BOARD MEETING DATE: March 2, 2007
AGENDA NO. 4

Execute Contracts for Development and Demonstration of 30 Plug-In Hybrid Electric Vehicles

SYNOPSIS:

On November 3, 2006, the Board approved the release of an RFP to design and demonstrate a fleet of plug-in hybrid electric vehicles with corresponding recharging stations at up to fifteen sites within the South Coast Air Basin.  Five complete proposals were received, subsequently reviewed, and scored by a panel of outside experts.  This action is to fund $2,718,280 from AQMD to develop and demonstrate 30 plug-in hybrid electric passenger vehicles.

COMMITTEE:

Technology, February 23, 2007, Recommended for Approval

RECOMMENDED ACTION:

1. Authorize the Chairman of the Board to execute a contract with Quantum Technologies for the development and demonstration of 20 plug-in hybrid electric vehicles, including cost of base vehicles, in an amount not to exceed $2,095,613 from the Clean Fuels Fund.
2. Authorize the Chairman of the Board to execute a contract with Hymotion for the development and demonstration of 10 plug-in hybrid electric vehicles, not including cost of base vehicles to be provided by demonstration sites, in an amount not to exceed $622,667 from the Clean Fuels Fund.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The AQMP has identified the use of alternative clean fuels in mobile sources as a key air quality attainment strategy.  True zero-tailpipe emission passenger vehicles, however, are either no longer manufactured (e.g., battery-electric vehicles) or are not anticipated to be sold in large numbers before 2015 (e.g. fuel cell vehicles).  The AQMD has sponsored plug-in hybrid electric vehicle (PHEV) demonstrations for over six years because of the potential for this technology to enable zero-tailpipe emissions for portions of the driving cycle.   Similar to commercially available hybrid-electric vehicles, PHEVs utilize a battery pack and an electric motor in concert with an internal combustion engine.  PHEVs, however, can employ a larger battery pack which can be designed to extend the electric portion of the driving cycle, providing improved fuel economy, lower greenhouse gas emissions, and reduced petroleum dependence.  The larger battery pack must be fully recharged external to the vehicle so a charger, plug, and energy management system must be integrated into the vehicle.

There has been increasing support for PHEVs from a wide array of organizations, including electric utilities, environmental groups, energy independence organizations, and other air districts.  Several automobile manufacturers have also announced plans to investigate the technology but voice concerns about the battery durability in terms of calendar and cycle life.  In order to discuss these concerns and identify the major obstacles to PHEV deployment, staff hosted a forum and technical roundtable on July 12, 2006 with invited experts from DOE, NREL, Sandia, CARB, Johnson Controls, SCE, EPRI, and EnergyCS.  One major result of this technical roundtable was consensus by the panel members that early demonstrations are needed to provide real-world data as feedback for the technology providers to improve the battery specifications, energy management systems, and packaging.  This information would then help produce reliable systems, which in turn may stimulate an early market, increase production, and thus lower the costs for these batteries and PHEVs.  The proposed project is to conduct this early demonstration using converted commercially available hybrid electric vehicles in sufficient numbers to provide a wide array of driving cycles, expose a large number of users to PHEV technology, and establish statistically significant data for feedback to the battery manufacturer.

At the November 3, 2006 meeting, the Governing Board approved RFP #P2007-14 to design, engineer, convert, test, certify, demonstrate, and maintain for 60 months 30 plug-in hybrid electric vehicles with supporting infrastructure at up to 15 demonstration sites in the South Coast Air Basin. 

Outreach

In accordance with AQMD’s Procurement Policy and Procedure, a public notice advertising the RFP/RFQ and inviting bids was published in the Los Angeles Times, the Orange County Register, the San Bernardino Sun, and Riverside County Press Enterprise newspapers to leverage the most cost-effective method of outreach to the entire South Coast Basin.

Additionally, potential bidders may have been notified utilizing AQMD’s own electronic listing of certified minority vendors.  Notice of the RFP/RFQ have been mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations, the State of California Contracts Register website, and placed on the Internet at AQMD’s Web site (http://www.aqmd.gov/ where it can be viewed by making menu selections “Inside AQMD”/“Employment and Business Opportunities”/“Business Opportunities” or by going directly to http://www.aqmd.gov/rfp/index.html).  Information is also available on AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.

Selection Process

Five complete proposals were received in response to the RFP.  The proposal from Quantum Technologies was for only a Ford Escape Hybrid platform.  The proposal from E Drive was for only a Toyota Prius platform.  The other three proposals provided options for a mix of vehicles.  Pursuant to the Procurement Policy and Procedure, the RFP identified 100 possible points for the technical score and 20 possible points for the cost score.  Within the 20 points for cost, 10 points were for the lowest cost in terms of absolute dollars, with additional points assigned based on the level of cost share.  An evaluation team with strong expertise in advanced batteries, electric and hybrid electric transportation, and government policy issues was assembled.  Comprising the panelists were staff from CARB’s Branch for On-Road Control Regulations, a transportation technology expert from U.C. Davis, a CEC Transportation Research Manager, an expert in advanced batteries from the Department of Energy, and an electric utility transportation expert (five males and one female; four Caucasian and two Asian/Pacific Islander).

The results of the panel evaluation are listed in Attachment A.

Proposal

Based on the Panel’s evaluation, staff recommends awarding two contracts; one to Quantum to convert 20 new Ford Escape Hybrid vehicles, with delivery of the first 6 vehicles within 10 months of contract execution, and the remaining 14 vehicles within 12 months of contract execution, and one to Hymotion to convert 10 new Toyota Prius vehicles, with delivery of the first 6 vehicles within 10 months of contract execution, and the remaining 4 vehicles within 12 months of contract execution.  AQMD will work with interested fleets to develop the demonstration program at up to 15 sites.  Depending on performance under these proposed contracts and value to AQMD, funding for additional vehicles may be requested.   

Quantum, with headquarters in Irvine, California, is an established world leader in the design, development, manufacturing, and commercialization of gaseous fuel management systems and alternate fueled vehicles.  Since 1997, Quantum has produced over 16,000 alternate fueled vehicles.  Quantum is the manufacturer of record with the California Air Resources Board (CARB) for GM’s CNG powered Chevrolet Cavalier, full size Van and medium and heavy-duty CNG powered Silverado and Sierra pickup trucks.  Quantum’s Advanced Vehicle Concept Center (AVCC) in Lake Forest is a state-of-the-art engine and vehicle development facility by recognized automobile manufacturers worldwide.  Quantum has the unique capability to develop, validate, certify, and commercialize specialty vehicles from the design stage to mass production.  The Lake Forest facility has the latest engine and chassis dynamometers commercially available, and the only SULEV emissions laboratory on the West Coast, recognized by CARB.  Quantum has also produced hydrogen fuel cell powered Neighborhood (NVs) and All  Terrain Vehicles (ATVs) in 2002 and 2004, respectively.  The latter is currently in production for the U.S. Army.  In 2003, Quantum developed a hydrogen fueled 2002 Toyota Prius, equipped with compressed hydrogen and metal hydride storage systems.  The hydrogen powered Prius prototype produces comparable power to the gasoline version, along with increased fuel efficiency and almost zero emissions, the latter consistent with CARB’s current partial zero emission standards.  In 2004, in response to a competitive RFP, Quantum was awarded a contract with AQMD to develop and demonstrate 30 hydrogen-powered Prius vehicles.  For this project, Quantum has support from Ford Motor Company, and will sub-contract with Advanced Lithium Power.  Quantum had annual sales of $25 million in 2002-2003 and has 150 employees.

Hymotion, with headquarters in Ontario, Canada, is a provider of complete integration for hybrid and fuel cell systems, with over ten years of experience in the alternative fuel industry.  Hymotion has delivered Prius PHEVs to Argonne National Labs, National Renewable Energy Lab, CoStar, Veridian, FairFax County, and HOURCAR, and is in pilot production with over 35 orders at the time of their proposal.  For this project with AQMD, Hymotion has support from A123 and AeroVironment, and will be sub-contracting with UC Riverside, CE-CERT. Demonstration sites, still to be determined, are expected to pay for the base cost of 10 Toyota Prius vehicles.  The cost of both projects to the AQMD shall not exceed $2,718,280.  Total cost is estimated to be $3,379,663 with cost-sharing summarized in the table below:

Quantum Technologies and ALP will provide almost $720,000 in cost-share by absorbing approximately 25% of the design, engineering, and administrative costs over the entire project.  Hymotion and AeroVironment will provide $100,000 in cost-share using the fast-charging infrastructure.

Benefits to AQMD

The expansion of the PHEV program is included in the Technology Advancement Office Clean Fuels Program 2006 Plan Update under items “Demonstrate Light Duty Plug-In Hybrid Electric Vehicles” and “Develop and Demonstrate Medium- and Heavy-Duty Hybrid Vehicles and Systems.”  Plug-in hybrid technologies overall have potential for lower criteria pollutant emissions and zero local emissions during portions of the commute when vehicles are operating on battery only.  This can provide substantial benefits to communities, neighborhoods, and schools where these vehicles operate.

The AQMD has been a leader in developing and demonstrating plug-in hybrid technologies.  Expansion of the AQMD PHEV Program will accelerate the determination of commercial viability for this technology and its associated air quality benefits.  Staff believes the PHEV strategy can be an enabling technology for all types of alternative fuels, such as CNG and hydrogen, by reducing the size of the most costly components (e.g., gaseous storage tanks and the fuel cell stack) and relying more heavily on the battery system. 

Resource Impacts

Funding for the RFP is not to exceed $2,718,280 for both platforms based on the estimated activities and budget (including cost sharing) in the following table:

*      Hymotion includes one fast charger demonstration
**    Quantum to provide 20 Escape Hybrid base vehicles. Hymotion to provide 2
      Prius base vehicles with the remainder to be provided by demonstration sites.

The cost of the projects to AQMD, in the event that additional state or federal co-funding is available, may be reduced or the total value may increase.

The cost of the project with Quantum Technologies will not exceed $2.1 million and the cost of the project with Hymotion will not exceed $623,000 from the Clean Fuels Fund. Sufficient funds are available from the Clean Fuels Fund, established as a special revenue fund resulting from the state-mandated Clean Fuels Program.  The Clean Fuels Program, under Health and Safety Code Sections 40448.5 and 40512 and Vehicle Code Section 9250.11, establishes mechanisms to collect revenues from mobile sources and stationary sources to support projects to increase the utilization of clean fuels, including the development of the necessary advanced enabling technologies.  Funds collected from motor vehicles are restricted, by statute, to be used for projects and program activities related to mobile sources that support the objectives of the Clean Fuels Program.

Attachment

Evaluation Scores

Attachment A
Results of Panel Evaluation of Proposals Received in Response to RFP #2007-14

Five complete proposals were received in response to the RFP.  The proposal from Quantum was for only a Ford Escape Hybrid platform.  The proposal from E Drive was for only a Toyota Prius platform.  The other three proposals provided options for a mix of vehicles.

Of the five complete proposals received, and based on the scoring presented below, proposals from Electro Energy, EnergyCS, and E Drive were ranked as not technically qualified since the average technical scores were below the required 80 points.  Quantum Technologies and Hymotion were both ranked as technically qualified with an average technical score of 85.3 and 82.0, respectively.  The following table summarizes the individual technical scores by each of the review panelists.