The road to widespread EV use is being paved by utility-auto partnerships

Published on September 18, 2023 by Kim Riley

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Utilities continue evolving their partnerships with the auto sector to make America’s transition to electric vehicles (EVs) as smooth as possible for both customers and the power companies. 

“We really see EVs as a critical path to taking the progress our members are making on the clean energy side and expanding that to other sectors like transportation,” said Kellen Schefter, senior director of electric transportation at the Edison Electric Institute, the trade association for America’s investor-owned utilities. “These partnerships between two giant industries are critical because they’re indispensable to this transition.”

Schefter added that the utility and auto sectors are now starting to come together on operational issues, such as those related to how to ensure that they manage the charging in a way that benefits the grid and the customers of the grid. 

“It’s an exciting evolution and I think it will only become more important as EVs become more mainstream,” he said during a Sept. 14 Utility Dive-sponsored webinar that included participants from IOUs, auto dealerships, and stakeholder organizations, among others. 

Leilani Gonzalez, policy director at the Zero Emission Transportation Association (ZETA), which represents a wide range of stakeholders in the supply chain from end-to-end, including charging manufacturers and utilities, said ZETA members are in constant conversation with utility companies about the process of going from EV novelty to mobilization. 

This includes discussing policy with the Biden administration and other stakeholders on how to help “create a seamless charging experience,” Gonzalez said, “which is what customers and consumers want the first time and every time” they charge an EV. 

That process, she said, opens up opportunities for a variety of conversations, whether that’s OEMs speaking to charging manufacturers or utilities looking at load management and the required infrastructure needed to facilitate widespread EV adoption.

Joel Levin, executive director of Plug In America, the national association for EV drivers, said the organization runs a program in partnership with auto dealers called in which the group provides training and support and certification to car dealers.

“Utilities have been really involved almost from the beginning of the program,” Levin said. “On one hand, they’re interested in helping car dealers sell more EVs. What we’re seeing now more and more is utilities being partners with auto dealers and trying to identify where the EVs are going to be driven so that they can try and have the grid ready.

“And as demand grows and there are more EVs out there, utilities are getting a little more nervous about being ready for the cars coming out,” he said.

For example, an EV owner will likely need an upgraded power system in their home to power up a new EV truck. If everyone on that block needs the same thing, then all of a sudden the utilities are under the gun to provide more electricity to meet the increased demand, Levin explained. 

“By partnering with auto dealers, utilities can get a jump start on grid planning,” he said.  

Toward speeding up such partnerships, Colorado regulators in 2020 approved an expedited process for Xcel Energy to enter them and advance EV pilots, according to Nadia El Mallakh, vice president of Xcel’s Clean Transportation and Strategic Partnerships. 

“We see EVs as the next chapter in the clean energy transition, said El Mallakh during the webinar. “We’re only one player in this ecosystem and so many of us need to come together to make this work.”

Specifically, Xcel asked regulators to let the utility work with stakeholders to bring forward innovative partnership ideas on an expedited basis, she said, adding that the original budget totaled $10 million.

“We’ve seen great success over the last two and a half years,” El Mallakh said. “We meet with stakeholders quarterly and exchange ideas and then we bring it forward to the commission to take it up and give it approval.”

Thus far, all of Xcel’s EV-related programs that have been submitted to the Colorado Public Utilities Commission have been approved and she said Xcel will be announcing more shortly. 

“For instance, one of the things we looked at is equitable access to car share services,” explained El Mallakh. “In Colorado, we worked with a nonprofit to fashion something that’s bringing EVs in a rideshare service to many of our underserved communities. We’ve partnered with cities, towns, universities, etc., and… are working on types of projects that include specialty vehicles, grid-facing tools, and integrating new resources in a way that is efficient for the grid, among others. 

“So that’s the portfolio that’s being executed and we hope to expand into other jurisdictions like Minnesota and will make a filing there in November,” she said. 

In paving the road to widespread EV use, utilities have to deal with several issues, the webinar participants said. 

For instance, Xcel Energy must make sure it’s ready and being a proactive partner in planning for EVs, El Mallakh said. 

“It takes a mindset shift,” she said, noting that traditionally, utilities plan and build as things are certain. “Here, we’re looking at things like in our Colorado transportation electrification plan that’s currently pending, we’re thinking about ‘how do we make some no-regrets investments in our distribution system to be ready in areas where there will be high concentrations of EVs?’” 

Affordability is also a key issue, as is ensuring a seamless customer experience, she added, “and that means key partnerships, innovative programs, being ready to take risks, and a collaborative policy environment,” among other issues.

ZETA’s Gonzalez added that another issue to contend with is ensuring that the supply chain for utilities is sufficient and robust. “We must make sure the domestic supply chain is secure from end-to-end but particularly from the utility side,” she said, adding that without the proper resources, equipment, tools, and other components, the infrastructure can’t get built.

EEI’s Schefter agreed, particularly regarding the needed infrastructure, such as charging equipment and electric power side equipment to support it. “It has to be there when you need it,” Schefter said. “Auto dealers haven’t had to care about this in the past. But now they’re a big stakeholder in our success and we’re a big stakeholder in theirs, so we absolutely have to work together” to ensure there are fewer roadblocks to EV adoption. 

“The infrastructure is the primary barrier to widespread adoption of EVs,” he said.

Xcel’s El Mallakh also said that while EVs are critical, the IOU is also planning for overall electrification and trying to estimate how it’s going to support all of the additional load from EVs, other beneficial electrification, economic development, natural load growth, and other users. 

The utility has set up an interdisciplinary planning area to consider how to do all that and still meet its 2050 carbon-free electricity goals, as well as how to maintain reliability and affordability, she said.

“EVs are a significant part, but there’s a bigger picture that we’re trying to take on,” said El Mallakh.

Partnership examples  

In Virginia, Dominion Energy works with Sonny Merryman Inc., a school bus dealership, to help school buses make the transition to becoming electric buses. The partnership focuses on smoothing the transition, helping school districts install the necessary charging, and to ultimately allow the utility to use the bus batteries as an asset, according to Utility Dive. 

During the webinar, Adam Birdsong, electric distribution program manager at Dominion Energy, described the utility’s work with Sonny Merryman and how it’s evolved.

“Going into this partnership, we didn’t really know the benefit of having a dealer-utility relationship,” Birdsong explained. “We quickly realized that through years of diesel bus sales, Sonny Merryman already had established relationships with school districts.”

In Virginia, each school district runs and operates its own bus fleet, so Birdsong said it’s pretty difficult for utilities to figure out who the key decision makers are in those organizations. Sonny Merryman quickly helped Dominion navigate those hierarchies.

“Also, being that we’re an electric utility, we didn’t always speak ‘school bus’ and Sonny Merryman has been fantastic in helping us understand the industry and be able to successfully communicate with it,” he said.

Whitney Kopanko, EV program manager and marketing director for Sonny Merryman, said that from the dealership’s perspective, the partnership is just expanding business as usual. 

“We are just serving, if you will, as the conduit for the project between the school district, the utility, and federal and state funding partners and trying to help facilitate the whole process,” she said. “It’s not much different from when we were selling diesel buses; now it’s electric buses.”

In California, Pacific Gas & Electric (PG&E) and BMW of North America are working together on bidirectional charging, which means EVs can send energy back to the electrical grid that can be used for backup power. 

Amy Costadone, PG&E’s principal product manager for vehicle-to-grid integration, said the partnership has evolved over the last eight years and has become even more important as the companies consider what integrating EVs into the electrical grid will look like. 

“The model we set out in California is that the utility will provide signals regarding pricing or otherwise, and aggregators like OEMs and BMW will interface with customers on delivering those signals,” Costadone said. “So it’s so important to communicate and work together to really understand the whole life cycle of what we’re trying to do.”

There’s also a need for the partnership to continue to evolve, she added, as BMW will provide education to customers in simpler terms about how their vehicles can also be used as a utility asset. 

For instance, the two companies currently are collaborating to test how vehicle-to-everything (V2X) technology can serve as a solution to offset growing demand on the power grid, improve reliability for electric customers, and maximize the usage of renewable energy. 

In addition, V2X technology could eventually enable customers to use their EVs as backup home generation when needed, according to PG&E, which said the V2X testing is taking place at its Applied Technology Services Lab in San Ramon and is the focal point of an extended partnership to advance V2X technology and explore the utilization of EVs as a flexible grid resource. 

Adam Langton, energy services manager at BMW of North America, said the companies’ original partnership started in 2015. He said that working with PG&E helps BMW understand what the utility’s needs are and “then we can translate that into products and features for customers that eventually benefit them and the grid.” 

PG&E also says that as it and BMW create a transformative clean energy future together, they’re finding ways to unleash the full potential of EVs to enhance grid resilience and reliability for customers, while reducing carbon emissions.