PHEVs are similar to current hybrid electric vehicles (HEVs) but have larger batteries that can be charged from the electric grid. More and more consumers are buying HEVs – sales in the US have grown by 80% per year since 2000. The same trend might be expected for PHEVs in the future. What's more, car manufacturing firms such as Toyota and Ford are now offering to convert HEVs into PHEVs and plan to sell retrofit kits to help consumers "upgrade".

By using grid electricity, PHEVs could reduce a driver’s fuel costs by hundreds of dollars per year. However, car battery costs need to decrease by at least 50% from current levels to make PHEVs economical for most consumers, says team member Alex Farrell. At present, near-term costs for PHEVs appear to be too high to justify the savings that come from buying electricity, which is cheaper than gasoline. But economic calculations are only part of the reason consumers buy cars, Farrell adds, so some people would probably buy PHEVs even at current costs.

Another important result from the team’s work is that the time when PHEVs are charged needs to be properly managed. There is sufficient electricity capacity to charge several million PHEVs in California without expanding the electricity grid in the state. But adding even one single PHEV to the grid at peak hours (2.00 p.m. to 6.00 p.m.) will create demand for new electricity infrastructure, explains Farrell.

"These results are important because PHEVs offer consumers a whole new choice, and a way to advance key social goals – including reducing consumption of petroleum and lowering greenhouse gas emissions," he told environmentalresearchweb. Co-author Dan Kammen of the Berkeley Institute of the Environment notes that half of all cars in California drive less than 20 miles per day. Increases in battery capacity thus make PHEVs very attractive for a large number of urban and suburban residents.

The Berkeley team obtained its results by analysing the costs of electricity on a normal weekday and comparing this with petroleum prices during the same period. The researchers calculated the retail electricity prices that would be equivalent to various retail petroleum prices in terms of the PHEV's fuel cost per mile.

"We also took a set of common assumptions about the design of PHEVs and combined these with existing data for the California power system to evaluate what choice consumers would have," said Farrell.

The results provide a clear vision of what is needed to make PHEVs a significant part of the vehicle fleet, said Farrell. This includes research and development for better batteries and for PHEV/grid interconnections to control charging. Also needed are policies to support the early adoption of PHEVs, to lower their costs, and to ensure that PHEV charging occurs when it is most beneficial.

The team is now investigating the energy and greenhouse gas implications of different types of PHEVs, such as compact cars versus sport utility vehicles (SUVs). "This will give us a better understanding of how PHEVs can contribute in the fight against global warming," said Farrell. "In addition, UC Berkeley and UC Irvine are collaborating with Toyota on a project to evaluate how consumers actually use PHEVs in the real world," he revealed.

The researchers reported their work in Environmental Research Letters.