This post is part of our Industry 101 Series, an ongoing campaign to provide a foundation of knowledge about our unique industry. To learn more about this campaign, please click here.
6.3 Electric Vehicle impact in the Grid
Electric cars are becoming more popular every day. What is the motivation for people switching from traditional gasoline cars to electric or plug-in hybrid vehicles? A host of reasons are cited for the increase in popularity including environmentalism, the cost of gasoline, the desire to distance ourselves from foreign energy sources, and the long-term cost and maintenance of electric vehicles cheaper. These reasons are a clear demonstration that electric vehicles are not simply a passing trend, but rather a monumental change in the way we think of daily transportation. Whether all of these are valid reasons to switch to electric vehicles is not the focus of discussion in this article. Instead, the size of the electric vehicle market, the effect of their increasing popularity, and the ways in which this changes the way electric utilities manage their operations and grid will be the focus of examination.
6.2.1 ELECTRIC VEHICLE (EV) MARKET
The following graph shows the total number of electric vehicles year over year. Over the last several years, the largest adopter of electric vehicles worldwide is by far the United States. In fact, nearly a third of the world’s electric vehicles are being driven on U.S. roadways, putting U.S. electric utilities in a unique position to define the way in which electric vehicles are managed in relation to the grid. Assuming this trend increasing electric vehicle ownership continues, some changes must be made in order to manage the influx of electric vehicles being plugged into the grid to charge.
With stricter policies regarding automobile emissions, friendly policies in regards to alternatively fueled vehicles including tax breaks and incentives, and the rapid expansion of electric vehicle manufacturing, it is only logical to assume that the number of electric vehicles on the road will continue to increase at a rapid rate. Many new electric vehicle models are being released to the market, and the current models are already selling quite well. In the long term, all of this translates to a larger population of drivers using and owning electric vehicles.
An important factor in determining which countries upgrade their grids to deal with increased demand and stress of EV charging is where electric vehicle ownership is concentrated within a country. It can be assumed that early adopters of electric vehicles will live in certain highly populated areas that offer charging centers and have the available infrastructure to accommodate electric vehicle charging. Currently in the U.S., the highest concentration of EV ownership is in California. Although the current electrical grid in the U.S. is said to be able to support 150 million battery-powered cars, electric vehicle adoption in concentrated areas can be problematic for local grids. Adding a specific fast charger to a grid can consume the same amount of electricity and generate demand equivalent to an entire small household. If multiple people in one neighborhood install these devices, it creates issues with local grids and transformers sized for smaller neighborhoods. A few solutions address this problem, and one solution is the modernization of the electrical grid.
6.3.2 ELECTRIC GRID UPGRADES
Many electric utilities are already in the process of upgrading their grids through increased capacity, smart meters, and many more enhancements. These upgrades, especially ones which deal with capacity, must be introduced in high-demand areas first, so many programs have been developed to help pinpoint areas which need priority upgrades. One example is a customer-driven program in which utility companies ask their customers to let them know if and when they purchase an electric vehicle. Electric utilities are also using smart meter information and data to determine peak charging times and areas which generate the highest demand, so these areas can be prioritized in grid upgrades.
6.3.3 DEMAND/PEAK LOAD IMPACT
One of the most significant impacts of electric vehicles is the impact on peak usage. Many people come home from their commute and plug in their cars. As discussed previously, this can be problematic in smaller neighborhoods where the local grid cannot handle the increased demand usage of electricity. This can be handled in a few ways, including delayed charging, time-of-use, and shifted usage plans. Demand spikes can cause issues for utility companies that may need to suddenly shift their energy production to another plant or might need to suddenly increase production. These sudden increases not only cause stress on the grid, but can cost a significant amount of money as utilities must produce electricity to meet this increased peak in demand, especially considering most electric grids are currently built only for transmission and not storage. This means that any electricity that is produced and transmitted must be used when it is generated. This particular issue creates a unique opportunity for electric vehicles to fill gaps during peak demand times in which they are not charging but are still connected to the grid.
6.3.4 POTENTIAL BENEFITS
Thus far, we have discussed the potential negative impacts to the electric grid brought about by the advent of the electric vehicle and their increasing popularity. However, the rising popularity of electric cars also creates many positive impacts for the grid and for energy providers such as utility companies. We have already cursorily mentioned some of the potential benefits for the customers including saving money on fuel costs, low cost of maintenance for electric vehicles, and more. But, how does this benefit the utility companies?
The major opportunity for utility companies in the shift from fuel-powered to electric vehicles is the shift of the market from petroleum providers to utility companies. This allows utility companies to increase their bottom line and accommodate the emerging needs of their customers. Not only is this an opportunity for increased revenue, EVs also provide an opportunity for cost savings. As previously mentioned, many grids cannot store electricity, so in order to meet increased peak-demand times, generation must be ramped up. Electric vehicles, however, have the ability to store electricity. This means EVs could be used to supply power back to the grid during peak demand hours. Peak demand times are currently determined primarily by the need for heating and cooling peaks, which happen to coincide with the time people are generally not using or charging their electric vehicles. If enough electric vehicles are on the road and connected to the grid during peak demand time periods, it is possible they could help meet peak demand by using stored power in their battery cells.
If electric cars are used to combat peak demand from heating and cooling and various other demand generating events, how should utilities handle the increased demand from EV charging?
With the advent of smart meters and the smart grid, it is possible to determine when and how people use electricity. The most effective way to combat peak demand generated by the charging of electric vehicles is to use time-of-use plans, which reward customers who shift their usage to off-peak times with lower billing rates for electricity. If the cost of electricity is more during on-peak times, then people will be less inclined to charge their cars during these times. In the long run, this can save utility companies a significant amount of money. This can also encourage EV owners to use the delayed charging capabilities of their electric vehicles,which allow a car to be plugged in, but not begin charging until a specified time. This approach in combination with electrical grid updates is the best way to mitigate any serious negative impacts that may arise from the rising popularity of EVs.
Electric vehicles are increasing in popularity, and this sudden and constant increase in EVs on the road will cause significant impacts on the electric grid. However, these impacts do not have to be negative if utility companies use their existing smart grid infrastructure to anticipate where upgrades need to be made as well as use the data collected by smart meters to enforce time-of-use plans, which can shift demand to off-peak times such as overnight charging. The advent of the electric vehicle is a unique and exciting opportunity, not only in terms of the potential for increased revenue for utility companies, but also to decrease our dependence on foreign energy sources and potentially distance ourselves from carbon-emitting fuel sources such as petroleum.
If you enjoyed this article, click here to start from the beginning of our Industry 101 Series.
Or to continue your journey, click here to access the next installment of our Industry 101 guide.
Here is a list of relevant reading material our expert identified as sources for additional information: