What Is Grid Modernization—and What’s the Role of Electric Vehicles?

, Kendall Science Fellow | September 12, 2017, 4:40 pm EDT
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Utilities around the country are creating “grid modernization” plans. What does this mean? Isn’t the grid “modern” already?

We get electricity reliably with the flip of a switch. It can power all manner of appliances and devices. The National Academy of Engineering (NAE) regards electrification as the greatest engineering achievement of the 20th century. Even so, NAE observes that the system could be even more economical and reliable with the right kinds of improvements.

Maintaining the current level of reliability requires investments of billions of dollars each year by utilities and grid operators, and regular attention by trained line workers and electrical engineers. The grid is over a century old in much of the country, and has been built up in a patchwork fashion over this time.

As a result, most states are looking at ways to improve the system, as seen in Figure 1. “Grid modernization” can mean different things depending on local needs. A state in the Midwest might focus on upgrading transmission lines to connect more wind turbines and deliver the power to urban centers. California or Hawaii may focus on pricing structures to reflect the abundance of solar power at mid-day. New York is working to address growing electricity demand in the Brooklyn-Queens “load pocket,” where constructing a new substation would be expensive and disruptive.

Figure 1: Grid modernization activities took place in 37 states, either in their legislatures or regulatory agencies, in the first quarter of 2017. Source: NC Clean Energy Technology Center, “50 States of Grid Modernization.”

A common feature of most of these grid modernization plans is communication. By sending real-time information about conditions such as power flow or the supply of renewable energy, and designing systems to respond automatically, we can reduce grid costs and maximize the use of clean power.

Smart charging of electric vehicles is an illustrative application of grid modernization that brings together many of its key elements. By varying the rate at which the vehicles draw electricity from the grid, we can manage short-term changes in wind and solar power output, or even compensate for outages at other power plants. This can be done without inconveniencing drivers. It requires communication between the vehicle and the grid, but is possible with existing technology.

Why grid modernization?

Grid modernization can deliver greater quantities of zero-to low-carbon electricity reliably and securely, including handling variable renewables like wind and solar power. It can support the electric vehicle revolution and increase grid resilience to withstand climate impacts. It can spread economic opportunity in rural and urban communities through electricity and transportation infrastructure investment and upgrades. And, it can improve system efficiencies and reduce costs by reducing the need for expensive and dirty power plants that only run a few hours per year (these are called “peakers”).

The US obtained about 10% of its electricity generation from wind and solar in the spring of 2017 (counting distributed solar), with some regions much higher on individual days. A modern grid will allow higher levels of renewable energy by improving weather prediction, limiting the effects of local variations, and providing storage and load flexibility (electricity demand that has some leeway to adjust up or down) so that backup power plants won’t need to be kept running.

UCS modeling (in The US Power Sector in a Net Zero World) has shown that 55-60% of US electricity could be delivered from renewable energy by 2030, most of this from wind and solar. The US Department of Energy (DOE) explores a scenario of 20% wind power in 2030 in Wind Vision, and DOE’s National Renewable Energy Laboratory (NREL) illustrates a pathway to even higher levels of renewables in 2050 in the Renewable Electricity Futures Study. Modernizing our grid will help us best take advantage of those new wind and solar resources.

The technologies

Unlocking the promise of a low-carbon electricity system will require deploying new infrastructure and innovative technologies and changing the rules that govern our electricity system and markets.

Some established technologies have a valuable role to play in grid modernization. Transmission lines move power between different regions of the country. This can help manage large amounts of renewable energy. For example, wind power becomes more consistent when the wind farms are in many different places across a large area. Transmission lines also help regions cope with outages of other types of power plants, such as natural gas or nuclear.

Energy storage is finding new roles on the grid. Storage that uses hydropower has long helped match supply to daily changes in electricity demand, while recent years have seen tremendous advances in another technology: batteries. As costs come down and performance improves, batteries are increasingly viable for a broad range of electricity sector applications. They can store power produced during times of low electricity demand and discharge it to the grid when needed.

Batteries can also make renewable energy available on demand (such as solar power, as seen in Figure 2). In some cases, this is a lower-cost and cleaner solution than relying on other generators for power at night and on cloudy days.

Figure 2: Utility-scale solar array with batteries, Kaua’i, Hawaii. Source: Kaua’i Island Utility Cooperative.

The real-time communication aspect of grid modernization comes into view with “smart” systems on homes and businesses. Smart inverters on solar panels adjust solar power supply to help the grid provide electricity at the correct voltage and frequency. Smart charging systems allow electric vehicles to selectively charge at times of low cost or low emissions. Smart electric meters measure electricity usage at short intervals, such as every hour rather than every month, empowering consumers to shift their electricity use to times when power is less expensive. Smart thermostats learn the patterns of household heating and cooling demand to reduce energy costs.

Together, these technologies enable a more efficient use of our electricity resources to help reduce consumer costs as well as reduce emissions.

Some of these smart systems feature controllable loads. Instead of shifting supply to times of peak demand, as storage does, they can shift demand to times of abundant supply. A commercial air conditioning system might make ice during a period of low electricity demand and then use the ice to cool a building during the late afternoon, typically a time of high electricity demand. An electric vehicle parked overnight could vary its rate of charging to match the output of nearby wind farms. Controllable loads can help the grid manage variable energy resources. If consumers can control the demand, everyone can accept some variability in the supply. Controllable loads also can provide short-term demand response, contracting with a utility to reduce electricity consumption during times of very high demand.

Smart meters allow controllable loads to better align electricity demand with supply. This depends on some sort of information from the utility. Time-varying rates provide that information in the form of a price signal—identifying the best times to use power. These rates can move higher or lower over the course of the day, week, and/or season in accordance with true system costs, can save money, and can better match consumer demand with our supply of clean energy resources. Controllable loads such as water heaters and electric vehicles can benefit from time-varying rates, since they can be flexible in when they draw power from the grid. This is discussed in more detail in the UCS Issue Brief, Flipping the Switch for a Cleaner Grid.

Smart charging as an example of grid modernization

Electric vehicles represent a growing source of electricity demand. A modern grid would both minimize the impact of EV charging on the  grid, while also enabling (and taking advantage of) “smart charging.” This in turn would improve grid reliability and support greater renewable electricity deployment.

So, what exactly is smart charging?

An EV has flexibility in when you charge it. With a home EV charger, you might get 20 miles of range per hour of charging. If you drove 60 miles that day, then you would require 3 hours of charging. Now suppose you get home at 7 pm and don’t need to go out again—the vehicle will be parked for the next 12 hours. You probably don’t need to start charging right away at 7 pm, at the same time as everybody else is using stoves, ovens, microwaves, televisions, or other electrical loads. In fact, it would be less expensive for the utility if you waited until any time after 10 pm.

How might the utility encourage you to do that? It could charge you less for electricity in “off-peak” times. This would require a “smart meter” that can measure when power is used, not just how much is used in a month. That could be a new utility meter in your house, or the utility could use the systems embedded in the vehicle or the charger. Alternatively, the utility might give you a rebate for a charger that they can control within certain limits, while still ensuring you have an override option.

The 2015 Kia Soul EV paired with a charger at the DC auto show.

Your local utility would like to know that you have an EV charger (since many high-powered chargers on the same neighborhood loop could cause impacts on the local transformer). But there is also the potential for you to use smart charging and benefit the utility, reducing system costs for everybody. It may become more practical to use the battery in a two-way “vehicle-to-grid” arrangement, where the battery is actually sending power to the utility. Although not widespread yet, V2G systems operate in several regions and offer a technically viable energy storage option.

Smart charging is not just an idea; such programs exist today. In BMW’s “ChargeForward” program, smart EV charging, combined with a bank of used batteries from older electric vehicles, provides demand response. When power is needed, BMW has its vehicles stop taking power from the grid, and has its battery bank start sending power to the grid. Vehicle owners are compensated for enrolling and participating in this program, and have the option to override and keep on charging during any demand response event.

Another smart charging program is EMotorWerks’ “JuiceNet Green” algorithm, which automatically aligns vehicle charging at residential or workplace charging stations with clean energy generation to minimize pollution. Other systems have been developed for public charging stations, such as those from ChargePoint or Greenlots. Utilities such as San Diego Gas & Electric, Consolidated Edison, Eversource, and others are investigating how smart charging can benefit their systems. Many such programs, and some “vehicle to grid” systems, are discussed in the UCS report Charging Smart.

EVs bring together many of the elements of grid modernization. Because the vehicles incorporate storage, they are a controllable load. They can provide services such as demand response and can benefit from time-varying rates. These rates require the use of smart meters. The meters also provide the utility with a large amount of data; with the right information systems, utilities can use this data to improve grid operations. Smart charging systems can communicate with the grid in real-time, including the local components, and make automatic adjustments. A charger might vary the power draw to improve the local “power quality,” or coordinate with other chargers to limit power spikes on a circuit, or increase power draw if a neighboring solar photovoltaic system is producing surplus power.

Finally, EV chargers in some cases incorporate additional energy storage in the form of stationary batteries; these can offer many benefits, such as allowing higher-powered charging where the local infrastructure could not otherwise accommodate it.

EVs aren’t the same thing as grid modernization. You could have one without the other (there have in fact been electric vehicles and large-scale energy storage on the grid for many decades). But considering the technologies and principles of grid modernization when making investments for electric vehicles can help ensure that the vehicles are an asset to the grid—allowing increased reliability, greater utilization of renewable energy, and limiting the grid infrastructure investments needed to accommodate EVs.

Edit 9/14/2017: a new video by the Nature Conservancy just came out after this was published. It’s pretty good at explaining some of the issues. Check it out here.

Posted in: Energy

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  • lancejackson

    It seems to me that hydrogen fuel cell vehicles would solve some of the issues identified in this article, like grid capacity restraints resulting from EV charging (and thereby reduce the capital required for grid modernization), etc. Although most of the discussions these days center around EVs, I believe hydrogen fuel cell vehicles may be a better solution.

    • Pete O’Connor

      Thanks for your comment. Hydrogen fuel cell vehicles may have a role to play in certain applications, as other UCS work has pointed out (see http://www.ucsusa.org/clean-vehicles/electric-vehicles/battery-electric-vs-hydrogen-fuel-cell-vehicles), especially for heavy-duty vehicles.

      Electricity has the advantage of ubiquitous infrastructure. Most homes with garages have Level 1 chargers (that is, basic 120V outlets), which will restore 30-40 miles of range overnight. It doesn’t cost too much to improve that to a much faster Level 2 charger. Adding higher-powered charging stations to the existing power grid costs less than building an entirely new hydrogen distribution infrastructure and the necessary electrolysis facilities.

      We may see both types of vehicles become widespread. It is my estimate that EVs will be responsible for displacing a larger fraction of transportation emissions, and their charging can be managed in a way to benefit the grid — without inconveniencing drivers.

      Fuel cells haven’t had the benefit of improvements in other industries; battery technology has advanced tremendously due to laptops and cell phones, and continues to get spillover benefits from that research even as vehicles become a larger portion of the market. Fuel cells don’t have as large and diverse an industry improving them. That could mean there is a lot of potential improvement ahead, however.