Serving customers’ needs should be a top priority for power companies, irrespective of the regulatory construct and business model. Transformation doesn’t change this basic fact, but how do we...
CEO FORUM: Dealing with Disruption
Leaders adapt to strategic shifts in the utility landscape.
the EV outlook mean for market planning and grid-technology strategies?
Boston, PJM: The manufacturing capacity for EVs will limit what we need to do in the short term. Honestly, I don’t believe utilities will have to worry much about making infrastructure modifications. We have space on the system to add at least 25 million cars without adding generation or transmission—if we manage pricing and controls so everyone isn’t charging at once.
The question is which will come first—the smart grid or the smart electric car? We need two-way communication and control of these devices, and the smart grid will provide that. With all the smart-grid investments we’re seeing, we’re well on the way to being able to integrate and control EV smart-charging systems.
A key benefit of EVs is that they are ideal to help us integrate more wind energy, because of the storage capabilities they represent. PJM is working on the ability to provide renewable energy credits that would allow charging cars with renewable energy.
Also, we’re testing the ability to tap into the batteries for load-frequency control, working with GM and other manufacturers. We have five vehicles at the University of Delaware and a 1-MW battery that’s the equivalent of about 150 vehicles aggregated together in a parking lot. We send pulses to them, and within milliseconds they respond to instructions. That’s much faster than a base-load power plant can respond.
We’ll pay EVs on the system $10 a day, per vehicle, to provide load-frequency control services. That totals $3,600 a year in cash to the driver, to allow greater wind penetration. We generally try to hold 1,000 to 1,200 MW for load-frequency control, so we could see 350,000 early adopters entering into that market. As more wind comes into the system, we might need more like 2,000 MW.
Weston, Direct Energy: It’s not having a huge impact on our planning at the moment. But having said that, this will happen.
We’re most interested in the connection among EVs, the smart grid, home energy management and customer transactions. It gets more interesting and complicated when cars start acting like distributed generators. We’re starting to invest in distributed generation, something that serves the home. We’re thinking about how EVs fit into the distributed generation model, the customer’s lifestyle and their energy requirements.
Burke, TXU Energy: As a retailer, we see EVs as a very significant opportunity. We’re going to carefully gauge customer interest, and we intend to be right at the front of the line in making offers available. We already offer TOU pricing, running on the smart-meter platform, but we don’t have anything in the market today specific to EVs. It’s hard [to test the market] for EV-related products because of the lack of vehicles on the road. But we have put more than $100 million into customer information systems in the last two years. That moved us completely off of our legacy system, anticipating interval data from smart-grid infrastructure. We’ve made significant strides with substantial investments that help us design products and services as the new