Despite the current economy, the electric vehicle (EV) industry is expanding, especially with the adoption of all-electric transportation fleets from coast to coast. For example, New York’s Metropolitan Transportation Authority (MTA) recently announced its all-electric articulated bus fleet for the M60 Select Bus Service (SBS). New York City Transit's (NYCT) all-electric articulated buses will serve all five boroughs, thanks to funding from the MTA's 2020-2024 Capital Plan.
In California, the Public Utilities Commission (CPUC) energy division announced plans to put five million zero-emission vehicles (ZEV) on the road by 2030. Projects across the country involving the adoption of EVs are moving from the pilot stage to full fleet deployment — especially in the public transit industry. According to a recent BloombergNEF report, growth in the global e-bus fleet was up 32% in 2018. Much of this growth is attributed to falling battery prices, regulatory changes, and the adoption of new technology. One report points out that the cost of battery technology decreased by 87% in 2019, and by 2023, it is estimated that average prices will be close to $100/kWh.
But while this upswell of EV adoption is encouraging in light of achieving local and state-wide emission reduction and climate goals, the grid is unprepared to handle widespread electric fleet adoption because it lacks the infrastructure to do so. For example, fully charging three standard electric buses requires the same amount of energy as it takes to power roughly 190 homes, according to SEIA. Can you imagine building the necessary infrastructure to charge the equivalent of a housing subdivision every day — especially in urban settings where most bus fleet charging occurs?
Researchers at the University of Texas and the National Renewable Energy Laboratory have identified that if all passenger cars in Texas were electrified today, the state would need around 110 more terawatt-hours of electricity per year average annual electricity consumption of 11 million homes. The added electricity demand would result in a 30% increase over current use in Texas. This scenario could mean nearly 50% more electricity in California than the state currently consumes — an additional 120 terawatt-hours per year.
Producing enough energy to fulfill the growing demand for EV charging is a critical first step toward meeting transportation's shift to electrification. However, delivering that energy is equally important and more complicated. To provide energy where and when needed, requires all waveforms of energy (real, reactive power, and apparent power). To better understand these implications, we need to dig into the energy required to charge electric vehicles. "Real" or "active" power is the electricity that illuminates light bulbs and charges mobile phones. This power is usually measured in watts (W), kilowatts (kW), megawatts (MW). However, moving real power across the grid and keeping machines operating consistently, efficiently, and economically requires "reactive power." Reactive power, measured in mega volt-amps reactive (MVAr), enables real power to operate machines, including transmission wires. It holds the real power in the correct voltage to allow it to do work, which helps to reduce demand on the grid.
Both real and reactive power are commonly produced by large power plants (spinning generators) located large distances away from consumers. However, reactive power does not travel efficiently due to losses, so producing it at a distance and transmitting it to the load is expensive, and fluctuations in reactive power make the energy being transmitted on the grid unbalanced or unstable. Balancing reactive power requires voltage regulation, which injects or absorbs the correct voltage to bring reactive power into the proper power factor for transmission and use by a customer. An increase in the generation to meet EV charging demand means an increase in reactive power is also needed — when this generation occurs at a distant power plant, consumers — you and I — foot the bill, as utilities pass those costs on to ratepayers.
In addition to the expense of necessary reactive power generation and delivery, an added impediment to EV adoption is that the existing infrastructure for energy delivery (utility poles, wires, transformers, etc.) is not adequate for delivering the extra energy needed. BCG recently developed a model looking at the cost to utilities to upgrade the transmission and distribution system to meet electricity demand for transportation electrification. The model shows that a representative utility with two to three million customers will need to invest between $1,700 and $5,800 in grid upgrades per electric vehicle through 2030. Because these grid upgrades will primarily be covered in the rate base, the costs are ultimately passed on to their customers.
One solution to combat the issues of inefficient, expensive reactive power generation and costly infrastructure upgrades is local generation. The proposal produces real and reactive power locally, instead of with fossil fuel generation at power plants located far from the load. Distributed energy resources (DERs), like rooftop solar, can play a role in meeting the demand for electricity much closer to where it is needed. When aggregated, these DERs can also provide enough capacity to meet the entire fleet's charging needs. A grid with the capabilities to detect and operate DERs like spinning generators can incorporate locally produced real and reactive power as it does now with traditional fuel sources. Harnessing local generation can impact the economics of EV charging and lower transmission costs and reduce infrastructure upgrades since local power can minimize transmission and delivery required.
What is needed to implement this solution is for DERs to mimic a spinning generator — to produce real, reactive, and apparent power locally. The problem is that, on their own, traditional DERs only generate real power, so reactive power is still supplied from the grid. But with energy management technology that can produce reactive and real power locally and dynamically, energy generated from green resources can mimic a clean energy spinning generator — providing electricity for zero-emission charging. These solutions must produce the exact waveform of energy where it is needed, the second it is required, to be cost-effective, and so the grid does not need to supply it.
For example Apparent Inc., an energy management services provider, proposed a zero-emission charging solution based upon its proprietary software+hardware platform for a Southern California-based transit authority's 80 electric bus fleet. The transit authority's local utility imposed a new rate structure that froze demand charges for five years, but time-of-use (TOU) rates were extended with lowest peak periods in the middle of the day — making it difficult for EV fleets to charge efficiently and economically. As a result of Apparent's ability to dynamically monitor the bus fleet's energy needs and supply energy from the optimal source (solar, storage, or the grid), the transit authority is projected to save over $6M in 10 years from cost savings and system-wide efficiency.
Reactive power doesn't just support the grid in terms of satisfying demand for charging. For EV charging — whether a single light-duty car or a fleet of vehicles — Apparent's ability to dynamically generate and manage reactive power, and match the impedance of load with charging and discharging, translates to 20% to 30% increased efficiency with battery system charging and discharging. This means more usable energy is produced to meet charging demand, and more money is saved — ultimately, a faster return on investment than traditional EV charging infrastructure. These intelligent energy management solutions also allow for aggregated charging, opening up more vehicles to charge at the same time, and optimizing energy costs for original equipment manufacturers (OEMs), such as electric bus manufacturers and fleet managers.
As evidenced by Amazon's recent fleet order of 100,000 electric delivery vans, the adoption of electric vehicles is only just beginning, and charging solutions that rely solely on the grid are too narrow of a solution to scale effectively. The BCG model predicts that rates could increase as much as 1.4 cents per kilowatt-hour (kWh), or 12%, as a result of the necessary grid upgrades needed to support the uptick in EV charging demand. Since most of the energy we use today, except for specific areas in the U.S., is still generated from fossil fuels, now is time to re-envision what an EV-friendly grid should look like to integrate more clean energy, reduce costs for consumers, and keep the grid stable. By better managing and utilizing clean energy and reactive power generation at its source, we can realize the full potential of zero-emission transportation and its benefits for the bottom line for consumers and utilities, as well as the air quality of the communities they serve.
Maggie Alexander is Director, Business Development, at Apparent Inc.