Uncertainty over the future growth of electric vehicles (EVs) means the regulatory regime for networks may need to be reformed to allow them to build extra capacity ahead of demand, according to a new report from the Energy System Catapult.
Without changes, network operators may be hesitant to invest in reinforcements due to concerns over forecasting risks and the stranding of assets – possibly leading to outages if EV sales outpace projections.
The report drew attention to the long lead times for network upgrades, which typically take five years to complete from planning to delivery.
It also noted an “asymmetry of risk” when it comes to accommodating electric vehicles on the power grid: “Delivering capacity a short time ahead of need carries only the cost of the rate of return for that period, while late delivery could disrupt the networks and deployment of EVs.”
It said the RIIO framework may therefore need to be adapted to provide “appropriate risk sharing across all stakeholders and make it easier to commit to and implement investment decisions ahead of potential capacity gaps emerging.”
Smart charging could reduce the overall bill for reinforcing the network and also act as a stopgap measure to allow time for upgrades to be carried out. However, the report warned there “remain barriers to adoption centred around standards and interoperability of systems” that must be addressed.
It also called for improvements to demand forecasting arrangements, including greater cooperation between transmission and distribution network operators and the automotive sector.
Up to 10.6 million EVs could be on Britain’s road by 2030, according to National Grid’s latest Future Energy Scenarios report, and up to 36 million by 2050.
The system operator said they could add as much as 8.1GW to peak demand by the end of the next decade and 12.7GW by the middle of the century. The increase would be even larger in the absence of smart and vehicle-to-grid charging.