The Vehicle-Grid Integration Summit hosted by the Technical University of Denmark at the ostensibly inconspicuous Risø DTU National Laboratory for Sustainable Energy brought together the entire world of energy, mobility and IT professionals from the entire world. What is at stake? How to define and quantify value of new grid services eligible to be provided by the growing fleet of electric vehicles – writes Bartosz Kwiatkowski from PSE.
I recently wrote a speculative article on future of business models in e-mobility (text in Polish). Not to sound repetitive, I would like to focus hereunder primarily on the most interesting conclusions from the #VGI event.
– Given the magnitude of the challenge, there is a major need for any planned investments in power grid reinforcement to be preceded by a feasibility study on alternative solutions. It is the case in California, and now also the UK OFGEM issued a similar statement. Essentially, does it make sense to build a specific new or improve an existing power line – or maybe calling the demand side to provide, say, short-term reserve is technically feasible and minimizes costs for customers?
– Smart utilization of energy storage capacities provided by EVs creates opportunities twice a day – during home charging at night to shift the energy consumption to the cheapest time zones, and during work charging, facilitating availability of very flexible load during peak demand. The latter is particularly valuable (even more so if there is any meaningful PV capacity available) due to growing peak demand and increasingly stochastic grid operations – so the policy should promote installation of EV chargers in workplaces and rewarding smart destination charging during daytime (be it V1G or V2G). Any legislation promoting EV deployment needs to come with strings attached, i.e. requirements for smart charging – a responsible Government should not allow extensive development of “dumb charging” to prevent the adverse impact on the grid.
– And, behold aggregators, cash is out there. Using EVs as controllable load reduces necessary investments in the power grid reinforcement. According to UK forecasts, by 2040 the Brits will save up to 8bn pounds in avoided network investments, while EV fleets will earn even more on providing flexibility. I am starting to think that we should have paid a little bit more attention to EVs when developing the scope of EU-Sysflex project.
– Some sweating is still required to establish what grid services are eligible to be provided by EVs – both in terms of technical specification and pricing. Frequency services? Reserve services? Capacity markets? Response time and duration of the service are key parameters. The faster response time, the higher value for the system. In that sense EVs are well positioned to provide lucrative frequency services – given their response time measured in seconds and limited duration preferred by drivers. Pricing would be determined on the basis of the local energy market, including energy mix – so there is no magic wand to apply, no universal one-fits-all approach to services.
– Behind-the-meter peak shaving is a particularly promising service to start, as there are no major regulatory obstacles to overcome. The Vehicle2Building service is really a low-hanging fruit – the key technical issue is just to integrate chargers with the building infrastructure. A fleet of EVs connected to a large commercial property could easily reduce load on demand, or even supply the building with energy on demand if such a necessity occurs (V2G). According to CHAdeMO Association, substantial share of Japanese EV owners use their cars as an emergency backup.
– There are widespread concerns among EV owners regarding using their cars, i.e. storage, to provide any commercial services due to fears of battery degradation. Therefore compensation for such services need to alleviate worries of 2% battery deterioration over 5 years as indicated by the DTU team. Indeed the communications aspect will play a major role in shaping behavioral patterns of EV drivers. To reiterate my erstwhile comment, these patterns are radically different than in case of ICE cars owners, and the behavioral shift will take time and requires incentives.
At last, to paraphrase Bill Clinton’s old slogan, what really matters is economics, stupid. That is why I strongly believe that both cars and the charging equipment need to be cheap to penetrate the market. As long as V2G equipment is complicated and expensive, unidirectional smart charging will remain a prevailing technology. A charger should remain just a gate between the car and the grid, an affordable consumer device, not a fancy blinking cabinet.
For the same reason, despite improving battery capacities and potential charging speeds, I believe that the charging equipment market will increasingly split into two major segments: destination chargers and fast chargers. Even with a 60kWh car it just does not make sense to invest in high capacity charger at home and incur mind-blowing monthly connection costs – if one’s vehicle is charging overnight or waits for a driver to finish his duty, using a DC charger feels like eccentricity. These simple AC chargers at home and at work will become workhorses of the new line of grid services.
Charging at a juice station between Warsaw and Berlin is a completely different service – one needs to finish swiftly, before the coffee cools down. One won’t like anybody to use one’s car for balancing the electricity system while waiting to hit the road again. Rather, one would pay dearly for charging at 150kW or 300 kW, or even at 900kW (as the new CHAdeMO-GB/T standard promises), but these devices would probably initially generate revenues primarily from premium fast charging, not grid services. In the longer perspective, however, high capacity charging station integrated with RES generation and energy storage (perhaps based on the kinetic technology, like flywheels), may become vital for the distribution grid.
Very near future will verify these considerations. Next few years will bring a plethora of new projects – though it is clear enough that the Netherlands, UK, California, Japan and Denmark are all in the forefront of the revolution. Which jurisdictions will follow? Which will remain laggards and stuck to the fading paradigm of centralized electricity market? The power grid of the future will become unrecognizable for engineers trained in the 1960s and electric vehicles are deemed to comprise a vital part of the coming equilibrium.