EVs will put more stress on California’s grid. Smart charging can help

Truly ​“smart” EV charging means a whole lot more than just giving EV drivers a schedule of times to avoid plugging into the grid.

For example, with the right technologies and incentives in place, EVs can not only avoid charging when grid demand is at its peak — they can also absorb solar and wind power when it’s cheap and plentiful, or even serve as roaming batteries, reinjecting their stored energy when the grid is facing shortfalls.

But one of the most useful things EVs can do is to get synchronized. If EVs in the same neighborhood can coordinate when they start charging so they don’t overwhelm the power lines and transformers they share, they could help utilities avoid costly grid stresses and upgrades — and keep the grid open for even more neighbors to buy EVs and join them.

And such coordination isn’t just tinkering around the edges. In California, by far the U.S. leader in EV adoption, it could mean the difference between the state spending or saving tens of billions of dollars in additional grid upgrades.

That’s why the California Energy Commission is testing next-generation smart-charging tasks through its Responsive, Easy Charging Products with Dynamic Signals (REDWDS) program. Last month the agency awarded a first phase of $9 million in grants to 10 projects ranging from home smart charging and vehicle-to-grid services to electric truck and tractor charging.

The CEC has up to $300 million to award in second-phase grants later this decade for projects that show success in deploying ​“easy-to-use charging products which help customers manage electric vehicle (EV) charging and respond to dynamic grid signals.” Half of the program’s funding is aimed at serving people in communities designated by CEC as disadvantaged and low-income, where owning and charging EVs tends to be more expensive and complicated.

Right now, most of the EVs on California roads aren’t even signed up for the basic utility EV rate programs that already exist, let alone more complex programs that actively modulate when they charge to match the ups and downs of power prices and the availability of clean energy on the grid. That means the companies and utility and community power providers involved in these projects have a lot of work ahead — not just to get the smart-charging technologies in place, but also to convince EV owners to sign up.

With California aiming for about 8 million EVs on the road in 2030, compared to about 1.5 million today, and state policy calling for all new light-duty vehicles sold in the state to be electric or plug-in hybrid electric models by 2035, there’s no time to waste in widely deploying the smartest charging options available. 

Why smarter smart charging could make billions of dollars of difference to California’s grid 

The level of sophistication of different utility smart-charging programs varies widely, however — and not all are sophisticated enough to manage the impact of millions of EVs being plugged in at once.

Consider, for example, the first step most utilities take with their EV charging programs: implementing simple time-varying electricity rates that are higher during peak demand periods to encourage drivers to charge when the grid is least stressed. In California, that translates to high prices during the late afternoon and evening hours, when the state’s grid faces the double whammy of fading solar power and rising electricity use, and cheaper prices during late evening and overnight hours.

The problem with hourly schedules like these is that they create ​“a massive secondary load on the grid” when prices flip from expensive to cheap and thousands of EVs all start charging at once, according to Nick Woolley, CEO and co-founder of ev.energy, a U.K.-based startup that recently won a $1.6 million REDWDS grant to sign up thousands of EV drivers across the state. If it moves on to Phase 2, it could receive another $39.7 million in funding and expand to 275,000 drivers.

That enormous electricity draw might not come at a time when the entire state’s grid is short on power — but it could still place an inordinate amount of strain on the local grids in neighborhoods where lots of EVs are plugged in.

This is a well-known problem with utility rate programs that operate on set hourly schedules, said Jonathan Levy, U.S. managing director of Kaluza, another U.K.-based company that won a REDWDS grant worth up to $6.4 million in partnership with charger manufacturer Wallbox and utility Pacific Gas & Electric.

Thankfully, the problem has a relatively simple solution, he said — although it does require a deeper level of data on when individual drivers need to have their EVs fully charged.

Most EV owners plug their cars in overnight and expect them to be fully charged by the next morning. Whether that full charge begins at 10 p.m., midnight or 3 a.m. doesn’t really matter, Levy said — ​“as long as they end up at wherever they need to be by, say, 7 a.m., they’re hunky-dory.”

That means companies like Kaluza and ev.energy can modulate the charging schedules of all the EVs signed up to programs they operate for utilities to make sure they’re ready to go by whenever the owner needs to drive off in the morning — without overwhelming the grid by charging everything at once.

Last year, a set of analyses commissioned by the California Public Utilities Commission found that the state’s three major utilities could need to invest from $15 billion to as much as $50 billion in their distribution grids by 2035 to manage the additional peak demands coming from electrification of buildings and vehicles, with EVs playing the largest role.

One point of contention within these studies was sharply divergent assumptions about the degree to which future EV owners would commit to managed charging to limit their electricity use and optimize its timing.

The lower band of estimated costs came from a study by the CPUC’s Public Advocates Office, which assumed that managed EV charging programs would spread charging out more evenly throughout the day. The higher costs, meanwhile, came from a study conducted by Kevala, a grid data analytics company, which was instructed to assume that the majority of EV drivers would choose to begin charging when the standard time-varying rates now in place for residential customers of the state’s three big utilities switch from high-cost to low-cost hours at 9 p.m.

In other words, making sure EVs don’t all charge at once is really important, said Amanda Myers Wisser, policy lead for WeaveGrid. The managed-charging startup is working with utilities including Pacific Gas & Electric on a smart-charging project targeting more than 10,000 customers with EVs in fire-prone parts of Northern California.

WeaveGrid was approved for up to $11 million in REDWDS grant funding to expand the scope of the signals it can communicate to the EVs it manages in California.

“WeaveGrid is really proud of the work we’ve done with many thousands of customers in PG&E service territory,” she said. But as the number of EVs in California grows to ​“millions of vehicles on the roads — which is a great achievement — there’s some concern about whether we have enough of these mass-market managed EV charging programs” to maintain grid stability.

Making it as easy as possible to sign up and stick with it

Looking beyond grid needs, however, it’s critical for utilities to consider what individual EV owners want and need from managed-charging programs, Kaluza’s Levy said. ​“Making sure that customers recognize a tangible benefit is important,” he said — and even more important is ensuring that those who sign up never experience even the slightest inconvenience stemming from their participation.

The experience of managed-charging pilots already underway in California can provide some important learnings on that front, said Phillip Kobernick, senior transportation programs manager at Peninsula Clean Energy, the community energy provider serving San Mateo County — one of the most heavily EV-saturated regions in the country.

In the spring of 2023, PCE launched a pilot project with ev.energy and the University of California, Davis to test various managed-charging methods and incentives. The goal was to ​“set up some systems now that might be small-scale at first but can grow over time to manage this massive new” power draw, he said.

The first lesson program administrators learned is that ​“it’s really hard to recruit people,” Kobernick said. PCE emailed about 17,000 EV owners in its territory. Of those, about 700 people ended up enrolling, and many of those participants were early adopters of EVs who were ​“already religiously monitoring their charging,” he said — not necessarily representative of the next wave of EV owners who aren’t as eager to actively engage in tracking grid alerts and hourly pricing.

Another important lesson is that relatively few EV owners today are installing the advanced ​“smart” chargers that can receive and send wireless communications from utilities or the California Energy Commission’s technology platform, he said.

Eventually, enhancing standard-issue chargers with the advanced capabilities now reserved for ​“smart” chargers — and embedding them in EVs as well — will be a critical variable in how broadly these technologies can be relied on to help the grid, Woolley said. ​“When you buy a brand-new electric vehicle, you often install a new charging platform” at your home, he said. ​“If the first charger you buy is smart, you don’t have to do anything else.”

Advanced chargers can also do things that EVs alone can’t — at least, not yet.

One of the largest REDWDS grants was awarded to dcbel, a manufacturer of a smart EV charger that can also serve as a home energy management control platform and a central inverter for rooftop solar and battery systems. Advanced chargers can be useful in connecting older EVs that lack the more sophisticated telematics capabilities of newer models — including the growing number of used EVs that could be an entry point for lower-income Californians to go electric. They can also be an important point of control for ​“vehicle-to-everything” (V2X) capabilities, such as using EV batteries to power homes during blackouts or even feeding their surplus power back to the grid. 

Testing the limits of EVs as active participants in a clean grid 

If the majority of EV owners can get access to the technology they need to enable flexible charging controls — and can be enticed by a combination of convenience and lucrative incentives to participate in smart-charging programs — ​“there are huge benefits to the customers, to the utility and to the grid at large,” Levy said.

“The way we approach that at Kaluza is not thinking about sending one signal” to initiate charging in all the EVs they manage simultaneously, he said. ​“Rather, we’re looking at all the devices we have to optimize and what the utility wants to [manage]: the cost of energy, the peak time for the grid or the share of renewables. Then, we optimize against that with the customer in mind,” he said.

Some utilities are further ahead in terms of being able to support this kind of optimization. In the U.K., a country with a competitive energy market that allows retail energy providers to compete for customers, Kaluza and retailer OVO have a program that offers EV drivers a flat electricity rate for charging that’s roughly one-third of typical retail rates. In exchange for the savings, customers agree to allow Kaluza and OVO to control when they charge to maximize their use of cheap renewable electricity.

Since its launch in March 2023, that program has grown from 200 to 16,000 drivers, Levy said. ​“As far as we know, that’s the largest residential managed-charging program in the world.”

That business model is tougher to pull off in California, where energy retailers can’t compete for residential customers and changes in utility rate structures require regulator approval and years of review. But California agencies have been slowly developing a set of options for customers to sign up for ​“dynamic” energy rates that follow the wide price swings on the state’s wholesale energy market.

One of the California Energy Commission’s goals for its REDWDS projects is to test how those rates might be used to incentivize EV owners to charge when power is cheap and clean, Woolley said. That could help mitigate the supply shortfalls that have pushed the state’s grid to the brink of emergencies during heat waves over the past few years.

To a degree, ​“we already do this,” Woolley said. Ev.energy has tested shifting when San Francisco Bay Area EV drivers charge in order to make more use of midday solar power, whether it’s from the grid or from household rooftop solar systems.

“The challenge is that dynamic signals create complexity for EV drivers,” he said. ​“Nobody wants to have to understand what’s happening with pricing” in the wholesale energy market. Nor should EV drivers be exposed to paying the ultra-high prices that can occur during times of severe grid stress, he added.

Instead, ​“we need automated tools,” he said. When ​“an EV owner plugs in, we tell them, ​‘We’re going to charge [your car] at the cheapest time’…and you just get money in your pocket.”