Solving the Power Challenge (ACT Expo 2024 Recap)

Published on
Jun 26, 2024
Written by
Jonathan Colbert
Read time
8 min
Category
Insights
Thanks for joining our newsletter
Oops! Something went wrong while submitting the form.

Solving the Power Challenge (ACT Expo 2024 Recap)

As it has been at every clean transportation conference I’ve attended over the last two years, power was once again front and center at ACT Expo 2024. In particular: the challenge of getting enough power, quickly enough, to support battery electric vehicles at scale.

“Literally the power infrastructure is the whole problem to solve, the whole bottleneck.”

Alex Nicholas, VP of Operations at MHX, speaking at ACT Expo 2023

The crux of the challenge is the rapid pace at which massive demand for new capacity is arising. Speaking on the Navigating the New Fuel Frontier panel, Chanel Parson, Director of Clean Energy and Demand Response at Southern California Edison (SCE) explained that achieving carbon neutrality by 2045 will take electrification, and will contribute to an 80% increase in electricity demand (“maybe more depending on how demand from data centers grows”). Meeting that demand, Parson said, will require 3 times more clean utility-scale generation and storage assets than exist today. Utilities will have to upgrade transmission systems at 4 times the pace and the distribution grid at 7-10 times the pace of today. “This is a lot of change.”

I wrote briefly about unique solutions to power challenges in my recap of Voltera CEO Matt Horton’s infrastructure developers’ panel. “The Voltera team has deep expertise in the charging world, plus we spun out of a large data center developer that builds high reliability data centers with large power needs,” Matt explained. “The approaches used in data center development inform our strategies for developing high-capacity charging stations.” The topic was a key point of conversation on many other panels as well.

The top power procurement challenges, detailed in Playbook 2: Solving Power Procurement Challenges, include locational capacity constraints, utility timelines mismatched to vehicle rollouts, differences across markets, and the fact that e-mobility is only one piece of the energy transition utilities are facing. Three potential solutions were the focus of the conversation at ACT Expo 2024: utility regulatory reform, load management, and distributed energy resources and microgrids.  

Utility regulatory reform

Perhaps the greatest power-related challenge for fleet charging at scale is the fact that utilities simply aren’t set up to deliver added capacity as fast as fleets want to deploy battery electric vehicles (BEVs). As GNA, a TRC Company, points out in the newly released 2024 State of Sustainable Fleets report, “the utility business model has always supported single- and low double-digit megawatt-level upgrades, but that has only been necessary for slower moving, multi-year infrastructure projects – until now. Fleet deployment timelines are much shorter than new stadium construction timelines, which typically require as much power as a mid-size HD fleet electrification project.”

Enabling utilities to move as quickly as fleets need will require regulatory reform permitting utilities to proactively invest ahead of demand. SCE’s Chanel Parson explained that SCE is “Looking at how to proactively upgrade the grid in areas where we know there will be demand. We’ve put in a request to our regulator to invest proactively because these projects can take years and if we don’t start now we’ll be too late.”

Asked whether utilities can really serve all the demand set to come online, Parson said yes, but it will be a challenge, and will require all hands on deck. “Challenges to be overcome include getting permission from regulators to spend the money as early as we can, accelerating permitting processes so work can start earlier, and relieving supply chain constraints on both utility-side and customer-side infrastructure.”

The relationship between utilities and customers has changed, Parson said. “Before, utilities were considered an afterthought. Now we’re a critical partner in our customers’ electrification journeys.” Part of that two-way relationship is information exchange. “We can’t do effective planning if we don’t know how much demand is coming and where it will be. We need developers to talk to us about where they’re planning to electrify. We need OEMs to tell us where they’re selling vehicles.”

Chip Silverman, Director of Policy at FreeWire Technologies, echoed the sentiment. “It’s not utilities’ fault. They’re the second-most highly regulated industry beside banking,” he said. “Utilities aren’t trying to hold fleets back from meeting their electrification goals. They want to be collaborative.”

In a report released earlier this year by the independent nonprofit RMI, ACT Now: Impacts of the Advanced Clean Trucks Rule on the Electric Grid and Fleets, authors advise utility regulators to “Approve proactive grid planning and charging infrastructure investments to ensure that charging infrastructure is built ahead of or alongside need. Revisit proactive plans in future years to minimize risk of underutilization.” And, “Protect ratepayers from excessive utility investment while not compromising the ability of fleets and manufacturers to comply with vehicle-focused policies like ACT and ACF.”

Load management

Where there are utility power constraints, the best first step – before deploying distributed energy resources or microgrids – is behavior modification, said Linnea McChesney, Business Development Manager, EV + Microgrid Infrastructure at Mortenson Construction, speaking on the panel Finding Innovative Solutions to Power Constraints. That includes load management.  

As we describe in Playbook 2: Solving Power Procurement Challenges:  

Managing the load is the least expensive, simplest, and quickest way to bridge a potential shortfall between the amount of power the utility can deliver and the amount of power required to charge the vehicles on the site. Unlike on-site storage, load management doesn't take space away from charging stalls. Unlike on-site generation options, load management doesn't require special utility interconnection agreements.  

Imagine for example a ten megawatt site with 100 charging stalls. The utility can deliver three MWs in the first year and the remaining seven MWs in three years. The chargers can dispense at full power until enough vehicles are charging that the three MWs is drawn, at which point a load control algorithm might reduce output to all of the chargers or might prioritize some chargers over others depending on the customer's needs.

Depending on the customer’s operations, it is sometimes the case that a customer doesn’t really need as much power as they think they need. Consideration factors include acceptable dwell time and whether all chargers will be in use at the same time. In any case, load management is a valuable tool to bridge the gap between site launch and full ramp.  

Distributed energy resources and microgrids

Distributed energy resources (DERs) are small-scale energy generation and storage technologies. A microgrid is a local, self-contained power grid that can operate independently of the main electrical grid to generate and distribute its own electricity. Charging infrastructure developers are increasingly turning to both – sometimes to temporarily bridge a gap between the amount of power needed for charging at the site and the amount of power available from the utility, other times to augment utility power on an ongoing basis.

Truck-as-a-service provider WattEV is one infrastructure developer actively leveraging microgrids to help solve the power procurement challenge. Speaking on the Navigating the New Fuel Frontier panel, WattEV’s Chief Technology Officer, Chairman of the Board, and Co-Founder Emil Youssefzadeh explained, “Creating microgrids has been a part of the solution for us. But it requires a significantly large parcel of land which isn’t always easy to find.” So some sites “have to rely entirely on utility power.”  

At WattEV’s flagship charging facility in Bakersfield, California, there was plenty of land (119 acres) to build a 25 MW microgrid anchored by a large-scale solar generating plant and battery storage. The site has a 5 MWh battery energy storage system (BESS) and a 6 MW grid connection for resiliency. “We built the microgrid partly to demonstrate that it is possible to reduce the cost of energy and avoid transmission costs. Microgrids could be a transition path,” Youssefzadeh said.  

Mortenson Construction’s Linnea McChesney explained that the benefits of DERs and microgrids include overcoming limited grid capacity, time-of-use bill management, and reduced demand charges. Paul Gioupis, Founder and Chief Executive Officer at Zeem Solutions, said the company is developing off-grid power solutions “to get operations started while full power being developed.” Greenlane Infrastructure is building microgrids for similar reasons, “plus peak shaving to get power at a lower cost than the grid,” said CEO Patrick Macdonald-King.

Asked if building an on-site microgrid creates any conflicts with utilities, McChesney said utilities want charging infrastructure developers to generate their own power, “as long as you do it in a well-optimized way.” She added, “It’s not about conflict. It’s about coordination, especially communicating with the utility about timelines.” In fact, FreeWire’s Chip Silverman described building microgrids for utilities, “because they don’t want to hold up their key accounts from electrifying.”

On the Navigating the New Fuel Frontier panel, John Kenning, Chief Executive Officer and President at First Student, described a soon-to-be announced microgrid project in partnership being developed with the local utility. “We’ll be supplying energy back to the grid.”  

Those types of projects are vastly more complicated than island microgrids (not connected to the main power grid). “The stakes are a lot higher when you’re interacting with the grid,” McChesney explained. But, “There is an opportunity for additional revenue via vehicle-to-grid (V2G).” She said certain use cases are particularly enticing, like school buses. “They’re sitting idle during peak demand hours.” Silverman believes V2G at scale is a long way off. “V2G has exciting use cases and can provide additional revenue streams but it is icing on the cake and we haven’t even baked the cake,” he said. “We really need to focus on enabling charging before getting into what else we can do.”