Electric utilities around the world are emerging as major boosters of electromobility, and are promoting EV adoption in various ways.
As we reported back in 2019, utilities are sponsoring the installation of public charging stations, and/or offering rebates to customers for installing home chargers. Some are also offering programs, such as discounted off-peak rates, that make it even more economical to drive electric.
San Diego Gas & Electric has collaborated with PlugStar, a subsidiary of the non-profit organization Plug In America, which is dedicated to breaking the auto dealership bottleneck by providing EV-specific training to dealers and their sales staff, and recommending best practices to dealerships that want to sell more EVs.
According to a recent article in Bloomberg Green, utilities have asked state regulators to approve more than 80 charging infrastructure projects and other pro-EV efforts, and 78% of the requested initiatives have been approved.
There’s one obvious reason for this enthusiasm—more miles driven on electricity means more income for utilities. However, there’s another, potentially even more important, dynamic at work. EVs can help utilities to regulate the electric grid in several ways.
Electricity usage tends to peak at certain times, so utilities are required to maintain expensive (and dirty) peaker plants, which provide extra energy at peak times. These peak times tend to be in the early evening, when people come home from work and start playing with their electrical toys. EVs are usually charged overnight, so they can be a valuable resource to smooth out the load curve. That’s why time-of-use billing programs, which incentivize EV owners to charge during off-peak times, are mutually beneficial to utilities and their customers. James Morris discusses the issue in a recent article published in Forbes.
Vehicle-to-grid (V2G) technology offers even more exciting possibilities. An EV equipped with bidirectional charging capability can act like a battery when it isn’t in use, absorbing energy during times of peak production, then releasing it during times of peak demand. As more solar energy is added to the grid, this storage capacity is becoming steadily more important.
The Nissan LEAF features bidirectional charging capability. The automaker is currently conducting a major trial of V2G technology in Australia, and says it plans to offer V2G to customers later this year. Oddly, EV trendsetter Tesla has been mostly silent about V2G, perhaps because it prefers to direct its efforts to its Powerwall stationary storage products. In May, Electrek caused a stir when it reported that an electrical engineer claimed to have discovered an unannounced bidirectional charging capability in Model 3. However, another engineer presented evidence that this wasn’t correct. Tesla hasn’t commented on the issue, so at this point, we’re not sure if Model 3 (and/or Y) is capable of V2G or not. We do know that Tesla’s Autobidder software allows the company’s stationary storage products to be packaged as resources on the energy markets, and this could theoretically be used for V2G applications. In fact, Tesla may have plans to become a sort of virtual utility itself.
EVs are part of a developing ecosystem that includes renewable energy, stationary storage and a variety of smart grid applications. Utilities see tremendous opportunity in this rapidly developing new field, but the oil industry sees a threat. As Bloomberg’s Jennifer A Dlouhy writes, oil companies and their lobbying groups, including the Koch Brothers-backed Americans for Prosperity, are fighting the transition to EVs on every front, from state legislatures to state utility regulatory agencies to Capitol Hill.
In Congress, the existing $7,500 tax credit for EV purchases has been a bone of contention. The Edison Electric Institute, a trade group for the utility industry, along with Tesla and GM, the only two US automakers who have sold enough EVs to cause the tax credit to sunset, have argued that the credit needs to be extended. Oil interests have been trying to get it eliminated altogether. (To date, neither side has prevailed, and the tax credit remains.)
Oil refiners and their trade associations have been working diligently at the state level to block utility investments in EV charging infrastructure, and in some cases, they’ve been successful. Bloomberg reports that, last October, Massachusetts regulators rejected large parts of a $167-million project proposed by utility National Grid, thanks to pressure from the American Petroleum Institute, gas station chain Cumberland Farms and fuel supplier Global Partners. In Minnesota, a coalition including Marathon Petroleum and Flint Hills Resources Pine Bend, a refining company owned by Koch Industries, have financed a legal challenge to a $25-million infrastructure project proposed by Xcel Energy. Oil interests are also behind many of the annual fees that various states have levied against EV owners.