Two of the most popular terms in urban planning today are smart cities and clean energy. These concepts naturally go hand-in-hand.
As cities get smarter, they use energy more efficiently and in a more controllable fashion, and they are better able to incorporate intermittent clean energy sources. Cities, and the power grids that support them, can use traditional power generation and stationary energy storage to support intermittent resources like wind and solar, but the lowest-cost solution for over a decade has been to control power loads with demand response. A large and emerging new power load is electrified vehicles, and they will play a critical role in the future of smart cities and clean energy.
To put things in perspective, the battery systems in the U.S. Toyota Prius fleet alone represent about 40 gigawatts of power. That’s about the same as the entire electric grid in New York state. While those vehicles don’t connect with the grid, there is a growing wave of plug-in vehicles with much larger batteries coming, and they will be a dominant and flexible force on the grid. If integrated properly, however, they can support the growth of smart cities and clean energy in profound ways.
At a basic level, smart cities are highly connected, efficient, and optimizing communities that can leverage data from many resources to operate more effectively. Ideally, smart cities make everyday life much easier and healthier for their residents and lessen the stress cities put on infrastructure and the environment.
It’s not surprising that improving transportation and energy use are high priorities for any smart city transition plan. Traditional transportation options tend to create pollution and traffic, which in turn impact health and quality of life for urban residents. Nevertheless, our society has been built on the freedoms and conveniences of cars, trucks, and buses, and they will not be completely phased out of the fabric of our cities anytime soon, so we need to make them cleaner.
The most logical path forward for improving transportation in cities is to use what limited capital is available to invest in solutions that provide the best results, both in terms of emissions reductions and financial returns. Ideally, you want to support solutions that also lay the groundwork for long-term, sustainable vehicles.
The U.S. consumer market for xEVs (hybrid, plug-in hybrid, and electric vehicles) has held steady with about 3 percent of market share for the last 10 years. Now that battery prices have come down and xEV technology has improved, we’re about to see massive growth. In addition to reducing emissions, these solutions can now provide good financial returns for the right customers, especially those customers who drive a lot of miles per year in and around urban settings, where the benefits of xEV systems are higher.
Simply converting an existing fleet vehicle to a hybrid electric vehicle (HEV) or plug-in hybrid electric vehicle (PHEV) can increase miles driven per gallon by 50 percent while also providing a good financial return. Consumers typically don’t drive enough miles per year to make the economics work without subsidies, but xEV solutions are now available on larger fleet vehicles (such as buses, delivery trucks, and service vehicles) where these improvements become far more attractive on a per-vehicle and fleet basis. (My company, XL, is one of the businesses that enables these fleet conversions.)
These HEVs and PHEVs also have the advantage of immediately creating hybrids out of existing, gas-powered vehicles on the road. They also don’t require specialized charging stations, allowing vehicles to instead plug into traditional wall outlets. This means they can be leveraged immediately, with no changes to a city’s charging infrastructure, and with little-to-no additional drain on the grid.
Full electric vehicles are also gaining popularity. Although their high cost and a lack of charging infrastructure have hampered their adoption, technology improvements and further infrastructure commitments are happening as we speak, which means you’ll continue to see more of these vehicles in your neighborhood in the coming years.
Another technology that has the potential to revolutionize smart cities in the longer term is autonomous vehicles (AV). While AVs are exciting for many reasons, one of their biggest clean energy advantages lies in their ability to increase the utilization rate of vehicles and improve the return on xEV investments. This should lead not only to more plug-in vehicles, but also to a highly predictable new power load that can be coordinated in a smart city to complement the needs of the electric grid. Charging these vehicles at the right time could help alleviate California’s (almost famous) “duck curve,” while charging them at the wrong time will make the problem worse.
AVs can also enhance traditional transportation methods in smart cities. Lower cost and more ubiquitous transportation within and around smart cities will make rail, buses, and even carpooling more convenient for commuters. Leveraging data across multiple infrastructure systems is what smart cities are all about.
AVs will also benefit from smart cities. While most AV companies are focused on enabling vehicles to drive safely by themselves, smart cities will provide connected vehicles with data from sensors across the city, further improving their safety in urban environments. Vehicles that connect to this network will be smarter than any one vehicle can be on its own. Cities that invest in sensors and smart city solutions will be in a better position to benefit from AVs when they hit the market at scale.
Clean energy is smart business
Vehicle electrification can help support the market for clean energy in many ways. Emissions from transportation are now the largest source of CO2 in the U.S., and the transition away from oil can create a large new demand for electricity. With wind and solar now cheaper than traditional power sources, that means more demand for renewables in the long run. The new demand from vehicle electrification is also very predictable and can be controlled if part of a smart system, so it can be complementary to the intermittent nature of renewables.
Vehicle electrification is the main driver of global demand for batteries today, and one of the reasons battery costs have come down so much in the last few years. Lower-cost batteries will benefit the stationary storage market, and we’re already seeing repurposed xEV batteries getting a second life in stationary power applications (at prices of less than $100 per kilowatt hour).
Advancing transportation technology will have an incredible effect on smart cities of the future. There will be less pollution and congestion, less time wasted in traffic, and more and varied ways to get from point A to point B, making cities much more livable. As clean energy options continue to be implemented more broadly, and as automotive technologies continue to develop in parallel, it’s clear that the cities of tomorrow will become “smart” on many different levels.
