Among alternative fuel vehicles, electric cars are the best positioned to overcome refuelling infrastructure challenges, writes Ian McClenny. The difficulty lies in having sufficient vehicle charging availability to reduce consumer’s range anxiety, he argues.
Ian McClenny is lead analyst for Navigant Research’s Advanced Batteries Innovations research service. His latest report investigates energy storage options for EV charging.
Historically, the private sector has faced challenges in developing profitable business models for charging infrastructure. Consequently, early charging infrastructure buildouts in Europe were largely financed by government programs in anticipation of increased EV availability and sales. From Western to Eastern Europe, infrastructure buildouts vary significantly. Some countries have built out comprehensive direct current (DC) networks quickly, while others follow the mixed alternating current (AC)/DC approach taken by the US.
Of note, in December 2017, the European Parliament and member states came to an agreement over revised rules regulating energy performance in buildings. The Energy Performance of Buildings Directive requires in part the installation of at least one EV charging station in new or renovated large commercial and industrial (C&I) buildings. The law also requires that one in five parking spots in these C&I spaces be equipped with the proper infrastructure to allow the streamlined installation for future charging sites.
Though this ruling may have marginal implications to the building owner and energy service provider, the high visibility of these charging points will be key to raising public awareness. Education surrounding the benefits of EVs and their associated infrastructure is a major hurdle that participants in the value chain have been pushing to increase across global markets. Markedly, a 2014 survey conducted by the US Department of Energy concluded that employees that visibly see charging stations available at their place of work are about 20 times more likely to purchase an EV.
With this ruling in place, it is incumbent on EV charging equipment service providers to ensure that newly installed systems are equipped to meet the needs of current and future use cases. Interoperability of energy systems are becoming increasingly necessary in the industry. Being able to manage and monetise loads effectively could be the determining factor of whether a business will fail or thrive.
EVs and their associated infrastructure are a portion of how Navigant Research sees the Energy Cloud manifesting. Through technology innovation, education, progressive policy, and utility mindfulness, global energy markets will reach the interoperability that the industry is trending towards. Key attributes that EV chargers exhibit in the evolving market are further explored in the figure below. A confluence of factors, including advanced technology, two-way smart data analytics, and stakeholder engagement, will be key in how EV charging systems will develop over the next several years.
EV chargers are poised to be play a significant role in the smart energy economy on both the supply and demand sides. Vehicle-to-grid integration is a hot topic for utilities, which seemingly cannot happen without proper integration of EV charging infrastructure. A significant opportunity for EV charging companies and EV charging service providers is incorporating energy storage systems (ESSs) onsite with chargers. Doing so will allow system owners and utilities to monetise these chargers by way of value stacking.
Two main reasons exist to couple energy storage with EV chargers for both AC and DC charging stations:
- Charging times: Current AC Level 2 charging times for a 30 kW EV battery range is approximately 3.5-4 hours. DC fast chargers can charge the same battery in 30-40 minutes. These times are not currently competitive with internal combustion engine refuelling times and contribute to the range anxiety of customers.
- Demand charges: Demand charges are enacted to recoup the fixed costs for utility expenditures like power plants, power lines, transformers, etc. so that the customer can connect to the grid and receive power. As soon as the car plugs in, charges accumulate based on several factors including number of charge ports, maximum power vehicle pulls from the charger, time of day, and other factors. These chargers when utilised under specific conditions can make the system unprofitable.
Demand charges vary across service territories, ranging from $2 per kW all the way up to $90 per kW. Interestingly enough, some of the highest demand charges exist in markets that have seen the highest EV populations. At a charging station that services one vehicle at a time during peak hours, monthly demand charges could reach as much as $5,000. This translates to $50 (or more) per refuelling cycle to the customer in demand charges alone. As the number of vehicles active on a charging site increases this cost falls, but the prohibitive price of charging infrastructure has deterred many customers from investing in EVs.
Energy storage has the potential to resolve these issues. Energy storage can charge from the grid at times where electricity costs are lower and discharge (i.e., charge an EV) at 150 kW (or more) during times of high demand. When a car arrives, the battery can deliver electricity to that vehicle without drawing power from the grid. If two vehicles arrive, one can receive power from the battery and the other from the grid. In both cases, the business case improves because electricity prices and demand charges are lower.
Additionally, a battery built for a 2-plus hour duration (e.g., 250 kW/500 kWh system) can manage peak demand through several multivehicle charge cycles and keep demand from the grid low. A system designed in this manner could reduce demand charges by as much as 60%, and costs would not be passed onto consumers.
Coupled with this, the rapidly declining price of ESSs, particularly lithium ion (Li-ion) batteries, makes an even more compelling business case for deploying batteries with EV charging stations. Balance-of-system costs are also declining at a rapid rate. Navigant Research forecasts that by 2023, Li-ion system prices will reduce by 42.8%.
Companies integrate fast charging and storage
Several companies are looking to take advantage of the value that energy storage-enabled EV chargers provide. For example, in January 2018, EV charging equipment provider Greenway launched the first ever EV fast charging station in central/eastern Europe supported by battery storage. Known as the GridBooster, the system employs a 60 kWh battery to support the charging station located at Bratislava’s Avion Shopping Mall. This station can support combined charging systems (CCS), CHAdeMO, and AC 22 kW charging levels. Citing demand charge savings as the primary business case, Greenway plans to deploy 20 additional battery-enabled EV chargers across Slovakia and Poland between 2018 and 2023.
Swiss battery manufacturer, Leclanché, also has plans to provide its Li-ion batteries to several EV charging stations in Europe and North America. Of note, Dutch EV charging station developer, Fastned, will be integrating energy storage into two of its fast chargers in the Netherlands. The goal of the project is to help “reduce stress on the grid by functioning as a bugger, and also [provide] a means of increasing charging capacity.” These systems will also be equipped with onsite solar PV. This project will reportedly be operational in the second half of 2018.
Dutch energy solutionist Alfen Energy was selected to supply an integrated energy storage solution for ElaadNL’s EV charging test site in Arnhem, the Netherlands. With the ESS rated at 138 kWh, the integrated system provides ElaadNL with full testing capabilities around smart EV charging. Equipment manufacturers, grid operators and ElaadNL can test the interoperability of EVs with various charging stations, including power quality effects and smart charging options. The penetration of EVs in the Netherlands is amongst the highest in Europe and, as such, will provide continued opportunities to deploy more ESS-enabled EV charging systems.
The Future of EVs and energy storage
Energy storage can contribute immediately to problems that EVs and their associated infrastructure face today. Customer anxiety can be reduced knowing that vehicles can be charged in minutes instead of hours and it will not come at a ridiculous cost.
While some believe battery-enabled EV charges will not have as competitive of a business case as EVs continue to proliferate the market, Navigant Research believes that battery-enabled EV chargers will benefit from economies of scale and effectively absorb demand charges with the higher volume of vehicles going through a station. These systems will also be able to offer stacked benefits to station owners.