How Electric Utilities Are Enabling Transportation Electrification at Scale
With states like Ohio, Pennsylvania, and Hawaii beginning to execute their National Electric Vehicle Infrastructure (NEVI) Formula program plans, utilities within these states are rapidly coordinating the electrical power requirements needed to support these public electric vehicle (EV) charging stations. The influence of utilities on power infrastructure, including grid modernization, capacity growth, and energy management, is massive. As such, utilities will be the central enablers of electric mobility and are thus challenged to balance this growth while maintaining safe, reliable, affordable, and resilient electric grids.
Large, investor-owned utilities (IOUs) bolster the EV market by developing make-ready and related infrastructure programs, collaborating with technology providers, and monitoring and modeling the incremental energy demand that electric transportation will create. Municipal and cooperative utilities are also evaluating ways to support their customers and members with EV infrastructure, including some own-and-operate programs and offering rebates or other collaborative incentives. Still, they are often confronted with challenges that differ from those of the bigger utilities.
COMMENTARY
Utilities must serve their customers equally, regardless of location or profitability. However, those with a smaller customer base often encounter a reduced rate base (read: paying customers), leading to smaller budgets and, in turn, less financial and human capital. Since demand for EV infrastructure does not always grow evenly across jurisdictions, municipal and cooperative utilities must plan for energy demand increases and how to deploy equipment (or funding and incentives) to keep individual customer segments served in the most economical and beneficial ways.
With the substantial influx of funding for EV infrastructure programs, utilities of all sizes must determine how to deploy resources to manage the electric distribution system best and improve grid reliability while serving all their customers equally. For example, is it reasonable to expect a mid-sized rural town to be home to as many EVs as a large coastal city? In this case, how does the power company manage (likely) lopsided demand?
Thankfully, utilities now have more options than ever to leverage the support of experts in electric transportation infrastructure. For smaller or resource-constrained utilities in particular, these resources can support the development of effective long-term electrification plans, streamlining management and administration of incentive programs, and strategic EV charging infrastructure deployment.
How Utility Programs Can Accelerate State Efforts and Protect The Grid—Framework and Scaling Capabilities
The term “EV-ready” can mean different things to different stakeholders, so an industry standard for each utility type should be considered before utilities are deemed ready. To be most effective nationally, the utility industry must be allowed to employ proven best practices to keep the grid and power supply stable as EV charging demand grows organically. Regardless of the service area or experience, many utilities will need federal or grant funding to build EV infrastructure and grid capabilities. A framework for deploying funds and infrastructure will be a requirement for applicants.
Want to learn more about the electrification of transportation and other industry sectors? Read this POWER exclusive, “Electrification: Plugging into the future of energy.”
Among utilities, IOUs are more likely to receive approval for funding—and leverage that funding—to establish make-ready programs and streamline the distribution of funds for large infrastructure projects. The challenge for IOUs will be deploying technologies that provide interoperable and centralized operations and maintenance, managing feature and function upgrades via software, and sophisticated monitoring for efficiently scaling the technology stack. Avista Utilities tackled this challenge by deploying a new platform to provide a scalable, hardware-agnostic option that eliminated the need to juggle multiple software packages to ensure its chargers operate reliably.
Municipal utilities will face challenges moving from pilot programs and small-scale bus and fleet electrification–in which they have been trailblazers–to ubiquitous municipal electric mobility. Successful EV infrastructure projects follow a similar path to triumph, whereas unsuccessful projects can go astray for many reasons. For example, the roughly 2,500 utilities run by cities and municipalities must have the staff and expertise to distribute millions of dollars so that EV infrastructure programs produce the desired results. Thankfully, there are lessons to be learned from cities like Los Angeles, California, and Nashville, Tennessee, which are seasoned administrators of high-dollar public works programs. A “playbook approach” to EV infrastructure deployment offers a solution for municipal utilities. It allows multiple entry points, accounting for the reality that all such deployments are different enough to require individualized approaches. On the other hand, EV industry experts can provide vast insights into how municipal and private passenger EV charging demand dynamics differ.
Municipalities in rural areas often lag in implementing the latest technologies, but their inclusion in EV electrification infrastructure is critical to the success of nationwide EV adoption. Transportation electrification in rural areas has fallen behind because the business models around EV charging do not scale as efficiently as they do in big and densely populated cities. This dynamic is further confounded by the requirement to serve customers equally, regardless of the population density across service areas. To succeed, cooperative utilities must leverage federal resources and industry expertise to project energy demand from EVs and the grid capacity required to serve it.
Luckily, federal funds have become more readily available to support these smaller municipal and cooperative utilities. The Dept. of Transportation established the NEVI program in 2021, recognizing the need for additional funding to build a strong national EV infrastructure. As part of the Infrastructure Investment and Jobs Act, the NEVI program has allocated $5 billion in funding to states to deploy EV fast chargers every 50 miles and within one mile of the Alternative Fuel Corridor. This initiative will provide financial support to rural areas that need help implementing the latest EV charging technologies. Slowly but surely, states have begun developing their NEVI-supported charging projects, but the program’s rigorous criteria have held many from deploying their proposals. Fortunately, countless companies within the EV landscape are banding together and offering their expertise to make these plans possible—ensuring EV drivers in every state have access to electrons and future-proofing America’s roads.
Funding the Future of EVs
Utility companies are the backbone of EV transportation, and technology companies that build products around open standards and interoperability will help streamline the transition. Avista Utilities is a clear example of the impact of hardware-agnostic platforms and software in scaling charging networks using various charging hardware. Practically all utilities will need support to balance the demand from charging with the energy transition, grid health, reliability, and affordability. As such, the importance of collaboration with companies that take a hardware-agnostic approach, the lessons learned and best practices of other successful utilities, and the utilization of state and federal funding is critical.
Thankfully, there are more resources than ever to assist utilities nationwide to become influential stakeholders, collaborators, and influencers that accelerate access to reliable, safe, affordable electric infrastructure.
—Ram Ambatipudi is SVP of Business Development at EV Connect, an EV charging management solutions company.