Switch­ing your elec­tric­i­ty provider when you buy an auto­mo­bile: threat or oppor­tu­ni­ty for utlities?

Increas­ing elec­tric mobil­i­ty requires util­i­ties to posi­tion them­selves strate­gi­cal­ly, irre­spec­tive of their role in the mar­ket. This also entails involve­ment with smart meter­ing sys­tems (Ger­man abbr.: iMSys) beyond the statu­to­ry require­ments. Elec­tric mobil­i­ty and the aim of grid capac­i­ty uti­liza­tion through iMSys not only com­ple­ment one anoth­er – they are pre­con­di­tions for one anoth­er. This is sup­port­ed by the fore­cast reg­is­tra­tion fig­ures for elec­tric vehi­cles on the one hand and, on the oth­er, the envis­aged role for smart meter­ing sys­tems to enable sec­tor convergence.

Smart meter­ing sys­tems facil­i­tate bi-direc­tion­al data com­mu­ni­ca­tion and intel­li­gent con­trol of dis­trib­uted ener­gy resources. This makes it pos­si­ble to con­trol the local load on grids intel­li­gent­ly and thus relieve the strain on them. Elec­tric mobil­i­ty is play­ing a key role in eas­ing the bur­den on elec­tric­i­ty grids. But it can only take on this role if bi-direc­tion­al or intel­li­gent charg­ing is possible.

Growth in e‑mobility and iMSys

In order to make elec­tric vehi­cles viable as flex­i­ble ener­gy stor­age sys­tems or con­trol­lable loads, they must be avail­able in suf­fi­cient quan­ti­ty. The lat­est reg­is­tra­tion fig­ures for 2017 from the Ger­man Fed­er­al Motor Trans­port Author­i­ty (Kraft­fahrt­bun­de­samt) show sig­nif­i­cant increas­es, with 29,436 plug-in hybrids (+114.2%) and 25,056 pure­ly elec­tric auto­mo­biles (+119.6%) reg­is­tered. Fore­casts such as that of the con­sul­tan­cy com­pa­ny PwC envis­age fur­ther growth by 2030 to a mar­ket share for new auto­mo­biles of 30% for pure­ly elec­tric vehi­cles and a fur­ther 40% for hybrids.

The growth in iMSys is enshrined in law. The Ger­man Act on the Dig­i­ti­za­tion of the Ener­gy Tran­si­tion pro­vides for com­plete con­ver­sion of the ener­gy sys­tem. The cen­tral point in the Dig­i­ti­za­tion Act is there­fore the intro­duc­tion of smart meter­ing sys­tems, which make it pos­si­ble to con­nect grids, gen­er­a­tion and con­sump­tion with one anoth­er in an effi­cient and intel­li­gent way. The smart meter roll-out is anchored in the Ger­man Meter­ing Point Oper­a­tions Act (MsbG), which reg­u­lates all aspects of instal­la­tion and oper­a­tion of smart meters. What are known as “smart meter gate­ways” (SMG­Ws) han­dle the com­mu­ni­ca­tion and data exchange between con­sumers and pro­duc­ers, and allow inte­gra­tion of the smart meters into the smart grid in a way that com­plies with data pro­tec­tion and secu­ri­ty. The timescale for con­ver­sion is also defined in the MsbG. All con­sumers with an annu­al con­sump­tion over 6,000 kilo­watt hours are to be con­vert­ed to iMSys by 2032. Meter­ing point oper­a­tors can also extend the roll-out to con­sumers below that lev­el. In sum­ma­ry, this means: soon­er or lat­er, all con­sumers will be equipped with a smart meter­ing system.

Elec­tri­fi­ca­tion of the trans­port sec­tor set to continue

The trans­port sec­tor is the largest ener­gy con­sumer in Ger­many after pri­vate house­holds. Accord­ing to the Arbeits­ge­mein­schaft Energiebi­lanzen (Work­ing Group on Ener­gy Bal­ances), trans­port account­ed for 29.5 per­cent of end ener­gy con­sump­tion in 2016. This cor­re­sponds to almost 750 ter­awatt hours. This quan­ti­ty of ener­gy could be pro­vid­ed by elec­tric­i­ty from renew­able sources in many areas and rep­re­sents enor­mous sales poten­tial for the elec­tric­i­ty mar­ket. Depend­ing on dri­ving habits, the ener­gy con­sump­tion of a house­hold can dou­ble. But that poten­tial can only be exploit­ed if the accep­tance of e‑mobility increas­es. Auto­mo­bile man­u­fac­tur­ers offer numer­ous incen­tives to buy an e‑vehicle, such as free elec­tric­i­ty for charg­ing. But the exist­ing charg­ing facil­i­ties are a cru­cial fac­tor when it comes to con­sid­er­ing a pur­chase. Invest­ment in extend­ing the charg­ing infra­struc­ture will increase sig­nif­i­cant­ly over the next few years. It is only a mat­ter of time until providers will be using the price of pub­licly avail­able charg­ing cur­rent to cov­er their costs. And it is equal­ly clear that, at that point, vehi­cle man­u­fac­tur­ers such as BMW and Nis­san will switch over to offer­ing their elec­tric cars as a pack­age with the appro­pri­ate charg­ing solu­tion, includ­ing a flat-rate elec­tric­i­ty con­tract and the smart meter gate­way required to con­trol charg­ing and pay­ment options. After all, the auto­mo­tive indus­try would not be the first indus­try from out­side the ener­gy sec­tor to move into trad­ing in and sell­ing ener­gy. Google and its peers have been there before.

Exploit­ing exper­tise for new busi­ness models

Sup­ply­ing elec­tric­i­ty is the core busi­ness of the ener­gy sup­ply com­pa­nies. They essen­tial­ly con­trol the process­es; many of them already offer charg­ing sta­tion con­cepts for com­pa­ny fleets as part of their ser­vice and prod­uct port­fo­lio. Fur­ther diver­si­fi­ca­tion of their port­fo­lio through coop­er­a­tion agree­ments and part­ner­ships with the auto­mo­tive indus­try is also pos­si­ble. Pro­vid­ing the charg­ing infra­struc­ture opens up oppor­tu­ni­ties for extend­ing busi­ness mod­els. Thus, for exam­ple, spe­cial tar­iffs for com­mer­cial e‑mobility are con­ceiv­able if they charge their com­pa­ny fleets in off-peak peri­ods. Inte­gra­tion of elec­tric mobil­i­ty as a con­trol­lable load would also be an option. E‑vehicles would then take up excess elec­tric­i­ty from the grid that they did not actu­al­ly need at the time and feed it back into the grid dur­ing congestions.

Smart meter­ing infra­struc­ture – an oppor­tu­ni­ty for utilities

The pre­req­ui­site for all new busi­ness mod­els is still col­lect­ing and dis­trib­ut­ing infor­ma­tion and con­trol­ling the charg­ing process­es via a stan­dard­ized com­mu­ni­ca­tion infra­struc­ture – a task that can be han­dled by smart meter gate­ways. Pub­lic util­i­ty com­pa­nies, ener­gy sup­pli­ers and grid oper­a­tors should thus see the Meter­ing Point Oper­a­tions Act as an oppor­tu­ni­ty in this context.

Kiwigrid offers iMSys-based solu­tions for the dis­trib­uted and dig­i­tal ener­gy world. With Kiwigrid’s high-secure meter­ing infra­struc­ture, meter­ing point oper­a­tors are pro­vid­ed with a com­pre­hen­sive solu­tion for the cost-effec­tive rolling out of smart meter­ing sys­tems. In this way, they can cre­ate the foun­da­tion for cus­tomized added-val­ue ser­vices for all mar­ket roles on a sin­gle platform.

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