A Twofer from a Hurricane: How Transportation Innovation Might Transform the Energy Sector

Better Place Smartphone App

The recent aftermath of Hurricane Irene up the Eastern seaboard of the United States illustrated how, even in this postmodern age, our energy infrastructure is completely brittle. As Hurricane Irene approached, Home Depot Inc. had dispatched more than 500 truckloads stocked with items from generators to flashlights, to its more than 400 stores in the potentially affected areas in the week before the anticipated landfall. This hardware retailer fully understood the implications of this storm based on hard experiences gleaned from similar hurricane events years earlier. They knew that power would be an issue and that it would be an issue for many, many people.

Correspondingly, one NJ electricity contractor and vendor bought 500 generators, tying up about $250,000 in capital briefly, and sold them at a sizeable profit based on similar, yet more mercenary thinking. Where there’s an (anticipated) need, right? These responses are completely appropriate given each company’s read of the storms intended path, the anticipation of the likely need and the design of a reasonable market response.

Here the story would end unless we started to explore this emergent need from a different perspective and reframed it as a persistent need. What if solving an energy dependency issue in one area meant it was possible to vastly improve energy security in another area?

Many people have started to exactly think about this interrelationship and one person has come to fore in starting to think about the possibilities in this space. Shai Agassi is the founder of Better Place, which TIME magazine called, “the most sophisticated electric-car enterprise in the world.” Better Place is transforming the way in which electric cars are conceived of and Agassi himself considers that this transformation will have an impact greater than the internet. Hyperbole aside, he may be onto something.

Better Place makes more than electric cars. It has designed and is rolling out an entire infrastructure intended to free automobiles from battery life limitations which require charging every 100 miles or so. It is launching in Israel later this year, and with this kind of national scale the prospect of a completely new way to engage with and exploit the automobile will arise. The model for ownership is based on cell phone model in which the buyer purchases the car but has a “subscription” for the battery. This enables batteries to be swapped at charging stations in under five minutes so that journeys longer than 100 miles are within reach. The long term cost savings in the higher-priced gasoline markets in the world is initially between 10-20% and would fall lower over time.

“Where’s the twofer?”, you say.

With this kind of infrastructure in place, essentially each car becomes a distributed storage device for the entire energy grid. Based on dynamic modeling, a smart grid would use computers and sensors to coordinate the distribution of power and accommodate the increased demand caused by electric vehicles or by the grid itself when it experiences shocks from external environmental factors like, oh let’s say, hurricanes. That particular innovation would also help optimize and integrate the use of electricity from renewable sources, including solar and wind power, too.

Andrew Liu, an assistant professor of industrial engineering at Purdue University highlights the benefits on the Purdue University News Service,

Your car can be used as a generator to not only power your house but also put electricity into the grid, but in our current infrastructure there is only one-way communication. You can only charge, you cannot send electricity back to the grid. If you could, you should be compensated for that, which could help the adoption of electric vehicles because then the cost of owning an electric vehicle would come down.

Understanding how to operate the power grid reliably given the demands posed by the introduction of plug-in hybrid and electric vehicles opens a world of possibilities. Not only will the grid need to reliably handle vehicle charging, it will also need to deal many cars putting power back into the grid. Your new car: it’s a method of transportation and it’s a power source. Who knew?

http://www.purdue.edu/newsroom/general/2011/110421DietzSmartgrid.html

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