The Smart Garage Charrette Pre-read documents include an overview of Smart Garage technology, hot topics, charrette details, technical background, economic analysis and market assessment research. To review the shortened 20 page version of the pre-read download here. For the full pre-read document download here. For deep dives on certain topics, check out the appendices files: download here.

Executive Summary: Charrette Designed to Accelerate the Build Out of Smart Garage

Introduction:

What is this Document? What is Smart Garage? What is a Charrette? Smart Garage brings transport, the electricity grid, and
the built environment together via the enabling technology of electrified vehicles (including electrified vehicle hybrids, extended-range EVs, and electric vehicles) and their smart integration with the grid.
Historically, our transport and electricity infrastructures have operated independently. With the rapid commercialization of a new generation of electrified vehicles—that will not just plug into the grid but communicate with it, help firm and regulate its
operation, and possibly act as a storage resource—our major energy infrastructures are about to conjoin. If implemented with foresight and care, the Smart Garage will integrate building, vehicle, and grid energy systems to improve the efficiency of all, and increase transparency for the consumer, leading to a complete shift in the way consumers use and make decisions about energy.

Economically, Smart Garage can reduce operating costs for vehicles, avoid large investment costs for utilities, and open up new business opportunities in fields such as software to manage communication between vehicles and the grid. Importantly, Smart Garage is much broader than bidirectional charging (commonly known as “vehicle to grid” or V2G) as vehicles and the grid can integrate in many different ways (such as Smart Charging or V2B) that can provide economic and environmental benefits. Smart Garage requires collaboration between many players, from utilities and OEMs to battery makers, grid service providers,  entrepreneurs and start-ups, retailers, car share companies, and more.

The goal of this pre-read is to prepare Charrette participants for the unusual and exciting three-day event with information on what we’ll be doing, and background on the topic at hand: the Smart Garage.

Smart Garage—the convergence of electrified vehicles, the smart and clean electricity grid, and advanced building energy systems—has the potential to significantly improve the efficiency of the transportation and electricity sectors and help make renewable energy available via the grid. Implemented carefully, it may also be highly profitable to key stakeholders like utilities.
However, many implementation challenges still exist, and critical questions remain: e.g., How do you facilitate integration among industries that to date have largely operated independently? How do you bring together the multiple “visions” of vehicle and grid interaction into a cohesive technology roadmap? How do you align incentives between stakeholders to facilitate the financing and scaling of infrastructure and electrified vehicles? How do you bring together large, established players with smaller,  entrepreneurial firms and nontraditional sectors to accelerate development?

This document contains an overview of these and other critical questions, while providing background on relevant technologies and developments in the market; findings from RMI’s financial analysis on Smart Garage scenarios; and an environmental benefits discussion. Document updates and in-depth appendices are available at move.rmi.org/smartgarage. If you have comments or additions to the documents, please add them at smartgarage.rmi.org/tiki-forums

Our goal is to accelerate the build-out of Smart Garage, focusing on the U.S., in the most environmentally and economically beneficial way by aligning the vision of critical and diverse stakeholders and designing collaborative next steps. Employed for centuries in the architecture field, today a charrette is a structured process in which a critical number (80 in our case) of experts from diverse backgrounds and industries come together for an an immersive and interactive problem-solving session.

During a charrette, participants alternate between breakout sessions focused on a solving a clearly defined challenge and plenary sessions where they share output from their breakout groups and get feedback and input from the other groups. The breakout sessions and plenaries in our Charrette will build upon each other and lead participants to the final goal: identifying 3–5 specific and collaborative projects that can be started immediately and that are a meaningful first step to realizing the Smart Garage
vision, as defined by the participants earlier.

Day One will Ground participants in consumer experience, expose differences in participants’ near-term visions, begin to rectify differences, and flesh out a value chain for the longer-term Smart Garage roadmap.
Day Two will test the value chain’s robustness in extreme scenarios, use lessons from this exercise to select the top ~10 barriers, and identify solutions. On Day Three we will create 3–5 concrete project plans that tackle the top barriers, reinforce commitments and alignment among participants, and kick off the new projects.

Executive Summary (cont’d): Research and Financial Modeling Highlight the Need for Integration
Technology
Most of the major requisite technologies for Smart Garage are “ready for prime time,” with the possible caveat of advanced batteries. Batteries have made steady improvements in the past two decades, enabling a recent surge of interest in electrified vehicles, but they have a bit farther to go to reach the price/performance point required to fully realize the benefits of Smart
Garage.
Even though most of the key technologies (for communications, IT, conversion, etc.) are available, installing them in an integrated infrastructure will be expensive and will require the commitment from many stakeholders, including the government.

Economics: What is the Value of Smart Garage?

RMI estimates the net present value (NPV) of vehicle and grid integration would be from -$63B to +$34B under our current set of assumptions. The first major driver of value is how vehicles connect to the grid:

• V0G (-$63B), i.e., doing nothing, maximizes risk to the grid and would be the most costly scenario,
• Timed Charge (-$32B), would be roughly half the cost of convenience charging, avoiding many of V0G’s pitfalls;
• V1G (-$11B) would even be less costly, enabling communications in real-time with utility, allowing utility benefits with unidirectional charging;
• V2B ($34B) would actually be profitable, confining bidirectional integration to buildings systems, maximizing benefits while minimizing cost and difficulty, and
• V2G ($15B) would also be profitable, utilizing vehicles’ capacity to act as grid storage, but this regime could require significant investments in infrastructure and advances in battery chemistries.

Our “default” assumptions are based on RMI research and interviews with participants. However, by changing certain key assumptions, the system can become much more profitable. For example, even costly scenarios could get to a $10B positive NPV, if:
• Give V0G a $6700/vehicle gov’t subsidy
• Give Timed Charge $6/gallon gas, or
• Give V1G $325/kwh batteries.

V2G NGU, because it relies on a future, renewables heavy generation scenario, is the most sensitive to assumptions. However, it does show the potential synergies from Smart Garage when the utilities move towards wind and solar.
While we find that Smart Garage can be profitable in the long run, there will be winners and losers. The utility and battery makers appear to be clear winners in all scenarios, as is any third party who can capitalize on the enormous amount of money and information that will be changing hands. The high capital costs on the vehicle side indicate that either the OEM or the consumer (or both) will lose money. The consumer may put value on the lifetime fuel savings at purchase and/or the differentiated benefits of electric drive, but it is highly unlikely that the OEMs will be able to capture the fuel savings for themselves. This indicates the value of exploring novel vehicle ownership/sales models. Current subsidies being explored in congress could alleviate this problem, as could sharing profits from other sectors.

Industry
Almost every major automaker has announced some form of electrified vehicle during the past year, led by GM, Toyota, and Nissan-Renault. Electrified vehicles are also the source of a flowering of start-up OEMs. Implementation of the Smart Grid finally appears to be a reality, and several cities have set up pilot projects. Internationally, Israel, Denmark, and Japan are leading
in electrified vehicle pilots and grid integration.
Environment
The scope of potential climate benefits of Smart Garage significantly exceeds the scope of financial benefits. Smart Garage represents a shift in the transportation energy use paradigm to greater efficiency while enabling deep penetration of renewables onto the electric grid. In other words, the Smart Garage is a single system that can significantly reduce the GHG
emissions from multiple sectors simultaneously.

Leave a Comment