Batteries-on-wheels trend, Real or Faux?
The Batteries-on-wheels trend is gaining momentum as the mobility and power sectors evolve and create new scenarios.
The shift towards electric vehicles (EVs) and renewable energy sources is being driven by government regulations and customer demand, presenting challenges also for power markets and grids. The increased deployment of renewable energy sources, such as solar and wind put stress on the electric grid because of their irregular availability. This can be addressed through power flexibility.
Power flexibility is the ability to shift the time of energy demand from devices, which opens up many revenue generation opportunities and dramatically improves electric grid management. Flexible assets include storage batteries, electric vehicles, thermal systems, and wet appliances. The ecosystem of players involved in power flexibility is complex and includes stakeholders such as active customers who own flexible devices, aggregators who manage a fleet of distributed assets, energy service companies that install new devices, and transmission and distribution system operators that need flexibility to maintain grid stability.
One crucial role in the success of power flexibility is being played by highly vertical software engineers whose algorithms and apps enable flexibility for different stakeholders and use cases. However, there are still many sceptics who debate whether batteries and EVs are truly poised to play a role in the renewable energy ecosystem.
While EVs were once considered a threat to the electric grids, they now can save them by acting as storage systems.
Through Vehicle-to-Everything (V2X) and Vehicle-to-Grid (V2G) applications, EVs can act as storage systems and provide a range of flexibility services. V2X enables EVs to provide flexibility services beyond the grid, such as to homes and businesses, while V2G enables them to provide grid services directly. These services include local optimisation, explicit demand response, and ancillary services for transmission operators.
The low-hanging fruit in power flexibility lies in local optimisation for end-users, which is already happening today.
This solution is available everywhere and consists of synchronising user demand with solar production, peak power demand limitation, and time of use optimisation. The higher value stands in explicit demand response opportunities, where Hive Power is running pilots and services for the wholesale market, optimising the energy consumed, and injecting it with V2G on the day-ahead market.
The third family of use cases involves ancillary services for transmission operators. It is already feasible today in some countries, like Switzerland, yet difficult in many others due to a lack of regulation allowing small devices to bid there. In this case, the main challenge is in aggregating many small distributed assets and subsequently forecasting and optimising the amount of energy and power to bid in different markets.
Despite the opportunities presented by V2X, there are still questions about its profitability. The main concern is the value that can be extracted from a single battery EV, considering factors like national regulation, energy prices, business models, and mileage, among others.
Academic literature and simulations estimate a value between €400 - €1000 for one EV per year for V2X.
To make these use cases successful, intelligent software solutions are crucial, along with user engagement and regulatory support. User engagement is vital to ensure a seamless experience for the customers, and Hive Power provides a mobile app to interact with users that can set their everyday needs or occasional events, like a vacation or car maintenance.
In conclusion, the Batteries-on-wheels trend is a valuable development that offers significant opportunities for the energy industry, EV owners, and the environment.
Despite some questions and challenges, the potential benefits of V2X and V2G applications are undeniable. As a complex ecosystem, the energy industry needs all stakeholders to work together to unlock the full potential of these solutions.
Today, we're already making progress, with local and market optimisation taking place in some countries, and testing grid services in other countries.
At Hive Power, we're committed to enabling the energy transition and exploring innovation opportunities for EV and energy players alike.
We offer plug-and-play SaaS solutions and can set up pilots depending on your regulatory environment.