Will Electric Vehicle adoption end in Grid Lock? 6th June 2019

What is the Grid?

The UK Grid - Transmission and Distribution National Grid Balance Generation and Demand on the Network in Real Time. Transmit over long distances Manage and Maintain Large Connections Distribution Distribution Network companies Distribute Locally Supply to towns, villages and direct to small industrial customers Manage and Maintain the Infrastructure

What is Happening to the Energy Market? Decarbonisation Cleaner, Greener forms of Generation Reduced emissions per unit of electricity generated (often given in grams of CO2 per kWh) Decentralisation Distributed Generation across the Grid Produced close to where it will be used Cheaper to Transport Digitisation Converting information into a digital format Adoption of digital Technologies Use of data, analytics and connectivity Smart Systems

Increased Renewables Creates Challenges Significant increase in renewables as a proportion of the generation mix creates challenges: Difficult to forecast Hard to balance DC generation Take it when available Hard to store System inertia is the energy stored in rotating machines providing power to the network (such as turbines in power plants). This built up kinetic energy means if there was an outage at the power station, the turbines do not stop immediately, but rather slow over time to a halt. This is a free balancing service, as the rate of frequency change following an outage is less steep, thereby giving National Grid SO more time to react. Renewables cannot currently provide this service, as they are connected to the grid via inverters. As such, declines in traditional generators are reducing the system inertia on the GB grid, meaning National Grid want faster acting reserves to ensure they can respond quickly after outages.

What is the impact of Electric Vehicles? System inertia is the energy stored in rotating machines providing power to the network (such as turbines in power plants). This built up kinetic energy means if there was an outage at the power station, the turbines do not stop immediately, but rather slow over time to a halt. This is a free balancing service, as the rate of frequency change following an outage is less steep, thereby giving National Grid SO more time to react. Renewables cannot currently provide this service, as they are connected to the grid via inverters. As such, declines in traditional generators are reducing the system inertia on the GB grid, meaning National Grid want faster acting reserves to ensure they can respond quickly after outages.

Forecast for Electric Vehicle Uptake The Figures 32 million electric vehicles by 2050 EV Energy Requirement of 60,000,000 kWh (60 TWh) Impact of poor management Significant network reinforcement will be needed to cope with peak demand spikes. This may cost up to £17 bn by 2050. Distribution networks will pass part of these costs on to suppliers. In turn, we’ll have to pass them on to customers. Significant reinforcement costs to the grid will result in more costly electricity for everyone.

The Current Network has Capacity In 2018 the UK consumed 334 TWh The total available Generation potential is 613 TWh (70GW * 8760 hours) Leaving 279 TWh capacity unused Not all is available all the time 465% of the 60TWh required for EV growth out to 2050

The Key Driver for Behaviour Will be Price Unit rate (p / kWh)

Smart Flexible Charging Behaviours En-Route Charge Home Charge Destination Charge 1. EV charging is a top-up model, like a mobile phone 2. Most vehicles are stationary more than 90% of their life 3. Average UK Daily Mileage is 21 Miles, which can be recovered in 1 hour of Charging Workplace Charge

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Thank you Robert Labinski Head of EV Business Solutions Octopus Electric Vehicles E: robert.labinski@octopusev.com M: +44 (0) 7960 334 008 T: +44 (0) 20 3870 3892 W: www.octopusev.com Call 020 3870 3892 or visit us @ 1-3 Upper James Street, Soho, London, W1F 9DE