Are Electric Vehicles a Threat to the Texas Electrical Grid?
Electric vehicles (EVs) can be a strangely polarizing topic among conservatives. Lots of conservatives remain skeptical of EV technologies and dislike the fact that they receive government subsidies. At R Street, we of course share their opposition to technology-specific subsidies, including subsidies for EVs. However, in some cases dislike of subsidies for EVs has blurred into a dislike of EVs themselves, even in cases where doing so means rejecting the logic of market principles.
As an example, consider a recent study by Wood Mackenzie that looked at (among other things) the effect of EVs on the Texas electrical grid. The study found that 60,000 EVs charging simultaneously would draw 70 gigawatts of power, equal to the current peak electrical-demand for the ERCOT* region of Texas. Since 60,000 vehicles would represent only around a quarter of a percent of Texas’ current 24 million-vehicle fleet, some have taken the study to mean that large-scale EV deployment is incompatible with a stable grid.
That conclusion, however, is mistaken. For one thing, the Wood Mackenzie study assumes each EV’s 100-kilowatt battery can be fully charged in five minutes. Currently, a battery that size takes significantly longer to charge. And while average charging time is expected to decrease in the coming years, the less time it takes an EV to charge, the less likely it will be that EVs will all be charging at the same time. By analogy, if every owner of a gasoline vehicle tried to refuel at the same time, the result would be massive gas lines and shortages. Yet in reality, this typically doesn’t happen because markets are able to encourage more rational fueling patterns. In the same way, electricity markets send the right pricing signals to avoid charging during times of high system-stress (high prices) and shift charging to lower-demand periods (low prices). For example, EVs tend to be charged at night, where there is currently plenty of surplus electrical supply.