How to determine a utility’s EV ‘tipping point’

Lisa Martine Jenkins | Source: Latitude Media | Posted 10/25/2024

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Even if EV sales aren’t rising as quickly as hoped, they could still be the single largest driver of demand growth in the decade to come. And utilities know they need to be prepared, but adoption rates differ by service area, so there’s no single answer for when and how utilities should ready the grid for the EV charging loads to come.

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Electric vehicle (EV) sales in the U.S. are on the rise, although not as rapidly as anticipated, with a Bank of America analysis projecting EVs to represent 30% of American car sales by 2030, falling short of the Biden Administration's target of 50% by then. Despite the slower growth, EVs are expected to be a significant driver of demand growth in the coming decade, prompting utilities to prepare for the impending increase in EV charging loads, although readiness varies across service areas.

A recent white paper by Camus Energy and AES highlights the moment when implementing changes like managed charging will outweigh costs for AES Indiana, serving over 500,000 customers in Indianapolis. The report suggests that preparing for the tipping point, expected at a 5% residential EV charger installation rate in early 2029, could save the utility $7.3 million from 2025 to 2035, and offer $75 million annually in capital flexibility. Recommendations include system-wide peak management, local distribution capacity planning, and transitioning to grid-optimized managed charging programs, essential steps for utilities to consider amidst the evolving EV landscape.

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How to determine a utility’s EV ‘tipping point’

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