The Electric Vehicles (EV) sector is beginning to boom and this rapid growth presents a great opportunity for electric utilities, entrepreneurs, and innovators.
Michael Shepard, chairman of E Source, says “Revenue growth is not the only benefit EVs offer to utilities.” When questioned about the estimated growth? “Possibly up to $100 billion.” Shepard believes that utilities and electric transportation are presented with the biggest opportunity they have had in the past century.
The United States currently spends $400 billion a year on gasoline and electricity. As Shepard claims, “If electricity could capture the entire fueling market for light-duty vehicles, power sales would rise by about 25%, adding roughly $100 billion per year to electric utility revenues and saving car drivers about $300 billion a year.”
In order to keep the grid stable, utilities will need more flexible and dispatchable capacities and storage that can even out any changes in fluctuation from other renewables. “Electric vehicles can be taught to respond instantly to calls from grid operators to shed or increase load, store excess generation for later use, send stored energy into the grid and provide frequency regulation and other ancillary services.”
Rocky Mountain Institute analysts are forecasting that by 2050, half of all cars in the United States will be electric, adding 2,900 gigawatt-hours of storage and generation capacity to the grid.
Utilities have been slow to adapt to other renewable innovations like wind and rooftop solar, according to some critics, however, utilities now have the opportunity to seize a share of the $400 billion US petrol market from the oil companies.
Southern California Edison (SCE), one of the nation’s largest investor-owned utilities and regulated by the California Public Utilities Commission, recently had their proposal approved to invest $22 million in its “Charge and Market Education Program”, which includes an incentive scheme to deploy 1500 EVs.
Jordan Ramer, CEO of EV Connect; the leading provider of electric vehicle charging solutions, claims SCE “has a vision on the future”, as the model of having a utility co-fund the infrastructure is a new way of providing this infrastructure.
The utility will contribute payment to the infrastructure to support EV charging. The charging program is designed to manage a system in locations where EVs are parked for longer time periods, such as places of work, shopping centres, and multifamily residences.
The SCE enables the state of California to bring more renewable energy to the grid, by scheduling charging periods to the times when more renewable power is produced. The utility can send signals to the charging station to regulate the charging times in order to meet the needs of the grid.
As a result of the current opportunities, the upcoming years represent a critical time and an astonishing opportunity for utilities to significantly boost the growth of electric transportation.