Electric vehicle proponents urge Oregon to take the lead

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A combination of new tax credits, government incentives and education and industry partnerships could help spark Oregon’s nascent electric vehicle cluster.

So say government and business leaders who’ll soon unveil ideas to urge economic development within the growing sector. The Alternative Fuel Infrastructure Working Group will make its economic development recommendations to Oregon Gov. Ted Kulongoski, who wants to attract more electric vehicle investment to the state. The group believes Oregon can grow on the backs of electric vehicle manufacturers and ancillary suppliers, such as technology companies that could create software and dashboard equipment to help operate the cars.

Kulongoski, who leaves office in 2011, has long encouraged the state to tie climate change strategies to economic development. He convened the group to goad electric vehicle-making sectors.

“Oregon has a heck of a chance to be a leader in transportation electrification,” said Charlie Allcock, a group member and Portland General Electric’s economic development director. “It’s a good time to be looking at this because the market is maturing.”

The recommendations also come during a flurry of activity aimed at establishing Oregon as an electric carmaking hub. The group Environment Oregon released a report detailing how electric cars can lower global warming emissions, oil consumption and toxic air pollution. The group includes Mark Frohnmayer, founder of the Arcimoto electric car company and an alternative fuel committee member. Frohnmayer’s company has collected $1 million from angel investors as it develops three-wheeled vehicles to sell for less than $20,000.

The alternative fuel group had no estimates of their proposals’ costs. Most industry analysts believe electric vehicle sales will comprise 5 percent of all cars sold by 2020. Research and Markets, a Dublin, Ireland-based researcher, estimates the industry will generate $227 billion in worldwide revenue by 2015.

Among the Oregon group’s proposals:

• One Oregon university would host an automotive engineering program backed by such private industry partners as Daimler Trucks North America, Intel Corp. and Ziba Design. Organizers could work with Clemson University, which established the $200 million International Center for Automotive Research. A Clemson official has already reached out to Intel Capital’s Steve Saltzman, a group member, to work on a similar Oregon project.

• The state could also provide as-yet undetermined funding to the Oregon Nanoscience and Microtechnologies Institute. The institute would use the funds to study ways to improve energy storage and lower electric vehicles’ usage costs per kilowatt hour. The institute typically receives funding through the Oregon Innovation Council, which received $16 million during the 2009 legislative session and $28 million during the 2007 legislative session.

• Electric vehicles would be folded into the state’s business energy tax credit program. Lawmakers are examining potential reforms to the program, which has lured several companies to the state but, critics say, has spawned abuses. Lawmakers had rejected, in the program’s 2007 expansion proposal, including provisions for electric vehicle-related manufacturing.

The state would establish a new “transportation electrification tax credit” for electric vehicles and infrastructure. The group gave no direction on how to shape the credit, but believes the option could increase electric vehicle usage and add more jobs in Oregon.

Chris Warner, Kulongoski’s transportation advisor, said the governor hasn’t seen the proposals. However, his office anticipates “a conversation, at least, on how the tax credit ideas would play out.”

Electric car proponents also want the state to set new purchase standards that would allow Oregon to include more alternative fuel vehicles in the government’s fleet.

The alternative fuel group’s ideas come as the state prepares to add 2,000 charging stations along the Eugene-to-Portland Interstate 5 corridor. A Department of Energy electric car initiative funded the stations, along with the delivery of 1,000 Nissan Leaf electric vehicles.

“That grant will lay the groundwork for this initiative,” said Jeff Cogen, the Multnomah County Commissioner who chaired the alternative fuel group. “It’s always been a chicken-and-egg thing: People won’t buy the cars unless there’s a place to charge them. With this grant, we expect to see more interest in both buying and building these.”

The alternative fuel group included several auto industry executives, utility company representatives, a restaurant owner and Saltzman.

Intel and other tech companies hope the state will eventually spur investments into software and hardware companies that supply materials for electric vehicles.

“We can use electric vehicles to build some of the regional clusters we already have here,” Saltzman said. “There are a number of silicon software and systems integration companies working on things like battery management systems and in-dash and entertainment systems. Oregon already has a number of leading companies in these areas.”

The Environment Oregon report is expected to reveal that operating costs of “plug-in” cars such as electric vehicles are likely to be three to five cents per mile. The costs come out to the equivalent of 75 cents to $1.25 for a gallon of gasoline.

In the long term, purchase costs for electric cars could drop to between $6,000 and $13,000, the group said.

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