Solar Energy and Electric Vehicles: Maximizing value through holistic utility programs

Note: This article has been revised with additional information from San Diego Gas & Electric.

Rooftop solar and electric vehicles.

As utilities across the country contemplate a future that will likely include solar as well as other clean tech resources, the mention of these two technologies in the same breath can conjure up a range of new technical and business opportunities.

“Given the high correlation between solar energy customers and EV drivers, it would be very interesting to see a utility offer an innovative residential solar and EV charging rate, incentives for solar energy storage by EVs, or to provide a streamlined application process for EV charging equipment and solar interconnection,” said Philip Sheehy, an electric vehicle (EV) expert at the consulting firm ICF International.

Car of the future: Chevrolet unveiled its concept model of the all-electric Bolt earlier this year. Photo courtesy of GM.

Sheehy notes that to date, most utility EV programs and incentives have focused primarily on rebates for chargers and specially designed time-of-use (TOU) rates, under which rates rise during periods of peak demand and fall during off peak hours.

But, a more holistic approach to distributed solar and EV programs — as part of a larger distributed energy resource (DER) strategy — could allow utilities to better manage energy demand, cross-market services to targeted communities and reduce paperwork. The net result of such efforts could be improved customer experience and participation in utility programs.

Evidence is mounting for such an approach. A recent California survey confirms the solar-EV connection cited by Sheehy, finding that more than 30 percent of EV drivers in the state now own or lease solar energy systems, and another 16 percent plan to install solar.

Translating those figures into real numbers, Hanan Eisenman, Communications Manager at San Diego Gas & Electric (SDG&E) said the company’s service territory now has about 60,000 rooftop solar installations and 17,000 EVs.

“Many of these customers own both technologies,” Eisenman said in an email statement.

Read SEPA’s Top 10 Utility Solar rankings track which utilities have the most solar online, here.

Jennifer Szaro, who formerly coordinated residential solar and EV programs for the Orlando Utilities Commission (OUC), said a database analysis showed that residential solar customers and EV owners often cluster in communities with strong demographic similarities.

More to the point, as shown in the table below, both distributed solar and EVs are continuing to expand at rapid and complementary rates.

A recent study from the National Renewable Energy Laboratory (NREL) also found that combining solar with EV charging programs improves the bottom line for utilities and customers alike.

To date, many utilities have encouraged customers to charge their EVs at home during off-peak hours. But, the NREL research shows that daytime charging can increase the total number of all-electric vehicles miles, which increases fuel savings for customers and leads to greater overall adoption of EVs. — a plus for utilities because it means more potential load or minimizing impacts of solar.

According to industry analysts, the average EV driven 12,000 miles per year will consume approximately 3,600 kilowatt-hours (kWh) annually — roughly 30 percent of the average per capita electricity consumption in the U.S.

According to NREL, EVs could also help integrate higher levels of solar by, “smoothing the solar supply curve, reducing the need for curtailment, and increasing the efficient use of transmission and distribution resources.” Strategically locating solar installations near charging infrastructure could also reduce or eliminate the demand spikes and increases in load created by daytime charging.

To better address the evolving needs of customers, Portland General Electric recently merged its EV and solar programs into an Integrated Technologies Division. OUC houses all of its DER programs, including solar and electric vehicles, in a Sustainability Division, which works closely with other divisions.

What might the utilities of the future look like? Check out SEPA’s 51st State Initiative, here.

NRG Energy, the country’s largest independent power producer, recently announced a new program known as NRG Home, which will provide a one-stop-shop for customers interested in a variety of energy services. The program website quickly and easily provides information about NRG’s solar lease program and its eVgo program, which provides residential, workplace and public EV charging infrastructure at no or low cost to consumers.

SDG&E is also focusing on being a one-stop shop for its solar and EV customers, Eisenman said, with “seamless” coordination between departments. It also has a special time-of-use rate for EVs that is particularly attractive for EV owners with solar, helping them to zero out their bills at the end of the year, Eisenman said.

Many utilities may not see a strong impetus to coordinate EV and solar energy programs, based on the somewhat limited EV sales to date. However, the Solar Electric Power Association (SEPA) predicts that future EV sales growth will coincide with residential solar growth in a number of states.

Ten states now have zero emission vehicle (ZEV) programs, which could put a projected 3.3 million ZEVs, including EVs, on the road by 2025. SEPA has identified nine of those states as top potential residential solar markets; specifically, California, Connecticut, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island and Vermont.

If even a fraction of utility customers ultimately install solar and drive EVs, it could trigger significant change in utilities’ programmatic and energy management strategies.

But, EVs and distributed renewable energy are a smaller subset of the broader DER conversation. For utilities to ensure their own economic sustainability, the new technology and business models they develop going forward must be responsive to customer needs, promote competition and continue to drive innovation.

Erika Myers is SEPA’s Senior Manager of Research. She can be reached at [email protected].