Energy flexibility - How to unlock the real value of EVs?

What is needed to successfully integrate clean energy and clean mobility? Is it possible to build a sustainable, efficient system that enables all parties to benefit economically?

The future EV charging infrastructure is being built today

It is clear that the days of climate goal setting are over; it is time to act. Automakers and energy companies have the same intentions, although the two sectors have different viewpoints. Both want to and have to support the rise of cleaner technologies and renewables and create user-friendly solutions for consumers. 

The ongoing transition is huge, as we are simultaneously changing the basic principles of producing and using energy, and moving around, and simultaneously introducing new digital solutions in every aspect of our lives. 

In addition, the transition towards e-mobility is in full speed: Electric vehicle sales are booming and charging statistics keep on rising. More than 3 million charging sessions were hosted in the Virta EV charging network alone during the 2020. 

But big question marks hang in the air:  

If the European goals for electrification of transportation are met but the energy sector is not prepared, electric cars will be loading the grid at the worst possible time – for example during evenings when the electricity consumption at households is high and renewable energy production low.  
 
With a simple fix this scenario can be avoided. This fix is called smart charging. With smart chargers, the charging time and power can be dynamically balanced, and vehicles turn into a major tool for flexibility. 

This EV charging optimization is a prerequisite and a great opportunity for the clean energy transition. The two industries, energy and transportation, are slowly realizing the advantage that electromobility can provide them, but many are still hesitant in approaching the new business opportunity. 

How and why to unlock the full value of EVs as flexible assets? We gathered three energy sector professionals together to discuss the sector integration.

View the whole webinar discussion here. 

“We believe that in the future, electric vehicles are connected with other electrical devices at home and work – they will be an integrated part of our daily lives,” Josephine Delmote, Strategy Analyst from Elia Group

The two prerequisites: Mass market adoption and smart chargers

Elia Group, a Belgian TSO, has concluded a report investigating what are the main barriers and enablers for mass EV adoption. The results were presented at the Virta Webinar in January 2021.

Like in many similar studies, the main hindrances seemed to be related to the charging infrastructure. If charging locations are not sufficiently available and user-friendly, consumers refrain from purchasing electric cars. Some charging infrastructure players are obscuring data which further complicates the process from a consumer’s perspective. 

“We believe that in the future, electric vehicles are connected with other electrical devices at home and work – they will be an integrated part of our daily lives,” Josephine Delmote, Strategy Analyst from Elia Group, describes. 

“A smartphone is not just a communication tool anymore, but something you can use to book a flight, order food or pay your bills. This is what we foresee for EVs as well.” 

According to the report, the greatest benefits of EVs can only be reached if electric cars become the mainstream vehicles. EV sales are currently rising but the goal is to reach the very top of the technology adaption curve, where electric vehicles become a mass market. Only this way they can provide the necessary flexibility for the energy grid and become new smartphones, so to say. 

”Electric vehicles are the new smart phones.”  

The Finnish TSO Fingrid has also been investigating the question of sufficient charging infrastructure. 

“The common target ratio for electric cars and chargers is 1:10 – one charger per ten electric vehicles. This should enable EV drivers adequate access to charging stations. However, the higher the ratio, the more beneficial it is for the grid, as cars can be connected to the grid more often and increase the flexibility capacity even higher,”  R&D Manager Jussi Matilainen from Fingrid explains. 

From the energy sector's point of view, the installed charging stations must be smart to enable congestion management. 

“The infrastructure installed today has to be ready for the future. It has to be able to interact with the price signals and the power grid, and it has to be digital so that consumers can enjoy all the new solutions and have access to their data,” Josephine Delmote outlines.

Benefits of smart charging 

Vehicles connected to the smart grid enable more renewables to be integrated, as the energy system becomes more flexible. When charging can be dynamically timed on the renewable energy production peaks, the utilization of expensive and polluting peak units can be avoided. 

“Based on our calculations, the annual operational costs of the European power system can be from 470 to 520 million euros lower with smart charging compared to uncoordinated, dumb charging.”  - Josephine Delmote, Elia Group 

In addition to economic profits, Elia Group’s calculations in the European power system show that the annual CO2 emission reductions from smart charging are equal to giving up 300 000 combustion engine vehicles every year. 

When cars are connected to the grid and charged dynamically, also the society can enjoy the benefits of electromobility.  

“Flexible and integrated energy and mobility sectors provide added value also for the consumers, EV drivers. Car batteries can be seen as an added home storage,” Jussi Matilainen explains. 

When consumers can see the price signals, they have a clear incentive to adapt their charging behavior. Even if the reduced CO2 emissions are not encouraging enough, coordinated and smart charging event has a strict impact on consumer’s annual electricity bill. 

“In addition to smart charging, vehicle-to-grid solutions will bring additional savings for the EV drivers and offer even more balancing options for the power system,” Matilainen continues. 

Annual operational costs of the European power system can be from 470 to 520 million euros lower with smart charging compared to uncoordinated, dumb charging. 

Energy transition as a business opportunity

Embedded mobility and energy ecosystem is the basis of future transportation. 

Both Delmote and Matilainen agree that both sides, the energy, and automotive sectors, have co-responsibility in creating a functional system. 

Energy companies have the chance to help build a fossil-free future by capitalising on the EV charging business

Encouraging business cases are needed to accelerate the co-operation between industries: to demonstrate that it all can be done, in an economically sensible and easy way. 

The good news is that the toolbox is ready. We have the solution to make this happen, to reach the targets. 

Interested to learn more?  

Read our new e-book: How to transform your energy business with EV charging

Listen to the full webinar discussion: 

How to unlock flexibility in the power system: Sector integration of energy and transportation