Although today microgrids serve a tiny fraction of the market, that share will grow as costs fall. Utilities can benefit if they plan ahead.
Riding on The Wind
Plug-in hybrids usher a new era for wind power.
as much energy as a dishwasher (1.4 kW to 2 kW). 4 So in a future that includes a significant number of PHEVs, it will be highly advantageous to design electric rates ensuring that vehicle charging occurs almost exclusively at night, guaranteeing that PHEVs will use low-cost electricity. Doing so both takes maximum advantage of available grid infrastructure and minimizes the additional strain that increased electricity demand from PHEVs puts on the electric grid during daytime hours of peak electricity usage. Overall, the electric industry’s valuable assets, from generation to transmission, are put to better use.
Toward this end, the smart-grid concept will play a key role, allowing consumers and utilities to have greater control over when and how they use and generate electricity. Smart-grid and smart-charging technologies will allow utilities to ensure that PHEVs are charged during the optimum night-time hours. Consumers will be empowered with options that allow them to respond to price signals, as they choose when, and when not, to charge their PHEVs. In addition, some vehicle-to-grid (V2G) concepts even allow PHEV owners to receive price signals to recharge their vehicles when wind energy output in a given region is strongest—maximizing the emissions benefits for the utility and ensuring that consumers’ vehicles are “green.”
Electric Industry Impacts
The impact of PHEVs on the electric industry will be huge once their introduction and growth starts to occur. The potential for more electricity load growth than generally has been projected—exceeding, for instance, the amount assumed in DOE’s 20 percent Wind Energy by 2030 report—could result if widespread adoption of PHEVs occurs over the next couple of decades.
This issue already has begun to be examined. One study, completed in January 2008 by the Department of Energy’s Oak Ridge National Laboratory, 5 considered a scenario of PHEVs capturing 25 percent of the new vehicle market starting in 2020—putting about 50 million such vehicles on the road by 2030. The study’s conclusion was not surprising: Most utilities will need to build some additional capacity or use demand-response initiatives to meet added electricity load as a result of the proliferation of PHEVs.
Who, then, holds the keys to unlocking this nexus between the transportation sector and the electricity sector, and who can benefit from the associated new business opportunities? The answer, of course, is electric utilities.
In July 2008, 34 U.S. and Canadian utilities announced a collaborative partnership with EPRI and General Motors to prepare for the large-scale integration of PHEVs into the electric grid. 6 By charging a large fleet of PHEVs at night and during off-peak hours, electric utilities would end up significantly increasing the utilization factors for all aspects of their infrastructure. U.S. electric utilities hold a unique role in providing the new gas pump for PHEVs— i.e., the driver’s 110-volt outlet. “Considering that the primary infrastructure needed for consumers to begin using PHEVs—an ordinary wall socket—already exists in nearly every garage in America, we can help reduce our oil addiction as quickly as these new cars can roll off show room floors,” says Paul Bonavia, president of Xcel