Charging as a Service vs. Energy as a Service – Which will support widespread ZEV fleet adoption?

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By Nicole Geneau

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3 min read

This has been a historic year for electrification and infrastructure investments. A fundamental question is how organizations and municipalities will fund, build and manage charging infrastructure for fleets. There has been much conversation around Charging as a Service (CaaS) solutions, whereby a third-party such as ChargePoint, installs and interconnects an on-site charging station to the local utility and manages this on behalf of the customer. In general in this scenario, the customer pays utility ratesfor the electricity plus a fee to pay off the cost of the charger via a subscription model. CaaS providers also typically provide guidance on when to charge the fleet based on when electricity prices are lowest, i.e. a ‘managed charging’ program.

But this service does not account for many of the specific energy challenges that electric fleet owners and operators can run into, such as ensuring uninterrupted operations, managing cost-efficiencies over time, and achieving carbon reduction goals. For many organizations, it simply doesn’t make financial or operational sense to rely solely on their local utility to charge their vehicles at this point in time.

For starters, in many locations the grid does not have the required capacity to meet increased demand for EV charging. According to a Princeton study, it will take an additional $350 billion for the U.S. to develop the capacity needed to achieve national EV and net-zero carbon commitments. Momentum is finally building to address long overdue upgrades to distribution networks with the passage of the new infrastructure bill through the senate. But it will take considerable time and further investment to ready the grid for Biden’s goal of having 50% of all new vehicle sales be electric by 2030.

CaaS customers will remain exposed to volatility in electricity prices, which stem from our nation’s aging grid infrastructure. Further, most electric fleets are subject to time-of-use rates and demand charges, so without demand management strategies and time-limited favorable EV charging tariffs, utility bills can easily grow out of control.

Lastly, many utilities often cannot deliver the level of decarbonization, reliability, or resilience to adequately support fleet owners’ EV adoption. Often, the largest driver of fleet electrification is to reduce emissions. Charging electric vehicles from the local grid –which in many areasis still dominated by fossil fuels –can defeat this purpose. The increasing frequency of utility power outages due to climate change-induced extreme weather is another major concern, and the risk of not being able to fulfil their operational and service obligations can dissuade fleet owners and operators from electifying.

Up until recently, organizations haven’t needed to think about the interplay between their transportation operations and energy consumption. The transition to zero-emission vehicles requires a significant change in mindset that puts the reliability, resilience and cost-effectiveness of organizations’ energy supply front and center.

For all of these reasons, I would like to see the narrative shift from utility-centric electrification solutions to integrated electrification infrastructure solutions —one that accounts for the EVs themselves, routing use cases, charge management, energy management software and distributed energy resources. Fleet owners and operators can benefit greatly from on-site clean energy systems, otherwise known as microgrids, that include distributed generation and storage technologies, fuels and controls. This integrated approach ensures there is a dedicated source of sustainable and resilient energy to charge vehicles and maximizes operational flexibility.

Developing on-site electrification infrastructure may not be as quick as plugging a charger into the utility’s supply, but with the emergence of Energy as a Service as a larger umbrella to capture all of the backend infrastructure required to transition to a clean fleet, it no longer has to be more expensive and complicated for the fleet owner. Customers can deploy robust charging infrastructure at no upfront cost with guaranteed outcomes for energy sustainability, reliability, resilience and costs over time.

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About the Author

Nicole Geneau

SVP, Development

Nicole Geneau is a tested leader with over 20 years of experience spanning clean and alternative energy, finance and investment, commercialization of innovation, strategy, and professional services. At AlphaStruxure, she leads the development team and supports developers to guide customers and deals in the pipeline from start to close.

Prior to AlphaStruxure, Nicole was Strategy and Market Development Director for Mortenson’s Integrated Energy Solutions business, actualizing electrification trends across the company’s vertical / commercial and energy /infrastructure operating groups. This includes incorporating electrified transportation systems, microgrids, distributed energy resources and utility grid modernization.

Nicole also brings extensive industry experience as a leader in large-scale renewable energy development. She was previously Development Director for NextEra Energy Resources where she was a key member of the team that delivered $2.5 billion of capital investment in renewable energy generation facilities in Canada. She was responsible for market entry strategy, development, landowner contracts, PPA negotiations, community and stakeholder engagement, government relations, siting and permitting, construction, operation, and financing. Prior to NextEra, Nicole managed a portfolio of investments in energy technologies working extensively with utilities and research institutions to foster innovation in the sector.

Nicole is a Sloan Fellow in Leadership & Innovation from MIT, a Fellow in Economics of Energy from the UK Foreign & Commonwealth Office (University of Reading, UK) and has a Bachelor of Commerce from Queen’s University in Canada.

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