This is the first in a series of articles on grid planning resources tailored to utility consumer advocates. Read the second article “Understanding the Grid Impacts of Electric Vehicle Adoption” and the third aticle “Planning Ahead for EV-Ready Grids Without Leaving Ratepayers Behind.”
Despite the sunsetting of federal electric vehicle incentives, the EV transition continues, with 1.28 million EVs sold in the United States in 2025 (just 4% fewer sales than in 2024), and even greater numbers abroad. An uptick in used EV sales in the United States is expected this year, as leases that began under the Inflation Reduction Act roll off their 2- and 3-year terms, increasing the availability of affordable EVs for first-time buyers. In addition, people turning in their leases will need a new car to drive, and many are interested in purchasing another EV. BloombergNEF forecasts that EVs will account for more than 25% of vehicles on the road by 2030, with substantially higher shares in many international markets.
Accordingly, energy demand from EVs continues to grow, with EVs expected to represent the primary source of new electricity demand across the United States by the 2035–2040 range. Meeting this increased demand will require load management tools to reduce its impact on the grid, as well as investments in distribution infrastructure to provide sufficient capacity for EV charging needs. With affordability at the forefront of consumers’ minds, there are valid concerns around how these investment decisions will impact ratepayers.
RMI’s Ratepayer Lab
RMI supports consumer advocates with tools, research, and direct engagement to address energy affordability challenges in the United States. Our Ratepayer Lab delivers tailored assistance for consumer advocates on issues including return on equity reform, securitization, fuel-cost sharing, integrated resource planning, performance-based regulation, customer safeguards, and effective grid planning practices for electric vehicle infrastructure.
While the challenges of meeting EV charging demand are real, these vehicles also offer a huge opportunity to provide multiple benefits for the grid — and all ratepayers — when planned for strategically and integrated effectively:
- These uniquely flexible loads can be managed to increase utilization of existing grid infrastructure and help to defer or even avoid distribution system upgrades.
- This flexibility also allows charging to be aligned with low-cost energy sources such as solar and wind generation, reducing both electricity costs and renewable curtailment (waste).
- As vehicle-to-grid (V2G) capabilities expand, EVs will increasingly be able to support local energy resilience by providing backup power for homes and businesses, as well as numerous grid services where utilities allow exporting of energy back onto the distribution system.
When leveraged effectively, these characteristics of EV charging (and discharging) can increase the efficiency and cost-effectiveness with which we use the grid, putting downward pressure on rates for all customers. Ensuring that we reach that outcome, however, requires planning for an increasingly electrified future in thoughtful and forward-looking ways. Two of the most important aspects of that planning include leaning into EV load management and identifying areas of the grid that will likely require proactive infrastructure investment to avoid bottlenecking the growth of EV charging — and the promising benefits it can bring.
Solution 1: Managing EV load for better grid utilization
The timing of electricity usage has a substantial impact on the cost of providing that electricity. As such, when and how EVs are charged has a direct effect on both utility and customer costs. These considerations will become even more important as the number of electric cars and trucks on our roads increases. If these vehicles can be charged when energy demand is low and more grid capacity is available, we can reduce incremental strain on the grid and take advantage of lower-cost power.
Utilities can support this charging behavior through a variety of charging management practices. Passive load management approaches reward off-peak charging with lower electricity costs, often through time-of-use (TOU) rates. Active management strategies, such as direct load control programs where utilities or third parties manage charger power output and timing, balance driver charging needs with grid constraints (e.g., overall system demand, local distribution asset conditions) to improve grid utilization and reduce costs for all.
Flexible service connections have quickly grown into a promising opportunity for connecting EV charging projects to the grid more quickly. This approach allows utilities to expedite service connections and charger energization for fleets or other customers by providing customers the option to limit charging during times of local grid constraint. Currently considered a temporary solution until required utility upgrades can be completed, flexible service connections can increase electricity usage and grid utilization like other forms of load management. For the right fleet operating schedules, similar, flexible arrangements can ultimately serve as a permanent way to limit infrastructure costs by avoiding significant grid upgrades.
To illustrate the potential of this approach, consider heavy-duty truck depot charging. In a traditional service connection or upgrade process, electrifying many of these depots would spur upgrades on feeders that currently don’t have the ability to accommodate the full nameplate capacity of the chargers to be installed. However, some of these trucks sit parked at the depot for longer than the total amount of time they need to charge, suggesting flexibility in the timing of their charging. Flexible service connections would enable more of these depots to electrify, more quickly, through agreements to limit charging during specific hours. Given the promise of more timely connections for fleets, and the potential benefits for overall grid utilization, this approach is expected to grow quickly in the coming years.
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Load management strategies and flexible service connections can shift and reduce demand peaks and corresponding need for grid upgrades, allow for faster service connection, and provide reduced costs for charging.
Solution 2: Planning ahead to maximize the cost-effectiveness of investments
While effectively managing EV load will be critical to reduce the amount of new grid infrastructure required, we will still need to build more electrical capacity to enable the electrification of transportation and other end uses such as space and water heating. In this era of rapid load growth, traditional grid planning may not suffice – and may not be cost-efficient.
There can be a significant timing mismatch between how quickly chargers can be ordered and ready for installation, and how quickly the distribution system can connect those chargers based on available grid capacity and related upgrade timelines. As more vehicles are electrified and more chargers are needed, this at-times steep difference in timelines is already leading to connection bottlenecks in some markets, delaying projects and deterring customers from going electric while also threatening the achievement of policy goals.
Recent analysis puts some numbers behind these delays: Atlas Public Policy estimates that a six-month reduction in timeline for typical public DCFC station sizes can save between $100,000 and $165,000 in net present value, while an 18-month timeline reduction for a larger, heavy-duty trucking station can provide $1.8 to $3.4 million in gross benefits in net present value. These benefits stem from reduced project development, financing, and permitting costs; accelerated revenues; and in some cases, health benefits from quicker emissions reduction.
To get ahead of service connection delays, we will need to update grid planning practices and — in some locations —front load infrastructure upgrades. In areas where anticipated EV demand is most concentrated and the distribution system doesn’t have sufficient capacity, conducting upgrades further in advance will be necessary to avoid energization delays. As RMI’s 2025 report Ahead of the Curve identified, in some areas a meaningful number of distribution assets will see much of their currently available headroom (the additional capacity they have to accommodate growth) utilized by EV load within the next decade.
When done well, building for anticipated future loads can harness economies of scale to benefit all customers, and a growing body of research suggests targeted proactive investments can provide net ratepayer savings. However, the potential benefits of EV load are not guaranteed, and any proactive investments to serve anticipated future energy demand come with different risks compared to traditional approaches. For example, stakeholders are understandably concerned that investing further in advance could lead to underutilized infrastructure, driving up costs. At the same time, failing to prepare for anticipated needs — falling back on traditional planning approaches — could lead to higher costs due to inefficient, repeated upgrades to the same assets compared to a longer-term strategy of conducting larger upgrades less frequently.
Various, complementary options exist to better understand and mitigate these risks. As discussed above, emphasizing effective load management reduces overall capacity needs and therefore investment requirements. Leveraging the best available data to inform planning, including innovative, bottom-up load forecasting based on actual vehicle travel patterns, is key for understanding the concentrated, unevenly distributed nature of EV load, and is already playing an important role in identifying likely “hot spots” where the grid is most likely to require attention. Innovative approaches to risk sharing between parties is another topic of growing interest, such as the ratepayer cost cap approach being taken for proactive investments in Minnesota.
Unlocking EV benefits
No single strategy will entirely remove the risks inherent in building out the grid. But collectively, the available data, tools, and regulatory innovations being explored in leading EV states can reduce this risk enough to enable data-driven, strategic investments that will unlock the benefits of EVs for all. Whether or not these benefits will be realized depends on the decisions made today to prepare for future energy demand.
Managed charging can maximize EV flexibility to put downward pressure on rates, and planning ahead can ensure that EVs have a place to charge without straining the grid. To achieve these goals it will be critical to leverage high-quality load forecasting tools to support targeted proactive investment where chargers are most likely to be needed. These combined strategies will help ensure that EVs can deliver their full potential for utilities and ratepayers alike. It is also essential to include key stakeholders, such as consumer advocates, in the development of these strategies and corresponding programs to ensure ratepayer impacts are being considered appropriately.
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