Electric cars seen as killer app for smart grid

WASHINGTON--Where you see an electric car, your utility sees a battery on wheels.

Forward-looking utilities are gearing up to tap into the stored energy that plug-in electric vehicles can provide using smart-grid technology, said industry executives at consulting firm Kema's Utility of the Future conference here this week.

Car batteries can provide a buffer to lighten the load on the grid during peak times and potentially provide back-up power to homeowners. Down the line, old plug-in hybrid electric vehicle (PHEV) batteries could be recycled as storage devices, they said.

"I think PHEVs will be the killer application for the smart grid," said David Mohler, the chief technology officer of Duke Energy. "They are able to both consume and provide energy like no other device can and can really change storage."

A number of plug-in electric vehicles aimed at mainstream buyers will become available over the next two years. Although there's no standard storage capacity, Mohler estimated that four of them could power a house, at least for a short time.

In the near term, the most promising marriage of the grid and car batteries is providing what the power industry calls "frequency regulation." It's an arrangement that could save utilities money, reduce pollution, and potentially save consumers money, advocates of the approach said.

Utilities routinely pay for frequency regulation services to ensure that the supply of electricity matches the demand. When an imbalance between supply and demand causes a change in signal frequency, power generators crank up to adjust the flow of electricity.

But a network of plugged-in electric vehicles could effectively perform the same function by taking a break--even for a few minutes--from charging their batteries. Charging cars in bursts--all while ensuring they're topped off when the drivers needs them--could be done with millions of cars, said Alec Brooks, a renewable energy engineer at Google.

Google has developed proof-of-concept "smart charging" software with algorithms that monitor the electricity supply and very precisely control when cars get charged, he said during a presentation where he showed simulation data. "You figure out which ones you need to dispatch (electricity) to be full when they say they need to be full," Brooks said.

Using car batteries for frequency regulation--already a billion-dollar market--is more cost-effective and would allow power generators to take better advantage of wind and solar power, which are variable, Brooks said. Google is testing the software on its fleet of eight converted plug-in hybrid Priuses.

"You can shape the load to match renewable energy, which can be very different even within one day...So you have a system where you move the load around rather than the generation," he explained.

Saving money on the Chevy Volt
It's not just software engineers at Google who are tooling around with PHEVs and frequency regulation. When the Chevy Volt is released at the end of next year, the car will have smart charging built into it using the OnStar service.

In a Department of Energy research project, General Motors is working with 50 utilities to see how the Chevy Volt can interface with utilities. Providing grid services, such as frequency regulation, will lower the cost of owning the Volt, said Keith Cole, GM's director of advanced vehicle strategies and legislative affairs.

"If a customer can sign up and say they are willing to have their charging interrupted for 140 seconds and the utility will pay them to do it via a credit, it would cut the cost of charging the Volt," Cole said. "So instead of costing 7 or 10 cents a kilowatt-hour, it might cost 5 or 3 because of the service."

Although this will be technically possible when the Volt is first released, don't expect it to be available for a while. The business models for these types of services have yet to be worked out.

Still, cutting electricity demand for frequency regulation makes sense for utilities because the power purchased for this job is relatively expensive, Cole said, adding that a utility would only be interested if it could get large numbers of cars under management.

Farther out, utilities could potentially pull stored electricity in car batteries to lighten the load on the grid, rather than fire up an expensive and dirty auxiliary power plant during peak times. But that two-way power flow, called vehicle-to-grid, is technically challenging and puts added strain on the battery.

Auto/power mash-up
To illustrate how the auto and electricity industries are connecting, Chrysler anticipates that it will be producing over 1 gigawatt of electrical capacity per year by about 2015, said Tom Sacoman, the portfolio executive of Chrysler's ENVI electric auto division. That's about as much power as a nuclear or coal plant can produce.

Sacoman anticipates that customers will be offered a range of options--sort of like cell phone pricing plans--when they buy an electric car. In some cases, they would allow the utility to control the speed of battery charging in exchange for a discount. In other plans, the customer would not cede control at all and pay full tariff.

Although it's still years away, utility companies already have designs on used-up plug-in electric vehicles' storage, most of which will be lithium ion batteries. The Chevy Volt's battery life, for example, will have a 10-year, 150,000-mile warranty.

But some grid energy storage executives think customers will swap out a car's original batteries for newer, better ones sooner than that as the performance degrades. Those same batteries could be recycled, either to provide back-up power in a home with solar panels, for example, or looped together as big storage banks for utilities.

"A battery could be taken out of that car and used for a stationary application in a home where it could live for many years," said Brad Roberts, chairman of the Energy Storage Association. "But who owns the battery? To make PHEVs really take off, we need to have consumers buy the car and lease the battery."

Battery leasing is essentially the business model developed by BetterPlace, which owns car batteries and provides charging stations at homes and public places. Having cars plugged in as often as possible makes grid services, such as frequency regulation, far more feasible, executives said.

Just like getting discounts for consumers offering grid services with their electric cars, recycling old electric batteries for storage needs a viable business model. Some entity will need to collect them and repackage them for utilities, said Ali Nourai, manager of distributed energy resources at utility AEP.

"We know the auto industry will bring the prices down for batteries," Nourai said, who estimated it would take about 10 years before these car batteries will be available. "We don't need a brand new battery."