The notion that utilities don’t do a good job of consumer engagement is only half true. The fact is, many customers don’t want to be engaged. They just want cheap, reliable electricity, no...
Industry giants start the EV revolution.
Who killed the electric car? Well, as it turns out, the body never was found.
A lot has happened in the four years since a biting documentary film lamented the electric vehicle’s (EV) demise. Automakers and utilities have launched an unprecedented collaboration—to build and market a car that will never visit a gas station. Later this year the first mass-market, fully electric car—the Nissan Leaf—rolls onto showroom floors. Many other models will follow.
“We are definitely at the tipping point,” says Mark Perry, director of product planning for Nissan. “The question is whether it will be a gradual or a rapid transition, and I don’t know if anybody really knows that answer.” In some regions, utilities expect rapid growth in EV sales.
“Our mid- to high-case range is 100,000 to 200,000 cars by 2015,” says Ted Craver, CEO of Southern California Edison. “By 2020 we’re looking at between 450,000 and 1 million cars—and this just covers our service territory.”
It’s difficult to overstate the impact on the nation’s utilities of tens of millions of EVs—each one a roving reservoir of stored electric power.
EVs’ most enthusiastic proponents envision a future in which cars are charged overnight—ideally by off-peak wind generation—and driven to work where the battery is topped off by on-site solar panels. At peak hours, vehicle-to-grid (V2G) transfer would allow utilities to pull small amounts of energy out of cars to shave load, effectively turning customers into micro-vendors. This scenario would of course necessitate smart pricing, robust wireless communication, distributed generation, advanced metering infrastructure, and, incidentally, a whole new business model for utilities.
There’s some disagreement over which parts of that vision ultimately will come to pass and when, but the challenge isn’t a question of technology.
“We understand that every one of these things is do-able, we’ve already done a lot of it with OnStar,” says Britta Gross, GM’s director of global energy systems and infrastructure commercialization. “It’s really a no-brainer to take power off these batteries; in fact, we do this every day in battery labs.”
North America’s regulatory patchwork is a hurdle, no doubt, as is the challenge of harmonizing communications standards across several industries, but the biggest x-factor might be the person at the heart of this futurist’s fantasy: the driver. How consumers choose to interact with their EVs will go a long way toward shaping the market for the auto industry, for utilities, and for the rapidly sprouting third-party vendors in the EV space. And those drivers are about to get behind the wheel.
Since the earliest days of the automobile, the industry has focused almost exclusively on the internal combustion engine. The fuel source, while not necessarily an afterthought, wasn’t particularly difficult to understand. Gasoline formulations evolve and the oil market fluctuates, but it’s nothing compared to the Byzantine complexities of the utility world.
“We’ve had to learn a lot about the auto industry, but it’s probably a bigger learning curve for them to learn about