New study highlights system savings with flexible EV charging

A joint report by the Regulatory Assistance Project (RAP) and the International Council on Clean Transportation (ICCT) reveals that managed electric vehicle (EV) charging could lead to substantial savings in Colorado’s electrical infrastructure costs. The savings are estimated between $100 million and $300 million per year by 2035, and $200 million to $900 million per year by 2050.
The chart titled "Figure 7. Cost savings by category" shows cost savings in millions (M) from 2021 to 2050 for four scenarios: Flex none, Flex light, Flex medium, and Flex high.
Source: RAP

The report explores the economic and environmental benefits of smart EV charging. By optimising the timing and level of EV charging, system costs can be significantly reduced. This avoids expensive grid upgrades and better integrates renewable energy sources.

Flexibility Scenarios

The study examines four scenarios of EV charging flexibility: Flex None, Flex Light, Flex Medium, and Flex High. Each scenario demonstrates different levels of potential savings and impact on the grid.

Flex None assumes no flexibility in EV charging. EVs are charged immediately upon plugging in, without consideration for grid demand or renewable energy availability. This scenario serves as the baseline, showing the highest system costs due to unmanaged peak demands and necessary infrastructure investments.

Flex Light allows for limited flexibility. EV charging can be delayed by up to four hours. This scenario reduces some peak demand, offering moderate savings by shifting some charging to off-peak times, reducing strain on the grid.

Flex Medium introduces more flexibility. EV charging can be delayed by up to eight hours. This scenario provides greater savings by significantly shifting more charging to times when renewable energy is abundant and grid demand is lower, further reducing infrastructure needs and integrating more renewable energy.

Flex High represents the highest level of flexibility. EV charging can be delayed by up to 24 hours. This scenario offers the most significant savings, optimising charging times to maximise the use of renewable energy and minimise peak grid demands. It showcases the potential for the greatest cost reductions in both distribution and storage investments.

Key Findings

Most savings come from residential EV charging flexibility. The study found that residential charging alone could save enough to cover the costs of Level 2 (L2) chargers for all households in the state. The net present value (NPV) of these savings could cover 100% of the cost for 172.000 to 325.000 L2 chargers by 2030 and 394.000 to 1.000.000 L2 chargers by 2040.

The report breaks down the cost savings into several categories, showing substantial savings across distribution, storage, and solar investments. Distribution cost savings come largely from avoided capital investments. These savings are highest in the Flex High scenario, which allows for the most significant reductions.

The study also highlights the importance of optimising EV charging times. By shifting charging to periods of lower demand and higher renewable energy availability, significant savings can be achieved. This helps to avoid costly grid upgrades and supports the integration of more renewable energy sources.

Policy Recommendations

The report offers key policy recommendations:

  1. Focus on Residential Programs: Design programs targeting the residential sector first due to its significant potential for savings. Following this, attention should be given to managing flexibility in commercial, industrial, and highway sectors.
  2. Develop Customer Programs and Tariffs: Create customer-focused programs and complementary tariffs to ensure EV owners are fairly compensated for participating in managed charging programs.
  3. Utility Integration: Ensure customer programs are integrated into utility operating systems and planning processes to maximise benefits and avoid unnecessary grid investments.
  4. Invest in DERMS: Encourage utilities to invest in distributed energy resource management systems (DERMS) to effectively manage EV loads.

Conclusion

In conclusion, the report highlights smart EV charging as a crucial tool in reducing the overall costs of transitioning to a decarbonised electric grid. By managing EV charging effectively, utilities can avoid significant infrastructure investments, reduce system costs, and support the integration of renewable energy sources, ultimately benefiting all ratepayers.

Source: RAP & The ICCT

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