NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Battery Ownership Model: A Tool for Evaluating the 

Economics of Electrified Vehicles and Related Infrastructure

Michael O’Keefe

Aaron Brooker

Caley Johnson

Mike Mendelsohn

Jeremy Neubauer

Ahmad Pesaran

25th Electric Vehicle 

Symposium 

Shenzhen, China

November 5–9, 2010

NREL/PR-5400-50356
NATIONAL RENEWABLE ENERGY LABORATORY

Vehicle

Characteristics Model

Charge Service

Provider

Aggregators

Traditional EVs PHEVs

City Charge Points Swap Stations

Smart Grid

Battery Life

Charging Algorithms

Drive Profile Location

Wind Power Solar Power

V2G

Cost of Money

Subsidies

Job Creation

Battery

Secondary Use

Consumer Behavior

Future Cost of Gasoline

Battery Specific Power

& Specific Energy

2

Many New Vehicle Technologies, Power Sources, 

Infrastructure Technologies, and Business Models 

Are Being Proposed for Transportation

How Do We Make Sense of These Options as They Relate to 

Component Development, Economics, Energy Use, 

Greenhouse Gases, and the Role of Government?

Gases
NATIONAL RENEWABLE ENERGY LABORATORY

Battery Ownership Model Multi-Disciplinary Team

Michael

O’Keefe

power electronics, EV grid 

integration & programming

Terry

Penney

advisor on project direction

Michael

Mendelsohn

economics & financing

Caley

Johnson

carbon markets, policy analysis & 

fueling stations

Ahmad

Pesaran

energy storage 

system task lead

Jeremy

Neubauer

battery secondary use, project 

subtask lead

Aaron

Brooker

vehicle systems analysis, 

optimization & programming

John

Rugh

vehicle ancillary loads 

reduction & driving statistics

3
NATIONAL RENEWABLE ENERGY LABORATORY 4

NREL developed the Battery Ownership Model 

to answer this question
NATIONAL RENEWABLE ENERGY LABORATORY

Location-Specific Driving Distance Distribution

5

Price of Gasoline

Price of Electricity

Baseline US 

average driving 

case shown
NATIONAL RENEWABLE ENERGY LABORATORY

Vehicle Performance and Sizing Model

6

City

Highway

Acceleration

Inputs

Results
NATIONAL RENEWABLE ENERGY LABORATORY

Vehicle Component Cost Model

7

Baseline technology 

costs have been 

calibrated against 

currently available 

vehicles

Equation coefficients 

can be varied to 

explore sensitivities 

and future scenarios
NATIONAL RENEWABLE ENERGY LABORATORY

Battery Life Model

8

A simple model for 

battery degradation 

has been tied to 

the driving profile
NATIONAL RENEWABLE ENERGY LABORATORY

Infrastructure Requirements

9

Swap Fraction Swap Stations per 10,000 Cars

11% 11

09% 9

01% 1

For reference: ~6.4 gasoline stations (~54.7 pumps) per 10,000 cars

Assuming: same “level of convenience” for swap station as gasoline 

station in terms of cars per “pump” & time per fueling
NATIONAL RENEWABLE ENERGY LABORATORY

Electricity Usage

10

Generation Demand

Efficiency

kWh of 

Electricity 

Used
NATIONAL RENEWABLE ENERGY LABORATORY

Service Provider Economics Module

11

electric fueling

battery replacement

assuming cost reduction

in battery over time

up-front costs

dominated by battery cost

no infrastructure => large range battery

service fee

service provider eliminates

risks, provides network &

other services for a fee

Traditional EV

Ownership Model:

time

consumer

costs

...with Service Provider

time

consumer

costs

KEY

up-front costs

electricity

service fees

battery costs

purchase cost

“batteries not included” cost
NATIONAL RENEWABLE ENERGY LABORATORY

Driver Economics Module

12

Cost

End User

Services and 

Technology

EV charge

service provider
NATIONAL RENEWABLE ENERGY LABORATORY

Greenhouse Gas Accounting

13

CA
NATIONAL RENEWABLE ENERGY LABORATORY

Levelized Cost per Mile (LCPM)

14

time

consumercosts

time

consumercosts

Equivalent

initial one time

payment

time

consumercosts

Equivalent

payment per each

period
NATIONAL RENEWABLE ENERGY LABORATORY 15

Validation: The model does well at estimating 

the cost of vehicle technologies

30

40

50

60

70

80

90

10,000 12,000 14,000 16,000 18,000 20,000

Levelized Cost per Mile (Cents / Mile)

Annual Vehicle Miles Traveled

Small Car (NREL)

Small Sedan (AAA)

Medium Sedan (AAA)

Large Sedan (AAA)

WARD's 2009 Model Year Average Car

IRS Mileage Reimbursement Rate

Ward’s
NATIONAL RENEWABLE ENERGY LABORATORY 16

We compared the LCPM of the following vehicles:

Conventional Vehicle

(gasoline)

Plug-in Hybrid Electric Vehicle [40 mile]

(electricity / gasoline)

Hybrid Electric Vehicle

(gasoline)

Electric Vehicle [100 mile]

(electricity)

CV

HEV

PHEV40

EV100

PIX#15963

PIX#17075

PIX#02773
NATIONAL RENEWABLE ENERGY LABORATORY

...considering the following variable inputs...

17

Variable Min Max

D1: GHG Market Cost (2007 U.S. Dollars/Ton 

CO2e-Year) 0.00 28.53

D2: Federal Tax Incentive (2007 U.S. Dollars) 0 7,500

D3: Gasoline Cost Forecast EIA Reference EIA High Oil Price

D4: Annual Distance Driven (Miles/Year) 9,059 15,691

D5: Vehicle Auxiliary Load (W) 700 2,200

D6: Battery Energy Cost Coefficient (2007 U.S. 

Dollars / kWh) 350 700

D7: Battery Life Coefficient 86

(low cycle life)

433

(high cycle life)
NATIONAL RENEWABLE ENERGY LABORATORY

...and found the EV can be cost competitive, but is 

quite sensitive to changes in assumptions

18

0.8

1.0

1.2

1.4

1.6

1.8

2.0

2.2

2.4

2.6

2.8

HEV PHEV40 EV100

Cost Ratio

(Vehicle LCPM / CV LCPM)
NATIONAL RENEWABLE ENERGY LABORATORY

Battery Cost And Life Are The Strongest Factors

19

0.0

0.2

0.4

0.6

0.8

1.0

Cost Ratio Sensitivity

HEV PHEV40 EV100
NATIONAL RENEWABLE ENERGY LABORATORY

Niche Markets

20

Hawaii: more battery-friendly 

driving distribution & higher 

gas prices...

...but higher electricity prices 

and no effect on dominant 

battery prices

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

2010 2015 2020 2025 2030

Gasoline Price at Pump (2007 US Dollars/gallon)

Vehicle Ownership Year

HI / High Price

US Avg / High Price

HI / Reference

US Avg / Reference

in 2007 real dollars

Occurrence

―

―

―

―
NATIONAL RENEWABLE ENERGY LABORATORY

Service Providers

21

Service provider costs are dominated by batteries 

(up to ~92%), allowing charge points and swap 

stations to be provided at minimal marginal cost

2.2% 5.8%

79.1%

13.0% Swap Stations & SS Batteries

Charge Points

Batteries - Leased

Batteries - Replacement
NATIONAL RENEWABLE ENERGY LABORATORY

Summary

• This presentation is meant to give you a quick preview of the 

“Battery Ownership Model” and its capabilities

• The purpose of the model is to assist the U.S. Department of 

Energy in understanding how various business plans for EVs 

compare to other technologies

• The preliminary results presented herein show:

• EV costs are most sensitive to battery cost and life assumptions 

within the scope of other parameters considered herein

• Service provider costs are dominated by battery rather than 

infrastructure cost; thus one may be able to provide significant 

added value at minimal additional cost

• Additional application and development of the tool will 

continue in FY11

22
NATIONAL RENEWABLE ENERGY LABORATORY

Acknowledgements

23

We would like to thank our sponsor, Dave Howell, Energy 

Storage R&D, Vehicle Technology Program, U.S. 

Department of Energy.

Thanks to the U.S. Department of Energy’s Hawaii Clean 

Energy Initiative and its Transportation Working Group for 

their interest in the tool and feedback.