The Challenges and Opportunities of Electric Vehicles

The Biden administration recently stated that it wants electric vehicles to represent 50 percent of new vehicle sales in the U.S. by 2030. But is this target achievable, and can it help reduce carbon emissions?

In 2021, global electric vehicle (EV) sales grew 80 percent[1] as automakers, including Ford, GM, Toyota, and Volkswagen, committed to reducing CO2 emissions. Driven by political policies and incentives, falling battery prices, and an increasing number of EV offerings, consumer demand for electric vehicles is accelerating. According to BloombergNEF, EVs made up seven percent of global car sales in the first half of 2021, up from three percent in 2019 and four percent in 2020.[2]

In addition to potentially reducing exhaust emissions and addressing part of the 23 percent of global CO2 emissions contributed to by the transportation sector, EVs may also help increase the grid’s resilience and flexibility. Yet, EV adoption faces several significant challenges.

Fossil fuel-based energy sources

The adoption of EVs may do little to curb carbon emissions because of our reliance on fossil fuels to generate electricity. In 2020, 60 percent of the four trillion kilowatt hours of electricity generated at utility-scale facilities in the U.S. was from fossil fuels, including coal, natural gas, petroleum, and other gases.[3]

If demand for EV cars were to increase dramatically, then utilities might build additional natural gas peaker plants to meet the demand for electricity, which will increase CO2 emissions. Without a strategy to increase the use of renewable energy sources to create electricity, the adoption of EVs will simply transfer emissions from vehicles to generation facilities.

Grid capacity

Recent crises with energy distribution in California and Texas have revealed weaknesses in the power grid. Adoption of EVs will further stress the grid, requiring new investments in infrastructure to meet increased demand. According to the National Renewable Energy Laboratory (NREL), to meet demand by 2050, the electrification of transportation and other sectors will require the U.S. to double its generation capacity.[4]

Charging infrastructure

Charging stations can be hard to find, especially in rural areas. According to the American Petroleum Institute, there are more than 150,000 fueling stations across the United States.[5] Contrast that with the 43,000 public EV charging stations available in the U.S., primarily concentrated in New York, Florida, Texas, and California.[6] Additionally, the inability for consumers to charge where they live and work has deterred some from adopting EVs.

Solar power and EV batteries

Solar energy systems that are integrated with behind-the-meter storage, like EV batteries, can help solve some of these challenges in a number of ways.

By investing in solar initiatives, companies and consumers can offset some of the energy generation needed to meet the increased use of EVs, possibly alleviating utilities from building large-scale power plants.

When grid operators temporarily need power or have excess power, they can push it back and forth into a connected EV’s battery. At a regional scale, with access to hundreds or thousands of EV batteries, utilities can purchase the energy stored in batteries from consumers to help meet their demand needs. This could prove invaluable and profitable for EV owners who could be paid for these ancillary services.

Commercial and industrial customers can benefit from behind-the-meter storage by reducing their usage during peak demand hours and cut fees for maximum power usage that often determine the amount they pay for energy. EV batteries can also help consumers cut their electricity bills by reducing the amount of power they consume during expensive peak hours.

By charging during off-peak hours, EV owners can help flatten the typical load curve of the grid.

During power outages, homeowners and commercial customers with solar panels can use energy from their solar systems. By integrating behind-the-meter storage into their solar installations, they may have enough power to ride out an outage of a day or more.

Next steps

Making a switch or diversifying your energy sources with a solar energy system can be a safe, financially smart, and profitable decision in the longer term. If going solar in 2022 is something that sounds right for your business, there are many things to consider. We can help you make sense of the entire picture.

To learn if solar is the right move for your organization, contact us for a free solar feasibility report.