Electric vehicles amount to a fraction of total U.S. auto sales, but they represent a potentially lucrative market for electric utilities. Still, few have developed strategies to ease their adoption; the availability of public charging infrastructure remains the chicken-or-egg question at the heart of continued market growth. A report written for Seattle’s municipal utility offers a model for ways utilities and regions could progress in efforts to develop potentially carbon-free transportation.
Planning and building out new charging networks isn’t at the top of most utilities’ to-do lists. Many have more immediate problems, including how to integrate the rapid growth in distributed solar and storage systems and addressing their own aging grids. And with plug-in vehicles still only making up 2.1% of U.S. passenger-vehicle sales in 2018, how those cars get charged simply isn’t an issue yet in most regions.
But this could be just the time to begin getting plans in order, because the 2.1% is expected to grow very quickly. For perspective, the market for plug-in EVs didn’t even exist prior to 2010, though hybrid EVs, such as the original Toyota Prius, have been around much longer. In nine years, it’s grown to more than 1.18 million of the vehicles on U.S. roads. And more than 149,000 plug-in vehicles were sold in the first half of this year, a 23% hike over 2018’s first-half figures.
This growth rate is motivating Seattle City Light’s interest in preparing for a surge in demand for new charging options. There are now approximately 8,000 EVs registered in the utility’s service territory, making it one of the top metro areas outside California for plug-in vehicle adoption.
The utility began investigating the potential impact of new charging equipment in 2015 with a study conducted by the energy-advisory group E3 Consulting. Research found a net benefit to the utility of $1,250 per passenger EV, over its lifetime, thanks to increased electricity sales. Electrified buses and other heavy-duty vehicles would also provide a bottom-line boost. Researchers also found the city’s existing distribution network could handle most of this added load.
Since that time, Seattle has moved to support EV market growth. King County Metro Transit, which already operates 11 all-electric buses, plans to buy 120 more by the end of next year, and the city has set a goal to have 30% of all light-duty vehicles operate under electric power by 2030.
Realizing random expansion in the EV market could lead to operational and customer service breakdowns, the utility contacted Rocky Mountain Institute (RMI) to help them develop a strategy to realize their vision.
RMI researchers based their findings on a framework of values developed with the utility that emphasized the need to make the most of existing grid infrastructure, maximize greenhouse gas reductions and ensure equity in access to clean transportation options. High-level recommendations that follow from this framework include:
- Investing in charging infrastructure that enables universal access and expands coverage
- Developing new rates and improving customer service for the transportation market
- Preparing for electrification of heavy-duty transportation, including port and ferry activities
Now, Seattle City Light is using RMI’s findings to develop a Transportation Electrification Action Plan to define specific programs and equipment required to support the city’s ambitious EV adoption goals. Of particular concern is the need to address “spot” loads created by charging equipment for transit buses and heavy-duty trucks, which, the report notes, “have a very real potential to overwhelm available capacity and require grid upgrades.”
It’s important to mention that Seattle City Light has a couple advantages in its efforts to promote greater EV use. First, its power mix is already among the country’s least carbon-intensive, with 96% of its electricity (as of 2017) coming from hydro, nuclear and wind resources. Second, as a city-owned utility, it’s able to make direct investments in capital equipment without oversight from state-level utility public utility commissions. Most cities are served by investor-owned utilities (IOUs) overseen by public utility commissions, which can restrict a utility’s ability to pass specific capital investment onto their customers’ bills.
Seattle City Light’s proactive approach to planning for EV market growth still offers lessons for IOUs. Regardless of their regulatory structure, all electricity providers will face similar challenges as falling battery prices make EVs more accessible to all. The Edison Foundation, a research group sponsored by the utility industry, forecasts 18.7 million EVs will be on U.S. roads by 2030, requiring about 9.6 million charge ports. While most charging will be done at home, the group estimates 900,000 public charging ports will be required to keep all those EVs powered. Developing plans to meet those needs now could help position utilities to better serve the one electricity market bound to grow over the coming decades.