It was barely a year ago that electric vehicles (EVs) were largely relegated to the novelty category by most in the utility industry. Now, one finds EVs prominently covered in virtually every utility smart grid conference program, and some utilities are even considering the launch of new EV charging businesses. In over 20 years of utility industry involvement, I have never seen utilities go through such a rapid shift in thinking.

Many factors contributed to the shift in utility perspectives toward EVs, but the turning point arguably would be the announcement of billions of dollars of federal stimulus funding to support alternative fuel vehicle programs in the U.S. and elsewhere. This has propelled auto manufacturers to announce planned production of at least 60 xEV (EV, PHEV, HEV) passenger and light duty plug-in vehicles by 2010, and at least 119 models of xEV passenger vehicles by 2015 (1). What does the arrival of all of these EVs mean for utilities?

Location, location, location

Consumer adoption of EVs, especially over the next couple of years, is expected to occur in localized concentrations where the combination of demographics, consumer attitudes and familiarity with hybrid vehicles favor their early adoption. Thinking of adoption of hybrids, it is not too hard to see where the first waves of EVs are likely to land. Such concentrations of EVs pose potential issues for utilities.

Each time a vehicle plugs in, the amount of power required is roughly equivalent to another home suddenly appearing on the distribution system. Depending on the local residential energy profiles, a 3-6KW EV connection can even look like the equivalent of as much as 2-3 homes. Utilities have designed their systems to accommodate such impacts only up to a point before system upgrades and new investments are required. Managed EV charging solutions offer the most attractive way for utilities to ensure EV drivers get the energy they need while minimizing utility impacts – and thus defer, or possibly avoid altogether, the need to invest in system upgrades.

Show me the energy

The U.S. electric utility industry operates an interconnected transmission system that links generation to demand (customers). Utility generation, transmission and distribution systems are designed to meet the highest expected demand, which in most cases occurs for less than a few hundred hours a year (out of a total of 8,760 hours). The rest of the time, up to a third or more of the power plants are idle, ready to respond to part-time duty, or shut down altogether if there is no scheduled requirement.

Based on research conducted by Pacific Northwest National Laboratories, this idle capacity in the U.S. grid could supply the equivalent energy needs of over 70% of the cars, trucks and SUVs that are on U.S. roads today – with no new utility system investment required! That’s approximately 175 million electric vehicles that today’s U.S. grid could support. However, achieving this requires the charging of EVs to be managed in a centralized fashion to ensure that charging takes place during “valley” (or “off-peak”) periods.

How green is my (off-peak) valley?

As the number of EVs grows within a region, they transform from being a potential headache for utilities to becoming an important energy asset. Large numbers of EVs create a “distributed storage” resource that can be used to absorb excess energy that routinely occurs in utility systems. Such excess energy, for example, occurs moment to moment as the system operators attempt to match generation supply with demand and keep the system in balance. Perhaps more significant is the “excess energy” associated with renewable energy. Renewable energy is inherently variable and in many places is mostly available at times when energy is least in demand (i.e., off-peak, at night). On the contrary, without energy storage, the ability of electricity systems to absorb increasing amounts of renewable energy is significantly impacted. One recent study indicated that without energy storage, achieving 50% renewable portfolio standards in California would result in over 3,000 GWh of energy “dumped” annually – energy that could otherwise charge the equivalent of 1 million vehicles for a year!

If 2009 was the year that EVs became real to utilities, 2010 promises to be the year that EVs start becoming formally integrated into utilities’ smart grid strategies. We have been actively working with utilities and grid operators around the world by demonstrating how our technical achievements in Israel and Denmark can be brought to other countries as well. It’s exciting to see the enthusiastic response to our intelligently-managed EV charging approach—an approach that can become a key element of utility smart grid strategies everywhere.

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(1) “Electric Vehicles: Plugged-In 2,” 11/3/2009, Deutsche Bank