Charging an electric vehicle (EV) is pretty simple: plug it in and wait. The only variables are the charging rate (kW), the amount of energy needed (kWh), and the amount of time it takes to reach that level. But with the advent of demand charges and time-of-day pricing, two new variables are tossed into the equation: the total amount of power that a house is currently drawing and the electric rate at that moment in time.

To help consumers deal with these volatile quantities, Siemens developed VersiCharge Smartgrid, an EV charging station with an app that lets users balance their needs (for example, quick charging now vs low-cost charging later).

Energy vs Power

Let’s start with some basic definitions. (If you already know this stuff, feel free to skip to the EV Examples section.)

Energy is the ability to do work. The metric unit of energy is the Joule, but electrical energy is often expressed in watt-hours, kilowatt-hours (kWh), or megawatt-hours. I’ll use kWh since that’s what we’re charged for on our electric bills.

Power is the rate at which energy is transferred. It’s an instantaneous value, much like flow rate. Power is measured in watts; one watt is one Joule per second. You could also say that one Joule is one watt-second (energy = power x time). Since I’m using kWh for energy, I’ll use kW to discuss power.

Energy (kWh) = Power (kW) x time (h)

In an electric vehicle, a battery bank is specified in kWh, since it stores energy. Think of the battery bank as a bucket whose capacity is measured in kWh. The charging rate (kW) is analogous to the diameter of the hose that fills the bucket - a bigger hose can support a greater flow rate and fill the bucket more quickly.

Time of Day (ToD) Pricing and Demand

Time of Day pricing (sometimes called Time of Use pricing) is related to the power company being obligated to meet everyone’s demand at any instant. Since most electrical energy is consumed in the mid afternoon to early evening, that’s when the utility struggles to meet those needs and is more likely to fire up a peaker plant. On the other hand, there’s plenty of capacity available at 3:00AM, so they’d rather have customers using more electricity overnight rather than during peak demand hours. ToD pricing makes electricity inexpensive during low demand times and very costly during high demand times.

Demand is well-known among commercial and industrial users, but most residential customers don’t have to deal with it … yet. But it’s coming. In short, demand represents the highest amount of power that a customer is drawing from the grid during a given period.

Why does the utility charge for demand? It’s because they must provide enough generation and transmission capacity to handle everyone’s peak demand at any instant in time. That means having more peaker plants available, most of which burn natural gas. By penalizing customers for high demand, the power company gives an incentive to reduce that demand. Although industrial and commercial customers have the biggest impact - that’s why they’ve been paying this all along - residential customers will soon be expected to keep their demand in check as well.

Actual Rates

I just looked up the residential rates for a certain power company in the US. (This is one of several options that the company offers its residential customers. In exchange for accepting the demand charge, the customer receives significantly lower rates per kWh.)

On-peak rate = $0.096/kWh        (2:00 PM - 7:00 PM Monday-Friday)

Off-peak rate = $0.009439/kWh

Demand = $18.09/kW

We’ll use those rates in the following examples.

EV Examples

Suppose your average demand is around 1 kW, but one day a week you recharge your EV. You have a supercharger capable of delivering 7.2 kW of power, and it takes 3 hours to fill your car’s 24 kWh battery bank. (I’m assuming it’s not completely drained.) You plug it in at 4:00 on Friday afternoon.

The energy that you put into the car would only cost you $2.07 (7.2 kW x 3 hours x $0.096/kWh). But your demand for that time is your normal 1 kW plus the 7.2 kW from the charger, giving you a whopping 8.2 kW of demand. Congratulations, you just spent an extra $130 to fill your car. (And you thought gasoline prices were high!)

Obviously there are more intelligent ways to charge your EV. You can slow charge it overnight every night, reducing the demand and taking advantage of off-peak rates. If you plug in the car every night at 7PM and let it slow charge overnight, you would draw only 0.36 kW of power during each charging session. Coupled with the off-peak rate, your total fill-up is now $6.71 ($0.20 for the energy, and $6.51 for the added demand.) Even better, if you delay the charging until after you go to bed, then it’s likely that you won’t increase your demand at all, since you’re not using much power for lights, entertainment, etc. Now you only pay $0.20 to charge the vehicle.

A customer who will be quick charging often might prefer the rate plan with no demand charge. In that case the rates are $0.203217/kWh (peak) and $0.04643/kWh (off-peak). With those rates a full charge would cost $4.39 during peak hours and $1.00 during off-peak hours, regardless of the charging rate (kW).

Let the App Manage That

Raise your hand if you like the idea of going out to your garage at midnight to plug in the EV. Didn’t think so. 

Remember that app I told you about at the beginning of the article? It manages everything for you. VersiCharge SG allows the consumer to select a charging rate, program a schedule, track previous charging, and more. You can even use it to post your energy savings on social media … if you really want to be that guy. (For me that’s a non-feature, but to each his own.)

^{Image courtesy of Siemens}

A WiFi connection allows the charger to communicate with the utility to determine the best time for charging. Thinking long term, if everyone switches to an electric vehicle and we’re all charging our cars overnight, that would put stress on the grid, especially if all of our chargers turn on at the same time. Power companies could offer a deal where customers agree to let the utility regulate the charging (to a certain extent) so that EVs in a certain neighborhood charge in a round-robin fashion. Everyone would still wake up to a fully charged car, but the charging is distributed evenly throughout the night. Even longer term, if EVs become part of the grid-level storage system, this app can help facilitate the transfer of energy between the EV and the smart grid.

While many of these options are only possibilities at this time, it’s good to see that Siemens is thinking ahead and building the capabilities into its products well in advance. Whenever there’s a major technological shift, as we’re going to see with the smart grid, standards must be developed. It’s often the forward-thinking companies who have a strong voice in creating the standards, and Siemens has decided that they want a seat at the table when these discussions take place.