Don’t Be Caught Unprepared for the EV Tsunami
The long years of waiting for electric vehicles (EVs) to enter the mainstream are over. Largely thanks to sharply falling prices, EV sales in the U.S. have been growing at a compound annual growth rate of 32 percent for the past four years, and monthly 2017 sales data suggests that the sales rate continues to accelerate.
EVs are on track to beat gasoline burners on price, without incentives or subsidies, by 2025. Bloomberg New Energy Finance anticipates there will be 39 models of plug-in hybrid electric vehicles and 44 models of battery electric vehicles available in North America by 2020. Today, several of the best-selling EV models can already go more than 200 miles on a single charge, and the ranges are only getting longer. If recent trends persist, 2.9 million EVs could be on the road in the U.S. within five years, bringing over 11,000 gigawatt-hours of load to the U.S. power grid, or about $1.5 billion in annual electricity sales.
One by one, the barriers to EV adoption—price, selection, range, consumer familiarity—have fallen. They’re all rapidly becoming nonissues. The vehicles are coming, and they’re coming fast. So fast, in fact, that a lack of charging stations is increasingly being seen as the biggest impediment to continued EV adoption. How can we get ready for this tsunami of EVs?
Rocky Mountain Institute’s recent report, From Gas to Grid: Building Charging Infrastructure to Power Electric Vehicle Demand, offers useful guidance, best practices, and lessons learned that all U.S. states can start using to get ready for a future of electric mobility.
Best Practices for Charging Station Deployment
It’s difficult to generalize a “one size fits all” best practice for deploying charging stations. The best type of charger to install in a given location depends on several variables, including the types of vehicles on the roads, how far they need to travel on a charge, how long they can remain connected to a charger, the cost of providing charging, who owns the charger, and sometimes overlapping regulatory and legislative requirements that vary from place to place.
The benefits that charging can deliver vary as well. Slower “Level 2” charging stations, like those commonly found at workplaces, can offer charging at low cost. Their capital costs are typically in the $600 range (plus installation), and they can often be installed at a residence with a modest amount of additional wiring and no upgrades to the main service panel. With managed charging, Level 2 chargers can also deliver valuable grid services by ramping their demands on the electricity grid up and down over a period of hours in response to changing grid conditions, while still ensuring that the vehicles are charged up and ready to go when drivers need them.
Conversely, “DCFC” fast chargers cannot easily deliver grid services because drivers expect them to provide the maximum possible charge at all times, hence the fast charging. They’re also an expensive way to provide charging, typically running around $50,000 per charger installed. Some installations can cost considerably more; it’s not unusual for the total cost of DCFC deployment to run as much as $300,000 each, including costs for project development, design, permitting, and system upgrades. However, because DCFC chargers can charge vehicles in a fraction of the time, they are needed for certain kinds of traffic, like commuters and long-distance freeway travelers. Eventually, DCFC will be able to charge EVs (even those with high-capacity batteries) in about the same amount of time that it takes to fill up at a gas station today.
From Gas to Grid describes how the business case for hosting charging stations depends heavily on all of the above factors. Utility tariff design, the utilization rate of the charging stations, the cost of land and capital, and the ability to swap vehicles on and off the stations efficiently can all make or break a charging station’s economics.
Accordingly, getting all the details right for deploying charging stations in a given municipality and utility territory requires significant advance planning and careful engagement with a broad range of stakeholders, including utilities, regulators, charging station providers and aggregators, municipal officials, property owners, employers, and consumer advocates. It is essential to develop a deployment strategy that engages with all such stakeholders early and iteratively, using pilot projects to determine what works best in a given context, and then scaling up from successful pilots while continuously collecting performance data and using it to inform future deployments. With such a strategy, charging station infrastructure can be built so that it meets the needs of EV drivers while providing service at the lowest possible cost and for the greatest possible benefit to all members of society—even those who don’t drive.
In order to keep the transition to electric vehicles moving, all utilities and municipalities should be actively planning and developing their charging station infrastructure. The need for charging stations is no longer in some hazy, distant future. It’s now. Considering that a typical utility rate case of this nature could run two years from start to finish, it could easily be 2020 before a utility is ready to implement a program of EV infrastructure investment initiated today.
The good news is that if EV charging is done right, meaningful cuts in emissions from the U.S. transportation sector can begin to be made, and the load of charging stations can be managed to optimize the grid and reduce the cost of electricity for all customers while simultaneously increasing the grid’s ability to absorb a larger share of clean wind and solar power.