Stimulus funds used to buy foreign cars

LIHU‘E — At a time when Americans struggle to find jobs and national debt approaches crisis levels, some taxpayers may be interested to learn stimulus funds are supporting foreign auto manufacturers.

Kaua‘i County, for example, has added five Japanese-made cars to its fleet using money provided through the American Recovery and Reinvestment Act, which was designed to stimulate the U.S. economy and create jobs domestically.  

The county announced last week the delivery of five silver 2011 Nissan Leaf EVs, the only new solely electric vehicles currently on the market.

“We’re very excited about launching the county’s EV pilot,” Kaua‘i County Sustainability Manager Glenn Sato said in a news release. “This will give us the opportunity to examine how the latest models perform and whether the county might consider purchasing more electric vehicles in the future.”

With a purchase price of $35,986 each, the county allocated $180,000 of $267,000 in grant funds for the cars. The grant, under the ARRA Alternative Transportation Program, is allocated to local governments for the purchase of energy-efficient vehicles.

Both hybrids and EVs are covered under the grant program.

However, Sato said when he wrote the grant request last year, he specified the county’s interest in procuring and testing the fully electric vehicles.

When the county put out the bid for the EV, it specified five Nissan Leafs or equivalents. On Thursday, he said in retrospect he wishes he had not made the grant request quite so specific as to exclude the Chevy Volt, a plug-in electric car with a gasoline backup engine.

Remaining grant funds will go toward the purchase of 10 EV charging stations, five of which will be designated only for county use and five for public use.

“We were within budget for the electric cars, but the charging stations will cost more due to installation and county desire to have stainless steel components for all exterior electrical devices other than the chargers,” Sato said in an email. “We have added $79,000 to the original charger budget of $96,000.”

The additional funds for the charging stations will come from the Water Department, which is participating in the EV pilot program, and from state grant, Sato said.

The chargers will be made in the U.S.A. and the contractor will be verified, he said.

Buy American

The ARRA has Buy American Provisions that require products purchased with ARRA funds be either wholly produced in the U.S. or, if it contains materials from another country, has been substantially transformed in the U.S. into a new and different manufactured good.

Vehicles exempt

But “vehicles are exempt” from Buy American Provisions, according to Maria Tome, Renewable and Transportation Energy Program manager at the state Department of Business, Economic Development and Tourism, which is administering the grant.

Uncertain as to why they are exempt, Tome contacted a representative from the U.S. Department of Energy, who told her “vehicles are exempt from Buy American (Provisions) because vehicles are not a manufactured good incorporated into a public building or work.”

The unidentified DOE representative added that “with no Buy American compliance issue, the state has no hurdle to purchasing them. DOE funds are only bound by DOE regulations, not those of the federal highway administration or any other federal agency.”

A matter of choice?

So although state officials say the county’s purchase of foreign cars with ARRA funds was within the provision’s limits, the question remains as to why the county chose to use domestic stimulus dollars to buy Leafs, which are manufactured solely in Oppama, Japan, and exported to the U.S.

General Motors has the 2011 Chevy Volt — a highly rated EV hybrid — on the market.

“We did not choose to purchase foreign-made electric cars over American-made electric cars,” Sato said. “King Windward Nissan was the only respondent to the bid. The bid was written broadly so any four-door EV would have been acceptable as long as they came in within budget.”

Tome concurred. “You don’t always get bids from all,” she said. “When we go out for state bid, we don’t get bids from GM. They don’t go for fleet sales.”

Side-by-side comparison

Both the Leaf and the Volt are similar in price and both are electric vehicles. The primary difference between the two is that the Leaf is electric-only and the Volt has gas-powered backup.

The Volt is Car and Driver magazine’s Editor’s Choice in Budget and Green categories and received accolades from Consumer Reports. It can run 35 miles on an electric-only charge and has a combined gas-electric range of 372 miles.

The Leaf is a fully electric vehicle that isn’t getting much love. Extended tests by Car and Driver staff resulted in a report about the difficulties of living within the limitations of the vehicle, which is said to get an average range between 58 and 78 miles per four- to seven-hour charge (with a 240-volt charger), rather than the 100-mile range estimated by the Environmental Protection Agency.

Car and Driver said the Leaf’s limited range induces fear and anxiety in drivers  — anxiety over using the radio, thermostat control or even windshield wipers for fear of running out of juice before reaching a destination. And if you do run out, the article states, the car has to be towed to a charging station.

Zero fuel, zero emissions?

Despite its limitations, the prospect of zero emissions and zero trips to the gas station is an appealing one. However, in reality, a zero-emissions electric vehicle is not possible unless it is being charged by a zero-emissions source, such as solar or wind power.

Tome said Hawai‘i is the only state in the U.S. that relies almost entirely upon petroleum-based energy production. On Kaua‘i, 90 percent of the energy produced comes from a 50-50 mix of diesel and naphtha, according to a 2005 Kaua’i Island Utility Cooperative report.

Sato said he wasn’t sure how much energy is required to charge the Leaf and hadn’t calculated the costs in dollars to charge it, but added that such figures will be determined during the course of the pilot program.

Diesel and naphtha pollute more carbon emissions than gasoline, according to government-sponsored bioenergy research. One gallon of gasoline produces 2.42 kilograms of carbon; whereas, one gallon of diesel fuel produces 2.77 kg. One gallon of naphtha produces 8.3 kg.

It takes 2.8 gallons of diesel-naphtha fuel to produce the 33 kilowatts needed to fully charge the Leaf, according to Leaf specifications and the energy rating on KIUC generators, provided by Tome. With 10 percent deducted for KIUC’s non-fuel energy production, that translates to 2.52 gallons of diesel/naphtha needed to fully charge the EV and 13.96 kg of resulting carbon.

At KIUC’s October flat rate for large commercial users of 43 cent per kwh, it will cost the county approximately $14.19 to go an average range of 68 miles. That equates to an average of 21 cents and 0.21 kg of carbon per mile to operate.

Comparatively, a standard gasoline-fueled economy vehicle that gets an average of 30 miles per gallon will require 3.33 gallons of gas to go 100 miles and result in 8.06 kg of carbon. At Lihu‘e’s current rate of $4.47 per gallon, the cost totals $14.89. That’s an average of 15 cents and 0.08 kg carbon per mile.

Leaf production growing

Although Leafs are currently produced in Japan, the company has plans to expand operations to Smyma, Tenn., at the end of next year. The U.S. federal government is subsidizing the expansion, which is expected to create 1,300 manufacturing jobs.

Charging stations

The 220-volt charging stations the county plans to install for public and county use will be available in Lihu‘e early next year, Sato said. The county is in the process of procuring services for the purchase and installation of the 10 EV chargers that will be installed at several county facilities, including the Civic Center, the Historic County Building Annex 1, an automotive repair shop and the Department of Water headquarters.

The public will have to pay a fee to use the chargers, Sato said. There will be a credit card swipe for payment.

“The fee hasn’t been determined yet, but it will include the cost of electricity plus the processing fee for credit card payment,” he said in an email.

A county press release said an EV public outreach program is also included under the grant’s pilot program. The county will provide informational brochures, displays at public venues such as the Kaua‘i County Farm Bureau Fair and Earth Day events, and presentations at energy conferences.

The total taxpayer bill per car, including charger: $53,486.

• Vanessa Van Voorhis, staff writer, can be reached at 245-3681 (ext. 251) or by emailing


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