Stimulus money unveiled for green cars

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But a boost for established manufacturers leaves innovative companies out in the cold, critics say.

General Motors - manufacturer of the Chevy Volt, a plug-in hybrid electric vehicle - has benefited from a stimulus windfall. Credit: Wikimedia Commons

The US Department of Energy rolled out $2.4 billion in stimulus grants on 5 August to develop next-generation technologies for electric cars.

The awards, made to 48 projects in more than 20 states after a highly competitive application process, aim to reduce greenhouse gases and oil imports by spurring electrification of the automobile sector and boosting domestic manufacturing of 'green' vehicles.

The bulk of the grants will support factories to make battery components. Smaller pots of money will go to producing electric motors and other drive components, and to fund road-testing of plug-in hybrids and all-electric cars.

"These awards communicate a vision that plug-in vehicles are really a critical part of our energy future," says Marc Duvall, director of electric transportation at the Electric Power Research Institute in Palo Alto, California. In partnership with the South Coast Air Quality Management District, the institute has received $45.4 million to develop a fleet of hybrid trucks and buses.

“It's scaling up the existing guys with the existing technology in the existing way. Mark Platshon , VantagePoint Venture Partners”

More than $400 million went to the 'Big Three' car makers — Chrysler, Ford and General Motors — and the two biggest winners, the Michigan divisions of Johnson Controls and A123 Systems, together pulled in around $550 million to manufacture new batteries. Other manufacturers who received more than $100 million each towards lithium-ion battery development included Dow Kokam and Compact Power, both based in Michigan, and EnerDel, of Indianapolis, Indiana. The winning companies are expected to match the sums with their own capital investments.

Around $35 million was also allocated to universities to establish education and training initiatives for electric drive projects.

James Greenberger, founder of the National Alliance for Advanced Transportation Batteries, which promotes lithium-ion battery technology, was "disappointed" that his own organization did not get funding, but says that the recipients are all "first-rate companies that can move this technology forward".

Mark Platshon, a clean-technology analyst with VantagePoint Venture Partners in San Bruno, California, had hoped to see more money handed to smaller, innovative companies, and believes that the cash injection will do little to put the United States at the forefront of green technologies.

Most of the funding went to companies that make the same types of batteries that are already in large-scale manufacturing in Asia, where the most advanced electric vehicle components are made, Platshon says. "It's scaling up the existing guys with the existing technology in the existing way," he adds.

John Goodenough, a mechanical engineer at the University of Texas at Austin who reviewed some of the funding applications, adds that in his opinion, the allocations were politically motivated. "I was just very surprised at who got a fair amount of the money," he says. "Lobbying in Washington must have played a big role."

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Dolgin, E. Stimulus money unveiled for green cars. Nature (2009) doi:10.1038/news.2009.806

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