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Smart charging – key to reducing grid investments

Updated: Jul 15

Electrification of the society is key to succeeding with the green shift, requiring transportation to shift from fossil fuels to electricity, stored either in batteries or as liquid hydrogen. At the present, batteries seem to be the chosen technology, at least for personal transport and light trucks.

The advantages of electrical vehicles (EV) are well known: Electric motors are significantly simpler to construct and maintain then their combustion predecessors, and electricity is cheaper than fossil fuels in most countries. Further, EV´s can be charged at home, being fully "tanked" every morning. The huge downside so far has been the cost and size of the batteries, but as time goes by, battery cost is dropping year on year, in a fashion not unlike the one we see for solar panels.

A common question is what it would take to provide all EV´s with sufficient electricity. In Norway, the majority of cars being sold are EV´s, and it is predicted that a fully electric portfolio of cars would require some 5 TWh of electricity, based on the numbers for 2020. This will cause an increase in the national electricity consumption of appr. 3%, which is considered unproblematic.

Source: Teknisk Ukeblad, Feb 21st 2021.

The challenge in Norway, as in most industrialized countries, is thus not delivering the energy necessary for an all-electric population of cars, but rather to be able to deliver it at any given time, depending on the desires of the consumers. Already, the grid is stretched to the limit in many regions at peak hours, i.e., mornings 7-9 and evenings 16-20. In order to avoid investing double digit billions of Euros in upgrading the grid, having the consumers shifting their consumption to off-peak hours will make for a much better utilization of the grid. The consumers are already paying roughly the same amount for grid access as the electricity cost itself, even before investment in deferred maintenance and capacity extension.

Smart charging is the designation of a charging system where EV´s are charged when grid load is low, the chargers turning off when grid load is peaking. As with power prices, grid cost will fluctuate during the day, containing an element of penalising tariffs for excessive load, preferably at peak hours. These excessive tariffs may be up to a factor of 100 times more expensive that normal cost, to ensure change of consumer behaviour.

For the households, this will further complicate electricity consumption. They are already struggling getting accustomed to continuous electricity pricing, with significant volatility intraday, especially in the wintertime. It gets even more complicated when you add power load to the equation. Smart charging will be an important component in giving the consumer control with the situation – a system that can react both to the energy prices as well as peak load pricing, will help the consumer saving money, as well as contributing to reducing the investment need for the grid, keeping grid cost low in the long run.

Such a solution for controlling the charging should react to power prices, peak load pricing as well as ensuring that the EV is sufficiently charged when needed. To be practical for the customer, the system will need real time data from the market, as well as a user-friendly interface, enabling the system to be set up with profiles minimizing energy related costs. Being designed correctly, such a system would only require the consumer to add information about when the car should be fully charged - the rest is automated, based on the pricing data mentioned above.

For the consumer, the key argument for acquiring a smart charging solution is to what extent it is self financing, i.e. that the cost of the system should be less than the savings achieved. Smart charging can also be part of establishing a market where individual consumers are selling grid capacity at peak hours. Today, this is a market existing only for points of consumption exceeding 1 MW, due to the installation cost for existing solutions. A retail oriented, decentralised solution, including smart charging, will make it possible to bundle up thousands of households in a grid area, providing the same possibility to reduce load at specific time at a fraction of the cost of the existing solution.

With modern home chargers delivering up to 22 kW, they will normally be the single point of consumption requiring the largest grid capacity, being the point most important to address when it comes to shifting consumption towards off-peak hours. This makes smart chargers one of the most important components when establishing smart grid solutions in the electrified society of the near future.

It is estimated that the grid capacity needed for charging EV´s worldwide by 2040 can be reduced by almost 40%, or 110 GW, being equivalent to the power output of some 37.000 average windmills. This reduction in required investments is also a key component to keep the cost down for the consumers – after all, all the infrastructure cost tend to end up just there.

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