Six Building Blocks to Prepare the Grid for EVs
The planning and investment to support millions more EVs needs to happen now. Here’s how utilities and regulators can do it.
This is the pivotal decade for making electric vehicles (EVs) a key part of our transportation system. Many signs suggest that we’re on the right path, most directly the continued growth in EV sales – from passenger cars to buses to the trucks that power our economy. Yet we risk the speed of the transition by not preparing our electric grid for this level of growth as quickly as we need to be.
The power required at a site like public fast charging at a highway plaza or a big trucking depot can be as large as a professional sports stadium or even a small town. The scale of planning needs to match the scale of the power needed. That means planning and investing in grid infrastructure now, so that millions of EVs can seamlessly integrate into our networks as soon as they hit the road.
RMI has been working to tackle this issue from different angles. In collaboration with GridLab and Advanced Energy United, our CHARGED Initiative convened dozens of experts to develop actionable ways utilities can prepare the grid for high levels of electrification. We are exploring policy and regulatory changes needed to fully utilize EVs and other customer devices as grid resources through the Virtual Power Plant Partnership. Most recently, based on a series of expert interviews with a diversity of stakeholders, including current and former utility commissioners, utility representatives, researchers, and non-governmental organizations, we developed a set of Transportation Electrification Building Blocks that collectively create a strong foundation to help utilities, regulators, and other stakeholders appropriately plan for and invest in upgrades needed to support EV load growth, while also protecting ratepayers.
Stakeholder-informed strategies can help utilities and regulators plan and develop the grid further in advance
Our strategy aims to address the root causes hampering more rapid upgrades to the grid: uncertainty as to when and where specific upgrades will be required; a 20th-century regulatory paradigm that isn’t well-suited to the current period of rapid growth in electricity demand; and the deep-seated risk aversion of utilities and their regulators.
We propose six steps — or building blocks — that can help to determine the needed type, location, and timing of grid upgrades, as well as how best to provide that infrastructure quickly without putting undue risk on either utilities or their customers.
1. Plan against long-term EV market expectations.
Strategic investment in the electric grid to support transportation electrification first requires an understanding of how many EVs will be operating in the future. Regulators can help make this future state less uncertain by requiring or encouraging utility plans be tied to specific targets, informed by market expectations of future EV growth and customer demands.
2. Improve load forecasting practices.
Better load forecasts will be critical for planning and budgeting infrastructure investments. Newly available data such as detailed vehicle travel patterns (telematics) enable increasingly precise estimation of when and where EV load growth is likely to materialize, of what magnitude, and how flexible that load may be. Better load forecasting is especially important for EV charging sites with larger power needs, such as medium- and heavy-duty fleet depots and DC fast-charging plazas, which can be built quickly and give utilities little time to react to those power needs.
3. Prioritize efficient, cost-effective use of distribution infrastructure.
The challenge of meeting new EV demand will be much more difficult, slower, and expensive to address if utilities rely solely on traditional distribution capacity upgrades. Utility planning should take a whole system view of assets available on the distribution network and consider how they can best be utilized. This view should include enabling customer and third-party-owned resources to be useful grid assets in exchange for appropriate compensation. A systems-level view of planning will increase efficiency and lower costs. Strategies such as Integrated Distribution System Planning and expanding planning time horizons are key to the successful implementation of this more holistic planning paradigm.
4. Align grid connection with customer needs.
EV charging project developers need to know that their schedules will not be interrupted by slow grid connection processes. Better aligning the two will ensure existing distribution infrastructure is used efficiently, reduces the overall need for new infrastructure investments, and saves costs. Serving the growing volume of new loads on reasonable timelines will also allow utilities to better meet their core obligation to provide electric service. Connection timelines can be reduced through several good practices, including streamlining application processes and queues, increasing transparency for third parties through tools like public hosting capacity maps, and developing reasonable stockpiles of common equipment.
5. Improve risk sharing and mitigation.
Innovative approaches to risk sharing and mitigation, such as through new partnerships between utilities and customers or third parties, will be important to enable the scale of grid investment required to support anticipated levels of EV load growth. While this type of risk mitigation is not currently common practice, promising examples include opportunities through federal programs and green banks, and tariff options with new approaches to cost allocation. These and similar methods can help to limit both real and perceived risk in grid investments, catalyzing necessary upgrades that will support a broader scale of transportation electrification.
6. Enable accountable, longer-term utility capital investments.
We must ensure needed infrastructure investments are made far enough in advance to avoid the grid becoming a bottleneck which prevents electrification. Utilities need flexibility in how and when their capital will be deployed while also being held accountable for the appropriateness of their expenditures. A promising package of closely tied steps includes a) enabling multi-year rate plans to provide utilities needed flexibility in resource and system planning; b) establishing cost trackers for proactive grid investments, including cost-containment measures such as shared-savings mechanisms to protect utility customers; and c) proposing carefully designed performance-based mechanisms tying utility cost recovery to desired outcomes.
Together, these building blocks have the potential to dramatically increase the pace of grid infrastructure investments by reducing uncertainty and risk, unlocking the full potential of the transition to electric vehicles.
