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Utilities Rev Up the Electric Vehicle Renaissance

Utilities Rev Up the Electric Vehicle Renaissance

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  • Utilities are emerging as a key player in the global race to deploy electric vehicles.
  • Utilities are increasingly flexing their political and legal muscle

In the early 1900s, Henry Ford and Thomas Edison were camping buddies. They called themselves the Vagabonds and took road trips together nearly every year. In 1914, Ford revealed that he and Edison were even working together on a cheap electric car, although that project never got off the ground. In those early years of automobility, electric cars were still preponderant on American roads: in 1900 more than one-third of U.S. vehicles — nearly 34,000 cars — ran on batteries, compared with 22 percent fueled by gas.

All that changed with mass-production of the Model T. But now, more than a century later, Ford and Edison’s industrial descendants are again attempting to produce and fuel the cars of the future. Utilities are emerging as a key player in the global race to deploy electric vehicles. Not only do they provide the ‘fuel’ — electricity — they’re also increasingly investing in, and championing, vehicle electrification. By doing so, the Edison Electric Institute says, utilities can achieve a ‘quadruple win’ – making better use of existing grid assets, pleasing customers, cutting costs, and reducing environmental impact.

Let’s look more closely at some reasons for that “quadruple win”:

Grid benefits: EVs provide a flexible load that can be managed through smart chargers that ramp up and down, vehicles that respond to signals from utilities, and even old-school pricing that encourages customers to charge during hours when power is cheapest. The EVs’ flexible load makes more efficient use of the utilities’ existing assets (think wires and poles) AND can improve reliability and cost-effectiveness of wind and solar by enabling utilities to match power demand with supply.

Customer and utility benefits: Compelling research has shown that when utilities add a flexible and revenue-generating load from EVs, the grid benefits can translate into lower rates such that all utility customers can benefit. For one example in California, which accounts for half of US EV sales, Synapse found that EVs increased utility revenues more than costs, leading to downward pressure on electric-rates for everyone. The new demand from EVs can also help compensate for declining demand as more customers install solar and upgrade buildings for greater efficiency, which some have hyped as a potential ‘death spiral’ for utilities. Even in countries with a rapidly growing load, like India, EVs can provide revenues that improve the balance-sheets of cash-strapped utilities.

Environmental benefits: Because of their much higher efficiency, EV’s are cleaner than gas-powered vehicles even when their electricity is produced with fossil fuels, and they become cleaner over time as the grid becomes cleaner. In fact with rising percentages of renewable generation globally, EVs are the only cars you can buy today that will become cleaner the longer you drive them. These benefits are why EVs are an essential ingredient in meeting our goals for climate change.

Source: forbes
Anand Gupta Editor - EQ Int'l Media Network

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