National Electricity Market may be overwhelmed by increase in electric vehicle use

Data analysed by Cornwall Insight Australia has shown the National Electricity Market (NEM) may become overwhelmed by peaks in demand caused by the charging of Electric Vehicles (EVs). Using data from the 2022 Integrated System Plan released by the Australian Energy Market Operator (AEMO), Cornwall Insight Australia have plotted expected key peaks and troughs in daily EV charging across the NEM in 2040, based on projections for trends in EV usage and charging behaviours.

The data predicts significant peaks in charging demand, most notably between 7pm-10pm, the time many would consider the most convenient time to charge, after use during the day. This convenience-driven charging behaviour is projected by AEMO to be the primary charging mode for the next 15 or so years. If this view of EV charging behaviour becomes a reality, the peaks have the potential to exacerbate evening energy demand issues and could cause significant problems for network operators and planners.

Cornwall Insight Australia is calling for a greater focus on changing vehicle charging behaviour to lessen the impact on the network, with clever use of financial incentives (such as tariff structures), timers and smart chargers having the potential to shift and spread the demand through the night and increased coordination of charging with renewable energy output.

Figure 1: Forecast daily EV charging demand in June 2040

Source: AEMO 2022 ISP data, Cornwall Insight Australia analysis
Con Dimitrakakis, Energy Consultant, at Cornwall Insight Australia:
“EVs are expected to overtake internal combustion engine vehicles by 2038-39. As more and more people make the switch, the increase in consumers charging their cars in the evening, while usually the most convenient time, has the potential to put significant strain on the energy network. It is clear that the changing patterns of vehicle ownership will be a substantial factor in shaping Australia’s future energy systems and markets.
“Market redesign is not the only way to cope with the extra pressure, and consumers, while often creatures of habit, will need to be encouraged to move from convenience charging. This is easier said than done, however, financial incentives such as time-of-use tariffs and the increasing the use of features such as smart chargers and timers could spread the charging times and lessen the pressure on the grid. At the same time, this can save consumers money as they charge their vehicles during cheaper energy periods outside of peak times.
“2040 may seem like a long time away, however if the market can get ahead of potential kinks in the system now, the switch to EVs can be made smoother for the energy market and consumers alike.”
Notes to Editors
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About the Cornwall Insight Group
Cornwall Insight is the pre-eminent provider of research, modelling, analysis, consulting and training to businesses and stakeholders engaged in the Australian, Great British, and Irish energy markets. To support our customers, we leverage a powerful combination of analytical capability, a detailed appreciation of regulation codes and policy frameworks, and a practical understanding of how markets function.