As I mentioned on The Panelist...

With the race to launch the world's first commercially viable zero-emission vehicle now in full swing, it would be kind of fun to take a short trip down memory lane to see the genesis of this race and how we can formulate our expectations going forward.

The story can be traced back to the early 1990's, when General Motors (GM) was developing its all-electric vehicle (EV) technology, slated to launch in calendar year 1996 (for the 1997 model year). Using decades-old, proven lead-acid battery technology, GM came out with the EV1. GM released 200 vehicles in its inaugural year in Arizona and California and consumers could only drive them as a lessee.

The EV1 never became available for purchase. There were, of course, several problems/complaints with the initial model, including that they were heavy, the range allowed only 80 miles of driving before necessary recharging, and the batteries took a long time to recharge. By 1999, GM had launched a second-generation EV1 using the more advanced nickel metal hydride battery technology that charged up quicker and were lighter.

Whether you have seen the documentary Who Killed the Electric Car? or not, we all know what happened next....the program was abruptly ended and all EV1's on the road were recalled and subsequently crushed. Several conspiracy theories then surfaced as to why this happened, but this is not the point of this post.

Fast forward several years, and we see hybrid electric vehicles (HEV) gaining steam as the flagship fuel efficient car. Led by the Toyota (TM) Prius, the HEV segment is rapidly gaining market share due to its wallet-saving nature and environmental stewardship. As a result, we are also witnessing new breakthroughs in battery technologies, as energy storage is vital to the post-pure-internal combustion engine vehicle era.

The traditional nickel metal hydride batteries that are used in current hybrid vehicles (either developed in-house by the auto manufacturer or outsourced to large conglomerates like Panasonic) are quickly giving way to the more advanced lithium-ion battery technology. Indeed, with a higher energy density, longer cycle life, and lighter materials, lithium-ion technology is paving the way toward increased energy efficient driving.

Automakers are pairing up with battery manufacturers such as Altair Nanotechnologies (ALTI), Valence Technologies (VLNC), and privately-owned A123 Systems, who are employing nanotech to advance the energy storage technology for HEV's and the next-generation plug-in hybrid vehicle (PHEV). The Chevy Volt, the first PHEV to be launched on U.S. roads, will be commercially ready in 2010.