The EV ‘Gridlock’

It won’t be long until we see an abundance of electric vehicles in the United States. Right now, there are roughly 1.7 million EVs in the U.S., but by 2050, half of the cars on American roads will be EVs. And that’s not all. In the short term, we can expect over half of cars sold in the U.S. will be electric by 2030, according to BloombergNEF.

This accelerated adoption will undoubtedly help spur the country’s net zero goals. However, we may be putting the cart in front of the horse—or in this case, EVs ahead of the electric grid. If roughly half of Americans will have an electric car in less than 30 years as experts predict, that means roughly half of U.S. households will undoubtedly charge these cars at home, doubling their load on regional electric grids. Utilities will not only have to contend with energy supply concerns, but also distribution challenges through their already congested network circuits. A surge in demand in a busy circuit could cause it to overload, wiping out power in an entire neighborhood—or worse.

Utilities are doing their best to prepare for this new landscape and adjust their load management strategies in the wake of the EV revolution. Utilities now include EV considerations in distribution planning by revising their traditional assumptions around residential load diversity and increasingly turning to advanced analytics solutions to help monitor and forecast asset utilization levels to preemptively upgrade or reinforce parts of the network. And thanks to the recent Bipartisan Infrastructure Bill, companies now can bid for billions in funding options for greenfield EV charging infrastructure and electric grid modernization.

Despite this progress, that’s only half the battle. Utilities will not be able to make it on this journey to nationwide smart grids and mass EV adoption alone. The electric transportation ecosystem includes a vast network of power generators, electric grids, EV manufacturers, vehicle owners and users, infrastructure developers, telecommunications, and communities—and it will take widespread, cross-industry collaboration among all of these players to reach this new frontier. 

Two industries are better than one

To ensure America reaches fully scaled smart grids, EV adoption and ultimately net zero carbon emissions, the utility and auto industries will have to work together. And now’s the time to do it. EV fleets and energy transition agendas are in relatively nascent stages. We’ve seen the early days of the EV market and discovered their propensity to collect, analyze, and even predict data such as battery charging range and travel patterns. That insight is helpful for the auto manufacturer and consumer, but it could also be invaluable to regional utilities who need to monitor and forecast load management trends and electric cars’ impact on the grid.

When looking to develop this cross-industry partnership, automotive industry players and utilities need to address foundational elements of their partner ecosystem. Leaders must align to understand the intersection between business environments and identify the pathways for collaboration. All partners should recognize the joint obligation towards the mutual customer, define the joint value stream and engagement strategy, and agree on the structure of the partnership to assign specific roles, responsibilities, and rewards.

Once this foundation has been set, partners will need to develop a strategic framework to promote collaboration and secure data sharing. At a high-level, these strategies will need to include the following tactics:

• Using localized grid operational status in vehicle charge optimization algorithms to minimize grid overload, while ensuring driver convenience and vehicle range remains unaffected;
• Providing auto manufacturers with grid network topology to obtain EV connectivity activity aggregated by the circuit for operations and future planning;
• Sharing of vehicle telematics and network telemetry to create and administer customer incentives for reasonable and reliable grid utilization.

Bumps in the road to mass electrification and load management

No partnership is without its challenges. As auto and utility companies determine the parameters of their cross-industry collaboration, they’ll have to contend with several hurdles.

For example, auto and utility stakeholders will have to comply with certain industry regulations and   information security protocols, including data privacy and Critical Energy/Electric Infrastructure Information (CEII), when sharing EV and grid data. Leaders, particularly in the utility industry, will also have to contend with the mobile nature of EVs—which is very uncharacteristic of other types of loads utilities have traditionally managed.

Both EV manufacturers and utilities will also need to jointly incentivize their shared consumers to charge their cars in more manageable terms and share real-time communications to inform them when, where, and for how long to charge their vehicles. Determining such consumer charging behavior and monitoring load management analytics would thus require companies to introduce additional digital solutions, processes, vendors to achieve such a feat.

There’s no question—America will see a spike in the EV market over the next two decades. And we will also see mass grid modernization during that time. What is unknown is how these events will unfold, and how our current grid infrastructure will support an influx of EV charging needs. Although auto manufacturers and utilities have already begun their respective preparations, there is a notable lack of collaboration between these industries. EV enterprises don’t have access into utilities’ load management analytics and limits, and utilities don’t have access to EV charging trends and real-time analytics. A structured cross-industry partnership that emphasizes secure, accurate data-sharing processes and management protocols could propel the nation to decarbonized transportation and smart grids—but auto and utility leaders need to act fast. With transformation agendas accelerating within both industries, the time to partner is now.

Dinesh Abhimanyu Rajan is an industry specialist, who has assisted Utilities during key phases of change such as Deregulation, Rollout of Smart Metering, Grid Modernization and Digitalization. He has global experience covering Americas, Europe, Australia, Asia, and the Middle East, and, across the entire spectrum of regulatory structures; from state owned entities to fully deregulated and unbundled markets. Dinesh has been a speaker and panelist at various US and international conferences, and has contributed articles, commentaries, and expert opinions in leading online and print publications for the industry.