The demands of electric vehicle charging are blurring the line between the auto industry and utilities. Now, General Motors is erasing the line altogether with the creation of a new business unit dedicated to grid resiliency and energy management.
The newly announced GM Energy will house the automaker’s EV charging and energy products. The division will develop both hardware and software to help customers manage energy use, from individuals charging their car at home to corporations operating an entire fleet. The development speaks to the ongoing shift in how automakers figure into the energy system, and how much that shift depends upon relationships with new supply chains and new partners, like utilities.
GM Energy is an expansion of the company’s existing electrification operations, which hinge upon the proprietary battery platform it has dubbed Ultium.
The company’s new and in-development hardware will allow for vehicle-to-home and vehicle-to-grid systems that essentially treat GM EVs like giant batteries that can keep the lights on if the power goes out or provide extra baseload for the grid when needed. GM is also looking beyond its vehicles, with the company saying in its Tuesday announcement that GM Energy will also focus on stationary storage paired with solar panels and more speculative technology like hydrogen fuel cells.
The products will be connected via a cloud-based management interface known as the Energy Services Cloud; GM promises that this will allow customers to, for instance, charge during periods of low energy demand. That cloud-based software will also help the company develop its bidirectional charging offerings.
Very few EV models currently have bidirectional capability, which lets owners pass electricity back onto the grid when power demand surges (and theoretically be paid by their utility for the privilege). GM is banking on that being a major selling point, though some utilities have fought similar measures with rooftop solar, and it remains to be seen how many will get on board with GM’s vision.
But it's going to be an increasingly important tool as more cars sit in garages charging. Mark Bole, who heads GM’s vehicle-to-everything and battery division, said during a press briefing that one impetus for this work is the fact that the growth in EV ownership in the coming decades will put more pressure on the grid.
“It's important for us … to make sure we're providing this clean flow of energy back and forth with utilities to help manage resiliency and reliability for the electric grid,” Bole said. GM has several utility partners, including Northern California’s PG&E. The two companies have a vehicle-to-home pilot project in the works that would enable “a subset of residential customers” to use an EV and bidirectional charger combo as backup power during the planned outages that have become common practice in lessening wildfire risk. After lab-testing the hardware, the project is expected to roll out in 2023.
Separately, GM has an agreement with the solar company SunPower to develop a home energy system including at-home energy storage and solar panels.
Utilities and other customers are already using Energy Services Cloud, but hardware like bidirectional chargers and storage systems is at least a year from being ready for action. Ultium Commercial customers can place preorders — GM’s vice president of EV growth Travis Hester said the company has “several” commercial customers already, including construction company Graniterock — but those systems will not be delivered until the end of 2023. And residential customers will also have to wait until the end of 2023 for Ultium Home hardware, when it will be offered in conjunction with the retail launch of the electric Chevy Silverado. GM said vehicle-to-grid capacity will come later, though the company has not specified a precise timeline.
Part of the reason for the delayed rollout, Hester said, is that GM doesn’t want to “over-commit” given that the company is still ramping up its battery cell manufacturing: “We have to graduate our growth based on our cell availability,” he said.
GM has big battery-production plans, but they are still in their infancy. The company has partnered with the Korean battery giant LG Energy Solution to invest $7 billion in building several battery plants in the U.S. (The project also received a $2.5 billion Energy Department loan.) The first of at least four plants began production at the end of August.
The automaker is far from the only one vying for EV and battery supremacy. Legacy automakers and EV companies alike have announced plans to build battery factories in the U.S., particularly in the wake of the Inflation Reduction Act’s tax credits for EVs and battery components made there. Critical mineral prices have risen sharply, and their supply chains are increasingly tenuous due to geopolitical instability. All these factors could complicate GM’s battery plans.
At first, the charging and home energy technologies will be available only to GM customers, though Hester said there is a possibility that both the software and hardware on offer will work for those who drive another automaker’s EV.
Bole said that the company has estimated that the total market for these products will be between $125 billion and $165 billion by 2030, though he didn’t answer questions on what share GM Energy expects to capture.
“With us working across the entire ecosystem, we think we can be very prominent within that space over the coming years,” said Bole.
In early 2021, GM committed to selling only zero-emissions cars and trucks by 2035 despite having a meager lineup of EV options at the time. While GM was a first mover, many of its competitors have followed suit with aggressive electrification plans of their own in the time since.
Even so, GM and other legacy automakers have lagged behind Tesla in EV sales. Tesla reported last week that it delivered 343,000 vehicles in the third quarter of 2022. In comparison, GM only delivered 15,156. The EV-only company also has its own energy operations, complete with solar panels and storage options, though its approach to grid management does not yet involve bidirectional chargers.
The rollout of GM Energy comes as the company doubles down on its EV commitment in other ways as well. The automaker announced three binding battery supply agreements in July, which it says will secure all of the raw materials needed to achieve its goal of producing 1 million EVs per year by the end of 2025.
The Biden administration has taken actions that could spur more domestic lithium and critical mineral production, including invoking the Defense Production Act, and made money available for charging infrastructure. The federal government is also racing to suss out where deposits of minerals essential for the EV transition are located. That, coupled with state-level policies and IRA incentives, could help GM achieve its goals.
