Tag Archives: rolling blackouts

EV rollout will require huge investments in strained U.S. power grids

By Nichola Groom and Tina Bellon

(Reuters) – During several days of brutal cold in Texas, the city of Austin saw its fleet of 12 new electric buses rendered inoperative by a statewide power outage. That problem will be magnified next year, when officials plan to start purchasing electric-powered vehicles exclusively.

The city’s transit agency has budgeted $650 million over 20 years for electric buses and a charging facility for 187 such vehicles. But officials are still trying to solve the dilemma of power interruptions like the Texas freeze.

“Redundancy and resiliency when it comes to power is something we have long understood will be an issue,” said Capitol Metro spokeswoman Jenna Maxfield.

Austin’s predicament highlights the challenges facing governments, utilities and auto manufacturers as they respond to climate change. More electric cars will require both charging infrastructure and much greater electric-grid capacity. Utilities and power generators will have to invest billions of dollars creating that additional capacity while also facing the challenge of replacing fossil fuels with renewable energy sources.

Extreme weather events add additional layers of difficulty.

“Reliability keeps you awake,” California Energy Commission member Siva Gunda said in an interview.

Rolling blackouts during a California heat wave last year prompted the state to direct its utilities to procure emergency generating capacity for this summer and to reform its planning for reserve power.

The state plans an aggressive phase-out of sales of gas- and diesel-powered cars and trucks by 2035 – which, if achieved, would require vast increases in electric grid capacity.

The power and transport sectors combined make up more than half of U.S. greenhouse gas emissions. Their simultaneous greening is considered critical for the United States – the world’s second-largest emitter behind China – to meet its obligations under an international accord to address global warming.

The goal is to power electric cars with renewable energy rather than the coal and natural gas that currently dominate the U.S. power supply. To realize that vision, electricity from intermittent sources like wind and solar will need to be stored, probably through battery technology, so that cars can charge overnight or at other times when supply outstrips demand.

DOUBLING POWER CAPACITY

A model utility with two to three million customers would need to invest between $1,700 and $5,800 in grid upgrades per EV through 2030, according to Boston Consulting Group. Assuming 40 million EVs on the road, that investment could reach $200 billion.

So far, investor-owned companies have plans approved for just $2.6 billion in charging programs and projects, according to trade group Edison Electric Institute.

“The electrification of the transportation sector will catch most utilities a little bit off guard,” said Ben Kroposki, director of the Power Systems Engineering Center at the National Renewable Energy Laboratory (NREL).

The organization estimates that, by 2050, the electrification of transportation and other sectors will require a doubling of U.S. generation capacity.

If not managed carefully, the needed investments could saddle consumers with higher energy bills, according to a report last month by California’s utility regulator. Another challenge: lower-income customers often can’t afford to make the upfront investment in electric cars, home batteries and rooftop solar systems that could save them money in the long term.

‘CHICKEN AND EGG’ PROBLEMS

Utilities are embracing EV sales growth as both a promising new source of revenue and an opportunity to use excess wind and solar power generated at very windy or sunny times when supply exceeds demand.

Investments in both the grid and charging infrastructure that are recovered from ratepayers could add between $3 billion and $10 billion in cumulative cash flow to the average utility through 2030, according to Boston Consulting Group. The forecast also includes potential revenues from new products outside of utilities’ regulated businesses, such as customer fleet routing or charging station maintenance.

The revenue opportunity is still nascent, however, with EVs making up less than 2% of all vehicles registered in the United States. And utilities must invest in infrastructure now for consumers to feel secure in their purchase of an EV, said Emily Fisher, general counsel of utility trade group Edison Electric Institute.

“There is definitely a chicken-and-egg situation with charging infrastructure,” she said.

AUTOMAKERS BET BIG ON EVs

Major U.S. automakers General Motors and Ford have announced large investments in EV development to keep pace with electric-car pioneer Tesla Inc and to prepare for the prospect of tougher emissions regulations. EV share could grow to 15% by 2030, according to U.S. Department of Energy forecasts.

The electricity to power all those cars is expected to come primarily from renewable energy sources and natural gas, according to NREL. Even if natural gas generation increases to support electrified transportation, overall emissions are projected to decline, the organization said.

Large new investments may pose difficulties for utilities already experiencing weather-related problems. In Texas, many of the companies that would be making those investments face a financial crisis stemming from last month’s cold snap. Utilities and power marketers face billions of dollars in blackout-related charges, and several have filed for bankruptcy.

CHARGING UP

Daimler Trucks, the world’s biggest maker of heavy-duty haulers, plans to sell electric vehicles in Europe, North America and Japan by next year. But the company is grappling with how to charge what will one day become hundreds of thousands of battery-powered trucks, said Daimler Trucks chairman Martin Daum.

The need for massive investments in grid infrastructure and charging stations “cannot be underestimated,” Daum said.

Ford Chief Executive Jim Farley last week called on U.S. government leaders to support EV sales with favorable regulation and subsidies for the production of batteries and charging infrastructure.

But Robert Barrosa, senior director at Volkswagen AG’s Electrify America, which is building out fast-charging stations throughout the nation, said the gradual pace of EV adoption will allow utilities to adapt.

“We’re not in a doom-and-gloom situation,” Barrosa said. “We’re not going to 80% battery electric sales overnight…it will be a natural transition.”

Barrosa said U.S. energy consumption decreases over the last 20 years, due to efficiency gains in appliances and the transportation sector, mean that the U.S. power system has enough established capacity to support EV growth without the immediate need for big investments.

‘Rare, dangerous’ heat wave to hit California, U.S. West

By Andrew Hay

(Reuters) – A record heat wave with temperatures of up to 125 Fahrenheit (49 Celsius) was set to punish California starting on Friday as another extreme weather event raised risks of more forest fires and rolling blackouts.

The “deadly heat wave” of “rare, dangerous and very possibly fatal” temperatures was forecast across Southern California for the U.S. Labor Day holiday weekend, the National Weather Service (NWS) in Los Angeles said.

Record or excessive heat was also expected in Nevada and western Arizona with “brutal” temperatures set to peak on Sunday and continue into Monday, the service said.

“There is a high risk for heat illness along with heightened fire weather concerns,” the NWS Los Angeles office reported, forecasting record high temperatures on Saturday and Sunday.

Climate scientists blame human activities for a two to three degree Fahrenheit rise in average temperatures in California since the early 20th century and say extreme wet-dry cycles are creating abundant parched vegetation to supercharge wildfires.

The long weekend’s heat event is expected to be hotter than the one in mid-August that helped trigger the second and third largest forest fires in California history that are still burning.

Death Valley in California’s Mojave desert recorded one of the hottest air temperatures ever on the planet of 130F on Aug. 17, and highs of around 124F were expected there on Sunday, the NWS said.

The California power grid asked power generators to delay any maintenance until after the weekend to prevent blackouts like the two nights of rolling outages seen in mid-August as residents cranked up their air conditioning.

(Reporting by Andrew Hay; Editing by Tom Brown)