Will electric vehicles affect my business energy strategy?

The time is now for businesses to start planning for a rapid rise in the use of electric vehicles.

The truth is that the UK’s current electrical infrastructure is designed to deal with the power we use today, it isn’t designed to charge millions of electric vehicles. This is the challenge our infrastructure will face with the increased electrification of transport.

Vehicle sales figures released in January 2019 showed that fewer new vehicles were registered in the last year but that the number of electric vehicles had risen. Over the next few years we will see electric vehicles being pushed into the mainstream, with a number of new models being released in 2019.

Businesses with an employee or customer car park will need to be conscious of an increase in demand for electric vehicle charging points. But installing significant numbers of those charging points will have implications for their existing electricity supply, potentially necessitating a physical increase in capacity, at a time that others may also be vying for that capacity.

Given the increasing demands electric vehicles will place on local electricity distribution, national transmission and generation infrastructure, we are likely to see the evolution of smart charging.

We predict that smart charging will most likely be underpinned by a variable cost to charge. Customers who are willing to be most flexible around when they charge their car will likely pay a lower price for the electricity while those who want to charge immediately will pay a higher cost.

 As EV penetration increases it will be impractical to allow significant numbers of vehicles to charge simultaneously (for example from 6pm onwards when drivers get home from work). Consequently, there will most likely be cost benefits for those customers who are happy to leave their car plugged into the charger but for the actual charging to take place at a time when there is greater capacity on the local and national network.

A natural extension of smart charging will doubtless be the possibility of supplying power from an electric vehicle’s battery back to the grid. Already under development, Vehicle to Grid (V2G) will allow export from the vehicle to the grid. Once electric vehicles become more mainstream, the collective capacity of their batteries and their ability to store electricity will be colossal.

As with smart charging, V2G will largely be driven by financial incentive; allowing access to a small percentage of an electric vehicle’s battery will result in either payments for doing so or preferential rates for charging.

Given the quantity of data analysis and the number of decisions that will need to be taken in real time, the process of electric vehicle charging and V2G will, in time, become fully automated. The system will require extensive telemetry throughout the electrical distribution as well as real time information regarding price, weather data, predicted generation availability and the preferences of the vehicle owner. In all likelihood, the owner will set some basic parameters regarding when they want to be able to use their vehicle and the range they want and the system will operate to ensure it charges at the lowest cost, charging and discharging as required. Alternatively, an override would allow maximum charging at a higher price for the fastest recharge.

The adoption of electric vehicles will increase significantly over the next five years and they will be commonplace in 10 years. As the battery prices reduce and the technology improves the cost of the vehicles will fall. This, combined with improved range, will make the electric vehicle proposition more attractive. Once electric vehicles reach price parity with petrol and diesel vehicles, except in very select circumstances, virtually all new cars sold will be electric models.

Whilst this wide-scale adoption will bring challenges to our electrical infrastructure, in many regards the flexibility afforded by the batteries through V2G will in itself go some way to solving those problems.