppliers develop near-term battery chemistries required

if we are going to be commercially successful in the next few years. However, as

an industry, we also recommend last November in response to a White House request that Congress provide funding support for manufacturing and facilities development for potential U.S. suppliers. This will be essential if these new battery

chemistries are to be manufactured in the U.S. at a cost and reliability level that

57

will enable more than just niche market success sooner than would others be possible.

We also recommended that more funding be provide for long-term research into

new, novel approaches to batteries. The potential of lithium-ion appears to be limited to plug-ins and other short all-battery operation mode vehicles. We will need

all new batteries approaches if we want to extend the range of vehicles to the point

where an internal combustion engine or fuel cell generator would not be required.

With these points in mind, we have the following comments on the Discussion

Draft you provided us for review. First, we support the overall authorization levels

for both basis and applied research into energy storage. If fully funded at these levels, the proposed research program could materially speed up the development of

advanced batteries. Second, the direction to conduct demonstrations of advanced energy storage systems could make a valuable addition to the development of plug in

vehicles, although funding is not specified in the bill.

One issue that is not clear from the draft is the relationship between this research

program and ongoing DOE battery research programs, and the roles of USCAR and

USABC in the new program. In general, we believe new legislation should build on

the existing DOE structure and not seek to create a parallel research program.

Another issue is the scale of any demonstration programs. We believe that in the

2009–2014 timeframe, demonstration programs should be of limited size. As with

fuel cells, we learn most of what we need to know with relatively few vehicles involved—placing thousands of vehicles in a demonstration program yields limited

marginal returns. Within this time window, we look beyond demonstration programs to early purchase programs where federal procurement of early vehicles—realizing that they will be more expensive than today’s vehicle technology.

We suggest that the Committee consider transitioning from demonstration programs to buy-down programs to reduce the cost of cutting edge technologies to federal and State agencies. Sections 782 and 783 of the Energy Policy Act of 2005, dealing with early federal and state purchases of fuel cells, may offer a model for plugin vehicles.

Thank you.

BIOGRAPHY FOR DENISE GRAY

Employed by General Motors since September 1980.

Current assignment is Director Hybrid Energy Storage Systems. Position responsibility consists of advance development, design, release, validation of battery system solutions for GM Hybrid and Range Extender vehicles.

Previous assignments include the following.

Director of Transmission Controls. Responsible for design and release of Transmission Algorithms and Calibrations, Electromechanical devices, and Torque Converters for four-speed, five-speed, and six-speed transmissions. These transmissions

are integrated into GM conventional powertrains as well as hybrid powertrains.

Director of Engine and Transmission Controller Systems Integration and Director

of Engine and Transmission Software Engineering. Both positions engineered controller hardware and algorithm/software solutions into GM vehicles worldwide. The

job elements contained design, development, and verification of complex engine and

transmission controls systems to meet worldwide emissions and safety standards

while meeting customer driveability requirements.

GM Vehicle Engineering experiences include electrical systems development and

validation. Some of the electrical systems include instrument clusters, entertainment systems, lighting systems, and anti-lock braking systems. Assignment locations also included GM’s manufacturing and assembly facilities.

Educational accomplishments include BS Electrical Engineering from Kettering

University (formally GMI) in 1986 and MS Engineering Science—Management of

Technology from Rensselaer Polytechnic Institute in 2000.

Proud wife and mother of two sons.

Chairman LAMPSON. Thank you, Ms. Gray. Ms. Wright, you are

recognized for five minutes, and at the conclusion of that, we do

have three votes, and we will be in recess long enough for us to

make those votes, probably half an hour.

58

STATEMENT OF MS. MARY ANN WRIGHT, VICE PRESIDENT

AND GENERAL MANAGER, HYBRID SYSTEMS FOR JOHNSON

CONTROLS; LEADER, JOHNSON CONTROLS–SAFT ADVANCED

POWER SOLUTIONS JOINT VENTURE

Ms. WRIGHT. Very good. Thank you, Mr. Chairman and Members

of the Subcommittee. It is a pleasure to be here. And my hope is

when we all walk out of this room for you to go vote that you will

have a better understanding of what the state of play is for battery

technology and how we are applying that battery technology into

the various hybrid applications.

Before joining Johnson Controls, I was with Ford most of my career, where I was the chief engineer of the Escape Hybrid. And Mr.

Inglis, I was also the chief engineer for the fuel cell program and

the hydrogen internal combustion program. So I am going to do two

things today. One is what is the state of play of hybrid battery

technology, and what is going on relative to putting that technology

into the vehicle.

As Denise said, on the road today, we have a lot of hybrids. They

are powered by nickel-metal hydride batteries. And I have to tell

you that in the industry we have done a really good job of creating

acceptance and confidence in the technology. They are reliable.

They perform well. They are safe, and they deliver really good fuel

economy and lower emissions. But like anybody’s technology, your

iPod or anything else, technology continues to move forward.

Now, what we are doing is you are seeing this journey go on from

nickel-metal hydride to lithium ion. And it is the right step: they

are smaller; they are more powerful; they are lighter; they are

equally safe. And the exception, obviously, is the economic benefits

are going to come along with them as well, and along with those

benefits, you get better fuel economy, better emissions performance

because they are lighter. Weight is the evil in a vehicle for fuel

economy.

Now, not all hybrids are alike. At the break, we had an interesting discussion, and one of the things I want everybody to understand is there are several different types of hybrids. We have hybrids that are on the road today, readily available for all of us to

purchase and drive. Mr. Bartlett drives his Prius. I have an Escape. Starting with the stuff that is here today, we have micro-hybrids. Those are basic start-stop function hybrids. They are widely

available in Europe. In fact, Johnson control will put over 400,000

of these batteries in vehicles this year over in Europe. And they

have a pretty good efficiency rating of about 10 percent fuel economy and CO2 reduction benefits.

Moving up the spectrum, we have mild hybrids. That you would

probably think of as a Honda Accord. It delivers about 30 percent

improved fuel economy and emissions and provides a bit more

functionality, as Denise said, regenerative capability.

And then, finally, we have the full hybrid, and an Escape hybrid

and a Toyota Prius are a full hybrid. You can power the vehicle on

electric power alone, which clearly would provide increased economy relative to fuel consumption, as well as reducing CO2 emissions.

All of these are on the road and available today. In fact, Johnson

Controls, next year, will be putting our first lithium ion batteries

59

in the Mercedes S–Class, which will go on sale in the United States

in 2009. And they are also ready to go into the full hybrid.

If you take the journey a bit further, now we are talking about

plug-ins and pure EVs and there is an awful lot of, deservedly so,

excitement about the opportunity with plug-ins. They are very

promising, significant improved fuel economy and emissions. I

mean literally, you can have zero emissions and a very, very high

fuel economy rating. Lithium ion, clearly, is the enabler, just because of the physics of the battery—they are smaller and lighter—

because of all of the energy that is going to be required to be able

to propel these vehicles.

Just as the lithium ion is the enabler, it is also the biggest technical challenge that we have on the table, and it is working with

my customers, such as Denise, to try and overcome these challenges as an industry. Now, in Johnson Controls, we have a lot of

partnerships in play right now, with GM on the Saturn VUE, with

Southern Cal, with Ford Motor Company on a plug-in fleet, and

clearly all of the great work that is going on with USABC as well

as the Chrysler Sprinter Vans that are going on sale next year.

We are going to solve these technical problems. I am absolutely

convinced of that because I sat in this seat about four years ago,

talking about hybrids and just getting them on the road. But then,

what you are faced with is what are you going to do about the cost

and the economics? We have got to get this scale up. We have to

get standard. We have to put a recycling infrastructure in place.

We need domestic manufacturing capability. We have to establish

a diverse supply base outside of Asia.

So in conclusion, we are confident we are going to be able to get

to commercialization by solving the technology and working towards these cost drives. But it is going to take Federal Government

assistance. We are going to need to continue to fund research, and

not for just the stuff we are doing today. Clearly, we need that, and

we need demonstration fleets. We also need to fund the next great

breakthrough, because just like lithium ion was a breakthrough,

next is going to be something else. The consumer and manufacturing incentives are sure enablers to help us with this. Funding

manufacturing investment and infrastructure and supply-base development, we have to facilitate collaboration between the industry,

our government labs, the automakers and the utilities to see this

all come to fruition in a way that we can see mass commercialization.

So in summary, recognizing that you all need to go and vote,

thank you very much, and I look forward to answering your questions.

[The prepared statement of Ms. Wright follows:]

PREPARED STATEMENT OF MARY ANN WRIGHT

Mr. Chairman and Members of the Subcommittee, my name is Mary Ann Wright.

I am the Vice President and General Manager of the Hybrid Battery Systems business at Johnson Controls, headquartered in Milwaukee, WI. I also serve as the

Chief Executive Officer of the Johnson-Controls Saft Advanced Power Solutions

(JCS) joint venture. JCS was formed in January of 2006 specifically to address our

customers’ needs for advanced battery systems for hybrid vehicles, plug-in hybrid

vehicles, and electric vehicles. In addition, I serve on the Board of Directors of the

Electric Drive Transportation Association (EDTA).

60

I greatly appreciate the opportunity to discuss with you today the options and

challenges that America faces as it moves down the road towards the goal of a sustainable transportation future. I am honored that you have asked me to speak before you today on a topic so critical to the security, economic vitality, and environmental stability of our country and planet.

Electrification of Vehicles

Clearly, the United States is at a crossroads. We face a double-edge sword: the

world’s supply of crude oil is approaching maximum output while the specter of an

environmental future compromised by green house gas-induced global warming continues to grow. As President Bush stated in his 2006 State of the Union speech we

must change the way we power our buildings, homes, and vehicles. Today, I would

like to discuss specifically what can be done on the vehicle side of the ledger.

The focus of my discussion will be vehicles with electrified drivetrains, powered

by advanced battery systems. A key to this discussion will be differentiating hybrid

battery applications in the range of micro to full hybrids, that have been proven

using NiMH chemistry and are in the final validation phase using Li-Ion, from battery applications which have not yet been fully validated for functional performance

and life; plug-in hybrids and pure electric vehicles. However, first I would like to

comment on other credible powertrain technologies that can help us transform the

way we power our automobiles, trucks, and buses. Given the continuing upward

trend in vehicle miles driven annually in the United States, incremental increases

in spark (gasoline/ethanol) and compression (diesel) ignition engine efficiency, while

desirable and attainable, will not be sufficient to substantially reduce America’s dependence on crude oil. Increased production and use of biomass derived motor fuels

(e.g., ethanol) are important from an energy security standpoint, and have the potential to significantly advance progress towards the President’s 20 in 10 goal. Affordable Fuel Cell (H2) vehicles and an infrastructure to produce and distribute hydrogen are many years away from commercial viability.

I passionately believe that electrification of the vehicle powertrain in part or in

whole can make a dominant contribution to America’s energy security and transportation sustainability. Electric powertrains by nature are incredibly more efficient

than their internal combustions counterparts. This efficiency prowess is the foundation of the hybrid advantage. The additional benefit of electrified powertrains is that

they can be used as complementary technology to internal combustion engine

drivetrains or as stand-alone technology, e.g., pure electric vehicles. Despite the

proven benefits in terms of fuel economy and emissions, we face substantial challenges to widespread adoption of hybrid vehicles in the United States. Currently,

neither the domestic market-pull nor the domestic manufacturing technology-push

is sufficient to drive a sustainable electrified powertrain vehicle industry. Contrary

to a popular notion, battery performance is NOT the barrier to widespread adoption

of standard hybrid vehicles. In fact, Johnson Controls is the leading supplier of advanced lead-acid battery technology, called AGM, for use in micro hybrid automobiles as well as hybrid transit buses. Next year Johnson Controls will launch its

first production Li-Ion battery system for the Mercedes-Benz S–Class mild hybrid.

You may be familiar with Nickel-metal hydride (NiMH) batteries. NiMH battery

technology is a proven, mature technology that to date has captured nearly 100 percent of the HEV battery market. Yet Li-Ion, due to its lower mass, reduced volume,

higher power and energy, faster recharging, and lower cost potential is expected to

overtake NiMH as the battery technology of choice by 2012. From 1988 to 2005, I

worked for Ford Motor Company. I was the Chief Engineer for the Escape Hybrid

SUV, the first domestic hybrid which was successfully launched in 2004. Since then

total global sales for the hybrid Escape and it sister vehicle, the Mercury Mariner

hybrid, have exceeded 59,000 units. The Escape hybrid utilizes NiMH battery technology. I also led the team that launched the first hydrogen fuel cell demonstration

fleet. These vehicles also use the same NiMH battery technology as in the Ford Escape. Please see Figure 1 on page four for a comparison of the NiMH and Li-Ion

technologies.

61

Rather than battery technology, the major issues impeding broader acceptance of

HEVs in the United States are:

1) Relative insensitivity to motor fuel prices on the part of the American consumer, thus inhibiting the desire to purchase a hybrid vehicle at a cost premium.

2) An underdeveloped domestic industry for manufacturing raw materials and

key components necessary to produce hybrid powertrains.

To better understand the domestic factors currently suppressing hybrid vehicle

sales, it is helpful to look at the hybrid advantage from a global perspective. In Europe, the vehicle manufacturers are aggressively pursuing the spectrum of nearterm hybrid technologies—micro, mild, and full, while continuing to improve the diesel engine technology that has traditionally enjoyed tremendous popularity. Because

of the high fuel prices and CO2 reduction targets self-imposed by European OEMs,

the incremental costs of hybrid technology is less daunting to would-be purchasers.

In Asia, and particularly China, there is a tremendous amount of activity focused

on the rapid development of hybrid and fuel cell vehicles. In the People’s Republic

of China, the government has set very aggressive goals for the introduction and proliferation of ultra-efficient and clean vehicle technologies.

The United States is somewhat unique in that our relatively low motor fuel prices

and current lack of CO2 emissions reduction mandates also contribute to stunted

demand for high efficiency vehicles such as hybrids. Fortunately, there is a remedy,

but it will require a phased-technology plan and government assistance at the federal and perhaps State and local levels as well.

Phased Technology—A Journey

I see the development of a strong hybrid vehicle industry and market in the U.S.

as a journey, not just a destination. As is the case with most journeys there are key

achievements points or milestones along the way. Figure 2 illustrates the Hybrid

Journey—a technology evolution that builds on hybrid technologies available

62

today—yes, today. I urge the Congress to implement policies that accelerate the

commercialization of micro, mild and full hybrid vehicles in the United States.

The plug-in hybrid concept has garnered substantial attention over the last 18

months and deservedly so. Congress has heard testimony extolling the virtues of

plug-ins and their promise to eradicate our energy and environmental problems.

Without question, plug-in hybrids are a promising technology. The plug-in approach

has the potential to double vehicle fuel economy while displacing imported oil with

domestically produced electricity. The environmental benefits could be massive, particularly if recharging is done using predominantly renewable energy sources for

electricity generation. Demonstration vehicles, like those being operated by Sacramento Municipal Utility District are registering fuel economy over 90 mpg. The

key tasks needed to make PHEVs a reality are: 1) accelerated technology, particularly the Li-Ion battery development; and 2) further assessment of the commercial

opportunities and issues by the public and private sectors. The assessment phase

should include a plan for the development of a recharging infrastructure throughout

the country to ensure that the benefits of PHEVs could be maximized. Also, because

PHEVs by definition will at times be ‘‘on the grid,’’ it is imperative that all stakeholders, but in particular, the vehicle OEMs, the supply base and the utility industry, engage in frank discussions about the cost/benefits that will be encountered.

Unlike the case for micro, mild, and full hybrids, there are significant battery technology barriers to the commercialization of PHEVs. A strong partnership between

the public and private sectors will be needed to tear down these barriers. A successful outcome from this endeavor would serve as a giant step forward in achieving

the ultimate embodiment of highly efficient and environmentally responsible transportation—the pure electric vehicle.

Johnson Controls has a development contract with General Motors to furnish

PHEV battery systems technology for the Saturn Vue Green Line vehicle. We are

also partners with Southern California Edison and Ford to deliver PHEV demonstration fleets. Earlier this year, Johnson Controls announced a partnership with

Daimler and Chrysler to provide Li-Ion batteries for Sprinter van demonstration

fleets. In addition, the Department of Energy announced on September 25th that

63

Johnson Controls will be awarded a PHEV battery development contract for 10 mile

and 40 mile electric range vehicles. We are proud to continue our mutually beneficial relationship with DOE and the United States Advanced Battery Consortium,

and look forward to accelerating the development of commercially feasible technologies for PHEV battery systems. Next, I’d like to concentrate on two words from

the previous sentence—commercially feasible.

Reducing the Cost of Battery Systems

During my stint as Chief Engineer for the Escape hybrid SUV my team had to

focus on the same acceptance criteria demanded by purchasers of conventional automobiles: style, performance, comfort, convenience, reliability, quality, serviceability,

safety, and last but not least, cost. There is certainly a place early in the product

development cycle for demonstration vehicles produced with recognition that costs

will be high, but the bottom line is this: A successful HEV (all types of HEVs) vehicle industry and market in the United States must be based on satisfying these required criteria. These requirements are demanded by our customers and/or mandated by the government and they must be delivered at an affordable cost and acceptable market price.

So, although the battery technology is in the final validation phase to drive forward the market for micro, mild, and full hybrid, other elements needed for marketplace success, notably cost, are in a very early stage of development. The resolution

path to ensure a long-term economically successful HEV industry in the United

States must elevate cost reduction to the highest priority. Johnson Controls is confident that there are no insurmountable technical issues prohibiting the eventual

widespread use of Li-Ion battery technology as the heart of standard hybrid vehicle

drivetrains. Other issues separating it from commercial viability are:

• insufficient field experience,

• lack of domestic manufacturing infrastructure

• adequate sales volume to achieve economies of scale

• supply base diversity beyond Asia

• technical standards to drive common architectures

These challenges can be overcome in a compressed timeframe with sufficient federal assistance. Specifically, we propose a partnership between the appropriate Federal Government agencies, the battery manufacturers, and the lower Tier supply

chain companies to drive down costs by focusing on the three following elements:

1) Material and component manufacturing and supply base development, 2) Process

development and recycling, and 3) Equipment development.

1. Material and Component Manufacturing and Supply Base

Currently, we obtain almost all of our critical battery materials and system components from Asia. We need to develop a North American supply base for:

• Cell materials

• Oxides

• Carbonaceous and graphitic additives

• Separators

• Electrolyte

• Roll stock aluminum and copper

Although the battery system is central to this discussion, other HEV system components are of similar concern from the standpoint of an insufficient domestic manufacturing base including:

• Power electronics

• Drivetrain electromechanical devices

• A secure supply of strategic materials, e.g., lithium ore

2. Process Development and Recycling

Another cost reduction opportunity is in the processes used to convert the basic

battery materials and components into finished products. For example, today the

electrode manufacturing process is time intensive, energy intensive, and environmentally challenging. A new electrode manufacturing process can be developed that

would be a lower cost process, which is more environmentally friendly, saves energy

and could potentially enhance battery life. Also, significant economic and environmental advantages can be realized through recycling spent battery systems. This

64

can involve both re-use of certain components and re-processing of components containing strategic materials; e.g., nickel and lithium. Currently, over 97 percent of

all lead-acid automotive batteries are recovered for recycling. Although recycling

processes exist today for NiMH and Li-Ion batteries, technology development programs aimed at cost-reductions goals should include recycling.

3. Manufacturing Equipment Development

To achieve an optimal balance between product cost and creation of a sustainable

domestic manufacturing base we must also focus on the equipment needed to execute the advanced processes discussed above. We need to work with domestic equipment manufacturers to develop large, production-scale equipment with a high degree of automation capable of obtaining higher speeds compared to the smaller

prototyping and development-scale equipment currently in use.

There is also a large cost savings potential in improving the design of the cell for

manufacturing. Identifying a design change might save several steps in the manufacturing process, thereby saving time and cost. In addition to the electrochemical

cells, the battery system requires additional components and subsystems to provide

critical functions, such as thermal management. Domestic manufacturing of non-cell

componentry should also be factored into policy-enabled mechanisms to advance the

commercial viability of hybrid vehicle technologies. A high level listing of the barriers to sustainable commercialization of hybrids in the United States and proposed

enabling countermeasures are shown below in Figure 3.

We would urge Congress to consider legislation to stimulate advanced battery development, including the following detailed provisions:

• Research and development programs to maintain our nation’s competitive advantage in the basic and applied areas of energy storage R&D

• Demonstration programs to accelerate the development of batteries and battery systems

• Demonstration programs to accelerate the development of advanced manufacturing technologies to reduce production costs

• Loan guarantees for capital investment

• Battery industry and supply chain programs to secure a low cost economically

competitive industrial base in the United States

• Strategies to secure long-term critical material supplies

• Fleet programs to prove-out advanced technologies

• Tax incentives for micro, mild, and full hybrids

Æ Automotive manufacturer incentives to drive domestic production and

supply of hybrid systems

Æ Consumer purchase incentives

• Carbon-based fuel efficiency regulations (miles per carbon content rather than

liquid volume)

• Increased role of the battery manufacturers in determining the goals and

technical direction for development programs including more direct interaction with national laboratories and institutions of higher learning

65

• Integrated activities involving all stakeholders:

Æ OEMs

Æ Battery manufacturers

Æ Federal Government agencies

Æ Consumers

Æ Electric Power industry

Æ Fuels industry

Æ Labs

Æ Academia

In closing, I would like express my gratitude to this committee for taking the time

to hear my testimony. I hope that you consider my comments in the spirit of cooperation guided by the goal to secure the economic and environmental future of the

United States.

Johnson Controls looks forward to taking the hybrid journey with Congress. We

are energized and ready to go.

Thank you for your time and attention.

BIOGRAPHY FOR MARY ANN WRIGHT

Mary Ann Wright is the Vice President and General Manager, Hybrid Systems

for Johnson Controls, and also leads the Johnson Controls–Saft Advanced Power Solutions joint venture. Wright joined the company in March 2007.

Wright is responsible for accelerating the growth and executing the launch of hybrid, plug-in hybrid and electric vehicle battery programs with emphasis on state

of the art technology, manufacturing and electronics integration.

Prior to joining the company, Wright most recently served as Executive Vice

President Engineering, Product Development, Commercial and Program Management for Collins & Aikman Corporation since February 2006. Prior to joining Collins

& Aikman, she served as Director, Sustainable Mobility Technologies and Hybrid

Vehicle Programs at Ford Motor Company. In this capacity she was responsible for

all hybrid, fuel cell and alternative fuel technology development. Wright also served

as Chief Engineer of the 2005 Ford Escape Hybrid, the industry’s first full hybrid

SUV. She began her career at Ford in 1988, holding a variety of positions in finance,

product and business planning, and engineering. She also played a major role in the

launch of multiple vehicles at Ford including the initial Mercury Villager and Nissan Quest, and successive versions of the Ford Taurus and Mercury Sable.

Wright has been recognized by Automotive News as one of the ‘‘Leading 100

Women in the Automotive Industry.’’ She earned a Bachelor’s degree in Economics and International Business from the

University of Michigan, a Master of Science degree in Engineering from the University of Michigan and a Master of Business Administration degree from Wayne State

University.

Chairman LAMPSON. Thank you very much. We shall stand in recess for our votes. See you shortly.

[Recess].

DISCUSSION

GOVERNMENT ACCELERATING INDUSTRIALIZATION

Chairman LAMPSON. The automobile industry practically invented high-volume manufacturing. Why is the Federal Government needed to accelerate industrialization in this area, and what

can DOE do that the industry cannot do? Either of you?

Ms. WRIGHT. Well, actually, I came with a whole list of specific

projects that I would go and talk to my friends at DOE about relative to high volume manufacturing. We are presently completing

the construction of our first lithium ion facility in Nersac, France.

I wish I could say it was Nersac, Maryland or something. And one

of the things that we are learning is that we have good capability

to produce good quality hybrid cells, but it is not at the level that

66

we need to be producing them in the qualities and at the cost levels

that you do for cell phones and for laptop computers. We know very

well the kind of help that we need, that we need help from the government labs, DOE and other federal resources, and I would be delighted to share those specific projects with you that would, indeed,

enable us, here in the United States, to be able to get a leg up on

the high-volume manufacturing at affordable costs.

GOVERNMENT AND BATTERY MANUFACTURER PARTNERSHIPS

Chairman LAMPSON. To drive down costs and to spur development of advanced batteries in the U.S., you propose a partnership,

Ms. Wright, between federal agencies and the battery manufacturer’s lower tier suppliers. Let me ask you three questions. Do these

partnerships not already exist in the forms like the U.S. Advanced

Battery Coalition? Does the DOE partner directly with the battery

manufacturers and lower-tier suppliers in R&D projects, or is it

mostly conducted through partnerships with automobile manufacturers? Or is there a need for diversifying the pool of participants

in federal vehicle-related R&D?

Ms. WRIGHT. You know, clearly we do have partnerships that are

established, and they are good partnerships. Through DOE funding, USABC freedom card—those are all great forums. But I would

suggest to you that what we need now is to really look at it in two

pieces in terms of improving our partnership.

One is being able to take the technology that is ready to go forward and be commercialized in high volumes at affordable costs

and support that as an industry with the automotive manufacturers, the battery suppliers, and the Federal Government, including

the labs, who can help us with the intellectual-property generation,

and get those into demonstration fleets to absolutely build the confidence and the capability to do it on a high volume.

The second piece—and this is where I don’t think that we have

the emphasis that we need—that is the what comes next. We tend

to focus too much on getting through a specific project rather than

we will solve this, but what is going to come after that? Because

I assure you everybody else in the world is already thinking about

that. And I think, in terms of—the partnerships really are through

the USABC in terms of our day-to-day interaction, so the direct

work really comes through the USABC at the direction of DOE. I

would encourage more direct interaction between DOE, the automotive manufacturer, the industry, as well as the suppliers.

And then, finally, I think you had a question on diversification

of who should be involved?

PARTICIPANTS IN VEHICLE-RELATED R&D

Chairman LAMPSON. Who are the participants in vehicle-related

R&D?

Ms. WRIGHT. I think, you know, we are actually in fairly good

shape relative to who is participating, you know, in these established forums, and I think, clearly, if you take a look at how the

automotive manufacturers are partnering up, they are taking advantage of everything that is available to them. Unfortunately,

67

there are only a few of us that are based, here, in the United

States.

Ms. GRAY. If I could add in that area as well, I think USABC

and DOE have done an excellent job, thus far, to getting us to

where we are. But our product is still high cost. Our product still

doesn’t have a quality it needs to go. We need to take a step change

in allowing us to understand more, apparently, how these applications are going to work, learning cycles. We can stay in the research, we can stay in the what-if kind of mode for awhile, but in

order to really get to a commercialization of where this has to go,

you have got to have demonstrations. You have got to manufacture

the production, and you have got to have exercising activities from

a learning perspective. And the cost of these energy storage systems, these batteries, are high in the beginning, and you have got

to have means by which you get some quick learning cycles, and

then you have go to have a means for the customer to be able to

buy these kinds of things. So they’ve got to have some incentives

to bring it down so the customers don’t assume all of the cost, but

then, rapidly, at the same very time, you have got to build up your

manufacturing capacity in the States in order to continue and sustain that cost curve, because if you don’t do that, you will end up

having one system that works, and all of a sudden, it is gone away,

and technology has passed you up.

Chairman LAMPSON. I shall call on Mr. Inglis, and then I shall

come back and ask a second.

CHEVY VOLT

Mr. INGLIS. Thank you, Mr. Chairman. We are here at the

Science Committee, and you know, we are very excited about

science. It is also true it can be a science project until the market

sort of drives things along. And so the goal being to break our dependence on foreign oil, the goal being to create jobs by inventing

new technologies, and the goal being to clean up the air, I think

it is very helpful testimony you are giving because it is about the

market. And so, Ms. Gray, maybe you could talk a little bit about

General Motors hope of either—is it hydrogen or is it volt? Or is

it, it doesn’t matter, either one works for General Motors? As a

manufacturer here, what do you see as the market’s acceptance of

those? And help us move from a science project into something that

is really going to transform the fleet.

Ms. GRAY. You know, when we put out the Chevy Volt earlier

this year, I think that was a means to bring these kinds of things

together, because number one, we have got a battery, a high-voltage storage device, that allows you to mate that up with an internal-combustion engine so that when the battery gets depleted, you

can use the internal-combustion engine in order to replenish the

battery, but you can also use a fuel cell in that same configuration,

if you will, in order to provide power, if you will, energy for that

battery to store and to use appropriately.

It really was a way that we pulled all of these technologies together, so it is not an either-or, but an and, in order to allow us

to have diversification, if you will, from petroleum. So really there

is a place for both us them, depending upon the needs and the use

and the accessibility of the various energy devices.

68

GM ALLOCATION OF RESOURCES

Mr. INGLIS. That said, capital is generally limited. In other

words, you have got to allocate resources within a company, so you

think you will be allocating them—where do you think you will be

allocating them? Don’t tell me anything you have got to shoot me

after you tell me or anything or call the SCU lawyers if you have

got to before you answer, but I guess it is a public forum so you

can probably tell me.

Ms. GRAY. Allocation of resources have been applied for both

areas, quite frankly, and for all of the areas. I was telling one of

the constituents a little while ago, back in the early ’90s, I worked

on ethanol. Currently, I am working on energy storage devices in

fuel cells, and I am coming up with requirements for fuel cell vehicles with an energy storage device, and I am also coming up with

requirements for an internal-combustion engine, again, to replenish

the battery when needed, so we have resources allocated in all of

those areas. I was also trying to advertise that we are still hiring,

because for some reason, people think that we are not adding resources in these particular areas, but that is so, so incorrect. We

have been hiring over the last ten years in areas that allow us to

increase our fuel economy through regular, conventional vehicle efficiencies as well as diversification.

If you looked at where GM has been hiring, if you will, over the

last ten years, it has been in those areas so that we can meet the

need of where we have to go, so the answer is all of the above.

ENERGY STORAGE DEVICES

Mr. INGLIS. Ms. Wright, do you got a prediction about which one

is going to win?

Ms. WRIGHT. Well, I was going to ask you if I could make a comment if you didn’t invite me. I think it is really important for everybody to understand that one is a journey so you are going to

learn and we are going to increase hybridization, increase electrification, and there is going to come a point where it is not going

to matter what is actually providing the fuel. You will always, always, always have an energy storage device. So I am employable

for a long time, because you are always going to need an energy

storage device.

Now, what shape and form it takes, what the chemistry is, who

knows? What is really exciting about that, though, is we’ve done—

and it used to be called a science project at Ford with the hybrids

and with the fuel cells. We are now seeing the convergence, and exactly what GM is doing, and that is regardless of what the power

plant that Denise is told to provide an energy storage for, she

doesn’t care. She is going to be able to provide an energy storage

device that will fuel anything. And so as we get better and smarter

with ethanol and internal combustion engines and diesels and fuel

cells and pure electrification, it is all a journey that we are going

to drive standards, drive the cost down, and eventually, we will

have a whole portfolio of stuff that we will be able to.

So I didn’t answer your question. I would be a good politician,

wouldn’t I? I don’t think there is winner. I think the winner is the

battery, clearly.

69

SIMPLIFYING HYBRID SYSTEMS

Mr. INGLIS. That is helpful. Now, I have heard from some people

that hydrogen is the future—or a pure electric would be far more

simple to manufacture than a hybrid. I have heard the objection to

hybrids that they are actually very complicated systems. In fact, I

have seen it laid out how many pieces are in a hybrid as opposed

to how many pieces would be in a fuel cell vehicle, and it is really

an interesting layout. And the idea being, you know, you put all

of that complexity into a vehicle, and you drive it a couple of hundred thousand miles, a lot of those things are going to break, and

so the simpler, the better, right?

So I agree, you have got to have a storage mechanism, but you

want to get it as simple as possible, right, and cut out that—some

part of that so you can get the simplicity?

Ms. WRIGHT. Well, I do agree with you, and if you take a look

at the complexity of a hybrid system, you have essentially nine intelligence systems that are trying to play nicely in the sandbox,

right, and operate as a cohesive system. But what you have to

take—and this is where we get into Lynda’s expertise—is you are

right. Denise said EVs are inherently more simple, but then you

have to take a look at the total picture, and that is how clean is

the energy source from which you are driving that electric vehicle.

So I mean we get outside of the fundamental technology of the vehicle, and then you have to start looking at it more globally, so I

would suggest to you, yeah, we want to drive to electrification of

vehicles and with or without a fuel cell. You know, we can debate

that. But I do think, then, we have to examine and say how are

we doing, to ensure that the energy sources aren’t worse than the

cure of those vehicles of which we are propelling them.

Mr. INGLIS. Ms. Ziegler.

Mr. ZIEGLER. Yes, I just did want to add the study that was done

by EPRI and NRDC, when they look specifically at plug-in hybrids,

in all scenarios, even with the current mix of generation, which

doesn’t include any, you know, coal gasification or anything like

that, there was greenhouse gas benefits in all cases. And then if

you look at, as the electricity industry moves to, you know, lower

carbon generation, you get much more greenhouse gas savings. So

even with—and this was studied on the plug-in hybrids, not pure

electric vehicles. But in all cases, with the current mix of generation, there was benefits for greenhouse gas.

Ms. GRAY. The only comment that I would like to make, if I may,

as we talked about simplicity, I agree that as we move towards our

Chevy Volt for example, or E–Flex system, it does get more simple

when it comes to the control system. But we need the technology

breakthroughs in order to realize that simplicity, and that is why

we have to keep focusing on ensuring that we have got that technology breakthrough in our advanced battery technology area. So

I like the end-game, but we have got to make sure that we take

the appropriate steps as we move forward, and providing some additional support in the advancement of batteries will allow us to

get to that very more simplistic end-game.

70

SOUTHERN CALIFORNIA EDISON PARTNERSHIPS

Chairman LAMPSON. Ms. Ziegler, Southern California Edison is

leading the charge to develop plug-in hybrid vehicles, and you

signed some employment partnerships in this area with companies

like Ford and Johnson Controls. What are the next steps in using

these partnerships to advanced technologies?

Ms. ZIEGLER. I think what we will get out of these partnerships

is exactly what my two colleagues were talking about, which is getting vehicles tested with real people, out in real circumstances, so

when we get the Ford vehicles delivered to us, we will put them

in our fleet, we will put them out with some customers, and we will

test them in real circumstances, looking at the recharging cycles

and the discharge.

So the benefit of that is getting cars in the fleet, getting them

tested. The other things that we are working on, and you have

heard talk to day of this smart grid of the future—it is looking at

what are the kind of standards and controls that you are going to

want to have. When we talk about that the electricity grid can

charge most of these vehicles, you need to charge them off peak.

We have excess capacity on the grid for California that is typically

at night. So what you want to have is the intelligence, either in the

car, in the smart meter, or in the grid, that can tell the car that

you only want it to charge at night. So another benefit of these

partnerships is really looking at what are the kinds of standards

and controls that we need to develop between all of the industries

to make that happen and use the electric grid to the benefit, as opposed more on big load by charging the vehicles.

Chairman LAMPSON. What is the timeline to do so?

Ms. ZIEGLER. The timeline for the first, which is the demonstration, we will get some vehicles next year and begin demonstrating

those. I hesitate to speculate on the timeline for the smart grid. I

think we are experimenting now with one circuit, which we call our

Avante circuit, which is a test of a smart grid, and so we need to

test that and see the results, and then you are looking at a huge

infrastructure across the United States. So to replace that infrastructure with a smart grid technology is at least a couple of decades, I would think, if not more, to really replace all of the electric

grid with the smart-grid capability.

DOMESTIC MANUFACTURING OF BATTERIES

Chairman LAMPSON. All of you to comment on, we talked about

the importance of building up a domestic manufacturing base for

an advanced-battery industry, but what does this really mean for

your respective sectors and the United States as a whole? Why

should domestic auto-manufacturers not outsource part of the industry to Asia and buy cheap components from an established battery sector?

Ms. GRAY. If I could start?

Chairman LAMPSON. Please.

Ms. GRAY. Every single program that we have, we made up with

a supplier, and there is learning that happened. And that learning

on how does the customer use their vehicle—and as every one of

us is in here, there are those many different means by which a perVerDate 11-MAY-2000 10:14 Jun 08, 2008 Jkt 037987 PO 00000 Frm 00074 Fmt 6633 Sfmt 6601 C:\WORKD\E&E07\100307\37987 SCIENCE1 PsN: SCIENCE1
71

son drives a vehicle. And that learning loop is so important, and

how we characterize it, how we standardize those driving operations, and then give that to a supplier to make your system, they

are learning from you. And every time they do that, they are getting better and better at doing that. If we do that with all of our

non-domestic companies, they become smart. They will stay smart,

and we will continue to send information that way.

I think it is very important that we establish within our own

country that learning opportunity, the learning opportunity to

make energy storage devices, the technology to build the manufacturing tools. There are toolmakers out there that are all outside of

the United States. There are chemists. There are companies that

make all kinds of powers and things like that for energy storage

devices. And they are all outside of the United States. If we don’t

retain that knowledge here, every single vehicle that we build, all

of the knowledge on how we operate and how we advanced that

technology goes away and does not stay here in the United States.

So I think it is extremely important that we establish that capability, that competence, here in the States, so that we can retain

that knowledge, so that we can have jobs here for our folks, instead

of sending information or sending parts the other way.

So it is extremely important that we, as OEMs, partner up with

companies and have the ability to have that knowledge here, and

we can only get it by increasing our focus on manufacturing of energy storage devices, high-tech systems here in the States, because

it is an art, and it is also a science.

Ms. WRIGHT. In terms of—and let us talk about hybrids first.

The market is and is going to continue to stay here in the United

States. We are the largest consumers of hybrid vehicles in the

world, and it is projected that we are going to continue to be doing

that. So if you start with that premise, it seems to make sense that

you want to make the jobs here, where you are going to be assembling them. We can assemble them here; we can manufacture them

here; and we can sell them here.

I would also let you know that hybrid vehicle technology originated here in the United States, and if you take look at what happened, we are absolutely getting decimated in the marketplace

with technology that we invented here. And I am not going to repeat what Denise said, but I think she summed it up exactly right.

We have an opportunity here to take advantage of a market that

wants hybrids and will accept them, with some help from the government, of course. We can create jobs. We can create the infrastructure. We can pull, through our universities, and through our

schools, a desire and a sexiness for kids to embrace science and

technology instead of becoming day traders. We can then become

exactly what we are seeing happen everywhere else in the world

where we have to go and export. And from a purely practical standpoint, every time we do a hybrid vehicle right now, we have to go

to Japan, China, or Europe to get all of our components. It takes

a lot longer for us to get a vehicle on the road if we are traveling

all over the world to get these components, you know, engineered

and manufacture——

Chairman LAMPSON. Well, what is the state of the development

of a domestic supply chain for the battery——

72

Ms. WRIGHT. We don’t have one.

Chairman LAMPSON. Period?

Ms. WRIGHT. We don’t have one, and I would—I don’t think you

know this, but this facility that I have in Milwaukee, the Johnson

Control facility, is the only facility outside of Japan that has complete capability to do cell research, cell prototype manufacturing

and systems engineering. It is the only one outside of Asia. That

is a real commentary on what has happened to our ability to not

only have the basic science, but the capability to produce. We do

not have a single supplier here in the United States.

Chairman LAMPSON. Ms. Ziegler, would you like to comment?

Ms. ZIEGLER. I would just add one thing. I think, as we talked

about earlier, we are looking at plug-in hybrids and this technology

to really get ourselves off of imported oil, so doesn’t it make sense

to try to use United States manufactures to make the replacement

for imported oil. And I would really preach, as well, we as the

United States really need to have good jobs for our people that provide good wages, and I think being able to manufacture technology

in the United States is critically important.

Chairman LAMPSON. What are other countries doing to increase

their own capabilities that as we, perhaps, develop that, they will

stay competitive. What kind of comment would you have on that?

Ms. WRIGHT. Well, I think it starts first in the structure of the

society. If you take a look anywhere but in the United States, they

encourage science and technology in the school systems. They are

supportive from a government level, the industries as well as the

universities, to advance their technology. So I think there is just

a fundamental infrastructure inside of these countries that we just

don’t have here to encourage the building up that capability.

And if you take a look at what is happening—let us just use Europe as an example. They have a plethora of activity going on, not

only in diesels, but in hybrids, because they know for the 2012

Kyoto protocol, diesels, alone, are not going to get them to the levels they need to be at. So what they are going to do—and we will

produce the batteries—sell the vehicles over here. We shall make

sure that it is accepted, and we will get the technology, and they

are going to take it back over there. And that is what is happening

in the world right now.

Ms. GRAY. Just to add another comment, I think we need a more

focused effort between government and industry here in the United

States in order to advance that technology. You are absolutely

right. We have efforts in place, DOE, USABC. We have been doing

some thing thus far, but if we are going to stay in this league, we

are going to have to make a step change in our efforts, in our funding efforts, in our focus efforts.

As we, industry, come together—and it’s amazing how GM has

a collaboration with Ford and Chrysler. We also have collaborations with BMW as well as DCX because the answer is everybody

sees this is what we have to do. We have to advance the technology

in this area, and collaborations are occurring. I think, from a government perspective, we need to step up our game in that area as

well. Japan has a huge step up in this where they have combined,

very effectively, their government, their industry, as well as their

universities in development, not just nickel-metal hydride, but also

73

lithium and the next generation lithium, because the answer isn’t

just with one. You have got to have that business plan to allow you

to continue to sustain that to understand what the next one is and

the next one is in order to bring the cost down, because if you stay

in the startup mode, which I feel we are in at this point. We are

still at that infancy of being able to bring advanced-battery technology to fruition. If we just stay there, the cost will never be

there, and we will be left behind.

And then, again, the cost is going to be high in the beginning,

and collectively, with government, we are going to have to lower

that so that we can get more product out there in the real consumers’ hands so that we can learn more and then bring those

costs down.

Chairman LAMPSON. Mr. Inglis, I have well overstayed my welcome.

PURCHASING PLUG-IN HYBRIDS

Mr. INGLIS. Thank you, Mr. Chairman. I don’t know that I shall

use all of the five minutes, but here is the—if I wanted to go from

here to buy a plug-in hybrid, can I get one? Who would I call?

Ms. GRAY. You can’t get one from an OEM today that has been

completely integrated, that has been completely tested, that will

last the expectation, ten years, you won’t have to service it. We are

not ready yet. There is still a lot of work to get done.

You can buy demonstration kinds of things where it is in there;

it won’t last forever; but yet it allows you to have some demonstration opportunity.

Ms. INGLIS. So I could get a kit, right, for a Prius? I guess I could

buy that? I could go online and find a kit——

Ms. GRAY. Well, I am not advertising——

Ms. WRIGHT. I shall take care of that one Denise. Yes, there are

what we call garage-conversions. I would just caution you, however,

if you are personally thinking about that, one, you invalidate your

automotive warranty, and number two, Denise is absolutely right,

the standard and the validation that we have to undergo as an industry are beyond anything anybody, except for if you are in that

industry, understands. And so these conversions do not or are not

intended to meet those validations, useful life, reliability, and potentially unintended consequences. So I would just encourage you

to wait because she is going to be out very soon with one.

Mr. INGLIS. So it will be soon?

Ms. GRAY. Yeah, we are currently working on a plug-in hybrid,

right now, for Saturn VUE. Johnson Controls staff is one of the advanced technology suppliers that we are working collectively on,

but we have got to make sure that under all kinds of conditions,

this vehicle is safe, in a crash condition, that the occupant is not

hurt.

We have got to make sure that it lives and lasts. You don’t want

to go and replace your battery every 600 miles because we have

failed. So we are working towards coming up a with a real, certified plug-in vehicle that will allow us to, again, sell it to the customer, and it meets your needs.

Mr. INGLIS. And when is the projected delivery?

74

Mr. GRAY. We haven’t put a production date on that we can announce to the public, although internally, I got a production date

that I have to make sure that I line everything up and work as

hard as I possibly can to uncover and to deal with all of those engineering issues in order to make this program feasible.

PLUG-IN HYBRIDS FOR CONSUMERS

Mr. INGLIS. You encourage me that it is that, it is engineering

of standards. It is not the price of gasoline. Is that right? Or is it

also some concern about whether the price of gasoline goes down,

and then when it goes down, do I really want to buy one, or do I

just decide I shall keep on driving what I got?

Ms. GRAY. As an OEM, I wish I could predict which vehicles you

will buy and at what price you will buy them. I can’t do that, but

my obligation is to get the technology out there, certified, so that

you can have the opportunity in order to accomplish that.

Ms. WRIGHT. And you know what we have to do is, in absence

of mandates, we have to drive the market pull. And I think Denise

said it very well that it is going to be a collaboration. We have to

have continued and continued improved collaboration with government. The vision is, at some point, hopefully in the next couple of

years, you are going to go to the dealership, and when you choose

whether you want leather or your recyclable seats, you can then

check off a plug-in option or another hybrid option, and it will be

some reasonable incremental cost, that you see the value being

there and that Denise’s and my industry can have a profitable

growth plan.

That is what we are working towards, but we can’t do it at the

volumes that we are at now, the lack of standards, and the lack

of real collaboration in terms of driving scale and infrastructure

here in the United States.

Mr. INGLIS. So if we really wanted to drive this, mandates may

be a good idea? In other words, fuel efficiency standards might be

a good idea?

Ms. WRIGHT. You can address it in a number of ways. It could

be fuel efficiency, or I would—certainly the shift in discussion to

carbon mandates.

HYBRID EMISSIONS

Mr. INGLIS. Which is helpful in your chart that you had both of

those, either carbon kind of systems or a fuel efficiency standard.

I mean it is a good argument that perhaps that might really get

us going?

Ms. WRIGHT. Without a doubt, and what you saw in that chart

represented CO2. When you add in all of the other forms of greenhouse gasses, it only gets better as you increase your level of hybridization. So just to refresh your memory, I would very much encourage that we continue to exploit the technology that we have

available today that we can put on the road today, but we are not

in the volumes, as well as continue to invest in what is hopefully

going to be near-term plug-in capability and eventually EV.

75

RAW MATERIAL SUPPLIES FOR BATTERIES

Mr. INGLIS. And one last question: the—I have used all of the

time, Mr. Chairman. We have got enough raw materials to do these

batteries, right? It is not like there are made out of platinum, and

there is only so much in the world, and that means that we really

can’t use these or—it is not a resource problem, right?

Ms. WRIGHT. That is correct.

Mr. INGLIS. There is enough Lithium there is enough——

Ms. WRIGHT. We can’t divulge the recipes because that is our intellectual property, but clearly the materials are always a concern,

but as Denise said, when you look at nickel-metal hydride versus

a lithium ion, first because it is 50 percent lighter, you are using—

consuming less materials. And one of the areas that I would encourage additional research beyond where we are today is alternate

materials that take all of the variability in terms of market spikes

as well as availability. And they are there. They are on the horizon,

and we are working with them. So we are going to continue to experiment with our recipes to ensure that we meet all of the requirements from our automotive manufactures, but I think there

are a lot of opportunities for us to continue to take that volatility

out and still deliver all of the performance.

Mr. INGLIS. All right, thank you. Thank you, Mr. Chairman.

Chairman LAMPSON. You are welcome. I would like to go another

20 minutes. It is fascinating, and you all have been great. Thank

you very, very much. We appreciate you appearing before our subcommittee, and under the rules of this committee, the record will

be held open for two weeks for Members to submit additional statements and any additional question that they might have for the

witnesses. We shall send them to you. This hearing is now adjourned. Thank you.

[Whereupon, at 1:20 p.m., the Subcommittee was adjourned.]

(77)

Appendix:

ADDITIONAL MATERIAL FOR THE RECORD

78

79

80

81

82

83

84

Æ