09/14/2017

Electric vehicles will ‘save’ Hawaii’s energy grid, industry leaders say

Published on Pacific Business News 

As battery costs decrease, the adoption rate of electric vehicles is expected to increase exponentially and that could be a good thing for Hawaii’s energy grid, according to industry experts.

“EVs are going to save the grid,” Holu Energy CEO Ted Peck told Pacific Business News.

The state's energy grid has already undergone drastic changes over the last decade. It changed from a one-way system, where Hawaii's utilities produce power and distribute it to every single household, to a two-way system, where consumers not only receive energy but also produce it.

Just like residential solar photovoltaic systems, electric vehicles will become a distributed energy resource in the future. But unlike most of Hawaii’s rooftop solar systems, which can’t be seen or controlled by the utilities, EVs can be strategically employed to take and provide load.

“Right now, we think of electric cars as plug them in and it will get charged,” said Scott Seu, senior vice president, public affairs at Hawaiian Electric Co. “At the very basic level, we could build load at the appropriate times of the day to take in more solar energy – that’s today.

“As we think about those electric vehicles in the future, it’s about vehicle to grid. The technology currently exists for the electric car to put power back on the electric system. It’s just that it hasn’t been really adopted yet because of A, we haven’t really figured out all the controls, and B, Hawaii will once again be the first adopter.”

Current electric vehicles feature the latest technology, and HECO is convinced that future vehicles will have some sort of visibility. The Honolulu-based utility expects that should owners give permission it will be able to see any electric car in Hawaii and its state of battery charge and use it as an energy resource.

According to data from the Hawaii Department of Business, Economic Development and Tourism, there were 6,216 electric vehicles registered in the state of Hawaii last month. While the number represents less than 1 percent of all registered cars in the state, it's a 34.2 percent increase from August 2016.

The adoption rate is expected to accelerate even more once production costs for EVs are comparable or cheaper than those of combustion engine cars. Research from Bloomberg New Energy Finance earlier this year indicated that this could happen as early as 2025. The cost decrease is directly tied to falling battery costs, which account for about half of the cost of EVs.

Researchers expect battery costs will drop 77 percent between 2016 and 2030. Tesla’s recently unveiled Model 3, which has starting price of $35,000, is almost 50 percent cheaper than any of the company’s previous models.

At the Frankfurt Motor Show, which is currently taking place in Germany, electric vehicles are dominating the headlines. All major car companies have announced commitments to increase their portfolio of electric vehicles in the future. Swedish manufacturer Volvo will be the first one to manufacture only electrified drivetrains starting in 2019.

“It’s a game changer,” said Rick Reed, president of the Hawaii Solar Energy Association, on the potential of electric vehicles for Hawaii's energy future. Peck added EVs will not only benefit the environment and decrease the state’s dependence on oil, it will also provide a business opportunity for utilities.

"When you have an electric car you have a mobile energy consumer, and who better to meet the needs of an energy consumer than somebody that’s got wires all over the place," he said. "The utility is in a natural position to do that."

HECO recently opened its 12th fast-charger station in Hawaii and is expected to continue to invest in EV infrastructure. Even Par Hawaii, which owns the largest oil refinery in the state, is considering installing at an EV at at least one of its gas stations.

"The utility should be on the forefront to put in EV infrastructure and capitalize on it," said state Rep. Chris Lee, D- Kailua, Waimanalo.

Lee, however, cautions that the technological advances in the field of solar, battery storage and EVs could lead to people leaving the grid as they can produce and store all the energy they need.

"If the question of incentivizing people to remain part of the grid is not resolved soon that could accelerate grid flight," he said.