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Digital transformation – leading the way for EV charging value chain

The automotive future is electric—McKinsey estimates that worldwide demand for EVs will be growing sixfold from 2021 through 2030 and the annual unit sales would go from 6.5 million to roughly 40 million over that period.

Today, digital technologies have become an integral part of vehicle development – right from controlling critical driving functions (i.e., airbags, brakes, and steering) to delivering convenience features (i.e., infotainment and multimedia systems).

Electric Vehicles (EVs) are no different and primarily rely on the battery pack and its charging systems. Where on one hand, the OEMs want an increase in the EV sales, on the other, the buyers want more EV chargers first to overcome the range anxiety and protect the investment of buying an electric vehicle.

According to the U.S. Department of Energy, the US had employed fewer than 49,000 charging stations as of 2020, with an average of 30 EV chargers per 100,000 people approximately. Besides government incentives and ambitious plans like ‘500,000 EV charging stations by 2030’ from the Biden administration, the development of a robust and future-proof EV charging infrastructure is still a major challenge for faster EV adoption.

Before we deep dive into the current challenges of EV charging infrastructure and the latest trends in digital transformation, let’s have a brief understanding of the value chain and the role of its stakeholders.

EV charging value chain

EV charging value chain

 

Key challenges faced by the EV charging industry

One major hurdle that needs to be addressed is the disrupted supply chain for EV manufacturing. Currently, the domestic supply chain has some catching up to do, especially when it comes to crucial components like EV batteries and motors, which are largely imported.

The automotive future is electric—McKinsey estimates that worldwide demand for EVs will be growing sixfold from 2021 through 2030 and the annual unit sales would go from 6.5 million to roughly 40 million over that period.

As the EV charging value chain becomes more organized and companies decide to expand globally, we have identified some of the key challenges faced by the stakeholders moving forward:

Interoperability – Different countries and governments have defined EV regulations and technology to suit their needs. Hence, the compatibility of charging protocols, connector types, and safety standards vary significantly in different markets.

Equipment selection – There is no “one size fits all” approach when it comes to EV charging equipment. Based on the user segments,  the EVSEs should also be available in multiple variants (i.e., basic/premium, networked/non-networked) and provide protection against geographic conditions (i.e., temperature, humidity, and ingress protection)

Charging times – Unlike Internal Combustion Engine (ICE) powered vehicles that may need approximately five minutes for refueling, EVs may take up to 24 hours for getting fully charged. Not having enough time to spend on charging may also cause range anxiety.

Grid capacity – Electricity consumption fluctuates based on the EV charging behavior. Demand is higher during daytime hours and reaches a peak in the evening hours. Grid operators must employ a proper mechanism for load balancing and ensuring supply is available for all its users.

Transparency – A simple task of EV charging involves multiple transactions between the EV owners, CPOs, e-MSPs, and grid operators such as user authentication, energy consumption, and charging services. Transparency in operations is critical to ensure running smooth operations.

Cyberattacks – Like any other networked device, EV chargers are also susceptible to the risk of cyber security attacks. It may take various forms such as denial of charging service, identity theft, payment fraud, and endanger the security of electricity infrastructure.

Digital transformation trends that will help overcome challenges

Data is the new currency and electricity is the fuel. EV charging stakeholders are investing heavily in digital transformation technologies and gaining a competitive advantage. We have enlisted some of the key trends that will shape the future of the e-Mobility/EVSE industry.

Charging Protocols

The EV charging industry has recently formed alliances and started adopting common protocols and standards for better interoperability. Protocols such as OCPP, OCPI, ISO15118, and OpenADR ensure safety and smooth communication between stakeholders. Let’s have a brief look at the key charging protocols:

  • OCPP (Open Charge Point Protocol) an open-source communication standard for the EV charging stations and central management system.
  • OCPI (Open Charge Point Interface) an open protocol used for connections between the charge station operators and service providers.
  • OSCP (Open Smart Charging Protocol) an open communication protocol between a charge point management system and an energy management system.
  • HomePlug GreenPHY (ISO 15118) a standard that enables bi-directional vehicle-to-grid (V2G) charging and acts as a communication protocol between the EVs and charge stations.
  • OpenADR (Open Automated Demand Response) facilitates automated demand response to balance the grid supply and demand.

Smart Charging

Whenever a user plugs in an EV for charging, information such as charging speed and time, charge point usage patterns, and grid capacity are sent to the cloud-based management platform. This data is then analyzed in real-time and insights are generated to efficiently manage the grid capacity utilization and peak load at the charging stations.

Vehicle-to-Grid (V2G)

V2G is a bi-directional charging mechanism where energy can flow both into an EV and out of it. V2G becomes very useful to offset the peak load by giving power back to the grid and utilizing idle power residing in the EVs. The vehicle owners can also benefit from charging vehicles during off-peak hours at the lowest rates (i.e., night hours) and feeding power back to the grid when the energy rates are higher (i.e., evening peak hours).

Wireless Charging

Imagine a stopover at a supermarket and getting your car charged is a dream come true with wireless charging. It relies on resonant magnetic induction to transfer energy between a charging pad on the floor and another pad-mounted beneath the vehicle surface. When parked, the vehicles can be charged at rates ranging from 3.3 to 20 kW. New advancements such as DEVC (Dynamic Electric Vehicle Charging) that can charge a moving car with up to 20kW are also under the final testing phase before commercial release.

IoT & Cloud Integration

EV charger generates massive amounts of data from various sources such as charge cycles, energy consumption, billing & payments, and equipment failure events. IoT performs data analytics and generates dashboards for effective management of the charging infrastructure. IoT-enabled charging apps also contribute to enhancing customers’ experience by enabling them to find a nearby station, charging time, and equip them with self-service options.

Wireless Connectivity

Unlike the first-generation non-networked EV chargers, wireless connectivity options such as Wi-Fi, Bluetooth, 4G/LTE, and NFC enable cloud connectivity and bring newer services. For example, CPOs can now monitor and manage chargers from a remote location, e-MSPs can offer roaming network services, and EV users can see available stations and securely pay via smartphone apps.

Cyber Security

Early on in the development process, a fresh approach to include cybersecurity considerations (threat modeling and analysis), vulnerability, and penetrating testing (VAPT) has begun. Compliance with cybersecurity programs such as ioXt Alliance or IEC 62443-4-2 also ensures an additional level of security measures.

Blockchain

Blockchain applications such as P2P (Peer-to-Peer) are enabling innovative applications such as sharing of private charging stations and energy trading between utilities and the EV users (V2G). At the core, Blockchain provides distributed accounting by creating a shared ledger and transparency in transactions through automated smart contracts without involving intermediaries.

Stay tuned for our upcoming blogs covering these topics in detail!

 The path forward

The EV value chain encompasses everything from upstream to downstream, raw materials to dealerships, charging stations, EV component recycling, and more. The transition to electric will impact everything an OEM, supplier, investor, or other auto stakeholder touches. Your strategy needs to go well beyond just the battery — creating a holistic strategy requires informed analysis, data-fueled insights, and a comprehensive outlook on the future of the automotive industry. That’s why we developed our EV value chain projections, models, benchmarks, and other insights to help you navigate the complex future of the EV landscape.

Governments worldwide are fostering EV adoption with incentives and regulations. Major automakers have already pledged over $300 billion in investments for electric vehicle production (source: Reuters). All the above means that the EV ecosystem is here to stay.

EV charging ecosystem is still evolving and new business models are emerging. Energy suppliers and utility companies are taking the way of mergers and acquisitions to secure positions and past investments.  Stakeholders in the value chain can only survive if they can offer innovative solutions that distinguish them from the rest of the market.

What is EV Charging Ecosystem?

An EV Charging Ecosystem includes everything, from power production and (smart) power grids to the EV charging infrastructure with charging stations and electric vehicles.

The EV Charging Ecosystem consists of hardware, the people and companies involved in EV Charging, and, most importantly, the software that connects them all.

Together, they all form the EV Charging Ecosystem that constantly evolves and adapts to new situations.

 

The new-age EV charging stations are powered by renewal energy sources like wind & solar, equipped with the latest hardware & software technologies, IoT & Cloud connectivity, and support Vehicle-to-Grid (V2G) applications within the Internet of Energies (IoE) framework for smart grid management.

eInfochips is at the forefront of next-generation EVSE/EV charging station design and development. It has successfully executed award-winning projects, featured in EnergySage’s Best EV Charging Stations in 2021 list.

eInfochips offers turnkey design and development services including hardware/firmware development, charging protocols, wireless connectivity, smart HMI, IoT & Cloud integration, cybersecurity, blockchain, smart charging Apps, V2G applications, and system-wide QA/Test automation framework.  To know more, contact our experts today.

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