The technology to shift U.S. transportation from oil to electricity is basically ready to go, but political and infrastructure issues could stymie growth beyond a niche set of drivers, according to a study done by the Massachusetts Institute of Technology.

The report, put out today by the MIT Energy Initiative, said that the two main reasons for electrifying transportation are to lower greenhouse gas emissions and to reduce dependence on imported oil.

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Conventional hybrids lower carbon dioxide emissions compared to gasoline engines by about 33 percent, it found. If a plug-in hybrid were charged by carbon-free electricity, such as nuclear, biomass, and renewable sources, then the reduction would be 66 percent. However, a plug-in hybrid vehicle charged with coal-powered electricity has a slightly higher emissions profile than a hybrid, it found.

"The bottom line is that with coal-dominated power systems as we have in the U.S., the emissions gains are essentially already there with hybrid vehicles," said Ernest Moniz, director of the MIT Energy Initiative, during a panel presentation today. "Until we decarbonize, we will not gain the major emissions benefits."

Beyond the environmental benefits, there are significant unknowns around how plug-in vehicles will be adopted, presenters said.

It's not clear how consumers will take to plug-in electric vehicles--either plug-in hybrid vehicles or battery-electric cars--and how quickly the prices for batteries will go down. Also up in the air is how to pay for a public infrastructure and whether people can get more value from car batteries, either by selling them for grid storage after several years or getting paid for vehicle-to-grid services.

On the policy front, most participants in the study agreed that a coherent federal energy strategy would be better than a patchwork of state programs and the current "grab bag" of federal tax credits, fuel efficiency standards, and direct spending on charging stations, said John Deutch, Institute professor at MIT who worked on the study .

There was also agreement that aggressive spending on research and development would hasten the adoption of electric vehicles. Some also advocated for a policy to put a price on carbon emissions. But Deutsch said the current political environment does not look promising for a well-organized strategy.

"Coming to an agreement in our political system is probably going to be the major barrier to progress as anything to do with battery costs," he said.

Battery prices Ramping up manufacturing of batteries is expected to lower the cost of batteries. But progress on price has outpaced predictions for the past 10 years, said Yet-Ming Chiang, an MIT professor and also co-founder of lithium ion company A123 Systems. The price per kilowatt-hour of a car battery is between $500 and $600 right now and it's projected to be $300 to $400 as volumes scale up, he said.

"There are events going on that make me optimistic that the technology will advance faster than we think. About three times the number of people are working on this compared to 10 years ago so the rate of innovation is much faster," said Chiang.

The U.S. has lurched from different transportation energy policies in the past several years, favoring fuel cells and then biofuels and now electrification. How far electrification will go is still unclear but it is one of the best options now on the table, said John Heywood, MIT Professor Emeritus and former director of the Sloan Automotive Laboratory.

Whether the cost of oil stays where it is or goes up significantly 15 or 20 years from now will largely determine how much electrification takes hold, he said. Right now, much of the demand for these cars is driven by California's emissions mandates but changes in the cost of batteries and oil could propel plug-ins beyond a niche market.

California laws "are the major driver for developing these technologies. It will take a realignment of the cost of batteries and petroleum to shift these into a genuine market pull" [from consumers], Heywood said.