The growth of electric vehicles (EVs) has big implications for both the automotive and the power (electricity) sectors. On both sides, technical solutions, business models and new commercial value chains are in their infancy, but fast evolving. That’s opening new opportunities for those willing to investigate and innovate; and may leave behind those who are too slow.
In this, one in my series of “project example” articles, I decided to focus not on a single project, but on a particular company – Nissan. As well as selling one of the world’s most popular electric vehicles – the Leaf – they are also active in a number of other interesting projects, pilots and products.
To be clear, the goal of this article is not to compare Nissan, favourably or otherwise, to other car manufacturers! I don’t have a vested interest in them and I’ve never owned one of their cars. I’m also not attempting to compile every project they are involved in, in every country, in detail. However profiling a few recent announcements by just a single company does provide a useful case study to really highlight the diversity of activities, trends and new partnerships that potentially exist – all illustrating the blurring of boundaries between the once-separate value-chains of transport and power.
I’ve split the examples covered into:
- Smart charging, at home
- Stationary storage plus PV, at home
- Home and Vehicle-to-grid (V2G)
- Commercial and fleet-focused V2G
- Commercial stationary storage plus PV
- EVs and microgrids for the power-poor
(By the way, the examples covered here have been compiled and summarised from a variety of publicly available press releases, news items and reports).
1. Smart Charging, at Home
Smart charging will be crucial in integrating EVs into the grid, in particular at the local distribution level, where capacity is particularly constrained. Put simply, EVs won’t all be able to all arrive at home at the same time, plug in and charge simultaneously, just as normal evening electricity demand is peaking. Instead the timing of charging will need to be managed.
Nissan was the EV supplier partner within the recently completed “My Electric Avenue” project here in the UK. This project was designed to investigate – and propose solutions to – the issue of distribution network overloading in locations of EV “clustering”. Amongst several other project partners were a charging point developer (Zero Carbon Futures) and two distribution network operators or DNOs (SSEN and Northern Powergrid).
The project recruited ten clusters of neighbours around the country, each of whom drove a Nissan Leaf: one hundred owners in total. It ran for eighteen months and provided invaluable findings about the potential costs of upgrading local distribution networks: for example finding that 32% of low voltage feeders in the UK would require upgrades if the customers attached to them were 40-70% EV equipped. The project also trialled a technology solution to control the charging of EVs and to curtail high loads once local grid demand exceeded certain levels. The outcome suggested such a solution could save over £2bn in reinforcement costs over the next thirty years.
(Best of all, the project has published a number of reports and documents, so I’d heartily recommend browsing from their home page link: http://myelectricavenue.info/)
2. Stationary Storage plus PV at Home
As subsidies for PV decline or disappear, the case for matching it with battery storage grows. It enables homeowners to maximise their own usage and reduce grid imports. It enables grid operators to avoid congestion and voltage issues on sunny days, when domestic loads are low but distributed PV generation is high. As smart meters become more prevalent and trigger the growth of more diversified time-of-use tariffs, the benefits of matching PV to storage are only going to grow.
Nissan have been partnering with power management company Eaton for a while, providing what they call their “xStorage” battery solution. It’s a stationary storage solution that comes in various sizes for domestic use (and can be stacked for larger applications, as we’ll see later). In its lower-capacity guise (just over 4kWh) it uses reconditioned batteries from old Nissan Leafs. However higher-capacity versions (to 7.5kWh) use new batteries, representing a significant product diversification – in that they don’t depend on recycling from previous EV sales. Power outputs are 3.6 to 6kW (specs as listed here).
Stepping even further into non-EV, energy-sector product sales, Nissan recently launched “Nissan Energy Solar”. Not only will the venture sell stationary storage to owners of existing rooftop solar PV, but it will also sell a PV + storage system from scratch, for those who haven’t yet taken the plunge into solar self-generation.
Solar inverters are already integrated into the home batteries. So too is a home energy management system which automates when and where energy flows; determined by usage, PV production peaks and storage capacity – plus of course, if the home has one, EV charging.
3. Home and Vehicle-to-Grid
Whether stationary or within an EV, the correct (bi-directional) charging infrastructure opens up the chance for home-connected batteries not just to charge from the grid (separately or in addition to charging from self-generated solar power), but also to feed into it – and get paid for doing so. Payments could be energy based (for example providing energy at peak times) or power based (for example capacity provision or frequency response). While individual households may be too insignificant to monetise the various grid and balancing revenue streams that exist, aggregating multiple households together into a virtual power plant (VPP) is a solution that is already starting to become established (Germany company Sonnen provide an excellent example of this approach).
At a corporate “futures” event in October 2017, Nissan laid out a vision of giving its customers free power to charge EVs. It would charge a fee for the installation of a bi-directional Vehicle-to-Grid (V2G) charger after which users would transfer electricity to and from the grid at no cost. The proposal followed a year-long trial in Denmark.
Here in the UK, Nissan have also partnered with OVO, one of a new breed of young and innovative electricity & gas retailing companies (they started operating in 2009).
OVO, by connecting smart meters, new tariff offers and their own clever algorithms, will manage energy trading between home storage batteries, connected EVs, PV systems and the grid – exporting energy at peak times and charging batteries, including EVs, when prices are low. Although not mentioned in the announcement, it seems to me a safe bet that aggregating in order to provide other revenue-generating grid services in future will be on the radar.
4. Commercial & Fleet-focused V2G
According to a recent presentation I attended (by leading charging-point provider Chargemaster), new registrations for EVs in the UK market are being driven primarily by fleet (56%) and business (12%) customers. Only a third of sales is from private buyers.
One outcome of that statistic will be that workplace charging is likely to be a big growth market in the next few years. Another is that companies like Nissan haven’t just been focused on domestic EV users, but on commercial ones too, when investigating opportunities like V2G or the integration of energy systems such as EVs, stationary storage and PV. Compared to disparate and diverse domestic customers, fleet customers should provide a more constrained, homogeneous, centrally managed and naturally aggregated business opportunity.
For example, Nissan has been working with a much larger, established energy supplier: ENEL. It’s worth noting that the latter has been moving the other way too, from energy into the transport sector, not least through its acquisition of eMotorWerks, the prominent US-based developer of smart charging and vehicle-to-grid hardware and software solutions.
In 2016, here in the UK, the pair launched a major vehicle-to-grid (V2G) trial connecting one hundred V2G charging units, covering both private and fleet owners of the Nissan LEAF and e-NV200 electric van. A few months later, Enel announced the first commercial V2G hub in Denmark, whereby they installed ten 10kW V2G units at the headquarters of Danish utility Frederiksberg Forsyning. The latter purchased ten Nissan e-NV200s. The V2G hub generated revenue by stabilising the grid in Denmark (providing power capacity services to grid operator Energinet.dk).
More recently, in January 2018, Nissan announced it had won government funding to lead a much larger V2G project, targeting one thousand V2G installations. The project will specifically evaluate the business case for electric vehicle fleet customers.
This latest project includes a variety of key partners, including National Grid (the UK’s transmission system operator) and two DNOs. It also includes Nuvve, a US-based V2G aggregator: they will control the chargers and collect the data required to understand the technical characteristics of vehicle to grid charging for both the vehicles and the electricity networks. Nuvve were a partner in that smaller, earlier V2G project in Denmark too.
Elsewhere, in Italy, Nissan launched (in 2017) a V2G project coupled with MOV-E, it’s corporate EV-sharing pilot project.
5. Commercial Stationary Storage plus PV
As with car fleets vs. private owners, commercial applications provide some attractive and larger-scale, single-case opportunities in the stationary storage sector too. And, as in domestic settings, integrating stationary storage with PV – and EVs – is a natural fit.
Again working with Eaton, Nissan are installing a 3MW stationary battery storage system in the car park of the Amsterdam ArenA, a football stadium. The battery will be a mix of new and “second-life” xStorage battery packs stacked together: 280 Nissan Leaf batteries in total. The system is expected to be completed early this year, with scope to increase in size if needed. (I haven’t seen a figure for the total energy – MWh – capacity of the system; but based on the number of batteries involved, I guess it will be somewhere in the range 4-6MWh?).
The stadium already has PV panels covering around 7,000 square metres of its roof. Capacity is just over 1.1 MWp and the system generates around 930 MWh of electricity each year: 10% of the stadium’s electricity consumption. The remainder is sourced from its own wind turbines (sited elsewhere).
Stadiums like this one have a very variable demand profile: during live events, energy consumption at the Amsterdam ArenA can be 8-10 times higher than normal. The battery will act as an emergency power supply and remove the need for diesel generators. When the stadium’s own demand is low, it can earn revenue by helping balance the electricity grid. In future, it aims to supply energy to other buildings within a local smart grid.
By placing the system in the parking area, it can also help charge EVs – potentially with future V2G potential too, whereby parked cars will be able to offer additional storage capacity.
6. EVs and Microgrids for the Power-poor
Nissan already have some involvement in “developed” market microgrids, for example having donated 20 second-life LEAF batteries to the UC Davis RMI Winery Microgrid Project in California.
More recently, they’ve announced a number of other pilot projects, aimed at assisting in situations where basic access to electricity is more of a challenge.
One is to build microgrids for communities in developing countries without access to reliable grid power: plenty of these exist, so it represents a potentially big new market.
Another will involve partnering with organisations in areas affected by natural disasters where their electric van (the e-NV200) could potentially act as a mobile, back-up energy source when there is grid disruption or power cuts. To me, this is a concept not unlike the role of mobile infrastructure companies (such as Ericsson), who were past innovators in developing “drive-in” base stations. These proved crucial in enabling the rapid provision of spots of mobile communications coverage in a variety of scenarios: everything from disaster and other emergency situations to capacity-expansion at events such as music festivals.
Again, a natural extension of these kind of projects would be a pairing with PV, where that resource makes sense (instead of a diesel generator, for example). Innovations like solar panels that can be rolled out from the back of a truck already exist.
As stated at the start, the purpose of this article isn’t to suggest Nissan are doing things that other car companies are not. Many others are involved in their own variety of projects, similarly blurring the sectoral boundaries between automotive and power.
However, by illustrating how just one company can be involved in such a diversity of new business ventures and with such a variety of partners, it should emphasise just how many new opportunities may exist within this state of evolving industry convergence. EVs are mobile, distributed batteries, so will coexist naturally with distributed power generation and with stationary, distributed storage too. Clever software will optimise energy flows between each of them. While able to offer some benefit to individual users, larger commercial systems and aggregations of individual users will start to increase those benefits, by adding value to grid and system operators too.
So in future, cars won’t just be cars, they’ll be important components of distributed power systems. Which means car manufacturers won’t just be car manufacturers. They too will be key energy players, participating in various guises and connected into the energy sector through various key value-chain relationships.
Last Update: January 2018