How can utilities prepare for the approaching electric vehicle boom?
Mass electric vehicle (EV) adoption is coming to the U.S., and preparing resilient infrastructure for millions of electron-dependent vehicles is something we need to think about right away.
Such a wide range of manufacturers vying for market share means that current high-end, high-profile EVs like Tesla’s Model S will be the tip of a growing iceberg in the U.S. As more affordable EVs hit the road, a luxury goods market will transform into a mass market, where vehicles such as the Tesla Model 3 and Nissan Leaf will likely dominate in large numbers.
Five years to get ready
The U.S. Big 3 and most of the European auto companies have said that they’ll make good on their EV promises between 2021 and 2023. This means utilities and cities only have five years at most to start rolling out the sort of charging infrastructure that a U.S. EV boom will require.
And we’re not just talking about the top cities and biggest utilities in the United States. Second- and even third-tier cities will be no more immune to EVs than they were to the rise of the internal combustion engine. If forecasts prove true, as many as 2.9 million EVs could be on the road within five years.
Towards a viable charging solution
So as a utility or local municipality, how can you best prepare? The first thought for a city or regional planner, fuel company or utility is simply to site charging facilities at existing gas stations.
However, not only does this option ignore the changing face of driving and the unique needs of EV owners, it misses a number of highly lucrative commercial opportunities and new business models.
The right solution needs to offer extended parking for a large number of electric vehicles – which take anywhere from 30 minutes to 20 hours to charge. It would also have to be strategically placed near (but not in) key business districts – some of which may soon impose vehicle toll schemes, like New York or Seattle.
Let’s go even further than simply a car park with EV charging facilities. Instead, let’s build Mobility Hubs where EV charging is just part of a wider consumer benefit. Imagine hubs where office workers drop off the car along with their laundry or maybe even their kids for daycare. Drivers could grab a coffee, dine in a restaurant, or work out at the gym in the same place they charge their EV. Place Mobility Hubs just outside city limits, and offer bike and electric scooter hire points for the short final hop to the office.
The number of business opportunities and community benefits would stack up quickly, including the potential rejuvenation of previously neglected areas and utilization of unused plots of land such as old parking lots and garages. Mobility Hubs would engage local communities and build partnerships with small local businesses - far more beneficial than an existing parking garage or a gas station.
Making Mobility Hubs a reality
Given their complex nature, making Mobility Hubs a workable reality is not something that only one interested group could pull off alone. Getting it started will need participation from all relevant stakeholders in a three-step process:
- Convene thinkers and doers from city governance and planning, utilities and other interested stakeholders, including big fleet operators such as the U.S. Postal Service, UPS, DHL, plus mass transit authorities and taxi operators, Uber and Lyft.
- Next, hash out the ownership of and responsibilities for operations, any concessions arrangements, financing and community engagement issues – and, perhaps most important of all, grid stability, power supply and payment processing.
- Finally, set a realistic timeline with detailed goals and key milestones.
The planning has begun
The good news for utilities and cities is that many jurisdictions are already taking the first steps in planning for a robust infrastructure that will serve this coming wave of EVs.
Legislative clarity is a necessary first step on this journey. The state of Pennsylvania is at the forefront by proposing rules governing third party electric vehicle charging. Specifically, a draft policy stipulates that EV charging is not considered reselling electricity, and electric distribution companies should add EV charging to their base rates – which is great news for the utility business.
A solution from innogy consulting
My company, innogy consulting, is playing its part in helping organizations navigate these turbulent and exciting developments. We’ve been named finalist in the NYCx Climate Action Challenge, which asked the commercial sector to propose a city-wide solution to a future without gas-powered vehicles in New York City.
Our solution for NYC includes Level 2 chargers retrofitted on light poles, a mobility app connecting customers with the nearest charging infrastructure, and an initial five Mobility Hubs offering everything from integration with public transport to EV valet parking, Wi-Fi connectivity and local business deals. The plan’s five-year rollout would begin ahead of 2020.
In recent weeks, we’ve seen initiatives announced in such diverse cities as Raleigh, NC and Sacramento, CA. Mobility Hubs can help these cities fulfil their vision of electric mobility - perhaps we can help your organization do the same.
innogy consulting is an energy-focused management consulting firm with operations in North America, Europe, and the Middle East. Our 200 consultants drive projects from restructuring to innovation, change management to market capitalization, for leading U.S. energy companies intent on fortifying their businesses for the future. To learn more, visit innogyconsult.com.