Electric Vehicles Adoption – A Huge Business Opportunity for Utilities
Utilities have the greatest opportunity to profit from the increasing adoption of electric vehicles, differentiating themselves and boosting their customer value proposition.
According to the Boston Consulting Group, the average utility can gain between US$3-$10 billion in new value. By taking the leadership role in the EV revolution, they can monetize their existing and future grid infrastructure, creating new revenue streams in overlapping markets.
Their presence is already ubiquitous in every consumer’s home. With complete transparency into consumers’ consumption behavior, they have access to critical insights for their own use or to share with partners to create bundled experiences. Furthermore, they have spent their entire “lifetimes” navigating the energy market, its rules, regulations, regulatory agencies, and key players, so they know how to get things done.
The opportunities are vast:
- Supply the energy for home, office and on-the-go charging
- As a regulated utility, work directly with governmental agencies to support transportation electrification (TE) by developing new rate plans, rebates, and promotions
- Strategic partnerships
- Partner with automakers, fleet operators, charge point operators, parking lot owners and others
- Provide home and public charging stations
- Enter new markets to become a full-service eMobility solution provider, installing, operating, and maintaining EV charging networks and offering remote charging apps, integrated home- and EV-energy management, payment processing, and even EV purchase financing
Leading the Charge
With their comprehensive understanding of the market and ability to work cooperatively with governmental organizations, utilities are uniquely positioned to be a driving force for EV adoption.
Utilities can strengthen their relationships with municipalities by creating community charging hubs and working with other local organizations to provide guidance about workplace charging programs, public charging, and electric mobility hubs. They can offer advisory services to consumers, fleet managers, and e-Mobility providers about energy management, working with regulators, and customer communications.
Managing the Infrastructure
The growth of EVs is going to put increasing pressure on the grid. Utilities must take steps now to ensure they are prepared. They must work closely with their regulatory agencies to develop flexible rate structures that cover peak and non-peak charging; allow them to balance energy priorities during periods of high demand; and take advantage of the multitudes of business opportunities within the EV charging infrastructure.
While the net impact of energy demands by EVs won’t be enormous, the capacity of the grid, in terms of total kilowatts, will need to handle demand surges at certain times and locations. Therefore, smart grid technologies are becoming more commonplace, where smart charging balances and varies the electricity availability based on time and location for EV charging demands, ensuring that the grid is not overloaded. This flexibility will reduce the need for significant infrastructure upgrades and investments – although these will still be necessary.
Utilities already have 100 percent penetration when it comes to “architectural” infrastructure such as buildings and streetlights, etc. Building EV charging infrastructure adds significant complexity. Deployment requires different types of capital expenditures and lead times, as these need to be coordinated in partnership with municipalities or private enterprises. Locating EV charging sites requires analysis of demand, grid capacity, and land availability. Furthermore, energy demand itself travels with the electric vehicles – during the day, charging demand will be higher in urban centers, while at night, some demand moves to the suburbs.
Overcoming the Challenges
To get started as a major player within the EV charging infrastructure environment, utilities need to get their regulatory house in order, working with governmental agencies to create the flexibility they need to best supply the EV charging marketplaces.
Once that’s in place, they need to determine how deeply involved they want to get within the emobility marketplace – whether to maintain their role as a supplier only or become a full-service provider.
For utilities ready to embrace the array of opportunities of e-Mobility, they will need a robust and futureproof solution focused on every aspect: smart energy management and vehicle-to-grid (V2G) connectivity; charging operations; billing; and customer-facing technologies. This solution will need to quickly and easily integrate with the utilities’ existing technologies and operate within existing industry standards to support roaming and other cross-vendor services.
Smart energy management enables utilities to comprehensively monitor, manage, and adjust energy consumption, with the ability to provide optimal demand response. V2G connectivity positions them for the future of energy supply and demand.
Within operations, they’ll need to make sure they have the systems in place to manage the charging hardware and software, ensuring uptime and reliability. As utilities are uniquely positioned to quickly expand their serviceable markets, scalability is critical.
Furthermore, utilities need to expand their support personnel and technology infrastructure to be able to install home chargers as well as operate them remotely, with integration into demand-response systems. These home charging devices will need to deliver visibility into energy levels to address consumption and peak-load increases to minimize the need for expensive infrastructure upgrades.
Customer-related solutions include not only billing software but also the ability to offer a self-service portal and a mobile app with real-time billing data; showing chargers along a route; and delivering the ability to make charging reservations and automated payments. Utilities will be able to analyze consumer usage data to offer special rates and discounts to better manage peak charging as well as multiple business models.
The ubiquity of utilities gives them a competitive advantage in becoming e-Mobility powerhouses. It’s time to pick up the phone and call the regulators to get started.