The importance of renewable energy for electric vehicle charging | JD Supra

As vehicles continue to demand more energy, it will be increasingly important to ensure that more vehicles are powered by renewable resources. The automotive industry is experiencing a dramatic shift towards electrification with more widespread adoption of electric vehicles (EVs).

In 2021, EVs accounted for approximately 9% of global vehicle sales and approximately 4% of US auto sales, an approximately four-fold increase in global EV market share from 2019 sales Electric vehicle sales in the first quarter of 2022 were up 75% compared to the same period in 2021. Estimates indicate that electric vehicles will account for around 45% of new car sales by 2035.

Virtual Power Purchase Agreements (VPPAs) can become a useful mechanism to charge businesses, vehicle manufacturers and fleet operators with large EV energy needs to source renewable energy, which, in turn, can also help generate new renewable resources.

Emission reduction targets

The electrification of the automotive industry is crucial to meeting global carbon dioxide reduction targets.

In the United States, the Environmental Protection Agency (EPA) estimates that the transportation sector accounted for approximately 29% of greenhouse gas (GHG) emissions in 2020. 57% of these GHG emissions came from light-duty vehicles, such as than passenger cars, and 26% came from medium and heavy trucks. The electricity sector (i.e. the production of electricity) accounted for 25% of all US emissions.

The combined effect of electrifying vehicles and adapting renewable energy sources (renewable energy currently accounts for about 20% of electricity generation in the United States) in place of carbon-emitting resources would have a profound impact on reducing emissions. A Carnegie Mellon University study found that the combined impact of a nearly emissions-free power grid and widespread adoption of electric vehicles (about 84% of vehicle trips) would result in a 90% drop in emissions from light vehicles. The total potential benefit of EVs therefore depends on the source of energy used to charge them.

The US federal government and individual states have recognized that the electrification industry is imperative to meeting GHG emission reduction goals.

The Biden-Harris administration has a stated goal of a 50% reduction in GHG emissions by 2030, combined with an ambitious 50% EV target by the same year. Many states have independently adopted similar GHG and electric vehicle reduction targets. Notably, 15 states and Washington, D.C. have adopted zero-emission vehicle mandates, requiring all car sales in the state to be zero-emission vehicles by 2035. Ten states, Washington, D.C., and Puerto Rico have also targets to source 100% of their energy from renewable sources, and 26 other states have other forms of renewable energy targets in place.

The need for widespread adoption of electric vehicles in order to meet emissions targets is also driving federal and state governments to encourage the purchase of electric vehicles and the development of the necessary charging infrastructure. On November 6, 2021, the Infrastructure Investment and Jobs Act (IIJA) was passed, authorizing $7.5 billion for programs designed to encourage the national development of 500,000 electric vehicle charging stations . California has a $1.5 billion annual Clean Vehicle Incentive Program that funds various programs to encourage adoption of electric vehicles and reduce emissions from the transportation sector. New Jersey has a goal of 330,000 electric vehicles by 2035 and offers incentives for both purchasing electric vehicles and installing charging infrastructure.

Automakers have responded, and many have pledged to provide a variety of electric vehicle models, with some manufacturers pledging to go fully electric by 2030 or 2035. General Motors has announced plans to phase out vehicle sales internal combustion engine by 2035; Jaguar, Bentley, Volvo and Mercedes Benz have all announced plans to have electric-only vehicle models by 2030; and Toyota aims to be fully electric by 2040. The U.S. Department of Transportation (DOT) has predicted that 25 million electric vehicles will be on U.S. roads by 2030 and 114 million by 2040, which which represents 40% of the total number of vehicles in the United States.

Energy requirement to power electric vehicles

To power a fully electrified transportation sector, the United States will need to produce 25% more electricity than it does today. The International Energy Agency (IEA) estimates that by 2040, global electricity demand will increase by more than a third, mainly due to the widespread adoption of electric vehicles, which will increase demand electricity from the transportation sector from virtually zero to over 4,000 terawatt hours (TWh) per year. The U.S. Department of Energy (DOE) has found that without increased renewable energy generation to support widespread adoption of EVs, more EVs could actually extend the life of utility-generated power sources. fossil fuels.

Renewable energy to power electric vehicles

Electric vehicles are only as clean as the electricity that powers them.

A 2016 study by Tsinghua University found that the increased adoption of electric vehicles in China, when about 64% of electricity came from coal-fired generation resources, resulted in a two to five times liberation more particulates and chemicals than gasoline engine cars. Around 60% of electricity in China still comes from coal-fired generation resources.

Automakers and charging companies have recognized the importance of sourcing renewable energy sources to power electric vehicles, and consumers may also place greater importance on the source of electricity to charge their vehicles.

EVgo, the largest public EV charging network in the United States, is also the first EV charging operator to be powered by 100% renewable electricity. EVgo purchases Certified Renewable Energy Credits (REC) to qualify the electricity distributed through their charging stations as 100% renewable energy. General Motors, Subaru and Toyota have all entered into relationships with EVgo for preferential charging of their electric vehicles.

Ford participates in the California Air Resources Board’s Low Carbon Fuel Standard initiative, which allows 100% of the home charging energy of its California customers to be associated with renewable electricity. To do this, Ford generates or purchases an equivalent amount of REC from California to match the electricity consumption of California electric vehicle owners participating in the program.

Nuro, an American robotic autonomous delivery vehicle services company, announced that starting January 2022, it will use 100% renewable energy from wind farms in Texas for all vehicle charging and installation. Antelope Valley Transit Authority, the nation’s first all-electric transit agency, which operates 57 full-size battery-electric buses along with 20 commuter coaches and 10 micro-transit vans, said it plans to recharge its fleet with 100 % renewable energy . Antelope Valley is located in the Mojave Desert and is developing a solar plus storage project to charge its vehicles.

VPPA

For large fleet operators like Antelope Valley, automakers and electric vehicle charging companies, VPPAs can be a useful tool for sourcing renewable energy.

Under a VPPA, a renewable energy project developer will enter into an agreement to sell the renewable (i.e. “green”) energy credits of the energy produced. These agreements are typically long-term agreements tied to wholesale electricity market prices, and the long-term contractual commitment under VPPAs can typically provide the necessary financial support to allow developers to finance and build new energy projects.

Thus, VPPAs could be a solution both to increase the development of renewable energy projects and to ensure that electric vehicles have renewable charging resources.

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