Smart grids, together with electric vehicles, will enable their owners to sell power back to the grid, make money for themselves, and help keep the network from overloading.

But research shows that the cost of reducing carbon emissions this way is high compared to other methods.

Smart grids will be essential to the mass public uptake of electric vehicles (EVs) without overloading the electricity network, according to a report, Smart Grids and Electric Vehicles: Made for each other? from the OECD's International Transport Forum that was published yesterday.

It is assumed by governments that electric vehicles can be a significant means of decarbonising transportation to make it more climate-friendly. However, there would be a concomitant increase in demand for electricity, that must be clean.

The report finds that smart grid technologies, if rolled out nationally, make an ideal partner to EVs, because they enable demand management and therefore a reduction in peak electricity supply requirements, meaning fewer power stations would have to be built.

Moreover, EVs will be able to use their batteries to store intermittent solar and wind power supplies at off-peak times and feed the power back into the grid when needed, should the vehicle not require it.

"Vehicles are parked on average 95% of the time, providing ample opportunity for the batteries to be used in this way," the report observes.

EV owners would be paid for permitting this, reducing the overall lifetime cost of owning such a vehicle. This cost is already, on average, less than that of an internal combustion engine, despite the higher purchase price, because of the vastly reduced running costs.

The report therefore recommends that governments or network controllers should change the tariff pattern of electricity pricing to encourage the take-up of smart grid technologies and the use of electric vehicles for supplying power to the grid.

EV owners would have the added benefit that their vehicles could provide backup supply in case of power cuts.

Do EVs really save carbon?

But do electric vehicles really reduce carbon emissions when compared to the internal combustion engine (ICE)? A discussion paper, produced in April for the OECD, compared the lifetime impacts of different vehicles, taking into account various electricity generation scenarios.

It found that, for 4-door sedan and 5-door compact cars, the cost was at the high end of the range of costs of measures to reduce carbon dioxide emissions in the transport sector: between @500 and €700 per tonne of CO2 avoided. That is a lot.

The compact electric van was more of a bargain, largely because it travels further, therefore saving on fuel costs.

But the degree of carbon abatement benefit does depend on the electricity generation mix in the country concerned. If a large amount of coal is burned there may be no carbon dioxide savings over conventional vehicles.

The study adds “even in regions where baseload generation is relatively low carbon, high rates of peak hour charging will come from marginal electricity generation which may be much more carbon intensive", like coal, oil or gas. It adds: “the timing of recharging will have a significant impact on overall greenhouse gas emissions for electric vehicle use)".

The study also found that households may well not buy electric vehicles as 'like-for-like' replacements for fossil-fuelled cars. For many urban households, the electric vehicle may be a two-wheeler or other small, purpose-built, low range, agile, easy-to-park and congestion-beating urban electric vehicle.

The 4x4 will still be used for long or family journeys.

What is a smart grid?

The scenario above would take off after 2020, the date for the UK target of installing smart meters into every building in the country, provided that current concerns with privacy over data provision from smart meters are dealt with.

Many companies are currently positioning themselves to provide this service, and a huge amount of capital is being invested.

The digital technology installed in the metering network will enable communication, and, where permitted, switching capability, to be two-way between the utility and the customer's premises. Consumption and pricing information will be available almost in real time.

Utilities will therefore be able to dynamically manage the system "as efficiently as possible, minimising costs and environmental impacts, while maximising system reliability," the report says.

Motorists will be able to plug in their cars to recharge either at the end of the working day and overnight, or, if their employer permits, during the day while they are at work.

It has so far been assumed that off-peak priced electricity would only be available overnight, but the report suggests that smart grid technologies will let these tariffs apply automatically regardless of when the owner is charging their vehicle.

This will provide opportunities for EV owners, business fleet managers and employers, to make money from reselling electricity they purchase in this manner, as well as minimising carbon dioxide emissions from electricity generation.

EVs could feed electricity either back into the grid, or into homes and buildings. Smart meter technology could be programmed to determine, on the fly, at any given moment, which is the most financially advantageous use of this stored electricity.

EV ownership could grow to account for a substantial share of electricity consumption and peak load. Some scenarios put the increase in peak demand by over 20% in the long-term. The greater the increasing consumption, the larger the potential benefits from using smart grid technologies.

So far however there has been no study I know of that attempts to calculate the lifetime carbon emissions impact of installing the smart grid.

Batteries must do better

The report notes several issues that need to be addressed before this scenario can be realised. Firstly, the availability of such capacity during peak demand periods is uncertain and needs to be mapped.

Secondly, battery technology is not yet at a point where units that can perform efficiently in this way over a long period of time are commercially available.

Also, the capability of the smart grid to provide this function has not yet been demonstrated on a large scale. The report adds: “the sheer number of electric vehicle connection points that would need to be managed makes it prohibitively expensive at present".

Two technical developments therefore are required: charging times must be reduced significantly and battery storage capacity increased dramatically.

There have been as exciting developments in this respect: at the beginning of last year, the University of Illinois, and nearby Northwestern University, announced a breakthrough in charging time, and last October Nissan, working with Kansai University in Japan, announced that it had reached the charging time of just 10 minutes.

All these solutions use changes to the design of electrode and are lithium-ion batteries. Nissan said it would take up to a decade to get such batteries to the marketplace. One of the main challenges to overcome is to minimise the reduction in capacity of the battery over time as a result of such fast charging and frequent discharging.

In a way, the question of carbon impacts are immaterial. People will desire cars for the foreseeable future. The market will meet this demand. The grid will be decarbonised anyway.  Eventually.

But don't write off the internal combustion engine just yet, especially as they will become more and more efficient.