The findings of a very interesting study have just been released that works on the assumption that by 2025, one quarter of US cars will be plug in hybrid vehicles (PHEVs). Assuming continued growth in population and vehicle ownership in America, that amounts to at least 60 million vehicles, up from - I would guesstimate - a few dozen today.

The Oak Ridge National Laboratory Study was principally concerned with what the impact would be on electricity demand. As per their press release;

"In an analysis of the potential impacts of plug-in hybrid electric vehicles projected for 2020 and 2030 in 13 regions of the United States, ORNL researchers explored their potential effect on electricity demand, supply, infrastructure, prices and associated emission levels. Electricity requirements for hybrids used a projection of 25 percent market penetration of hybrid vehicles by 2020 including a mixture of sedans and sport utility vehicles. Several scenarios were run for each region for the years 2020 and 2030 and the times of 5 p.m. or 10:00 p.m., in addition to other variables.

The report found that the need for added generation would be most critical by 2030, when hybrids have been on the market for some time and become a larger percentage of the automobiles Americans drive. In the worst-case scenario—if all hybrid owners charged their vehicles at 5 p.m., at six kilowatts of power—up to 160 large power plants would be needed nationwide to supply the extra electricity, and the demand would reduce the reserve power margins for a particular region's system.

The best-case scenario occurs when vehicles are plugged in after 10 p.m., when the electric load on the system is at a minimum and the wholesale price for energy is least expensive. Depending on the power demand per household, charging vehicles after 10 p.m. would require, at lower demand levels, no additional power generation or, in higher-demand projections, just eight additional power plants nationwide."

So timing is everything. Even in a country like the UK, which powers most of its electricity by coal and gas, charging up overnight makes sense because when demand drops from a peak of 60 GW during the day to 20 GW at night, only the nuclear, hydro and wind power stations are still generating electricity. And because no one uses it much then, it's cheap, virtually half-price. The study also from what I gather, does not factor in the arrival of pure electric vehicles which would also want some of that demand.

Now, back to the bigger story. For PHEVs, from several dozen to 60 million in the US alone - this is a phenomenal growth curve - how could an investor get exposure to it?

Hybrid Battery Technology stocks;

Altairnano

Applied Intellectual Capital

Electro Energy

Quantum Fuel Systems Technologies Worldwide

There's also Ener1 - see here, which I don't list because it is a OTCBB stock.

and for the pure electric vehicle play . . .

Tanfield Group - UK based

Zenn Motor Company - Canada based but doing business in the States

So there aren't that many stocks and they're all pretty small. One should also be cautious as similar projections were made for fuel cell cars which everyone would now agree were ridiculous. I have more confidence though that plug in hybrids will succeed because they already work at a reasonable cost. Definitely a sector to swat up on.