IoT for EV charging – Ericsson | CarTailz

The electric automobile – 150 years of progress

Electric cars have been around for more than 140 years; In fact, the very first automobiles were electric before the internal combustion engine took over. Since then, electric vehicles have been patiently developing in their market niches, and now their global market breakthrough is happening.

Around 10 million EVs were on the world’s roads in 2020, representing 1% of all cars on the road, but growing by 43% compared to 2019. [1] According to a recent forecast by Markets and Markets, 8 million passenger cars are expected to be sold in 2022, rising to 39 million by 2030. [2]

A key indicator of this success is the freedom of choice for customers. In 2020, there were 370 different electric car models (of all types) on the market, an increase of 40% compared to 2019. [1] And beyond the classic car, there is an enormous variety of types and form factors, ranging from heavy trucks and adventure vans on the one hand to light city vehicles, three-wheelers and e-trailers on the other.

A crucial element in the rapid rise of electric vehicles is the emergence of new business models, from car-as-a-service to shared mobility services.

With all of this in mind, I would say that it is fair to speak of an electric vehicle market breakthrough and a fundamental transformation of the related industry, and as always, such events create opportunities and risks. But before we go there, we need to address the key factor – the power grid.

Network and electric drive – an ambivalent relationship

Increasing use of the charging infrastructure will lead to high loads on the supply lines of the power distribution grids; This must be carefully managed to keep the national grid stable. A sensible solution enabled by IoT connectivity is embedded demand management with the aim of avoiding peak loads.

Charge point operators need to know the available net capacity of utilities at any given time and in return should provide at least 24-hour charging forecasts to utilities. This enables automated, data-driven operation of both infrastructures.

There is also growing interest from charging service providers to use renewable energy generation near the charging stations: solar panels on the roof of a supermarket connected to charging points in the parking lot in front. The decentralized generation and use of renewable energy is a cornerstone for long-term sustainability.

Balancing a power grid that carries a lot of renewable energy requires buffer capacity, and a large fleet of electric vehicles represents just such a significant buffer capacity – if managed wisely! The vehicle-to-grid market has been somewhat dormant in recent years, but we expect it to now flourish into a commercially profitable business in the slipstream of a booming electric vehicle market.

Today the cheapest electricity is at night. However, this will change as more solar power is fed into the grid. Indeed, those who envision future grids are wondering what to do with all that extra solar energy, since it needs to be stored to be useful given the nonexistent demand for its use today.

When this happens electricity prices tip over and the 8am to 3pm period can become cheap electricity while night time becomes more expensive as it cannot come from solar but must come from storage, nuclear, hydro, wind or fossil fuels .

One interesting possibility is to put this extra power in cars. In contrast to many other consumers in the power grid, cars can be quite flexible when it comes to power consumption – as long as intelligent charging management ensures that the mobility needs of electric car users are met at all times. That is, once connected, they will be charged opportunistically if there is an excess, including from the sun and wind.

The need for those with excess electricity to sell is so great in the renewable energy world that suppliers expect energy companies could pay to install charging stations in these commuter areas just so they can be sure to use their excess electricity to sell. These stations will also work at night for people who need to park on the street and want electric cars.

Ultimately, all providers of EV charging services are involved in some form of energy management, and we are seeing some of these players now exploring business models, including participation in the spot market for electricity, which would generate additional revenue.

It’s a wonderful example of blurring the lines between industries and the need for cross-industry value creation.

IoT use cases in EV charging and what they are worth

We can distinguish at least 3 categories of IoT cases related to EV charging.

The first relates to user identification and payment processing. As a trailblazer for monetizing services, this is obviously a crucial case, and since we’re talking about ‘roaming’ customers, it’s not as trivial as it might sound.

Second, an infrastructure needs to be monitored and managed. This includes condition monitoring and remote maintenance, but also usage analytics that provide insights to make the right charging point investment decisions and maximize revenue.

Lastly, we have the emerging use cases mentioned above related to energy management and integration with power grids.

In a recent study conducted with Arthur D. Little, Blue Corner and Orange Belgium, we took a closer look at the business value of some of the above IoT cases. It may sound hard to believe, but in 2021 most installed charging points in Europe and North America are unconnected. [3] While these were primarily residential wall boxes, such residential solutions need to be connected to smart energy systems given the expected growth rate of new installations and their impact on power grids.

For its part, Blue Corner, part of Blink Charging, targets parking facilities (e.g. supermarkets, airports, municipal facilities), apartment buildings, healthcare and education facilities, workplaces, hospitality facilities and more.

Remote monitoring and maintenance of charging stations is an obvious way. this has the potential to generate annual business value in the order of 15% of annual sales for a mid-sized European charging service provider. This is quite comparable to similar use cases in other industries, and while it’s not rocket science, it’s a great bang for the buck.

From a commercial point of view, an exciting argument can be made for “interoperability”, which allows loyal customers of a charging service provider to also charge their electric vehicles at third-party charging stations. Roaming is very well established in our telecommunications industry, but not so much in the electric vehicle charging space. This offering alone has the potential to generate a 40% annual increase in sales!

A quick look at the broader ecosystem reveals that EV charging service providers are working with parking operators to enable relatively rapid adoption. If car park operators decide to act as “virtual charging service providers” (ie subcontract to a charging service provider), they are trying to generate an additional revenue of 1.3%. That may not sound very impressive, but not offering charging services is no longer an option either!

For more details on quantifying the business value of IoT use cases related to EV charging, see the Ericsson report.

Conclusion & Outlook

The EV charging market is building a whole new infrastructure that will be tightly integrated with the power distribution grids. Building such an infrastructure does not happen overnight. With an average annual growth in the region of 30%, this infrastructure will soon become a major player in its own right. Looking ahead to 2024, we will see > 5m charging points in Europe and > 2m in North America.

The use of installed charging points is accelerating and in some cases doubling every year. The faster this acceleration, the more the new infrastructure will depend on highly available and secure IoT connectivity. It is truly mission-critical infrastructure and for this reason charge point operators demand the best possible connectivity at every location.

EV charging is an integral part of the entire ecosystem. Charging point operators, mobility service providers (charging service providers), electricity distribution network operators and energy service providers benefit from data generated by charging infrastructures. Likewise service providers of shared e-car or micro-mobility services, automotive OEMs, parking lot operators, logistics centers of all kinds, battery providers moving towards a “Battery as a Service” business model, and others. In short, today’s business opportunities go well beyond charging stations as such!

Sources

[1] Trends and Developments in Electric Vehicle Markets ie 2021

[2] EV Market, Markets and Markets, 2022

[3] Electric vehicle charging in Europe and North America, Berg Insight 2021

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Report – IoT is changing the EV charging industry – Ericsson

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