Hawaii charges ahead with electric vehicles
By Sean Hao
Advertiser Staff Writer
The state is driving the adoption of electric and alternate vehicles through a variety of mandates and grants, but the push could add to costs at government agencies and businesses already grappling with the worst economy in decades.
Starting this month, state and county agencies buying new vehicles are required to give priority to electric vehicles, alternative-fuel vehicles and hybrids. And by the end of next year, government and private parking lots open to the public must have at least one space for electric vehicles and a vehicle charger for every 100 parking spaces.
To offset the costs of electric cars and special parking, the state plans to spend $4.25 million in federal stimulus money by an April 2012 deadline on chargers and grants.
Vehicles that run on electricity rather than gasoline emit less pollution and are expected to be cheaper per mile to operate. They're under development by every major car maker, and certain models are scheduled to be available in limited quantities on the Mainland by year's end.
However, it's unclear when the vehicles will be available to Hawai'i residents, and how quickly they will adopt the cars, which need to be regulary charged with electricity. There are also questions about the durability, reliability and serviceability of this new breed of vehicles.
The state's push to spur the adoption of electric cars could be premature, said Lowell Kalapa, president of the nonprofit Tax Foundation of Hawaii.
"It's well-intended, but not completely thought out on the economic side," he said. "Not only does it cost us taxpayers additional money to purchase those types of vehicles, but then we're going to have to build in these facilities for the electric vehicles.
"I think a lot more research needs to be done before we buy into a lot of these things, and the electric cars is one of them."
According to the state, there's expected to be 1,000 to 3,000 electric vehicles in Hawai'i in 2014.
So far, the private-sector interest in electric vehicles and chargers remains relatively small. In January, there were 179 registered electric vehicles statewide, according to the state Department of Business, Economic Development and Tourism. Those are mainly test vehicles, expensive high-end models, mini-cars and scooters.
Last month, green building and energy product retailer Green Energy Outlet installed the state's first public electric vehicle charger at its Kaka'ako store. GEO President Frank Rogers is banking on a rapid adoption of electric vehicles as they become commercially available .
"We're ahead of the curve, there's no doubt, but somebody has to jump in the pool first," Rogers said. "I really do think that you get that right car and you're going to have a hard time filling demand for it — it's going to be really flying off the shelf. "
Among the most anticipated electric vehicles coming to market are the Nissan Leaf and the Chevy Volt. The $25,000 to $33,000 Leaf is expected to launch in December. The Volt is scheduled to launch in November, though no price has been announced yet.
Neither vehicle is expected to be widely available for a while. That's because General Motors expects to only produce about 10,000 Volts the first year, or about 200 vehicles per state.
The Leaf initially will be deployed in Arizona, California, Oregon, Tennessee and Washington state, where 11,210 charging stations are being installed under a $99.8 million grant from the U.S. Department of Energy.
Hawai'i hopes to join those states that will get these vehicles first, said Maria Tome, renewable energy coordinator at DBEDT. Hawai'i's small geography and warm weather make it an ideal environment for battery-driven electric vehicles.
In turn, these vehicles could reduce petroleum consumption, Tome said. The charging could take place during off-peak night hours to prevent strain on the electric grid, she added.
"The problem is there was a delay in what the automakers were doing on the cars and on the chargers," she said. "Everybody was promising 2010, and now they've all flipped that to 2011, although some are still saying late 2010."
Those launch delays could jeopardize a state plan to use $4.25 in federal stimulus money to drive adoption by, among other things, providing about 625 grants of $5,000 each to those buying electric vehicles. Half a million dollars would go to state agencies to help meet electric and alternative-fuel vehicle purchasing mandates.
Under the stimulus program, that grant money must be obligated by the end of September and spent by April 30, 2012. DBEDT plans to distribute the grants via a contractor agreement signed before October of this year.
"That does make it really complicated with the deadlines that are in," Tome said. "So we're discussing if we need to modify that."
Separately, Gov. Linda Lingle has proposed the state provide a general excise tax rebate to those buying or leasing an electric vehicle or install ing an electric vehicle charging system.
Even without the proposed state grants and tax rebates, electric vehicle purchases may be eligible for a federal income tax credit of up to $7,500.
The state wants to ensure that people who buy electric vehicles have parking spaces and charging outlets by mandating that parking lots with 100 or more spaces dedicate 1 percent of those spaces for electric vehicles. At least one charger must be installed in each eligible lot. Under the law passed last year, that figure jumps to 2 percent of spaces once the number of registered electric vehicles statewide tops 5,000.
It's unknown how many electric vehicle spaces the law will create. However, the figure could be in the thousands. For example, Ala Moana Center — which has the biggest parking lot in the Islands, has about 9,800 parking spaces. That means the shopping center will need to set aside 98 parking spaces for electric vehicles by the end of next year. Electric vehicle chargers can cost $2,000 or more, depending on features.
Dave Rolf, executive director of the Hawaii Automobile Dealers Association, said the group supports efforts to reduce petroleum dependency. However, the electric vehicle parking mandate that takes effect at the end of next year is "too soon (and) too optimistic, based on what we know of production runs and what we know of the ability to adopt the product," he said.
Adoption of electric vehicles will depend on vehicle availability, prices and the difference in the price of electricity and gasoline , Rolf said.
"There are a whole lot of issues relating to electric vehicles that are just beginning to be addressed," he said. "Those (parking) stalls are going to be empty for several years."