It’s a common misconception among investors that the grid won’t be able to keep up with the adoption of EVs.
Many investors worry that the electrical grid in countries such as the U.S. and China will be a roadblock in the continued growth of electric vehicles. However, industry expert Anthony Sassine, senior investment strategist at KraneShares, said utility companies are preparing over a decade in advance for the evolving auto industry.
KraneShares is a global ETF provider specializing in China, climate, and uncorrelated assets. The firm’s climate investment portfolio includes the KraneShares Electric Vehicles & Future Mobility Index ETF (KARS) and the KraneShares MSCI China Clean Technology Index ETF (KGRN), among other funds.
Sassine said during a webcast on September 18 that he initially thought the limitations of the grid could be a roadblock. “But as you go to conferences and speak with industry participants, especially the utility companies, these guys have been planning for this forever,” he said.
Transition to EVs
The utility companies are planning up to 15 years down the road to try to accommodate this transition to EVs, Sassine said. The companies are building contingency plans, but also educating consumers.
One of the biggest problems, according to Sassine, is peak charging. This is the time when people return home from work and all charge their EVs.
Therefore, in addition to expanding the grid and ensuring there is enough electricity, some of the initiatives taking place include installing chargers at places of work and shopping centers. This allows people to charge during the day as well, dispersing the traditional peak charging window.
“There’s a lot of initiatives actually happening, especially in the U.S., especially in California, to account for this,” Sassine noted. “You’d be surprised how long term these guys are thinking.”
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