New opportunities created by EVs and the clean energy supply chain

Editor’s note: This article is part of the specialty theme, E-mobility meets the road, by Boyd theme, hosted by GlobalSpec News & Analysis.

Just like the gasoline cars being replaced, EVs have a growing ecosystem of secondary and adjacent markets. This is everything from the obvious, like battery startups and home contractors that can retrofit your garage or driveway, to some of the less obvious things, like a roadside emergency service dedicated to EVs only.

The clean energy supply chain is providing a lot of economical opportunity to second and tertiary suppliers of EV products and services. We’ll take a look at that world through the steps of power generation, energy storage, power distribution and the economics that will create new business models.

Alternative power generation

Take a drive along any interstate or county road, and you are likely to encounter fields or PV panels or plateaus of wind turbines. And in the coming years, those sightings will be more likely. According to the U.S. EIA, solar power generation will grow 75% from 163 billion kilowatt hours (kWh) in 2023 to 286 billion kWh in 2025, and wind power generation will grow 11% from 430 billion kWh to 476 billion kWh during that same period. Overall, renewable sources, including biomass, hydropower and geothermal, supply 22% of the U.S.’s energy supply in 2023, and growing steadily from there, in conjunction with a reduction on coal reliance.

Wind and solar farms aren’t the only place electricity is generated by renewables. Rooftop solar has become relatively mature over the last decade for many homeowners. Those with roofs or fields open to the horizon were often approached by suave salesman. Initially it took some subsidies to encourage consumers to invest. Those subsidies bought time for the solar panel efficiencies to improve. Now, consumers could be their own powerplant and get paid as a net producer if they produce surplus power.

“Crowdsourcing” for electrical energy, on the site where it is used, might be the future, especially as energy storage mediums develop and become more economical.

Energy storage

But instead of sending surplus power back to grid, solar farms and homeowners too can store that energy on site, for on-demand use powering either their homes, buildings or vehicles.

Batteries are the most convenient and reliable form of direct electrical storage. A growing number of operators and homeowners are seeking ways to add energy storage that can be easily expanded or removed, as generation capacity and demand fluctuates. As a result, large scale battery systems, typically mounted in ISO-like containers for easy modular transport, are making it easy to flex storage capacity between locations.

A number of services are offering smaller scale energy storage systems for homes. Although there are many battery styles, by far the dominant technology is lithium-ion. This battery has the highest energy density per pound, which ultimately means more charge in a smaller battery. However, li-ion has a notable instability, wherein an electrolyte leakage, if sparked by an electrical malfunction, causes a terrible chemical fire. These types of batteries should be kept away from homes and garages if possible.

And it is also driving development of similar battery types that use sodium-ion in place of lithium-ion.

Sodium has significant advantages. It uses the sixth most common element on earth: sodium. Best of all, it takes no mining or smelting operations. The electrolytes are non-flammable and comparable battery costs are about 30% cheaper versus li-ion. However, sodium-ion batteries are still very much in the R&D stage.

At present, there are two primary limits to sodium technology. First, they have a lower energy density: 100 to 150 Wh/kg, versus 120 to 180 Wh/kg for lithium. And the lifetime number of charge-discharge cycles is less than that of lithium.

For applications that don’t need especially high performance and where safety is of utmost importance, sodium-ion batteries make sense. Stationary storage to stabilize grid power is a great example, as battery size and weight as heavily penalized in an EV.

Power distribution

A conventional power grid has a generating source, an AC transmission network with step-down transformers and subdivide and reroute power, before it ends in a consumer 110/220 V service. Increasingly, those generating sources are represented by solar and wind assets. The actual network itself won’t need to be fundamentally different, outside of additional power conversation and rectification systems to transmit in AC, even though the power is generated and often used as DC.

At the consumer level, where the delivery of power to vehicles occurs is where things really get interesting. Selling retail power is really going to change dramatically.

Most of today’s gas stations include a convenience store – a place to buy a hot dog, scratchers or maybe use the restroom. Prior to the mid 1970s, these stations rarely offered that. Drivers stayed in their car while an attendant pumped gas. However, self-service became more common. Recognizing that the driver had a little idle time while fueling, stations added food and tchotchkes to bolster their revenue.

A similar scenario might play out as conventional gas stations feel the need to offer electric charging. Re-fueling in the age of EVs is more complicated, to say the least.

Presently, an estimated up to 90% of existing EV refueling takes place at home. There is no lost time since the car is idle for hours anyway. The ability to refuel at home is a huge change to consumer habits. It also reduces the demand for neighborhood service stations.

For a driver on a long trip to another town, time is often more precious. Gas stations that want to add EV charging need to invest in Level 3 chargers that can complete a full recharge in 20 to 30 minutes. Instead of 5 minutes to waste while filling up, drivers and their passengers now have additional time. And those users are likely to be a long way from home. This is a captive customer based, which is a significant opportunity.

A Level 3 charging station is about $50,000 for one and up to $500,000 for multiple charge points, plus infrastructure costs. According to some estimates, a traditional station with eight pumps would need about 40 charging stations to have the same equivalent customer capacity. In addition, the payback period is seven to 10 years.

What’s most likely is that stations will offer some combination of combustive fuel and plug-in charging. First, recognize that a significant portion of vehicles will feature hybrid technologies that rely on electrical generation. Considerable influence comes from the oil companies themselves. Some oil companies have branded stations. Whether owned or franchised they are more likely to have financial resources to execute a defensive move. By putting in the charging infrastructure and a couple of charge stations, they can follow the market by expanding the charge capacity as the EV market expands, while still keeping a foot in the petroleum market.

Regardless, the clientele will be changing and for a gas station owner, they have some decisions to make about what’s best in the short and long term.

New opportunities abound

Some of the new business opportunities presented by the clean energy supply chain are clear, like hybrid gas and charging stations or battery technology startups.

But there remain a lot of extra opportunities on the consumer and commercial level, either by offering contractor services for energy storage systems, renewable energy generation maintenance and installing EV chargers for average commuters. Property owners in rural areas may see their open acreage as business opportunity – who’s going to let all that sunshine go to waste?

One unique application exists now and is perfectly suited to EVs. That is the freeway rest stop. It is easy to imagine a future with more rest stops along major interstates, that offer additional amenities, since drivers might be stuck in a “charging layover.” It is equally as likely that intra-city service stations become a rarity, since the majority of EV charging will continue to happen at home.

There already is a version of charger wars, where EV owners are incentivized to visit one type of charger or business versus another, due to free or low-rate charging. That will potentially expand further.

There are also major opportunities for manufacturers who create all of the electronics, electrical systems and mechanical components in a charger and EV. This ranges from semiconductor manufacturing to electronics engineering to electrical service to, of course, materials converters.

You can almost put together the puzzle pieces in your mind’s eye that will build our electric, clean energy future. And though it was all theoretically possible for many years, it was decentralized PV and EVs that are the driving motivators.

About the author

Scott Orlosky has an MS in Manufacturing and Control Theory from the University of California at Berkeley and has worked over 30 years designing, developing, marketing and selling sensors and actuators for industrial and commercial industries. He has written numerous articles and application notes for speed and position sensors used in industrial and hazardous area environments including an author credit in “Encoders for Dummies.” Scott authored an industrial newsletter for nearly 15 years and is also co-inventor on a number of patents involving design and manufacturing of inertial sensors.