Navigant Research Blog

Plug-In Vehicles: For Utilities, More Opportunities than Challenges

Scott Shepard — January 3, 2014

According to the Energy Information Administration’s latest Residential Energy Consumption Survey (RECS), the average U.S. household consumed 11,321 kilowatt-hours (kWh) of electricity in 2009.  If the average 2014 light duty vehicle is rated at 24 MPG and travels 12,000 miles a year, then the amount of energy consumed by the vehicle over the year is equivalent to about 16,000 kWh of electricity.  When the EV Project 2Q 2013 data is analyzed, it shows that 96% and 99% of the energy consumption for participating Nissan LEAF and Chevrolet Volt plug-in electric vehicles (PEVs), respectively, took place at the residence of the PEV owner from April to June of 2013.  That would seem to mean the transition from petroleum-fueled to electric-fueled transportation will present serious challenges for utilities, which face a drastic increase in demand from the residential sector.  This, however, is not the case, due to the efficiencies of electric drive, the charging behavior of PEV owners, and the ways in which individually owned PEVs can be used by utilities to help match electricity supply with demand.

PEVs are far more efficient than petroleum-powered vehicles.  With an average battery size of 40.1 kWh, battery electric vehicles (BEVs) have an average range of 124.2 miles.  For plug-in hybrids (PHEVs), the figures are 11.7 kWh and 27.2 miles for all-electric driving.  Using the same 12,000 miles per year metric, the average BEV consumes 3,869 kWh of electricity a year and the average PHEV (utilizing all of its electric drive capacity every day) 4,271 kWh of electricity.

Non-Peak PEVs

While these energy requirements are significantly less than petroleum-powered vehicles, they still represent a significant demand increase of around 33% for BEVs and 37% for PHEVs for an average U.S. household.  At the average U.S. residential electricity rate of $.12/kWh, utilities collect around $450 per BEV and $520 per PHEV, per year.  To reap such revenues, some modifications to the existing utility grid infrastructure are necessary, but not many.

The increased use of air conditioning has required utilities to develop a grid supply infrastructure that can meet the highest peak demand loads of summer afternoons, when AC units en masse are turned on.  Studies on the charging behavior of PEV owners have shown that few PEVs are plugged in during these times, fewer still in areas where PEV owners are enrolled in time-of-use programs.  Thus, peak electricity demand will not be greatly multiplied by PEV charging.  Further, using PEVs for demand response programs, for grid balancing, renewables integration, and demand charge reduction, will help utilities supply electricity and may actually reduce peak demand loads.

Where utilities are most vulnerable to PEV demands is at the local distribution transformer.  Residential customers are supplied electricity through a transformer that feeds a number of units.  If all or many of the units supplied by a transformer require increased load for PEVs, the transformer may need to be upgraded to increase peak capacity and use.  However, data from California utilities shows that local grids need upgrades to serve PEVs less than 1% of the time.  The net effect to utilities should be new revenue streams with few costs.

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