Ferrari’s president has recently announced he doesn’t believe in Electric cars

The Italian firm may not be the only Electric Vehicle (EV) skeptic in the market but the voices of dissent are not as loud as they once were. In fact, this last year has seen a perceptible shift in attitudes as car manufacturers start to gear up for an electricity fueled future. The EV media wire is buzzing.

Granted, the number of electric car drivers is still tiny. In the UK, there are only 2500 EVs from a total fleet of 28 million vehicles. And the first pure electric car from a major manufacturer only landed in New Zealand a few months ago.

But many governments have set themselves aggressive EV targets – and are trying to accelerate demand and EV recharge infrastructure development with a range of grants and subsidies. But it’s not just governments who are fronting up with cash. In the UK, British Gas, Smart World, Ecotricity and a raft of other players are investing millions of their own R&D funds to gain first mover advantage in the recharge station market. The UK’s goal of 1.7 million cars being electric by 2020 may seem audacious, but it’s not inconceivable.

Of course, all this battery charging will come at a cost. And that cost is peak load.

Apparently, if all the cars in the UK went electric tomorrow, peak demand would jump by 400% whereas overall consumption would only rise by 25%. With current EV sales, this is hardly a looming crisis. But the longer term issue of peak demand, and in particular the ability of local infrastructure to deal with the high voltage requirements for rapid EV charging has to be addressed.

So, how are utilities and network companies preparing for this shift to E-mobility?

Certainly in the US, Australia and in the UK many are involved in trials at a city or state level. The primary goal of course must be to get a better handle of how and when EV users charge up and the potential impact on all parts of the network. The need for smart grid enabled intelligent charging is a given.

But provisioning smart metering networks and associated peak notification software won’t be enough. The complexity around invoicing for EV charging is also fast becoming a challenge in itself.

Yes, many utilities have already launched different tariffs for domestic supply and at home EV charging. But managing invoicing for EV recharge at other locations all need to be thrown into the mix. And there seems to be as many models as there are trials.

San Diego Gas & Electric has been running a trial since 2009, using mobile charging technology from Juice, that allows EV drivers to charge up anywhere with the amount automatically added to the monthly home utility bill.

In some European cities, a roaming system allows EV drivers to use common customer identification cards issued by their local councils. Again, the drivers receive an integrated invoice from their local utility at the end of each billing period. London is setting up a similar city wide recharging network with energy companies working with retail, airports and parking operators across a common platform and integrated communications infrastructure.

But it is not just power companies who are investing in EV charging infrastructure. Keen to grab the opportunity that many hesitant utilities aren’t, the independent charging station (ICS) market is growing. These ICS operators, often aggressive start-ups with significant VC backing, are forming relationships with retail outlets, councils and workplaces to install recharge points and develop mutually beneficially business models.  Flexibility in billing and payment processing will underpin success. Operators will look to vary tariffs per location, or time of charge (just like parking meters today), or by customer category (e.g. council fleet). Real time billing and payment processing to smart devices such as mobiles and tablets is already becoming a convenient reality for many.

Workplaces too are an optimum area to establish charging infrastructure. Employers may opt to offer discounted charging for employees, deducting charging costs directly from pay packets, while the same benefits may be not offered to contractors or visitors.

Ultimately, EV roll out will impact the entire energy supply chain. Energy retailers, network providers and an increasing number of charge point operators will need the right software platforms to accurately bill for energy supplied in a variety of locations, and to manage reconciliation, settlement and clearing between all parties involved.

A profitable EV market may seem like a long way off right now and the challenges just too overwhelming. However, with those first movers already sliding into position, energy providers could be fast approaching a watershed moment. Take an active stake in the EV recharge market now and help shape and accelerate its roll out or cede the lion’s share of the new business opportunities to others.

[1] http://www.smartplanet.com/blog/transportation/ferrari-president-i-dont-believe-in-electric-cars/787
[2] http://www.electricenergyonline.com/?page=show_article&mag=67&article=541
[3] http://gigaom.com/cleantech/belkin-invests-in-electric-vehicle-smart-charging-startup-juice/
[4] http://www.tfl.gov.uk/corporate/media/newscentre/archive/20094.aspx
[5] http://www.intomobile.com/2011/06/02/parkmobile-liberty-plugins-unveils-pay-phone-ev-charging/