Technological advancements are leading to substantial cuts in EV battery prices, with major enablers being research and development (R&D) in battery chemistry and scaling up of battery production for EVs in manufacturing plants.
We are at the very beginning of the era of electric vehicles (EVs). Today, there are five million EVs on the world’s roads, which is up two million from 2018. China is in the leading position, in terms of the largest EV market, followed by Europe and the US. However, large-scale commercial production of EVs by the big car makers is unlikely to take off until 2025, according to GlobalData, a leading data and analytics company.
Technological advancements are leading to substantial cuts in EV battery prices, with major enablers being research and development (R&D) in battery chemistry and scaling up of battery production for EVs in manufacturing plants. The fall in battery prices is essentially due to the increased economies of scale created by a booming EV market.
GlobalData’s latest report, ‘Thematic Research: Electric Vehicles in Utilities’, highlights that the fall in battery prices is essentially due to the increased attention from the EV market. Battery factories across the world have scaled up for the production of batteries for EVs. This fall in prices has proved useful to the battery energy storage market and hastened the deployment of energy storage projects globally. Power utilities use energy storage technologies in a range of applications such as time-shifts and supply capacity in order to meet the demand–supply gap efficiently.
Sneha Susan Elias, Senior Analyst of Power at GlobalData, comments: “Power companies are showing increased interest in EV programs. Utility programs are offering discounts and rebates on the purchase of EVs or charging equipment, free smart charge installation, along with EV time-of-use plans (on-peak and off-peak rate plans) for EV owners. Power utilities are collaborating with EV manufacturers for boosting their offerings in areas such as EV charging, vehicle-to-grid (V2G) services, energy storage and renewable energy sources."
V2G systems enable plug-in EVs, particularly their batteries, to play a major role in balancing energy demand and supply and leads to two-way power flow between an EV and the electricity grid. Through this V2G concept, plug-in EVs could be utilized together with electricity storage during emergency conditions or extreme events such as supply shortages, for supplying power back to the electricity grid. Power utilities such as EDF, E.ON and Enel, are involved in V2G pilot or demonstration projects, either by itself or through partnerships.
Elias continues: “Recently, French utility giant EDF introduced DREEV, its new subsidiary which is a joint venture (JV) between EDF Pulse Croissance and Nuvve, a San Diego based global leader in V2G solutions, for the development of V2G technology. DREEV works across various areas such as launching energy flexibility services, enabling a supply-demand balance; smart management of EV charging and discharging; customer experience that aid users assure their requirements in terms of mobility, providing them with best possible remuneration in exchange for providing electricity from their vehicles to the electricity grid when not in use. With its Electric Mobility Plan, the EDF Group aims to a smart charging leader in the European region, planning to operate around 4,000 smart electric charging points by 2020.”
Merger and acquisition (M&A) deals are also supporting the rising deployment of EVs worldwide. Recently, Engie SA, a major French utility company, was involved in the acquisition of ChargePoint Services, a provider of integrated EV charging solutions, from Gresham House. The acquisition will boost Engie’s existing EV capabilities and will set up Engie as an EV infrastructure company in the UK.
Another announcement came from a major energy provider Shell, with its acquisition of Greenlots, a leader in providing EV charging and energy management software and solutions in the US. With Shell, Greenlots will strengthen its growth efforts and enable global expansion of its mobility services across utilities, cities, automakers, fleets and drivers. Through this M&A deal, Greenlots’ EV charging and energy management software and solutions along with its team will become Shell’s base for continued expansion of their electric mobility strategy for the North American region.
Elias adds: “Governments across the world are keen to boost EV uptake and are offering incentives and subsidies for EVs, with the ultimate aim of decreasing dependence on fossil fuels and to enhance energy efficiency.
“In addition, stringent fuel-economy standards and regulations on carbon emissions, low - and zero-emission vehicle mandates, and other measures such as limitation on the circulation of internal combustion engine (ICE) vehicles depending on their emission performance have led to an increase in EV deployment.”
