RETRANS2 – Final Report
Univ.-Prof. Dr.-Ing. Armin Schnettler, Thomas Dederichs
Ann-Kathrin Meinerzhagen, Eva Szczechowicz
RWTH Aachen University, Germany
12. July 2011
Introduction
Background of the project
 The transport sector is globally growing and has the strongest reliance on
fossil fuels from all economic sectors
 GHG emissions from transport increased by 26% from 1990-2006 (in Europe)
 Worldwide transport is responsible for 25% of energy-related CO2-Emissions
 European Target – 80% CO2 reduction by 2050 compared to 1990
 thus oil consumption in the transport sector must drop by around 70% from today
 Expected development (globally)
 2009: 6,8 billion people, 700 million passenger vehicles
 2050:
9 billion people,
3 billion passenger vehicles
 Mitigation of fuel-dependency and CO2-Emissions possible with Electric
Vehicles?
 Co-Evolution of transport sector and energy sector provides opportunities for
developing Electricity from Renewable Energy Sources and Electric Vehicles
 Energy systems and transport characteristics differ around the world
→ need for regional perspectives
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Scope of RETRANS2 Regions
Comparison of three world regions
 Identify challenges and opportunities for the Co-Evolution of Electric Vehicles
and Electricity from Renewable Energy Sources in three world regions (North
America, Europe, China)
 Similarities and differences in personal mobility
 Infrastructure requirements for the integration of Electric Vehicles
and Electricity from Renewable Energy Sources
 Existing policy framework
 Economical influences on the evolution of Electric Vehicles and Renewable Energy
 Assist stakeholders of this Co-Evolution in better understanding the
characteristics of each region
 Examine whether the policy recommendations from the RETRANS project
can be applied
 Identification of those policy options that have to be adjusted to better fit the
situation in one region
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Background information from RETRANS
Stakeholders for Co-Evolution Policies
 OEMs
 EVs can be counted as ZEVs if contribution to energy fund for new RES-E is paid
 Lower overall fleet emissions
 Utilities
 Systems stabilizing bonus for connected EVs
 DSOs
 Smart metering required
 Government
 Hard coupling: increase RES-E portfolio share with growing EV market penetration
 Tax exemption on RES-E traction current
 Aggregator
 Actor that bundles EVs in a certain region for offering their common capacity for
ancillary services
 System stabilizing bonus might offer additional potential for revenue
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RETRANS Policy Recommendations
Consistent long term policy for Co-Evolution needed
that involves a variety of actors
 Preparation for EVs
 Infrastructure and standardization (plugs, charging levels, smart grids)
 Pilot fleets in niche markets
 Learning effects for cost reductions
 Long term perspective for Industry, security of investment
 Increase RES-E production
 Feed-in tariffs or premiums
 Renewable portfolio shares or obligations
 Cap and trade
 Balanced grid development
 Priority access for renewables (no coal based charging)
 Coordinated technical and institutional efforts
 Smart grids and active load management
 Phase 2: Increase EV deployment for mass markets, increase system
integration (V2G)
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Methodology & approach
 Literature survey and analysis of relevant studies and policy papers
 Assessment of pilot projects
 (In-House) Expert interviews on characteristics of regional electricity sector
development
 Analysis of statistical data
 Analysis of regional policies until today and their continuation
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Table of Contents
Chapters
 Context
 Regional Economic and Transport-related Background
 Electric Vehicles
 RES-E and Grid
 Opportunities & Challenges for Co-Evolution
 Conclusions
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Context – Transport Sector Overview
The Chinese transport sector adapts slowly
to Europe and North America
North
America
Europe
China
Passenger transport relies
mainly on passenger
vehicles
Passenger transport relies
mainly on passenger
vehicles
Passenger transport relies
on passenger vehicles and
public transport
Passenger vehicles become
an increasingly important
mode of transport
30% of final energy
consumption
30% of final energy
consumption
20% of GHG-Emissions
20% of GHG-Emissions
8% of final energy
consumption
9% of GHG-Emissions
Transport sector has fastest growing energy use and
strongest reliance on fossil fuels of all economic sectors worldwide.
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Context –Economic Situation
Diverse Economic and Population Background
- North America and Europe are comparable
 GDP per capita (PPP)
Source: IfHT,
values from World Monetary Fund
 North America and Europe have a GDP of
4 and 3 times the world average, respectively
 China has a much lower GDP per capita
(0,7 times the world average)
 Population
 342 million – North America
 500 million – Europe (EU27)
World
Average
1 billion
 Low population density in Nordic Countries
Source: IfHT,
values from CIA & Eurostat
 1.3 billion – China
 High density only in southern and eastern China
 Urbanization
100%
 High rates in North America (80%)
and Europe (72%) & Northern Europe (79%)
 Much lower urbanization (47%) in China
Urban Chinese population surpasses both
www.iea-retd.org North America’s and Europe’s total
Source: IfHT,
values from UN
9
Context – Vehicles Market
Differences in Vehicle ownership
and Market development
North America
Vehicles on Road
Passenger Vehicle
Sales
Vehicles per 1000
people
Overall Market
situation today
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Europe
China
277 million
210 million
~55 million
12 million (2009)
16 million (2009)
10,3 million (2009)
13,7 million (2010)
830
473
Nordic: 500
Eastern: 380
54
Beijing: 228
Stagnating, expected
to increase as of 2012
Stagnating
Strongly growing
(doubling of sales
within 3 years)
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Context – Chinese Vehicles Market
Chinese market will be catching up on Western levels
– further extreme growth expected
 Highest global sales of passenger vehicles as of 2009
 Sales more than doubled within 3 years
Million
 ~ 13.7 million new passenger vehicles in 2010
20
 Further growth expected, 20
Vehicle Sales (Total/  Passenger Vehicles
especially for lower-margin 18
 Commercial Vehicles)
subcompact and compact 16
cars
14
12
10
10
Total vehicle
sales
8
6
Commercial
vehicle
4
Passenger
vehicle
2
0
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
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Context – Passenger traffic
Cars are most important for passenger traffic
and will most likely stay so
 Europe and North America rely mainly on private cars
for passenger transport
North America
Share of passenger-km
in private cars
Travelled km per
person and year
Europe
93%
83%
15,000 – 20,000
ca. 10,000
Nordic: 14,000 – 20,000
 Importance of vehicles is mirrored in available infrastructure (Annex A13)
 Further increase in traffic expected for the European Union
 Passenger traffic activity + 51%, 2005 – 2050
 Reasons:




Immigration
Expansion of the Union (increase in labor mobility)
Economic growth
Increase in labor mobility
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Table of Contents
Chapters
 Context
 Regional Economic and Transport-related Background
 Electric Vehicles
 RES-E and Grid
 Opportunities & Challenges for Co-Evolution
 Conclusions
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Context – Electric Vehicles
Analysis of Strengths and Weaknesses
Weaknesses
Strengths
Economical driving
Electric grid provides basic
infrastructure
Battery limits
Lack of Standardization
Few models available
Scarce infrastructure
High investment costs
Opportunities
Threats
Integrating RES in transport
sector
Reducing local emissions (not
only gaseous but also dust and
noise)
Costs for infrastructure
Battery lifetime
Safety
Advances in efficiency of
conventional vehicles
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Context – Transport Sector – Electric Vehicles
EVs are a niche market
 EVs are close to the market
 This will change with increased adoption and information to the general public.
North America
EV sales
(2009)
1.1% of passenger
vehicles
JDPower: 2,8% sales
Only HEVs,
BEVs sales negligible
2020
Outlook
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Europe
1% of passenger
vehicles
China
0,4% of vehicles
(distribution below)
E-Bikes and E-Scooters
included
Less than 0,01% of
vehicles on road are EVs
3-10% of
passenger vehicles
on the road
(2020-2025)
5% Target
BEV car
BEV taxi
5%
BEV bus
4%
PHEV bus
69%
PHEV car
22%
15
Context –Electric Vehicles & GHG Mitigation
Benefits regarding GHG emissions
strongly depend on the regional electricity mix
 EVs considered as low- or no-emission-vehicles
 Technically this depends on the electricity mix
 EVs powered by coal-fired power plants emit >800gCO2/ km
 Nighttime charging can result in both increasing the share of RES-E and in
increasing the share of fossil base-load electricity and thus in higher emissions
 Emissions of EVs are 50% of ICEVs’ with current European electricity mix
 Emissions of EVs are 89-74% of ICEVs’ with current USA electricity mix
 GHG emissions lower in Canada (2006 data) 200
because of higher proportion of RES-E
(depending on province)
100
 Using RES-E, GHG emissions could be
reduced to 75%-38% of ICEVs’ to which the
new CAFE standards of 35.5 mpg by 2016 apply.
0
ICE BC AB SK MB ON QC NB NS PEI NL
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GHG = Greenhouse gas – EV = Electric vehicle
ICEV = Internal combustion engine vehicle
RES-E = Electricity from Renewable Sources
CAFE standards = US fuel efficiency standards
16
Context – Transport Sector – Emissions of EVs
GHG emissions from electric vehicles are beneficial
only in some Chinese regions
 In China the high share of coal-based electricity in the grid increases EVs’ emissions
above those from conventional ICEVs (2010 data)
N
NE
E
C
NW
S
Hai
Av.
ICE
 The electricity mix in the more densely populated southern and eastern China
decreases EVs’ emissions below conventional values
 The northern regions that today have the highest emission values
have large unconnected wind resources
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GHG = Greenhouse gas – EV = Electric vehicle
ICEV = Internal combustion engine vehicle
RES-E = Electricity from Renewable Sources
17
Context – Electric Vehicles – Economic Influence
Low gas prices in North America and China
reduce interest in EV’s cost-benefits
 Gas prices and gas tax are low in China, Canada and the USA
relative to Europe
Gas prices around the world (US $ per gallon, 2011)
10
9,27
8,42
8,01
5,60
5
4,96
3,82
Canada
USA
0
Norway
Denmark
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The
Netherlands
China
Source: www.dailyfinance.com
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Context – Electric Vehicles – Economic Influence
General transport sector emissions policies influence
also the deployment of electric vehicles
 GHG emissions are taken into account through
taxation in many European countries (map)
(Dark Blue: more than one taxation scheme, Light Blue: one kind of CO2-tax)
and in China
 Tax benefits from this taxation reduce impact of
cost-difference compared with conventional cars
 No taxation of GHG emissions of
passenger vehicles in North America
 Elevated electricity costs in Nordic countries
 Influence the economical viability of EVs
 Variety of policies regarding future of transport
 Shift of commodities to rail and inland navigation
 Increase of public transport
 Holistic approach provides less secure framework for investments
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Context – Electric Vehicles - Drivers
Societal change
drives the deployment of electric vehicles
 Urbanization
 Urban areas experience most traffic problems
 High population density in urban areas warrants investments in infrastructure
 Urban population tends to early adoption of new technologies
 So far the number of EVs (per head) is biggest in cities
But:
 Charging infrastructure faces competition for space
 Immigration and labor mobility
 Increase mobility needs
 Customer acceptance of new mobility patterns,
of the look, space and performance of EVs
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Context – Electric Vehicles – Drivers
Technical and political development will have
strongest influence on EV deployment
 Political and regulatory support
BEVs
61%
 Subsidies
 Infrastructure development
 Pilot projects
Buses
56%
FCEVs
4%
 Recommendations from funding organizations
 207 models recommended for subsidies in China
only these models are eligible
HEVs
35%
Others
23%
Cars
21%
 Some European countries publish catalogues of vehicles that are entitled to benefits
 Standardization
 Secure framework for investments from stakeholders
 Development of vehicle energy storage systems
 Longer driving range
 Lower battery costs
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The sustainability of the deployment of
electric vehicles has to be taken into
account for devising support policies!
21
Context – Electric Vehicles – Drivers
The availability of charging infrastructure is
a basic requirement for electric vehicle deployment
 Security aspect for users
 Necessary for widespread EV usage
 Quick-charging is now being implemented
in the Nordic European countries
 April 12, 2011 Denmark's first quick charge station
opened (max. 20 minutes for 80 % SOC)
 2 stations have been build
in the Oslo area in Norway
 Battery swapping stations will be built in Denmark
(Figure: Projection for 2012)
 In China all three charging technologies
are/ will be tested
 Some pilot cities have already published standards
 Slow charging and battery swapping are preferred by grid companies
 No governmental preferences yet
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Context – Challenges for EVs
Electric vehicles do not meet
with favorable conditions everywhere
 Diverse climate conditions
 All three regions encompass various climate zones with cold winters in the north
and humid and hot summers in the south
 These climatic differences will lead to different battery lifetime and vehicle availability
 Landscape and road conditions vary
 Areas with low population density increase infrastructural costs for
widespread deployment
 Midwestern America, western and northern China, northern Europe
 For first usage in cities population density is not an issue
 Ageing population in North America and Europe
 Ageing people remain increasingly mobile and thus cause more traffic
 An increasing share of governmental funds has to be dedicated to care
 Funding for new technologies becomes more difficult
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Context – Electric Vehicles – Markets
Complementary use
rather than replacing conventional vehicles
 Electric vehicles are typically second cars
 Commuting
 Germany: most commuting distances are 80 km or under
 This is absolutely within EVs range
 Inner-City-Traffic
 Reduction of local emissions
 Noise
 Green House Gases and Particles
 Short distances, stop and go
 Integration into Car-Sharing programs
 No individual perception of purchase costs
 Public electric vehicles in China
 Buses & Taxis – uniform fleets allow economies of scale and battery swapping
 Sanitation vehicles, postal cars, other public services’ vehicles
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Context – Electric Vehicles – Markets
Usage models have different requirements
on EVs and infrastructure
 Inner-City traffic
 Short distances, low requirements for speed
 Slow charging, mostly at home
 Commuting
 Medium requirements for distances and speed
 Slow charging, at home and at work
 Car sharing
 Short and medium distances, low and medium speed
 Slow charging at stations, maybe battery swapping
 Inter-City-Traffic
 Long distances, high requirements for speed
 Fast charging and battery swapping on road
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Context – Electric Vehicles – Business Models
EVs should be offered in a package
including additional transport and other services
 Public transport ticket(s)
 Rental car service
 Combination with car-sharing programs?
 Installation of home charging point
 Access to charging stations/ reserved parking spots
 Free charging on public charging stations
 Flat rate for charging current from RES-E




Pay-per-mile battery leasing offers
Maintenance services
Guarantee on battery and vehicle parts
Insurance
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Context – Electric Vehicles – Pilot Projects
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• Funding from
governments and
OEMs
• Projects
concentrate on
one city or region
• Focus on Usage
experience for EVs
and charging
infrastructure
• Variety of scales
(charging per EV,
100-10000 EVs
per project…)
• Mostly, cars are
leased
China
• Funding from
(regional)
governments and
OEMs
• Projects mostly in
big cities
• Different usage
models (Carsharing, public
transportation,
postal vehicles)
Europe
North America
Pilot Projects are nuclei for EV deployment
• Funding from
government and
municipalities
• 25 pilot cities
• Mostly, only public
vehicles are
funded
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Context – Electric Vehicles – Pilot Projects
European pilot projects surpass North Americans
in numbers
 Projects concentrate on cities or one peculiar region
 Small scale co-operation of local authorities,
Utilities and OEMs
 Focus
 Experience/ Usage
 Private use, Commuting
 Car sharing
 Public transportation, Postal service
 Charging infrastructure
 Many big cities have pilot projects
 Commercial/ public vehicles
 Car sharing
 Public transportation, Postal service
 Charging infrastructure
 One project encompasses several states (see Annex A4)
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Context – Electric Vehicles – Pilot Projects
Chinese
“Ten Cities Thousand Vehicles” Program
 There are three stages
of 25 pilot cities in the
“Ten Cities Thousand
Vehicles” pilot program.
 Currently, most EV in these
pilot cities are public buses,
taxis, official’s cars and
services vehicles.
 5 cities have subsidies
for private EV
customers
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Details of five representative cities are listed in Annex A4.
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Context – Electric Vehicles – Users
User Behavior
 EV users are early adopters or members of public organizations
 Early adopters are older, educated, interested in technology and enjoy being early
adopters
 Willingness to plug-in may depend on business models
 Interest in earnings through delayed charging vs.
concerns about availability of the EV
 V2G services only of interest if a benefit is perceived
 Preference for home charging
(90% in Northern Europe, 70% in Western Europe)
 Consumers value environmental performance,
but they value other attributes more.
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Context – Electric Vehicles – Users
User concerns
Global issues
Manufacturing issues
 High initial investment
 Performance of EVs
 14% of consumers that avoid purchasing a
hybrid do so due to performance. Only 5%
of non-hybrid consumers avoid a purchase
due to performance.
 Users today are more willing to take TCO
into account for purchasing decisions
 Price
 EVs cost at least ¥ 20,000 more than
ICEVs of same performance
 Geographical differences
 Weather/ climate
In 2010 Danish EVs showed poor
performance in cold weather
 40% of consumers that avoid purchasing a
hybrid do so due to cost. Only 10% of nonhybrid consumers avoid a purchase due to
cost.
 Nordic countries:
Prices on EVs (free from registration
charge) coming close to those of
conventional cars (including charge).
EV family cars start at € 65,000 in Norway
 Fuel economy (in $/km)/ Operating costs
 Scarce infrastructure
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 Landscape/ Roads
 Driving range
 Charge times
 Battery life(span)
 Relatively few models available/
lack of diversity
 Dislike of the look/design
 Safety
TCO = Total Cost of Ownership
ICEV = Internal Combustion Engine Vehicle
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Context – Electric Vehicles – Urban vs. Rural
Urban and rural backgrounds for EVs differ
– also between the regions
Urban
Rural
 80% of North American population,
75% of European population,
46% of Chinese population lives in cities
 Public transportation is not always
conveniently available
 Traffic load in cities increases
 Emissions from traffic increase
(gaseous, dust, noise)
 Increase of congestion
 Commuters have high requirements on
vehicle performance and reliability
 Cities have highest need for holistic
passenger transportation solution
 Most deployment of EVs in cities
 Spatial planning conflicts
for charging infrastructure
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 Need for reliable private transportation
solutions
 Vehicle ownership rates are higher
(Europe & North America)/ lower (China)
than in cities
 Demand for vehicles in rural and
suburban areas increases
 Focus: low-speed low-cost vehicles
 70 km/h maximum, 40,000 – 50,000 ¥
 Challenges: safety, environmental
impacts (battery), traffic regulation
conflicts
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Context – Electric Vehicles – Standardization
Standardization of infrastructure and vehicle
characteristics is urgently needed
 Some general vehicle standards for safety specifications, general design specifications
and emission testing also apply to electric vehicles
 Standardized Plug needed urgently
 Wider harmonization needed, parallel systems exist today
 Mennekes plug is harmonized between France and Germany
 Scame plug is supported by French-Italian alliance
 Yazaki is standard plug in the USA
 Chinese pilot cities have started issuing their own standards for charging infrastructure
 Need for standards on
 Number of phases for charging (1 or 3)
 National and cross-national compatibility
 Safety requirements + technical approval body
 Data protocols and protection of data
 Charging cable reposit
 Billing system
 Liability
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Context – Electric Vehicles – Standardization
Safety standards are especially important
 Differing vehicle standards between the USA and Canada
(involving bumpers, seat belts, side door strength, metric indicators, etc.).
 To be harmonized by 2012
 There is a need for nation-wide harmonized standards for after-market ICE
vehicle conversion.
 Safety of plugs and the charging process is a concern besides design,
number of phases & voltage level for charging
 Pure electric vehicles from independent manufacturers may not be as
equipped for safety as modern cars are
(airbag, anti-lock brakes, electronic stability control etc.)
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Context – Electric Vehicles – Objectives
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• Sum of national
targets:
5 million electric
vehicles on the
road until 2020
• Needed growth
rates for these
targets range from
20,000 – 250,000
EVs per year over
a 2 – 20 year
period
• Different pilot
projects have
targets for charging
stations
China
• USA:
1 million electric
vehicles on the
road by 2015
• The EV project
which encompasses 18 urban
areas in six
states will install
14,000 chargers
(residential and
public)
• Canada:
0.5 million electric
vehicles on the
road by 2018
Europe
North America
Targets for Electric Vehicles on the road
• 0.5 million electric
vehicles on the
road by 2015
• 5 million electric
vehicles (5%) on
the road by 2020
• Most ambitious
national target
worldwide
• Each pilot city
has targets for
charging stations
35
Context – Electric Vehicles – Objectives
Targets for Reduction of GHG emissions
 EU 20-20-20-Targets
 20% reduction of GHG emissions (relative to 1990)
 20% of energy from renewables
 10% share of renewables in transport
 20% increase in energy efficiency
 National targets are even stricter
Petroleum
products
95,33%
Biofuels
3,84%
 Sweden & Denmark:
100% renewable fuels in transport
by 2030
 North America
 Non-binding target of
17% reduction of GHG emissions by 2020 (relative to 2005)
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Fuel distribution in
European road transport 2009
Electricity includes inland waterway
and air transport
Electricity
0,52%
Source: Eurostat
Natural Gas
0,30%
Biogas
0,01%
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Context – Electric Vehicles – Regulatory Barriers
The lack of standards makes long-term planning
difficult for vehicle and infrastructure manufacturers
 No coordinated effort between car-making markets in terms of regulation
(regarding emissions standards which were agreed on in Europe & China or
the type of technologies to support) yet.
 Makes planning effectively for the long term difficult for auto-makers
 Can be somewhat mitigated by technology-sharing agreements between
companies
 Hinders large-scale deployment
(i.e. Chevrolet intends to produce only 10,000 units of the Volt in its first year of
production in the United States).
 No political will to implement high fuel taxes to stimulate the greatest
advances in vehicle efficiency and alternative vehicles
 Increasingly strict fuel efficiency standards are a good first step
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Context – Electric Vehicles – Benefits & Incentives
National or regional authorities provide a variety of
incentives for Electric Vehicle users
 Taxation reduction or exemption
 Registration fee – One-time-benefit
 Annual circulation or motor tax – annual benefit
 Subsidies
 At acquisition or later
 Traffic privileges
 Use of bus lanes, free parking
 Exemption from ferry tolls or road charges
 Exemption from car license plate lottery and traffic restrictions (Beijing)
 Fuel subsidies
 Reduced insurance rates for pilot fleets
Details for Regions in Annex A3
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Table of Contents
Chapters
 Context
 Regional Economic and Transport-related Background
 Electric Vehicles
 RES-E and Grid
 Opportunities & Challenges for Co-Evolution
 Conclusions
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Context – Electricity from Renewable Sources
Electricity from Renewable Energy Sources
Strengths
Weaknesses
Reduction of GHG-emissions
Using national energy sources
Diversification of energy sources
Promoting emerging industries
Conventional power plants need to stay
available for energy security
Increased need for ancillary services
Resources far away from demand
Opportunities
Threats
Increased energy security
Climate change mitigation
Transition towards
sustainable energy systems
Fast growth of production capacity
Volatile character of some RES
Environmental integration
of large RES-E power plants
Technology not mature enough
Higher costs
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Context – RES-E – Current status
(USA: 11%,
CND: 58%)
• Hydro most
important (base
load)
Nuclear
19,5%
Gas
21,0%
Coal
40,8%
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• 3600 TWh annual
production
• 22% share of
renewable energy
• Hydro, wind and
biomass most
important
• Country shares
differ (4%-99%)
Oil
1,1%
Hydro
14,2%
Gas
23,95%
Hydro
15,1%
Nuclear
26,8%
Renewable
3,4%
Oil
3,0%
Coal
25,1%
China
• 4580 TWh annual
production
• 18% share of
renewable energy
Europe
North America
1/6th – 1/5th of Electricity is from Renewables
• 3460 TWh annual
production
• 17% share of
renewable energy
• Hydro mostly used
for peak management
• Mix based on
government quota
Renewable
0,5%
Oil
0,7%
Renewable Gas
0,9%
7,4%
Nuclear
2,0%
Hydro
16,9%
Coal
79,1%
41
Context – RES-E
2020 RES-E Targets and Scenarios
North
America
No national targets
Production from natural
gas and wind will
increase, Coal will
decrease
Nuclear decreases
(CND) and increases
(USA)
First strong
interconnections
between grid areas
www.iea-retd.org
Europe
China
Target for 20%
renewable primary
energy in 2020 (2008:
17%)
Target for 15%
renewable primary
energy in 2020 (2008:
8,6%)
Production from natural
gas and wind will
increase
Domestic coal stays
most important
Increase in distributed
production expected
Further expansion of
interconnections to
neighboring countries
Details for North America in Annex
Expansion of
transmission capacity
(Extra High Voltage,
long distance)
42
Context – RES-E – Incentives
www.iea-retd.org
• Feed-In Tariffs
most popular
(below)
• Investment Grants,
Tax Exemptions,
other fiscal
incentives and
Quota obligations
and Premiums
also in force
China
• Feed-In Tariff only
in one province
• Renewable portfolio shares and
financial incentives
exist in many
states
• Net metering and
standard offer
programs (sometimes by utilities)
as well as fiscal
incentives are
common
• Some federal
incentives exist
Europe
North America
Production incentives for renewable electricity are
most widely in force in Europe
• Strong government
support of new,
large RES-E plants
• The electricity mix
is determined via a
governmental
quota – thus, a
renewable portfolio
share could be implemented easily
43
Context – Electricity Sector – Structure
www.iea-retd.org
• Unbundled
internal market
• Many different
TSOs and DSOs
• TSOs cooperate
in ENTSO-E
• Stakeholdersituation varies
between countries
China
• Vertically
integrated sector
• Partly regulated
market
• Market entry is
difficult for new
producers
(e.g. of RES-E)
Europe
North America
Electricity markets differ
– Vertical markets in North America and China
• Vertically
integrated sector
• Virtually no market
entry for new
producers
• RES-E plants
belong to grid
companies
44
Context – Reserve market
www.iea-retd.org
• Country specific
regulation
• Possible revenue:
up to 300 €/a
• Small scale of EVs
makes participation less interesting
for TSOs
• Water and biomass
resources offer
buffer capacity for
increasing share of
RES-E (especially
in Nordic
countries)
China
• Regulation
depending on local
grid companies
• Reserve power
from vehicles is
interesting in North
America where
reserve power is
costly
• First trials for feedin from vehicles in
two pilot projects
Europe
North America
Reserve power feed-in from electric vehicles may be
an income option for owners
• Millions of electric
vehicles are
needed for an
efficient smart grid
• Price differences
between valley and
peak electricity
make V2G very
interesting
• Grid expansion
and making the
grid smarter are
premises for
valuable services
from electric
vehicles
45
Context – Grids
www.iea-retd.org
• Stable and modern
• Grid structure:
• Transmission:
meshed
• Distribution:
meshed, loop or
ray
• Integration of EVs
possible for up to
40% penetration in
most grids
China
• Old and not always
reliable
• Investments
decreased over
last years
• Grid structure is
radial, meshed in
regions with high
population density
• Low overall
population density
makes expansion
costly
• Integration of EVs
possible in some
regions
Europe
North America
Electricity grids are very different in the three regions
• Strong expansion
of the transmission
grid is going on
• Distribution grids
are not always fit
for integrating
either RES-E or
EVs
46
Context – RES-E – Grid organization
„One common“ transmission grid for Europe
 European Network of TSOs
for Electricity
 Continental Europe
Synchronous Area
 Nordic Synchronous Area
 Baltic Synchronous Area
 British Synchronous Area
 Irish Synchronous Area
 Isolated Systems of Cyprus
and Iceland
 Harmonization of Grid Codes
 Common Network planning
www.iea-retd.org
Source: IfHT, based on Entso-e Factsheet 2011
47
Context – RES-E – Grid organization
North American grids are separated today
 Interconnected Grids:
 Western
Interconnection
 Eastern
Interconnection
 Texas
 Alaska/ Hawaii
The separation of the grid
continues northwards
into Canada.
 Links between
these regions planned.
 Planning in map:
 Separation of grids will
largely remain
www.iea-retd.org
Source: IfHT,
(based on) NPR 2009
48
Context – RES-E – Grid organization
China’s grid is split in two
 Two major grid companies
 China State Grid (blue)
26 Provinces
2274.8 TWh
 China Southern Grid (gold)
5 Provinces
628 TWh
 Six major regional grids
 Center, North/ Northeast
East, Northwest
 South
 Distributed power production is not encouraged
www.iea-retd.org
Source: IfHT, based on Earley et al.
49
Context – RES-E – Regional Power Characteristics
The densely populated demand centers are far away
from renewable resources in China
 Energy resources – and power
production – are located far from the
demand areas.
 Wind and other renewable energies
could directly charge EVs (or swapped
batteries) in both northern China as
well as in southwestern China where
transport of liquid fuels is inconvenient
 Given the low economic development
status of these areas, it is likely that
low-tech, low-speed, low-cost EVs will
be more accepted there.
 Low-cost EVs use lead-acid batteries
which are increasingly causing
pollution problems in rural China.
www.iea-retd.org
Source: IfHT based on "Imbalance of Power
Production and Consumption in China” and
Earley et al.
50
Context – RES-E – Regional Power Characteristics
Fossil fuel-based electricity dominates the electricity
mix in China
 Northwest and Southwest China have some wind power installed
 South and East China have hydro power available
 This is used for peak load management
 Regulated charging
 Uses excess RES-E
 Increases deployed
share of RES-E
www.iea-retd.org
 Thermal
 Hydro
 Nuclear
 Wind & other
51
Context – V2G
V2G at the moment not legally possible in any region
 The bidirectionality of charging and providing ancillary services makes billing
complicated
 Two pilot projects that include V2G are underway in the USA
(notably in Colorado)
 US personal vehicles are used ~1 h/day
 Expensive ancillary services (from coal or gas) in US
 Inexpensive ancillary services (from hydro power) in Canada
 Regulatory and Usage framework varies heavily in Europe
 European cars are immobile most of the day (comparably to the US)
 Parking situations vary between countries
 Vehicles are parked on the street overnight in Italy
 Availability of possibilities for plugging-in at work is unclear
 Important sources for ancillary services are gas and hydro power
www.iea-retd.org
52
Context – RES-E – Business models
Ancillary services from electric vehicles
 Further development of Communication infrastructure and bidirectional
metering for controlled charging and feed-back needed
 Participation in reserve markets is currently outlawed
 Revenue depends on demand and the energy provided
 Reserve from hydro power (in Canada and Norway) is cheap while natural gas
based reserve power
 Hope that EVs can result in less need for new or closing down existing fossil
fuel based base load capacity on the long term
www.iea-retd.org
53
Context – RES-E – Ancillary services
Revenues from grid-related services:
Reserve capacity in the Nordic power market
www.iea-retd.org
54
Table of Contents
Chapters
 Context
 Regional Economic and Transport-related Background
 Electric Vehicles
 RES-E and Grid
 Opportunities & Challenges for Co-Evolution
 Conclusions
www.iea-retd.org
55
Co-Evolution
Co-Evolution
Strengths
Weaknesses
Increasing stable share of RES-E
Ability to include transport sector into
emissions-mitigation schemes
Need for smart grids, communication
& new structures
Standardization
Business models
Opportunities
Threats
Increased energy security
in transport sector
Transition towards sustainable transport
Electricity supply security from RES
Development of smart grid technology
Combination of two so-far
independent sectors
Today ancillary services from EVs
are outlawed
Multiple stakeholders
www.iea-retd.org
56
Co-Evolution – General Requirements
Cooperation between stakeholders needed for CoEvolution
 Co-Evolution only possible if both EV deployment and RES-E production are
encouraged
 RES-E production needs to increase for Co-Evolution
 Tariffs for charging with RES-E need to be developed
 Cooperation between stakeholders
 Vehicle and infrastructure standards
 Facilitating RES-E integration
 Provide possibilities for RES-E charging
 Globally coordinated development of standards
 Synergies can only emerge if technological development does not take different
directions
www.iea-retd.org
57
Co-Evolution – System Requirements
Both RES-E production and EV deployment
rely on electricity grids
 Grids need to be sufficiently stable and/ or expanded for accommodating
 New centralized (off-shore/ on-shore wind) and distributed (solar PV, micro-wind,
etc.) production
 Preference for centralized RES-E production means more attention on transmission grids.
Security of supply is seen as more important than increasing the share of RES-E.
 Additional distributed load
 Battery swapping stations could stabilize and centralize demand
 A preference for home charging means increased (distributed) household-load
 Opportunities for high penetration of EVs
 Regulated charging
 For better capacity utilization
 For taking stress off the distribution grid (assets)
PV = Photovoltaics
RES-E = Electricity
from Renewable Sources
 Storage of RES-E
 Increase share of RES-E
 Provide reserve power for grid
 Stabilize feed-in from volatile sources
www.iea-retd.org
58
Co-Evolution – Situation of Islands
The two European island states take different routes
 Iceland focuses on Hydrogen and Fuel cell vehicles
 Co-Evolution of RES-E to H2 and FCEVs possible
 Economic crises have decreased the number of initiatives
 Ireland promotes EVs
 Electricity market
 Demand growth
 Small difference between peak demand & installed reserve capacity
 Few interconnections (2 more under construction)
 High dependency on imported fuels
 Opportunities for EVs
 Security of transport energy supply
 Nighttime charging with excess wind power
 Aran islands pilot project: becoming self-sustainable with local energy
 Security of supply is main difference to Texas
www.iea-retd.org
59
Co-Evolution – Impact on power generation
Targeted Numbers of EVs can be accommodated
without major grid and/ or production expansion
Europe
China
2020 – Target
5 million EVs
(≤ 7%)
2030 – Scenario
200 million EVs
Need: 20 TWh
Need: 800 TWh
0,5% of
electricity
demand in 2008
20% of electricity
demand in 2008
Canada
Northern
Europe
2020 – Target
2018
5 million EVs
(2%)
0,5 million EVs
(≤1%)
Need: 1,5 TWh
0,5% of
electricity
demand in 2008
+ 8% on
projected
demand 2050
0,2% of projected
electricity demand
in 2018
 This Assessment only considers global values. Results can differ for local grids.
 Distribution grids in urban areas may experience overloads of assets first.
 For average European grids up to 40% EV penetration does not create problems
 For Beijing, 100% EV commuting could not be sustained
www.iea-retd.org
Details in Annex A11
60
Co-Evolution – Impact on power generation
Chinese and North American grids may be first
to have problems with rising EV penetration
 Chinese grids are already now straining to keep up with the increased
demand due to the rapid economic growth
 Power shortages, especially in the densely populated areas, have to be expected
 30-60% difference in electricity demand between peak times and base load leaves
room for off-peak EV charging
 Investments in North American grids have decreased over the years
 Grid assets are old
 Local distribution grids may not have the strength to supply EVs
 Challenges increase with rising penetration
 Quick-charge at peak hours has the highest possible impact on grids and power
generation capacity
 Daytime charging may require upgrades in local distribution systems
in China and North America
 Regulated charging is expected to prevent impact on base load power plants
www.iea-retd.org
61
Co-Evolution – Impact on grids
Renewable electricity and electric vehicles affect the
stability of transmission and distribution grids
 Integration of distributed RES-E production and EVs influences stability of
distribution grids
 Communication infrastructure needed for controlled charging
 Integration of large RES-E plants increases stress on transportation grids
 Expected increase of off-shore wind power is a challenge
 European and especially Nordic grids are well designed and prepared for
transporting RES-E
 Modernizing and increasing the strength and flexibility in the grid will take place also
without the expected increase of EVs.
 Chinese grids will be strengthened with building extra high voltage transmission
capacity
 Grid expansion in North America is costly – especially for transmission
infrastructure
 Distributed generation with local grid reinforcement is a good first step
 Exploitation of resource-rich regions will be necessary for significant replacement
of fossil fuels (northern Canada (wind), western US deserts (sun), offshore wind).
www.iea-retd.org
62
Co-Evolution – Impact on Infrastructure
The impact on grids and power production depends on
time and method of charging
 Slow charging and Battery swapping are preferred by DSOs
 Both methods spread the load over a longer period
 The centralized storage capacity of battery swapping stations makes them interesting for
ancillary services and demand response
 Fast Charging has highest potential to destabilize the grid
 Time of Charging impact
 Daytime, especially peak time charging will most likely result in overload in assets,
especially in urban regions (demand centers, high population and vehicle density)
 Nighttime charging:




The grid has transmission and distribution capacity available
The use of “spinning reserve” on the grid may become more efficient
RES-E that otherwise would not be fed in can be used
increased use of base load power plants possible
 greater coal consumption  increase in GHG-emissions
 Charging strategies for smart grids may focus on using RES-E for charging
www.iea-retd.org
63
Co-Evolution – Impact on power generation
Regulated Charging is the first step to reduce the
impact on grid stability and power generation
 Possible strategies:
 Preference for charging with RES-E
 EVs (+ smart charging) can
increase uptake of RES-E
 Smart charging makes volatile RES-E
a better business case
 Charging in load valleys (with RES-E)
 Price difference of 0.6 ¥/ kWh
 An accounting system and charging
infrastructure are now being built in the
Nordic Countries.
Transport
 Smart meters are put up as part of the
"Introduction package" offered by
"Better Place".
 Smart meters are already installed
in large scale in Sweden and Norway
www.iea-retd.org
District
heating
Other
sectors
64
Technological Requirements for Co-Evolution
Integration of RES-E
Supporting RES-E with EVs
Intermittent storage
Smart Meter
Smart
Grids
Conventional
Grid
Unregulated
Charging
Conventional
Grid
ICT
Technical requirements
for grid support
www.iea-retd.org
Integration of EVs
65
Technological Requirements for Co-Evolution
Today‘s Situation
 A strong conventional grid
can take up small penetrations of EVs and RES-E
 EVs only charge unregulated
 First trials with smart meters
– not necessarily in combination with EVs






Conventional Grid
Unregulated Charging
Italy
Sweden
Norway
Denmark
Germany
China
 First V2G trials in North America
 RES-E integration depends on national electricity market’s regulation
www.iea-retd.org
66
Technological Requirements for Co-Evolution
Next Steps have begun
Charging
with RES-E
 Integration of RES-E
 Implementation of distributed generation
and local grid expansion in North America
 Supporting RES-E with EVs
 Charging with RES-E
Frequency
& Voltage
Stability
 Reduces EV emissions
 Incentive for increasing RES-E share
 Major RES-E bases will be constructed
 Extra High Voltage long-distance
transmission
 Transporting power to demand centers
 Integration of EVs
 Charging infrastructure
 First implementation in Pilot Projects
 Accounting system
 Is already being built in Nordic European
Countries and in some Chinese pilot cities
www.iea-retd.org
Accounting
Charging System
Infrastructure
 Technical requirements for grid support
 Frequency stability
 Voltage stability
 Both are guaranteed by implementing
simple charging control systems
 Increased transmission efficiency and
robustness
 Stability and efficiency of grid
needed for further development
67
Technological Requirements for Co-Evolution
Near Future
 Integration of RES-E
 Smart Meter & Smart Grids
 Enable more services for RES-E support
 First trials in place in different regions
 Extra High Voltage Transmission
 For transporting RES-E to demand centers
 Supporting RES-E with EVs
 Regulated Charging
 Higher penetration/ share without major
impacts
 Integration of EVs
 Information and Communication
Technology
Smart Grids
Smart
Meter
Regulated
Charging
Regulated
Charging
ICT
Communication with
local network stations
 Technical requirements for grid support
 Regulated charging
 Reducing overloads of assets
 Lack of standard in China today
 Automatic Power Distribution
 Distributing power according to demand
 For better vehicle control
 Communication with local network
stations
 Information and Communication stations
www.iea-retd.org
68
Technological Requirements for Co-Evolution
Phase 2 Development?
DSM
 Integration of RES-E
 Negative spinning reserve & Demand side
management
 Secure balance of RES-E production and
consumption
 Supporting RES-E with EVs
 Active load management
 Increase RES-E take-up in times of energy
surplus
 Ancillary services (unidirectional)
 Stabilizing the grid
 Integration of EVs
 Advanced Information and
Communication Technology
 Enabling V2G services
 Area wide charging stations
 Infrastructure covering large – medium
cities
www.iea-retd.org
Negative
Spinning
Reserve
Active load
management
Reduced load
during fault
Ancillary
services
Advanced
ICT
Additional
Area wide
spinning
reserve charging stations
 Technical requirements for grid support
 Additional spinning reserve
 Secure grid balance
 Reduced load during fault
 Stabilizing the grid
 Not in place or allowed in China today
 Strong smart grid
 Managing impacts and optimizing
demand satisfaction
69
Technological Requirements for Co-Evolution
Full Co-Implementation
 Integration of RES-E
 Feed-In of stored RES-E
 For massive RES-E integration
 Positive spinning reserve
 Supporting RES-E with EVs
 Intermittent storage
 For high demand times
Positive
spinning reserve
Feed-In of
Intermittent
stored RES-E
storage
Feed-In
during fault
Feed
back to grid
Bidirectional
ancillary
service
Bidirectional charging
infrastructure
 Bidirectional ancillary services
 Integration of EVs
 Bidirectional charging infrastructure
 Enabling revenue for vehicle owners
 Technical requirements for grid support
 Feed-In during fault
 Feed-In of stored Renewable Electricity
 For benefits of EV development
www.iea-retd.org
70
Technological Requirements for Co-Evolution
Growth in renewable energy sources
Integration of RES-E
 Today’s penetration of renewable energy sources can be handled with the conventional grid.
The Nordic and the Canadian grids are prepared for large penetrations of renewable energy
sources
 Distributed expansion of both RES-E and the grid will enable higher
shares in North America
 Smart Meter and Smart Grids enable the grid to provide more
services to support RES. Extra-High Voltage (EHV)
Transmission enhances electricity transmission from
remote energy resources to demand centers
 Demand side management and spinning
Smart Grids
reserve secure the balance between
consumption and production of RES.
Smart
Strong Smart Grid balances consumption
Distributed
Meter
and production of RES-E
expansion
 The Feed-in of stored energy
allows a massive integration
of RES-E.
Voltage/
frequency
stability
Rising Penetration of EV and PHEV
www.iea-retd.org
71
Technological Requirements for Co-Evolution
Growth in renewable energy sources
Technical Requirements for grid support
 To support the grid for a rising penetration of RES-E and EVs, changes in the
operating behavior might be necessary.
 Increased robustness and transmission efficiency are needed for a
rising penetration of RES-E and EVs. To guarantee the frequency
and voltage stability of the grid some simple regulations
can be implemented in EVs.
 Regulated charging can avoid overloads of assets.
Automatic power distribution is the foundation
of distribution of power according to demand.
 Additional spinning reserve guarantees
Voltage
the balance of the grid. Strong Smart
stability
Frequency
Feed back Grid manages the impact of RES-E
stability
to grid and EVs and optimizes the demand
Increased
satisfaction
Strong
robustness
 Special strategies during
Smart Grid
Increased
transmission
fault times support the fast
efficiency
stabilization of the grid.
Rising Penetration of EV and PHEV
www.iea-retd.org
72
Technological Requirements for Co-Evolution
Growth in renewable energy sources
Requirements for a high integration of EVs
 To integrate a significant amount of EV and PHEV, technical requirements
have to be fulfilled.
Conventional
grid
 An accounting system and charging infrastructure are obligated
as soon as possible. Both are currently being built in Nordic
Countries.
 To control the vehicles a communication infrastructure
has to be established.
Advanced
 To provide V2G services more communication
ICT
signals are required. With rising penetration
of EV and RES-E, more charging/swapping
infrastructure is needed.
ICT
 A bidirectional power connection
is required to earn revenue
Information
for the vehicle owner.
and Communication
Stations
Rising Penetration of EV and PHEV
www.iea-retd.org
73
Technological Requirements for Co-Evolution
Growth in renewable energy sources
Supporting RES with EVs
 Electrical vehicles profit not only from the collaboration with RES, they can support
a high penetration of RES in the grid!
 To reduce emissions in the transport sector, the highest benefit is
generated if EVs and PHEVs charge RES-E. In China, large RES-E
bases are constructed and EHV inter-grid transmission is
needed to transmit the large amount of RES-E.
In Europe and North America additional RES-E
capacity will be distributed.
 Regulated charging enables higher
penetration rates.
 Active load management and
Charging
ancillary services can integrate
with RES-E
Major
energy from RES in times of an
RE bases
energy surplus
 Intermittent storage of
Unregulated
RES-E for high
charging
demand times!
Rising Penetration of EV and PHEV
www.iea-retd.org
74
Opportunities for Co-Evolution
• Pilot or communal
projects implement
and test first charging
infrastructure and V2G
• Accounting systems
will be put in place by
individual ISOs
• Public-private partnerships are key to
getting the ball rolling
• Initiatives most likely
on State/ Province or
local level
• Ontario: FIT, EV target,
want to be coal-free by
2015
www.iea-retd.org
• Political framework for
future of transportation
promoting the use of
RE for fuels
• Societal framework
• Emergent rethinking of
vehicle ownership
models
• Widespread availability
of ICT infrastructure
• High share of RES-E
• Experience with EV
deployment in Norway
China
• Development most
likely via individual
projects
Europe
North America
Policy frameworks are developing
towards Co-Evolution
• The use of RES-E for
EVs is a recognized
concept in China
• Government policies
support both EVs and
RES-E
• Automotive Industry
Restructuring and
Revitalization Plan
encompasses grid
requirements and
standards for charging
stations and market
regulation for EV
producers
• China has set
ambitious targets for
increasing the installed
power of all renewable
sources (Annex A9)
75
Challenges for Co-Evolution
• Nation wide bidirectional smart grid
development almost
impossible.
• Federal initiatives
unlikely, apart from
funding for pilot projects
• Mandatory GHG
emission reduction
targets unlikely in the
short/ medium term
• Premise for mandatory
RES-E targets
• Without these targets,
large scale integration
of RES-E unlikely
www.iea-retd.org
• Political framework for
future of
transportation
• Introducing new
transportation patterns
to cities
• Internalization of
external costs
• Societal framework
• New concept of
Transport
• Uncertainty of EVacceptance
• RES-E storage in EVs
not planned for near
future
• Conventional reserve
capacity preferred
China
• High costs per capita of
nation-wide infrastructure development
Europe
North America
Co-Evolution faces cultural and economic barriers
• China has traditionally
opted for large scale, easily
regulated and centralized
systems, making regional/
local RE-EV interaction a
difficult concept.
• Plans and data for
implementing the use of
RES-E for EVs from any
involved parties are not
reliable or public
• industry and policy are
highly “siloed”
• Auto manufacturers, power
companies, battery
companies and the grid
companies do not make up
a traditional “community”
• Communication between
these parties has not
been simple
76
Context – Needed Policies for Co-Evolution
• Encourage Targets for
RES-E share and EVs
• Federal feed-in tariffs
for RES-E
• More likely on State
level
• Continue and expand
• Rebates and subsidies
for EV’s
• Feed-in tariffs for RES-E
• V2G project
development
• Harmonization of
standards
• Information campaigns
www.iea-retd.org
• Harmonization of Grid
Codes for comparable
conditions for new
RES-E production
across Europe
• Harmonization of
vehicle and charging
station characteristics
• Europe-wide EV
support policies
• Trials for charging with
RES-E in pilot projects
China
• Mandatory national
GHG emission
reductions targets
Europe
North America
Policies from one region might be interesting options
for others
• Percentage of OEM’s
fleet having to be EVs
• Parallel: energy
providers offering lower
carbon fuel over time
• Charging incentives
• Lower price for nighttime
charging
• Pricing scheme for
feeding power back to
the grid and
compensation for
additional battery cycles
• Infrastructure
incentives
• Making charging and
service options available
• Financing solutions for
large scale deployment
77
Co-Evolution – Feasibility of policy options
Two-phase long-term policy approach needed for large
scale Co-Evolution of EVs and RES-E
Prepare for EV’s
Phase 1
Market
Preparation
Phase 2
Deployment
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• Infrastructure and
standardization
• Pilot fleets in niche
markets for learning
effects and cost
reductions
• Provide long term
perspective to
industry
Increase RES-E
production
• Priority access for
renewables
• Feed-in tariffs or
premiums
• RPS or obligations
• Cap and trade
• Grid stability
Increase
deployment of EV
to reach mass
markets
Ensure balanced
grid development
• Coordinate technical
and institutional
efforts
• Smart grids and
active load
management/
regulated charging
• Long distance
transmission
Increase system
integration to
enable higher use
of EV and RES-E
78
Co-Evolution – Feasibility of policy options
Regulatory framework
Phase 1
 Emission targets for electricity production and vehicle fleets warrant other
support policies
 Targets for the deployment of electric vehicles are an incentive for first
deployments
 Standards for vehicles and infrastructure provide security for manufacturers
 Consequence
 Legitimate base for further policies
 Opposition from the people (North America)
 Feasibility
 Feasible in all regions
 Emission targets are more easily implemented for electricity
than for existing vehicle fleets
 Standards have to be based on technological consideration and have to be
implemented quickly
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Co-Evolution – Feasibility of policy options
Build-up of infrastructure
Phase 1
 Governments support Electric Vehicles by building up charging infrastructure
 Consequence
 Good network possible also for rural areas
 Costs for society
 Feasibility
 May be feasible in China
 Highly unlikely in Europe and North America
However, subsidies for the construction of new charging infrastructure are feasible
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80
Co-Evolution – Feasibility of policy options
Coupling Renewable Energy and Electric Vehicles
 Hard Coupling
 Electricity for charging electric vehicles is coupled to the absolute additional RES-E share in the
electricity mix
 Cap and Trade
 Electricity production or the deployment of vehicles have to fulfill emission targets (cap)
 Any additional demand for electricity or additional deployment of vehicles has to be provided
from carbon-neutral sources or has to be compensated by GHG emissions reduction measures
applied to other emitters that are part of the system (trade)
 Manufacturers’ investments in RES-E
 Vehicle manufacturers can count their electric vehicles as zero-emission vehicles if they
finance new RES-E production
 Grid Stabilization Bonus
 System Operators pay this bonus for plugged-in electric vehicles that can either provide
demand side management or ancillary services
 Tax Exemptions for Charging RES-E
 Electric vehicles are only eligible for tax exemptions if they charge RES-E
 Re-Investing electricity tax from charging current
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81
Co-Evolution – Feasibility of policy options
Tax Exemptions for Charging RES-E
Phase 1
 Vehicles are eligible for tax exemptions if they charge RES-E
 Exemptions from annual vehicle/ motor/ circulation taxes
 Consequence
 Additional RES-E
 Cost benefits for EV owners as an incentive
 Increased willingness to plug in?
 Costs
 Advanced billing system and separate metering needed
 Feasibility
 Feasible for low penetrations of EVs.
 Phase-out for higher penetrations
 EV owners have to be able to exclusively charge RES-E
 Feasible in all regions
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82
Co-Evolution – Feasibility of policy options
Re-Investing Electricity Tax
Phase 1
 The electricity tax from the traction current is invested in additional RES-E
 Consequence
 Additional RES-E
 Special electricity tariff/ separate metering for EVs needed
 Market distortion in deregulated markets
 Feasibility
 Feasible in all regions
 In North America this option might be possible only within one interconnection-area
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Co-Evolution – Feasibility of policy options
Hard Coupling
Phase 1
 Coupling electricity for EVs and absolute RES-E Targets
 Additional EVs have to be met with additional RES-E capacity
 Consequence
 EVs powered by pure additional RES-E
 Costs (user & society)
 Feasibility
 Unlikely for North America, because profitability is key for public acceptance of
both EVs and RES-E
 Feasible for Europe but concerns exist that this option may slow down
EV or RES-E deployment
 In China – based on policies until today – this option is unlikely.
However, if RES-E production is increased significantly and charging
business models are set up, Hard Coupling may become feasible
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84
Co-Evolution – Feasibility of policy options
Manufacturers‘ investments in RES-E
Phase 1
 EVs are considered Zero Emission Vehicles (ZEV) in return for investments
in renewable electricity
 OEMs invest in additional renewable electricity production (depending on MJ/km
per sold EV)
 DSOs invest energy tax for traction current in additional RES-E
 Consequence
 Additional RES-E
 Can lead to more emissions from ICEVs – Coupling to fleet emission standards!
 Conflicts of interests possible
 Feasibility
 Feasible in Europe, has to be introduced for all countries
 The vertically integrated electricity markets in China and North America may
impede implementation (if OEMs are new players in the market)
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85
Co-Evolution – Feasibility of policy options
Cap and Trade
Phase 2
 A Cap and Trade system for fleet emissions per vehicle manufacturer
 Comparable to the ETS and other C&T systems, emission targets will be adjusted
over time
 Earnings from the emission certificates trading can be invested into new RES-E
 Consequence
 Additional RES-E / CCS
 Needs strong regulatory framework
 Takes effect only on new vehicles
 Feasibility
 Feasible in all countries
 Less likely in North America and China because national Cap and Trade systems
for GHG emissions do not exist yet.
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86
Co-Evolution – Feasibility of policy options
Grid Stabilization Bonus
Phase 2
 EVs receive a bonus payment for plugging in and thus being available for
storage and feed-in of volatile RES-E
 Consequence
 Better RES-E utilization
 Stable grids
 Advanced metering and implementation (billing!) needed
 Feasibility
 This option is only feasible, if advanced metering (bidirectional!) is already installed
on a large scale
 Profitability is key for successful implementation
 First Countries: Italy, Sweden, Norway ?
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87
Co-Evolution – Feasibility of policy options
A policy framework for the transition towards a
sustainable transport sector is in process in Europe
 Today – Current directives
 Increase of RE-share in Primary Energy mix
 10% share of RE in land-based transport by 2020
 Future – White Paper on future transport
 Focus on Cities
 New Concept of mobility – Systems’ approach
 Long term objectives, legal & regulatory framework,
open standards, interoperability





Revision of the Directive on Energy Taxation
Internalize externalities & eliminate distortionary subsidies
Replacing CO2-standards with energy efficiency standards
Speed limits
Revision of driving license directive
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88
Co-Evolution – Technology Roadmap
Local
integration
of EVs and
RES-E
First Smart
Grids
time
Local grid
expansion
Controlled
charging
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Ancillary
services
(bidirectional)?
Penetration rate
of electric vehicles
Unregulated charging
Controlled charging
Further RES-E integration
Active load management
Ancillary services
Charging with RES-E
Storage of RES-E
Ancillary services
(bidirectional)
Urban EV
deployment
Further RES-E
integration
Transmission
grid
expansion
Controlled
charging
Load
management
for swapping
stations
Ancillary
services
89
Co-Evolution – Two Phase Roadmap
Two Phase Development for Co-Evolution
 Phase 1 (Today – 2015):




Market preparation
Pilot projects and other incentives for RES-E and EVs
Cost reduction and quality improvement
Standardization
 Phase 2 (Future):
 Measures aiming at increased deployment and system integration
 Cooperation between all actors is key
 This two phase development and its stakeholders are presented for
each region on the following slides.
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90
Co-Evolution – Two Phase Roadmap
North America
– Consumer demand drives Co-Evolution
 Actors
 Government/ Regulators – federal support unlikely
 Electricity sector – nationwide bidirectional smart grid highly unlikely
 Vehicle manufacturers – production capacity from conventional manufacturers needed
 Phase 1:
 Local change
 Implementation of RES-E and EV support policies
 Deployment targets for RES-E and EVs
 Pilot projects in public-private-partnerships
 Increasingly strict national and local fuel efficiency standards and consumer demand drive EV
production
 Grid reinforcement and charging infrastructure develop alongside EV deployment
 Public information campaigns
 Phase 2:




Increasing demand drives EV deployment and infrastructure change
Unbundling of the electricity sector is promoted for easier market penetration
V2G pilot projects
Consumer demand for V2G and FIT
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91
Co-Evolution – Actors
Actors for Co-Evolution
OEMs
Marketing and
information
campaigns
Increasing
production
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Government/
Regulators
Electricity
sector
Unbundling of
electricity market
Mandatory targets
for GHG reduction
Facilitate RES-E
and EV connection
to the grid
92
Co-Evolution – Two Phase Roadmap
Europe
– Adaptation of existing policies leads to Co-Evolution
 Actors




Governments/ European institutions
Vehicle Manufacturers
System Operators
Utilities
 Phase 1:






Vehicle charges and taxes are revised (external costs and environmental performance criteria)
Further growth of RES-E production – Continuation and revision of RES-E support policies
Harmonization of standards across Europe
Coordinated network development and system integration
V2G pilot projects
Information campaigns
 Phase 2:
 Full internalization of external costs
 Further GHG emission reduction policies
 Europe-wide charging infrastructure
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93
Co-Evolution – Actors
Actors for Co-Evolution
OEMs
Politics
DSOs
Utilities
EVs lowering
total fleet
emissions
Fiscal/
financial
incentives
Hard coupling
Smart
metering
EV earnings
for new RES?
System
stabilizing
bonus for
plugged EVs
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94
Co-Evolution – Two Phase Roadmap
China
– Rapid production increases drive Co-Evolution
 Actors
 Government
 Vehicle Manufacturers
 Electricity Sector
 Phase 1:





Nationwide standardization
Development of low-speed low-cost EVs for the mass market
Construction of major RES-E bases for a 25% share in the electricity mix
Increase long-distance transmission capacity and develop smart grid technology
Provide incentives to both manufacturers and private consumers, and attract investment from
private equity
 Phase 2:
 Long-distance transmission of electricity from remote resources
 Improved batteries make EVs competitive with conventional cars
 Nationwide availability of charging infrastructure and V2G
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95
Co-Evolution – Actors
Actors for Co-Evolution
Manufacturers
Government
Increase product
quality
Standardization
Incentives for
Manufacturers,
consumers and
system operators
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Electricity
Sector
Higher RES-E share
Enhance
transmission and
distribution capability
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Table of Contents
Chapters
 Context
 Regional Economic and Transport-related Background
 Electric Vehicles
 RES-E and Grid
 Opportunities & Challenges for Co-Evolution
 Conclusions
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97
Conclusions
Consistent long term policy is required for stimulating large
scale introduction of EVs and Co-Evolution with RES-E
 Provide security of investment for car industry and infrastructure providers
(Security of the existing tax exemptions )
 Mandatory targets for EV-numbers and RES-E share
 Standards development
 Investments in infrastructure
 Involve a variety of actors
 Coordinate network development and system integration to allow high
penetrations of EV and RES-E
 This is already taking place in the national Nordic TSO's and in the context of
ENTSO-E
 Grid reinforcement and upgrade
 RET integration
 Coordinate system integration among grids and vehicle/battery manufacturers
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98
Conclusions
Actions for Co-Evolution‘s stakeholders
 Government and regulators
 Determine regulatory and market solutions that can mobilize private sector
investments
 Determine regulatory solutions that link EV deployment and RES-E
 Infrastructure strategy should reflect regional needs and conditions
 Plan for evolution in regulation along with technology development
 Invest in research, development and demonstration (RD&D) that address systemwide and broad-range sectoral issues, and that provide insights into behavioral
aspects of EV use and RES-E charging.
 Lead education on the value of EVs with respect to environmental benefits and
lessening fear of performance restrictions
 International governmental organizations
 Co-ordinate international standardization issues for cross-national compatibility
 Support the RD&D of EV system solutions for developing countries
through targeted analysis, roadmapping exercises and capacity building.
 Support international collaboration on and dissemination of RD&D on EVs
and infrastructure, including business and regulatory experiences.
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Conclusions
Actions for Co-Evolution’s stakeholders
 TSOs/ DSOs
 Help develop business models that ensure all stakeholders and customers share
risks, costs and benefits.
 Promote adoption of real-time energy-usage information and pricing
 Co-operate with OEMs for interoperability standards and post-installation support
 Utilities
 System stabilizing bonus for plugged EVs that provide flexibility
to increase use of variable generation?
 Co-operation with regulators to facilitate implementation of RES-E
and EV connection to the grid
 OEMs
 International strategy and standards for interoperability of system components
thus reducing risk of technology obsolescence
 Address concerns with technology system integration,
long-term post-installation support and security and reliability
 Aggressive marketing and information campaigns for EVs
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100
Conclusions
North America & Europe
 Cities and urban areas will be breeding grounds for EV deployment and charging
infrastructure
 EV expansion to rural areas is highly unlikely in the medium term
due to infrastructure and social acceptance issues
 In Phase 1 EVs will not feed back power to the grid outside of pilot projects
 No problems arise in European grids for the projected low shares of EVs
 Measures for increased deployment:
 Support policies (subsidies, tax benefits and other support policies)
 Battery cost reduction / improved performance
 Public information campaigns
 Measures for system integration
 Get ISO’s involved in pilot projects or local development projects
 Grid upgrades and smart grid development to allow for bi-directionality and regulation
 Regulate grid expansion as a part of a feed-in tariff program
(eg. suggested for Province of Ontario)
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Conclusions
China – Co-Evolution requires changes in renewable
electricity and electric vehicles deployment
 Both grid and battery technology require technological innovation in China in
order to support the integration of EV and RE
 Charging models must be matched with RE grid interaction models in order to
take advantage of clean energy in EVs, and suitable business models need
to be developed
 Emphasis should be on increasing overall RE on the grid
 At this time, China is focusing on large-scale RE including wind and solar projects,
with little attention paid to distributed RE generation.
 Private power plants are not approved in China at this time. All power must enter
the grid and be downloaded from the grid.
 There should also be an emphasis on increasing population of EVs – to the
scale of millions of vehicles.
 It is unlikely that smart grid will be economically viable or technologically useful
without such large numbers.
 Incentives are needed for both vehicles and grid companies
in order to attain a critical mass of vehicles and smart grid participants.
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Conclusions
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• Increasingly distributed generation
(RES-E) and load
(EVs) challenge
grid
• Communication
technology needed
for higher penetration of EVs and
RES-E
• Nordic Countries
may achieve CoEvolution more
easily (most RES-E
and EVs)
China
• Low population
density: Grid
expansion costly
• Few instruments for
furthering RES-E
expansion
• EV deployment may
stay marginal for
longer:
Focus on cities!
Europe
North America
Comparison of regions
Characteristics
• Distributed generation not encouraged
• New RES-E in large
facilities require
transmission!
• EV deployment
concentrated on
public institutions
and load centers
• Market for lowperformance EVs in
rural areas
• Experience with electric
scooters has shown that
passenger vehicles
remain important status
symbols in rural areas
103
Conclusion
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• National &
European policies
have to be
coordinated
• Standardization is
an important issue
for providing
security for
manufacturers
• All discussed
policy options are
feasible on
European or
National level
China
• Incentives and
Policies on State/
Province level
most likely
• Fiscal (indirect)
incentives likely to
be publicly
accepted
• Facilitating market
entrance of EVs
and RES-E is key
to Co-Evolution
• Profitability is most
important acceptance factor
• Targets are a
premise
Europe
North America
Policy Recommendations by Region
• Centralized state
• can more easily
implement
regulatory policy
options
• Premise for many
options is the
development of
emission reduction
and RES-E targets
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Conclusions
Comparison of regions
Lessons learned so far
 Outcome of pilot projects:
 EVs alone cannot solve traffic problems
– an integrated approach and a new concept of transport are necessary
 User acceptance:
 EVs for a set purpose are well accepted
 Business cases:
 Car-sharing/ Mobility Partnerships for commuting
 Usage patterns:
 Local solutions for traffic problems and personal mobility
 Influence of RES-E deployment and potential
 Potential for RES-E not fully exhausted yet
 Sustainability of RES-E for EVs absolutely vital for ecological benefits
 Electricity tariffs that guarantee RES-E for charging EVs are needed
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Conclusions
Comparison of regions
Lessons learned so far
 Policy options & public acceptance
 An uninformed public does not accept EV promotion “from above”
 Information campaigns on the benefits of EVs needed
 Including financial, fiscal and non-monetary benefits for users
 Policies furthering EVs and RES-E have to be adapted to regional
characteristics
 Important regional differences between policies in Phase 1
 Possible synergies between regions in Phase 2
 Skepticism regarding Co-Evolution
 Low RES-E shares reduce benefits
 Technological and regulatory hindrances in foreground
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Conclusions
Follow-up work
 Analysis of the outcome of the different pilot projects
 Which co-operations were fruitful and why
 What makes EVs successful
 Experience with Co-Evolution
 Appraisal of technical / grid-related boundaries
and barriers to Co-Evolution
 Impact Assessment of policy options
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Table of Annexes













A1 – Acronyms
A2 – References
A3 – List of subsidies and incentives for EVs
A4 – Pilot projects in the three regions
A5 – Policies concerning EV deployment
A6 – List of available EV models
A7 – Standards
A8 – Renewable Energy policies
A9 – Expected growth in electricity sector
A10 – Revenue from Ancillary services for EVs
A11 – Impact of EVs on grids and production
A12 – Two phase development of Co-Evolution
A13 – Road infrastructure
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108
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For additional information on RETD
Online: www.iea-retd.org
Contact: IEA_RETD@ecofys.com