More EVs could impact power grids
As the electric vehicle industry continues growing, the U.S. power grid may not be able to sustain an increase in electricity demand, CNBC reports. The power grid would have to undergo major changes in order to avoid becoming so strained it couldn’t handle severe weather and blackouts. But doing so comes with some hurdles: Building new, energy-efficient transmission lines needs approval across state lines with a plan on how to finance it. Currently, California alone would have to pay $50 billion by 2035 to upgrade its grid, according to grid analytics company Kevala.
By Tiffany Moustakas, Editor at LinkedIn News
Why the electric vehicle boom could put a major strain on the U.S. power grid
Over half of all new cars sold in the U.S. by 2030 are expected to be electric vehicles. That could put a major strain on our nation’s electric grid, an aging system built for a world that runs on fossil fuels.
Domestic electricity demand in 2022 is expected to increase up to 18% by 2030 and 38% by 2035, according to an analysis by the Rapid Energy Policy Evaluation and Analysis Toolkit, or REPEAT, an energy policy project out of Princeton University. That’s a big change over the roughly 5% increase we saw in the past decade.
“So we’ve got a lot of power demand coming to this country when we really didn’t have any for the last, like, 25 years,” said Rob Gramlich, founder and president of Grid Strategies, a transmission policy group.
While many parts of the economy are moving away from fossil fuels toward electrification — think household appliances such as stoves, and space heating for homes and offices — the transportation sector is driving the increase. Light-duty vehicles, a segment that excludes large trucks and aviation, are projected to use up to 3,360% more electricity by 2035 than they do today, according to Princeton’s data.
But electrification is only an effective decarbonization solution if it’s paired with a major buildout of renewable energy. “So we have both supply-side and demand-side drivers of big grid needs,” Gramlich said.
That means we need major changes to the grid: more high-voltage transmission lines to transport electricity from rural wind and solar power plants to demand centers; smaller distribution lines and transformers for last-mile electricity delivery; and hardware such as inverters that allow customers with home batteries, EVs and solar panels to feed excess energy back into the grid.
It’s not going to be cheap. In a study commissioned by the California Public Utilities Commission, grid analytics company Kevala forecasts that California alone will have to spend $50 billion by 2035 in distribution grid upgrades to meet its ambitious EV targets.
Charging electric vehicles is quite electricity intensive. While a direct comparison with appliances depends on many variables, an owner of a new Tesla Model 3 who drives the national average of around 14,000 miles per year would use about the same amount of electricity charging their vehicle at home as they would on their electric water heater over the course of a year, and about 10 times more electricity than it would take to power a new, energy-efficient refrigerator. Larger electric vehicles such as the Ford F-150 Lightning would generally use more electricity than a central AC unit in a large home.
Lydia Krefta, director of clean energy transportation at PG&E, said the utility currently has about 470,000 electric vehicles connected to the grid in its service territory of Northern and Central California and is aiming for 3 million by 2030.
Given that PG&E’s territory covers about 1 in 7 electric vehicles in the U.S., how it handles the EV transition could serve as a model for the nation. It’s no easy task. The utility is tied to a four-year funding cycle for grid infrastructure upgrades, and its last funding request was in 2021. Now that funding will definitely fall short of what’s needed, Krefta said.
“A lot of the analysis that went into that request came from, like, 2019 or 2020 forecasts, in particular some of those older EV forecasts that didn’t anticipate some of the growth that we believe we’re more likely to see now,” Krefta said. This situation has PG&E applying for numerous state and federal grants that could help it meet its electrification targets.
“I think right now people have an overly simplistic view of what electrification of transportation means,” said Kevala CEO Aram Shumavon. “If done right, it will be phenomenal; if mismanaged, there are going to be a lot of upset people, and that is a real risk. That’s a risk for regulators. That’s a risk for politicians, and that’s a risk for utilities.”
Shumavon said that if grid infrastructure doesn’t keep up with the EV boom, drivers can expect charging difficulties such as long queues or only being able to charge at certain times and places. An overly strained grid will also be more vulnerable to extreme weather events and prone to blackouts, which California experienced in 2020.
The most straightforward way to meet growing electricity demand is to bring more energy sources online, preferably green ones. But though it’s easy to site coal and natural gas plants close to population centers, the best solar and wind resources are usually more rural.
That means what the U.S. really needs is more high-voltage transmission lines, which can transport solar and wind resources across county and state lines.
But Gramlich said that while we’re constantly spending money replacing and upgrading old lines, we’re hardly building any new ones. “I think we need probably about $20 [billion] or $30 billion a year on new capacity, new line miles and new delivery capacity. We’re spending close to zero on that right now.”
There are major regulatory hurdles when it comes to building new transmission lines, which often cross through multiple counties, states and utility service areas, all of which need to approve of the line and agree on how to finance it.
“If you just think about a line crossing two or three dozen different utility territories, they have a way to recover their costs on their local system, but they kind of throw up their hands when there’s something that benefits three dozen utilities, and who’s supposed to pay, how much, and how are we going to decide?” Gramlich said.
Permitting is a major holdup as well. All new energy projects must undergo a series of impact studies to evaluate what new transmission equipment is required, how much it will cost and who will pay. But the list of projects stuck in this process is massive. The total amount of electricity generation in the queues, almost all of which is renewable, exceeds the total generating capacity on the grid today.
The Inflation Reduction Act has the potential to cut emissions by about 1 billion tons by 2030, according to Princeton’s REPEAT project. But by this same analysis, if transmission infrastructure buildout doesn’t more than double its historical growth rate of 1% per year, more than 80% of these reductions could be lost.
Efforts are underway to expedite the energy infrastructure buildout. Most notably, Sen. Joe Manchin, D-W.Va., introduced a permitting reform bill in May after similar measures failed last year. President Joe Biden has thrown his support behind the bill, which would speed up permitting for all types of energy projects, including fossil fuel infrastructure. The politics will be tricky to navigate, though, as many Democrats view the bill as overly friendly to fossil fuel interests.
But even if the pace of permitting accelerates and we start spending big on transmission soon, it will still take years to build the infrastructure that’s needed.
“There’s going to be an in-between period where the need is very high, but the transmission can’t be built during the time period where the need happens, and distributed energy resources are going to play a very active role in managing that process, because no other resources will be available,” Shumavon explained.
That means that resources such as residential solar and battery systems could help stabilize the grid as customers generate their own power and sell excess electricity back to the grid. Automakers are also increasingly equipping their EVs with bidirectional charging capabilities, which allow customers to use their giant EV battery packs to power their homes or provide electricity back to the grid, just like a regular home battery system. Tesla doesn’t currently offer this functionality, but has indicated that it will in the coming years, while other models such as the FordF-150 Lightning and Nissan Leaf already do.
There will also likely be greater emphasis on energy efficiency and energy timing use. PG&E, for example, is thinking about how to optimize charging times for large electric vehicle fleets.
“One thing that we’re trying to do is to work with some of these companies that are putting in substantial loads to provide flexible load constraints where we can say you can only charge 50 EVs at 7 p.m., but at 2 a.m. you can charge all 100,” Krefta said.
Krefta hopes constraints on charging times are temporary, though, and said that moving forward, PG&E is looking to incentivize consumers through dynamic pricing, in which electricity prices are higher during times of peak demand and lower at off-peak hours. And the utility is working with automakers to figure out how electric vehicles can provide maximum benefit to the grid.
“What kinds of things do you need to do in your garage to enable your vehicle to power your home? How can you leverage your vehicle to charge whenever there’s renewables on the grid and they’re clean and low cost and then discharge back to the grid during the evening hours?” Krefta said it’s questions like these that will help create the green grid of the future.