More money for EV charging software — ev.energy raises $33M

Over the past five years, U.K.-based startup ev.energy has built a customer base of 120,000 electric-vehicle drivers in Europe and North America who are using its charging software to save money, ease stress on the power grid and soak up as much surplus clean energy as possible.

But the company wants to go way bigger. On Thursday, it closed a $33 million funding round to help scale up the platform to ​“millions of vehicles,” said Nick Woolley, CEO and co-founder. That’s an ambitious goal for a startup, but one appropriate to the challenge of handling the ​“colossal” power demands of future EV fleets, he said.

“We’re talking gigawatts of energy capacity in the next several years,” he said. With the government EV mandates now in place across the world, EVs are forecast to reach 40 million in global annual car sales and a cumulative 3,000 gigawatt-hours of battery capacity by 2030, according to the International Energy Agency.

All of those EVs will eventually charge from power grids that may struggle to support all of that new electricity demand. That’s an increasing concern not only for grid operators and consumers, but for the automakers investing as much as a collective $1.2 trillion in EVs and batteries through 2030 as well.

Controlling when and how these millions of EVs charge could spell the difference between an EV fleet that causes grid overloads and one that can help ease grid strains by absorbing surplus clean energy. A welter of studies has found that well-implemented smart-charging regimes can reduce the need for new power plants and grid infrastructure to the tune of billions of dollars.

Ev.energy’s investors represent a cross-section of the industries focused on the immense challenge and potential of EV charging.

The startup’s new funding round was led by National Grid Partners, the venture arm of U.K. and U.S. utility giant National Grid, and included InMotion Ventures, the investment arm of Jaguar Land Rover, and Wex Venture Capital, the investment arm of commerce and fleet management provider Wex. This week’s funding adds to an $8.8 million round in 2021 led by utility-backed fund Energy Impact Partners and including Future Energy Ventures, the VC arm of German utility E.ON.

Since its 2018 founding, ev.energy has integrated its software into the onboard telematics systems found in vehicles made by a host of EV makers and into EV charging equipment, including home-charging systems linked with rooftop solar and battery systems. It has also inked partnerships with more than 30 utilities and retail energy providers in Europe, North America and Australia.

Those partnerships range from relatively simple apps to help drivers charge during the lowest-cost times of the day to more complex programs that precisely schedule EV charging to avoid periods of heavy grid use or to begin when clean power is ample on the grid.

“Utilities will be able to control and aggregate more load than they’ve ever been able to — if they can build the capabilities to aggregate and use EVs as a virtual power plant,” Woolley said. ​“Virtual power plant” is the industry term for systems that control lots of distributed energy resources such as rooftop solar systems, batteries or EVs to reduce power consumption or inject power into the grid to mimic the operations of a large-scale power plant.

But EV drivers’ needs must come first in this equation. ​“I’m a utility geek,” Woolley said — he earned a doctorate in power network engineering before embarking on a career at tech startups and at National Grid prior to founding ev.energy. ​“I love talking about utility markets and relieving grid congestion on local feeders, and all that great stuff.”

“But at the end of it, we’ve got to get drivers to opt in” to participate in managed-charging programs, he said. That requires providing EV owners with the ability to schedule their charging to save money or meet their clean energy goals while also ensuring that they always have enough of a charge to get to their next destination.

Striking the balance between EVs as cars and EVs as grid assets 

Balancing the need to make charging as simple, cheap and reliable as possible for EV drivers and to make it a net benefit for utilities and the grid is a common challenge faced by companies like ev.energy.

“One of the things that’s so, so critical in this space is recognizing that the customer’s needs come first,” Apoorv Bhargava, CEO of WeaveGrid, a San Francisco–based EV software company that raised $35 million last year and runs charging programs for utilities including Pacific Gas & Electric in California and DTE Energy in Michigan, told Canary Media last year. ​“When you start with that proposition, it’s easier to go back to the utilities and say, ​‘This is what customers require; this is where we have to meet them.’”

At the same time, utilities and retail energy providers can pass on a significant amount of savings to EV drivers, said Greg Hintler, CEO of North American operations for The Mobility House. The German-based startup provides managed charging for EVs and raised $50 million last year. It recently launched a program with French automaker Renault that will offer EV drivers charging rates that are roughly half the standard cost of electricity in exchange for allowing their vehicle charging to be controlled to help make use of cheap, zero-carbon electricity and avoid price spikes on wholesale energy markets in the U.K., France and Germany.

“We’ve proven over a long period of time that we can generate money with EV batteries, that we can operate them in the wholesale market,” Hintler said in an interview last week. ​“Finally, the technology and regulatory environment is there to do the same thing with” EVs being used as personal vehicles.

Many EV software providers have been acquired by larger energy companies, indicating that these industry incumbents anticipate growing demand for managed-charging services.

One example is the U.S.-based startup EV Connect, which operates programs for utilities including Avangrid, Avista, Consumers Energy, Dominion Energy, Evergy and Southern California Edison, and was acquired last year by global electric giant Schneider Electric. Other EV charging-management startups have been bought by European oil majors BP and Shell and the distributed energy and renewables arms of French utility EDF and Italian utility Enel.

As the number of EVs on the road grows, so does the complexity of managing their charging — and the challenge of convincing their owners to volunteer to play a role in balancing the grid. But the rewards for those companies that can manage the complexity and gain and retain their customer base of EV drivers will only grow as the scale of low-cost wind and solar power on the grid increases, Woolley said.

“The great thing about renewable energy is that it’s zero marginal cost, and if no one else can use it, it’s the cheapest available energy on the grid,” he said. Software that can help millions of EVs use that cheap energy while avoiding strain on the grid can also help utilities ​“build less infrastructure and optimize their wholesale energy purchase agreements — and sell more low-cost electrons to those customers as well.”