The Impact of Electrification on the Grid (and Everything Else)

Hundreds of thousands of years ago, a wandering human learned how to control fire and use it. Then, two centuries ago, humans discovered electricity. Those were the first two milestones in our history with energy – separated by nearly a half million years. And then, in just two centuries, a dozen new milestones flooded the timeline – the advent of solar power, electric cars, and more.

The key takeaway from this brief history of energy and electricity is this: with time, things change faster. Therefore, it can be said that the next big changes are closer than ever, whether we’re ready for them or not. 

Perhaps the most important change that’s racing toward us is electrification. Electrification replaces systems running on fossil fuels with systems that use electric power, for reasons of efficiency and ecology. A classic example of this is electric vehicles.

However, this rapid transition to electric systems raises a critical question – will our existing infrastructure be able to handle the electrification of everything?

Let’s find out, step-by-step.

How Will Electrification Impact Our World?

It may sound counterintuitive, but electrification can reduce our total energy consumption. This was an important finding in a study called “Energy Futures”, conducted by the NREL, a subsidiary of the U.S. Dept. of Energy. This is true because the efficiency of electric technologies is generally much higher than that of fossil fuel sources.

Therefore, although we will be using more electricity, we will be using even less fossil energy. In most cases, electric systems are also cheaper in the long term. Take the example of an electric car. Over its lifetime, a basic electric car can cost less to own and use than its gas-guzzling counterparts. Lastly, electric systems can be powered by clean energy sources, preventing tonnes of carbon from being released.

But let’s come back to the topic of change in energy demand. Although electrification will indeed reduce total ‘energy’ demand, it will still increase our ‘electricity’ demand. Unfortunately, the speed of electrification does not necessarily match the speed of upgrading the existing electrical supply system – including power generation and transmission.

Canada’s Climate Institute released a report titled “The Big Switch”, wherein it states that in a net zero future, Canadian electricity demand will grow to be 1.6 to 2.1 times larger by 2050 compared to today. And to meet that demand, Canada’s electricity generation capacity will need to be 2.2 to 3.4 times bigger than today.

Electrification applies to more than just EVs, and yet, the adoption of electric mobility alone will lead to a massive rise in power demand.

The scientists at NREL recently published a study titled “Potential Impacts of Transportation and Building Electrification on the Grid.” The report highlighted four key areas of impact:

Peak demand changes

The paper argues that electrification will impact the demand profile more than the demand itself. This means that peak demand hours may see heightened demand, making it difficult for grids to handle instantaneous demand rises, such as during mornings and evenings.

A way to combat this is to have many distributed generation facilities on standby, to supply power at these demand peaks. From that angle, building a DER, such as a solar power plant or a battery storage system, can become not only a necessity but also an opportunity.

On the domestic level, using a solar and/or battery system can save on increased electric bills by avoiding expensive grid power during peak hours.

Voltage regulation

When a particular area suddenly draws a lot of power, the voltage of the electricity flowing into the area may drop. This may cause appliances to stop functioning, or possibly even be damaged. 

Think of a large community full of electric cars. As everybody returns from work and plugs in their EVs for charging in the same 1-2 hour window, there is a strong probability of voltage problems.
Once again, local solar plants and/or energy storage systems at the community or the house level may be able to reduce or even eliminate this problem.

Integrated Resource Planning

IRP is a long-term process for updating and expanding generation and transmission assets to meet capacity requirements. When demand grows fast and unevenly, this planning becomes increasingly difficult. 

A way to solve this issue is to ramp up power transmission and generation infrastructure in parallel with the rise in demand, especially from clean sources like solar and wind power.

Distribution Upgrades

Once again, a large increase in demand will create the need for upgrading the distribution infrastructure. These upgrades include increasing the capacity of existing lines and transformers, while also adding new lines and transformers wherever needed. 

Similar to the previous issues, communities, and homes can achieve some immunity to this challenge by setting up their own power supply to satisfy their own increased demand. In other words, more residential solar power systems may help with more EVs on the streets.

Here’s a table from the study that summarizes the above four points. Note the final text in both the bottom sections, which says “opportunities for energy storage”, and “opportunities for distributed PV + storage”:

Renewable energy constantly finds mentions wherever there is a discussion about electrification. For instance, an Electrification Analysis study done by the International Energy Agency (IEA) states: “The emission reduction benefits from electrification go hand in hand with an increase of renewable energy.”

Another, similar study by McKinsey and Company also highlights the role of renewables by stating that “Almost all new-build capacity will likely involve renewables, including wind and solar power, with some gas-powered generation.”

So far, we discussed the general impact of electrification. Let us now focus on Canada.

Electrification and Its Impact on Canada

In Canada, national agencies like the Natural Resources Canada (NRCan) and provincial agencies like Independent Electricity System Operator (IESO) are preparing the country for the electrification wave.

NRCan has introduced the Smart Grid Program nationwide. The program’s objective is to accelerate the development of smart grids to reduce GHG emissions and generate economic and social benefits (e.g. create new jobs). The program funds $100M over five years for demonstration and deployment projects.

NRCan also has a list of several other, related programs that will directly or indirectly prepare Canada for electrification. Check the graphic below for a list of these programs.

The previously mentioned “Big Switch” report by the Canadian Climate Institute includes an excellent graphic depicting Canada’s challenges toward electrification.

There is a lot of talk about the need for renewables in aiding the transition to electrification, but one often overlooked aspect of it is how energy storage systems will complement renewables in this transition.

Renewable energy alone cannot help us transition into an electrified world smoothly, especially because of its intermittent nature. For instance, imagine again a community that plugs in all their cars for charging in the evenings, when solar power is at its weakest. Battery systems can help in such scenarios by storing excess energy during the day and supplying it later.
As an article by the CBC puts it, “Canada’s electricity systems will also need more battery storage and be nimble enough to adjust to peaks in demand as both vehicles and many home heating systems switch to electric.”

Conclusion

The key takeaways of this discussion can be summarized as follows:

1. Electrification is essential and inevitable
2. Electrification will cause abrupt changes in electricity demand
3. Renewable energies and energy storage systems are indispensable in absorbing the shocks of electrification
4. Upgrading the generation and transmission infrastructure will be important
5. Smart grids can prove to be an important tool in adding resilience during the electrification transition.

However, the adoption of renewable energies, battery technology, and smart grids needs to speed up to match the pace of electrification. This applies to homeowners, but more importantly, our energy authorities. In minimal words, we can use an excellent statement from the Canadian Electricity Association’s report titled Vision2050: “The electricity industry has an obligation to leave a functioning and reliable system to our children.”