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Smart Grid as Quick-E Mart

Fortnightly Magazine - April 2010

During interviews for this month’s cover story, “ Customer Service: 2020 ,” leaders in the world of back-office information technology (IT) spoke with Fortnightly about customer service and the smart grid. They came from companies as diverse as Oracle and Telus, HP and Convergys, Vertex and SAP. But whatever the company, whatever the discussion, almost every leader came around eventually to focus on a single agent of change—the rise of electric vehicles.

Each executive imagined that EVs will transform the way utilities interact with customers, but in ways that not all of us might yet fully appreciate.

Gas Station of the Future

Several of the people interviewed for our cover story suggested that distributed generation will create a new role for utility customers: the “prosumer” role, in which individual customers and communities generate electricity for upload into the grid. Of course this is nothing new; utilities have been required to provide interconnection services for some types of customer-owned generation since 1978. But even if full-fledged net metering spreads across the country, the prosumer trend seems inextricably tied to the economics of small generation technologies—especially rooftop photovoltaics, and also things like micro-cogeneration.

But even without steep declines in the cost of these systems, might EVs feed into the same trend? Might so-called “V2G” (vehicle-to-grid) technology turn drivers into prosumers by allowing them to sell small amounts of power back into an integrated smart grid?

Oracle Vice President Guerry Waters expressed skepticism that V2G would emerge any time soon. “It’s hard to project when it will happen,” he said. “EVs will become a reality. A lot of auto manufacturers are focused on it, and the Obama administration set a goal of having 1 million EVs on the road in the United States by the year 2015. The rising price of gasoline will add fuel to that fire, and auto manufacturers will turn up production. But predicting how that will become a resource for utilities is a bit more dicey.

“By 2020 there will be smart-charging infrastructure, so EVs won’t unduly burden the electric system,” he said. “I’m just not sure that within a decade we’ll have all the issues solved for [V2G] to become anything but a fairly minor play. However, the utility will be viewed as the gas station of the future. The utility will be right in the middle of providing energy and interacting with EV owners.”

So irrespective of whether consumers become prosumers, EVs bring a different set of requirements—and opportunities—for utility customer service.

Specifically, the smart grid and smart-charging technology will allow utilities and their customers to achieve some important goals. First, smart charging will ensure a million cars plugging in at one time don’t crash the grid. Second, it will give drivers some choices about their power consumption, so they can take advantage of cheaper off-peak power rates when quick charging isn’t a priority. Third, it will allow drivers to charge their cars no matter where they’re parked,