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Arup Barat
Arup Barat
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Incorporating Managed Charging into Fleet Electrification for a Sustainable Future

The transportation industry's electrification revolution is gaining momentum, and looking in the rearview mirror, 2017 was a watershed year. According to BloombergNEF (BNEF's) Electric Vehicle Outlook 2023 study, 2017 was the peak year for combustion vehicle sales. Since then, we've witnessed a steady decline, with Battery Electric Vehicles (BEVs) taking the lead.

 

Overview of the Growing EV Market

BNEF projects that by 2040, 75% of all vehicle sales will be Electric Vehicles (EVs), propelling us toward a zero-emission future.

By 2030, the number of EVs on the road could reach 191 million, according to the International Energy Agency (IEA). And if more stringent environmental policies are enacted, the IEA's Sustainable Development Scenario anticipates 230 million EVs by 2030.

 
Global Increase in Electricity Demand

This growing adoption of EVs will inevitably lead to a corresponding increase in demand on the electrical grid. In a recent report released by the National Renewable Energy Laboratory (NREL), it was projected that EVs could contribute to a 38% increase in electricity demand by 2030 in the United States alone. The increase in demand will be especially pronounced during peak charging times, such as overnight or during early evening hours, which has the potential to strain existing grid infrastructure.

The demand surge is not limited to particular regions; rather, it's a global phenomenon. The 2021 study conducted by the European Commission predicted that the EU's electricity consumption could grow by 9.5% by 2050 due to the expansion of EVs. This pattern is observed across both developed and emerging markets, reflecting the impact of a worldwide shift toward electrified transportation.

 
New Solutions for Grid Sustainability

There is an emerging necessity to influence EV charging in a way that minimizes costs and delays or avoids expensive grid upgrades. One approach is managed or smart charging, and it involves controlling the time, power and location of charging to optimize the grid. According to McKinsey & Company, just in the segment of commercial fleet electrification, the U.S. market for energy-optimization services supporting EV fleet charging could be worth $15 billion per year by 2030. This includes procuring renewable power, offering energy-management services and providing ancillary grid services. Such strategies can help fleet operators reduce costs and contribute to renewable energy growth. Additionally, EVs can function as energy storage assets, enhancing grid functionality.

 

Challenges with Unmanaged EV Charging

Charging EVs isn't just about plugging them in; it's a dynamic process that intertwines with the entire electricity grid. Unmanaged EV charging can lead to peak load stress overloading transformers, and even premature retirement of critical equipment. Controlled, managed charging can prevent these issues.

 

Peak Load Stress

Unmanaged charging during peak hours can exacerbate existing peak loads. Evidence from the California Independent System Operator (CAISO) and the New York Independent System Operator's (NYISO) 2023 Load and Capacity Data report shows that unmanaged EV charging could increase peak demand by 9% by 2030.

 

High Cost of Grid Updates

Upgrading the grid to accommodate EV growth is costly. The U.S. Department of Energy's Grid Modernization Initiative estimated that approximately $100 billion would be needed over the next decade. Such investments are far from trivial and usually result in higher costs passed on to consumers. Utility companies, like Pacific Gas and Electric (PG&E), have noted that upgrading transformers, substations and other essential equipment would necessitate rate increases, affecting not only EV owners but all electricity consumers.

 

Managed Charging Solutions

The risks of rapid transportation electrification are imminent but can be mitigated, and managed charging solutions provide an elegant option. Implemented correctly, with the right mix of technology and policy, managed charging can turn EVs into important grid-connected assets that help defer the cost of grid updates while also supporting the growth of renewable energy.

 

Deferring Grid Updates

Managed charging strategies include:

  • Spreading Out the Demand: Intelligent scheduling avoids overloading during peak periods.
  • Shifting EV Charging to Off-Peak Times: Charging at night or during excess capacity optimizes grid resources.
  • Utilizing Demand Response Programs: Incentives for off-peak charging provide grid flexibility.
  • Integrating with Renewable Energy Sources: Aligning with solar and wind energy balances the grid.

 

Renewable Energy Integration

But managed charging isn't just about deferring grid updates. It's also about aligning with renewable energy sources and reducing our reliance on fossil fuels. California utilities have integrated solar energy with EV charging, and a study in the Processes Journal showed a potential 40% reduction in CO2 emissions.

 

Incorporating Managed Charging into Fleet Electrification for a Sustainable Future

As the electrification of fleets becomes an inevitable part of our transportation future, the integration of managed charging is no longer an option but a necessity. The approach must be comprehensive and involve all stakeholders. For example, Itron's focus on accelerating EV charging deployments creates harmony across the grid, allowing for an affordable and sustainable EV transition. Itron recommends an approach that includes progressive planning, staged deployment and continuous optimization of operations:

  1. Comprehensive Planning: Understanding the charging loads and their grid impact is crucial. Itron's approach includes forecasting, analytics and optimization tools to help plan fleet transition and energy management. Itron’s grid impact studies have been critical to utilities in making these key decisions. This quantification helps in identifying how smart charging can avoid unnecessary distribution infrastructure upgrades, thereby optimizing costs for all stakeholders.
  2. Intelligent Deployment: Utilities and manufacturers play vital roles in the implementation process. Collaboration between stakeholders, facilitated by Itron, explores alternative rate structures, renewable energy integration, Vehicle-to-Grid (V2G) potential and the incorporation of smart charging policies. Itron connects fleet owners and utilities to minimize the total cost of ownership and complexity. Using a turnkey, open-standards and vehicle-agnostic technology solution maximizes uptime with real-time data, computing and optimization at the grid edge. Itron is integrating fleet depots into the grid infrastructure using this approach.
  3. Optimized Operations: The key to a successfully managed charging solution is control of grid loads as well as EV loads. Itron's EV Optimizer is the only solution on the market that manages both EV loads along with other grid loads and orchestrates that with millions of deployed metering data nodes to ensure overall reliability and resiliency while working with utilities on both behavioral and managed charging programs. This charging management application is complemented by professional services needed to design, install and manage an EV charging installation. Itron-enabled charging-as-a-service (CaaS) programs through cloud-based SaaS offerings and turnkey solutions provide a one-stop-shop for navigating the electrification process.

 

The Itron Approach

With the imminent massive uptick in electrification, the range of benefits that smart charging can enable for fleets is vital for an affordable and sustainable EV transition. Itron's focus on accelerating EV charging deployments ensures that charging assets work in harmony across the grid, allowing end customers to better manage their fuel costs and utilities to protect the grid.

The future of transportation is electric, and the smart charging market, supported by companies like Itron, is poised for explosive growth. The path to a cleaner, more sustainable energy future requires collaboration, planning and innovation. By embracing managed charging, we are not only deferring the high cost of grid updates but also aligning with renewable energy sources and taking significant strides toward a greener future.

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