EV GROWTH: WITH THE RIGHT SUPPORT, CANADA’S ELECTRICITY GRID CAN HANDLE IT
Electric mobility represents a historic transformation of Canada’s automotive industry and is generating significant new economic opportunities for companies, workers, and consumers involved in Canada’s growing electric vehicle (EV) economy. A new player in the mobility ecosystem is electric utilities, who traditionally have had very little direct involvement with the road transportation sector, powered as it is by fossil fuels. With the advent of electric powertrains, electric utilities have now become a central player in this crucial transition. However, questions remain in the public mind about the readiness of electricity systems to accommodate new loads from electric vehicles.
Utilities in Canada have regulated responsibilities for affordable, reliable power generation and distribution, and the industry has over a century of experience in serving customers in every province and territory. Utilities are key to unlocking the potential of EVs to lower drivers’ energy costs, reduce transportation emissions, and improve air quality for all Canadians. At the same time, while Canadians have expressed support for the goal of net-zero emissions by 2050, there is low public literacy with respect to the impact of this change on the energy system, along with a persistent, underlying expectation of stable costs and reliability.ii With these factors in mind, this statement is intended to provide a high-level overview of utilities’ ability to accommodate the increase in electricity required for the transition to a highly electrified transportation system.
Across the country, Canada’s electric utility sector is at the forefront of technology, policy, and programming to accommodate the increasing share of EVs on the road, while simultaneously managing other important considerations, such as maintaining affordability, providing responsive customer service, planning the evolution of the workforce, and shifting generation away from fossil fuels and towards greater use of distributed and non-emitting resources. While utilities are all facing these developments, they present differently in each jurisdiction due to a number of factors such as geography, customer base, regulatory regimes, and past investments. While we focus here on key trends and commonalities, it should be understood that the specific experience of, and response by, each utility towards these concurrent issues will be unique.
Although this statement skirts deeper discussion of the technical underpinnings and workings of the electricity system, it is important to recognize some of the system’s primary components: generation, which produces the electricity; transmission, which carries the electricity over larger distances at high voltage; and distribution, where the electricity is brought to customers’ homes and businesses. All these components are necessary to bring the electricity services and amenities upon which customers depend energy, measured in kilowatt-hours (kWh), and capacity, the ability to deliver different levels of electric power, measured in kilowatts (kW). References to these concepts will be made as needed to highlight important points, but new conceptions are also emerging around what counts as a primary component of the grid; for example, EV batteries, demand management tools, and other ‘distributed energy resources’ (DERs) are increasingly recognized as energy regulatory assets that can provide grid services.