The grid’s influence on electric vehicle charging: business models and customer behavior

The way electric vehicle (EV) charging will affect business models for vehicle energy is an exciting element of the technology. Aspects of charging procedures and their consequences are explored in this article in the context of consumer-driven electric cars. Vehicle fleets, delivery drivers, and big vehicles will have various practices, which will be discussed separately.

According to the National Association of Convenience Stores, the United States has over 150,000 retail fueling stations in 2017. Almost all consumer gasoline is provided this way. The filling-station paradigm begins to break down as the shift to EVs progresses. Although rapid-charge ports at stations are vital, quick charging causes significant battery wear and tear, and energy provided at megawatt scales will almost certainly need premium pricing.

The reality of EV charging is much different. Consumers, based on their previous experiences, appear to be looking for convenience. As a result, access at home, at work, or in the community comes into play. There will still be a need for fast-charging terminals to enable long-distance travel, but a large amount of the energy will most likely be dispersed. According to data from the Federal Highway Administration, just 2.5 percent of household driving excursions surpass the daily average of 29.2 miles. The average isn’t really relevant (a car that doesn’t satisfy customer demands won’t be allowed on the market), but the data suggests that low-power charge stations may supply around 90% of EV energy. According to anecdotal evidence, EV owners prefer the ease of a filling station concept. This means that fast-charge stations will only provide around 10% of consumer EV energy.

The majority of the time, consumer automobiles are parked. This is not taken advantage of in a filling station arrangement. A parked EV has the potential to be a connected automobile, with options for charge coordination, interactive intelligence, and dynamic energy management thanks to its battery pack’s connection to the power grid. A connected automobile gives you more control over how and when you get your energy. It’s important to note that bidirectional energy flow has no effect on the fundamental issues—a “charge-only” system allows for more flexibility and coordination in time. For service aggregators, parked-car coordination implies business models. A city parking garage with several charging stations, for example, may provide frequency control and other grid functions.

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For future EV charging, this topic proposes four main commercial connections:

Stations where you may charge your car quickly. If practical, low-power charge stations became widely available, these would only provide around 10% of total EV energy. In a highway scenario, five automobiles would seek roughly 100 kWh each in ten minutes, resulting in a 3 MW rate. To recoup early expenses, energy costs would have to be high enough.

Aggregators of services. To counterbalance expenses, a parking lot operator with the ability to manage a large number of low-power charge stations might coordinate charging and provide grid services.

Charging at home and at work

Charging is done in the community. Consumers might be charged for free at a store, restaurant, or hotel, or a city could utilize free charging to lure customers to retail areas.

A shop that provides consumers with traditional 120-V plugs would typically supply 1.5 kWh per hour of connection. In the national average rate of 12 cents per kWh, a two-hour charge at a restaurant would cost just 36 cents, thus infrastructure and installation expenses dominate the economics. At home or at work, 30 miles of driving at an approximate use rate of 4 miles/kWh necessitates a daily energy intake of 7.5 kWh—at a cost of less than $1.

Fast-charging stations require a lot of energy, therefore working with grid operators and the distribution grid infrastructure will be crucial. Initial expenses are likely to be considerable, thus low-risk investors will need to be well-funded. Vehicle manufacturers might be an investment source when there are few fast-charge points (as there are now), but this is unlikely to be sustainable. In densely populated locations, the service-aggregator concept is appealing. A downtown parking company may improve outlet infrastructure and install vehicle-to-infrastructure (V2I) gadgets that communicate with individual vehicles. Monthly garage prices in the Chicago loop, for example, exceed $400 per vehicle. The aggregator has access to grid service markets, which would add roughly $10 per month to this.

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Simple time-of-day pricing structures may be extremely strong in a residential context. Modern EVs feature programmable chargers, and cheap overnight rates may persuade a driver to select a 2-5 a.m. charging window, for example. When solar power is plentiful at work, the same approach might encourage charging. A grid operator might provide an unique EV rate with low nighttime energy costs, low solar-linked pricing, and high prices in the late afternoon and early evening with more flexible programming. With correct programming, a motivated client may save electricity. These pricing structures might work with little or no vehicle-to-grid (V2G) communication, or with simple information like “I am connected,” “I will require x kilowatt-hours,” and “I am full.”

Some companies may use community charging as a loss-leader service in the case of community charging. A regulated outlet, enabled either when a client is confirmed or when a small charge is paid, might be used by a cost-conscious business owner. The effort to install conventional outlets close to a structure and within reach of cars is likely to be minimal in companies such as hotels.

Active demand response and V2G exchange might be supported by a more complex EV interface. A car connects (directly or through an aggregator), the EV charger reports the connection, reports the quantity of energy to be purchased, shows a power limit at the site, and offers a target time for energy delivery completion. The grid operator has complete control over charge rate and schedule, as long as the desired energy is delivered by the deadline. The grid operator may also do fast-charge modulation for regulatory services within the restrictions. Until the battery is depleted, a vehicle connection becomes a direct source of services. A fair energy discount might be enough of an incentive for the consumer to allow demand response control, as long as the client receives the desired energy on time.

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In order to augment state-of-charge and battery-health monitoring, effective V2G systems with demand response require precise, tamper-proof onboard EV energy metering. Active safety management, ground fault prevention, and handshaking are all required for chargers, as are EV supply equipment needs. There must be a means of communication. To avoid overloads when charging from non-intelligent outlets, the charger may need to cut back current. The vehicle software must be able to track consumption in a secure manner and connect with invoicing and external control systems.

According to the Department of Energy, there are around 44,000 electric vehicle charging stations in the United States now. Except for fast-charging stations, the preceding explanation suggests that normal electrical outlets should be able to supply roughly 90% of consumer car energy. Expansion of normal outlets for parked vehicles is not the same as installing rather expensive EV charging stations. Because fast chargers are essential for long-distance transportation, the economic tradeoffs between fast chargers and traditional outlets will continue to evolve. Even as the number of fast-charge stations increases, the quick availability of EV charging outlets is critical for wider adoption.