1. Discuss future collaboration or partnership strategies between electric car companies and utility companies once the use of electric cars has become more ubiquitous? Collaboration between electric car- and utility companies in the future Group 7 - Dolenc N., Makkonen S., Rauhala J., Itävuo T., Andersson M.,

2. Why is this an important and interesting question?

3. How can energy providers and Electric vehicle producers tackle this demand together?

4. Contents  Introducing to topic  Innovation strategies in the field  Examples of collaboration  Integration into electricity networks  Conclusion

5. Introducing to the topic

6. Utility company The utilities sector contains companies such as electric, gas and water firms and integrated providers Likely to be more regulated industries and owned partially by governmental entities in welfare countries such as Finland

7. Examples of utility companies

8. Electric car companies Most of the traditional car manufacturers already produce some type of hybrid- or electric car models and research suggest we are about two years away from mass consumer adoption of the segment. eMERGE: key contribution to developing the mobility of the future, Daimler, Jul 30 2015.

9. Examples of electric car companies Producers of only electric carsTraditional car manufacturers with EV or Hybrid models.

10. “Ubiquitous” Present, appearing, or found everywhere.

11. Ubiquity is near Only 15% of future new car sales is going to be traditional gasoline engine cars. How can Utility companies collaborate with electric car companies for more efficient universal energy storage and usage?

12. Current innovation strategies in the field

13. “The ability to innovate is a top priority for companies everywhere” Despite massive investments of management time and money, innovation remains a frustrating pursuit in many companies. (For example Polaroid, Nokia, Yahoo, HP & many others... ) “It seems obvious to say that utilities are not known for their innovation. “ Regulators are cautious about utilities experimenting with ratepayers money

14. PRODUCT INNOVATION new or improved goods & services ≠ PRODUCT INVENTION only new goods & services Business innovation: Business innovation is the creation of substantial new value for customers and the company by creatively changing one or more dimensions of the business system (Sawhney et al., 2006)

15. PRODUCT INNOVATION new or improved goods & services ≠ PRODUCT INVENTION only new goods & services Electronic Vehicles: ● Car batteries ● Charging ● Energy regeneration Utilities: ● Readiness to feed and receive electricity from grid

16. Business innovation: Business innovation is the creation of substantial new value for customers and the company by creatively changing one or more dimensions of the business system (Sawhney et al., 2006) Electronic Vehicles: ● Charging stations (e.g. pay to charge) Utilities: ● Readiness to feed and receive electricity from grid } Tesla Powerball

17. Examples of collaboration

18. Tesla patents ● Tesla has opened up its patents for everyone ○ Utilities can build charging stations easily ○ Anyone can utilise Tesla’s patents and build electric cars → Benefit: spark up the industry Tesla opened up all its patents on June 12, 2014. Screenshot from Tesla website.

19. Tesla Powerwall ● Powerwall for homeowners ○ Utilities can plug more volatile renewable sources to the grid ○ Will increase renewables in the grid ● Power companies could sell batteries when providing renewable solutions Tesla Powerwall home battery. Picture from www.teslamotors.com

20. Charging stations ● Utilities are collaborating by building charging networks ○ Electric cars need a dense network of stations ○ Benefits all: ■ Power companies ■ Car companies ■ Manufacturers ■ Gas stations Charge & Drive electric car charging station. www.fortum.com

21. Integration into electricity networks

22. Vehicle-to-grid (V2G) System where electrical cars communicate with the grid to answer to the power demand when car is not in use Cars are parked 95% of the time, mostly throughout the electricity demand peaks Car owners are paid for being the power reserve, plus cost reductions on the basis of how much electricity is fed back into the grid

23. How does it help? Vehicle to grid can balance the electricity demand peaks

24. Challenges for V2G The more a battery is used the sooner it needs replacing. Replacement cost is approximately 1/3 the cost of the electric car. Charging a fairly efficient battery system from the grid is at best 70 to 80% efficient How does the grid know when the customer needs to use the car?

25. Conclusion

26. V2G as a shaping strategy The goal of the V2G is to  reshape the way of responding to the daily electricity demands  change the consumer behaviour in how they park their cars and how their personal products may be utilized for common good → A shaping strategy is needed to reshape the two With a good shaping strategy, the shaper is able to attract a critical mass of participants and reshape an industry. Without the critical mass, V2G will never have any impact.

27. V2G as a shaping strategy In order to become a shaper, the shaper company needs a good combination of three interrelated elements 1) Shaping view - “the big picture” to alter the way the participants perceive market opportunities 2) Shaping platform - providing a set of clearly defined standards to help the participants organize their activities (eg. charger and battery patents) 3) Assets - The concrete actions and assets to convince that the shaper is able to fulfill its view

28. V2G as an Innovation Network  V2G is a good example of an innovation network with loosely coupled, autonomous organizations  The goal of the innovation network is to distribute knowledge in hopes of shared value gained within the network in anyone innovates  The Hub is in the center of the Innovation Network and its responsibility is to ensure the effectiveness of the network

29. V2G as an Innovation Network The hub company needs to ensure 1) Knowledge and mobility - with fast knowledge sharing and effective usage of joint assets 2) Innovation appropriability - with fair distribution of profits within the network 3) Network stability - by reducing competition within the network

30. V2G as an Innovation Network As the Innovation Network is considered a loose framework, virtually anyone benefitting from the network can become a hub company.  EV company benefits from the high number of available charging points  Electrical company benefits from the reduced peak load demand  An individual company producing the charging points is able to sell the electricity to the grid  Parking company benefits from higher demand for their parking places As everyone within the Network are supposed to benefit from it, the key point for the hub company is to ensure the effectiveness and fair value distribution within the Network.

31. Thank you! Questions?