According to GTM Research, the electric vehicles (EV) market will present a significant opportunity for smart grid hardware, software, and communications vendors.

GTM’s report, The Networked EV: The Convergence of Smart Grids and Electric Vehicles, focuses on the impact of electric vehicles on the grid as well as the next-generation hardware and software solutions that will support their growing use.

GTM expects cumulative global EV sales to reach nearly four million by 2016, which will drive distribution automation technologies, vehicle-to-grid communications, and new software applications. Recent increases in oil prices due to political unrest in the Middle East may drive even more sales.

The overall public interest in EVs will make it necessary for utilities to implement a variety of smart grid technologies to maintain grid reliability and safety.

GTM says its report is the first to investigate systemic, utility-side EV issues such as “the need for increased visibility and control, tiered retail pricing and reliable communications standards and protocols between distribution grid infrastructure and electric vehicles.”

David J. Leeds, report author and GTM Research’s Senior Manager of Smart Grid, explains, “Despite the appeal of electric transportation, presently the challenges facing utilities due to the introduction of EVs are not very widely, or very well, understood. Over the next decade, ensuring adequate distribution grid reliability appears to be the principal challenge related to the initial rollout of EVs. A variety of related grid control and protection issues will necessitate a large investment in smart grid technologies, specifically grid communications and distribution automation.”

Up to now, the investment in smart grid-EV infrastructure has focused on the charging station.

Leeds notes: “As more public stations and Level 2 home chargers pop up, investment in a new generation of dynamic grid devices will be imperative. Smart grid technologies such as next generation tap changers, voltage regulators, capacitor banks and reclosers, and the communication networks to support these smart devices, will bring a new level of grid optimization and control enabling EVs to safely scale into the tens and hundreds of millions.”

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