With millions of EV’s slated to hit the road this decade, industry leaders say it’s time to get with the VGI program

With U.S. forecasts predicting 10 to 35 million electric vehicles (EV) on the road by 2030, industry stakeholders are seeking ways to avert an expected EV-driven 10-20 GW increase in peak load across the nation.

A new report from the Smart Electric Power Alliance (SEPA) outlines how regulators can facilitate vehicle-grid-integration (VGI) development and deployment in their states to help manage EV impacts on the distribution grid.

Without a strategic planning approach, the predicted rapid growth of EV adoption could lead to costly infrastructure upgrades for utilities, while leaving significant beneficial load growth value on the table, according to SEPA.

“The greatest risk to VGI deployment right now is not knowing what the rules of the road are,” Janet Gail Besser, SEPA Managing Director, told NPM. “That makes the utilities reluctant to develop a program, so they're looking for guidance from policymakers and regulators, and that's really what the regulatory roadmap for grid integration is about. It alleviates some of concerns that utilities have about making an investment that they may not be able to recover, and it gives some guidance to the utility and to the broader EV electrification community about what's going to be required to make VGI work.”

Parallel to regulatory risks are technology challenges, says Besser, which can be addressed by deploying VGI at pilot scale. Deploying these demonstration projects will require support from regulators, who can direct utilities to use innovation funds for programs to test new equipment and partnerships with vendors, as well as develop standards that support VGI aggregation, communication, and control requirements.

“Addressing the regulatory barriers and addressing the technology barriers should be happening in parallel,” Besser said. “You don't want to be waiting to develop your regulations and policies until you think you've answered all the technology questions, because you might wait a long time and you might not be able to answer them.”

Regulators will also need to determine the value of VGI, which will help increase access and transparency to utilities and aggregators and facilitate investment decisions.

Within the broader VGI suite lies vehicle-to-grid (V2G), which has its own set of deployment barriers, including how to compensate EV owners for potential battery degradation, reducing impacts on drivers who need access to the vehicle, software control, and metering.

What states are doing

The transportation sector remains the leading source of greenhouse gas emissions in the U.S., accounting for a whopping 28 percent of these polluting emissions.

This has led to major policy momentum around transportation electrification among states, who are setting bold targets to electrify fleets and deploy new EV and EV infrastructure within the next decade.

New Jersey has called for 100 percent EVs by 2035 via a ban on gas car sales--a first for any East Coast state--while New York is aiming for 850,000 EVs to hit the road by the end of 2025.

States like California are exploring VGI planning, developing a roadmap to enable EVs to provide grid services while meeting consumer needs, as well as guide a coordinated investment and regulatory plan.

But while states have defined aggressive targets for EV deployments, Besser said regulators and stakeholders must determine an ultimate endgame in terms of cost reductions, carbon reductions, increased grid flexibility, and grid resilience.

“We think a roadmap is really important, and we think education almost at the point of purchase of an EV is important,” Besser said. “When you think about customers making a decision to buy an EV, one of the questions they then have is, how are they going to charge it, and do you have a smart charging capability from the start? Do you have a charging capability that can be easily upgraded? Because you don't want to be investing a lot in infrastructure that you then might have to replace. You want to have a smart charging program in place. Regulators want to make sure that any investments utilities are making are going to be beneficial for customers.”

From a financial perspective, a future without managed charging could result in billions of dollars of additional investment, including unnecessary grid upgrades and new generation.

As an example, an Illinois Citizens Utility Board report estimated USD 856m of required investment by 2030 due to EV-related stress to the grid caused by vehicle charging during peak demand times. Alternatively, the report estimated savings up to USD 2.6bn by 2030 for both utilities and customers if the state successfully encouraged off-peak charging.

A five-state economic analysis report by MJ Bradley & Associates reveals that load growth and managed charging of EVs could lead to a cumulative net benefit of nearly USD 3,900 per person, derived from utility electric bill savings and direct savings for EV customers.

“Going out further on edge with VGI, once we demonstrate the capabilities, there may be opportunities to use vehicles as storage and use, if not at the residential site, then certainly fleets connected in an integrated way that can then be used as storage when you have a lot of, say, solar on the system, and fill the belly of the duck curve,” Besser said. “There are companies that are looking at opportunities for more integrated and interactive EV connections to utilities. That's the future vision. You want to be looking forward so that as you're making investments in EV and encouraging utilities to support EVs, that they're making the kinds of investments that will be scalable and will enable this integrated use of the capabilities of EVs in the future."