Karl Bach from Axle Energy explains how their software enables EV chargers and home batteries to provide grid flexibility, helping balance supply and demand while earning money for users. Unlike energy suppliers like Octopus Energy, Axle Energy operates behind the scenes with charger manufacturers and battery providers, optimizing charging times without degrading batteries or inconveniencing drivers. The discussion covers market size, technical requirements, and how smart charging can benefit from excess renewable energy. The episode also highlights resources for comparing public EV charging prices and raises awareness about carbon literacy.
In Episode 203 Gary discusses some of the financial benefits which accrue from owning an electric car. These include specific tariffs and demand management sessions.
We'll be looking at the sort of things that can make EV ownership profitable.
Guest Details: Karl Bach
Karl is the co-founder and CEO of Axle Energy. Axle's software connects EVs, batteries, and electric heating to flexibility markets, helping households save up to £500/yr. Prior to founding Axle, Karl worked in various capacities in energy & decarbonisation, most recently at Bulb.
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So we're not currently working directly with octopus. So in that sense, you could say that they're a competitor because they offer something relatively similar to their customers. As the octopus approaches, at the end of the day, they're an energy supplier. And they think of the world through tariffs, and they'll offer the octopus go or intelligent octopus go tariff. And if you want everything bundled up in a tariff, that's great. Of course, there's a trade off there. So getting cheaper charging overnight means that your electricity will be more expensive than the other hours of the day. For some people, that works well for others, they prefer to stay on their existing tarrif and receive the benefits of EV flexibility, as additional revenue, as cash sent to their bank account each month.
Extra revenue. Sounds great, right? So how does that work, Carl?
So let's say you have a Podpoint charger in your home and Podpoint is one of our clients. So Podpoint may tell you that based on where you live, there's a local constraint on that grid, and that your Podpoint charger can help you manage those local constraints, and you'll get paid for that participation. So you'll see an offering maybe by email from Podpoint or in the Podpoint app, you'll say, Yes, that sounds great. Sign me up, you'll click a button. And all work great. For the most part, you know, you'll see some updates in your app, but you probably won't notice what else is happening. And behind the scenes, we'll be working with Podpoint to make sure that your EV charger is is helping and not covered in news local constraints on the grid
Here's the fundamental difference between Axle Energy and someone like Octopus Energy. With Octopus, they are the 800lb gorilla in the room, you work with them, you use their software and processes and you pay their tariffs. With Axle Energy. They're an additional layer of software between the grid and the charge point,
we sit behind the scenes. So we're a service provider for our partners. And in some cases, they want this this whole offering to be branded as their own. So in many cases, we don't disclose who we work with. So we're we're one of the largest providers of EDI flexibility in the UK today. So if you see an offering from your Evie, charger, manufacturer, those there's a very good chance it's us behind the scenes.
What this means is that if you want to use Axle Energy to help save you money, you can't. They don't appear as a service you can purchase as an end customer.
Today, you'll need to go to your your EV, charger, your battery, etc. Go into the app and see if there's any offering for flexibility. If there's not send them an email, give them a call and ask why can't I use my my EV charger to help the grid? We're rolling out quickly. So we expect this will be available to pretty much everyone quite soon. But of course, this is something that's still quite early. So we're working as hard as we can to make sure it's it's available and make sure that everyone's able to benefit from it.
Presumably all you need from a hardware point of view is a smart meter and a compatible EV charger and/or batteries. Is that correct? or is there other requirements that you need?
No that's correct.
Yep I mentioned batteries. They're Axle Energy and not just connected with smart chargers. They do batteries as well.
I can give give one example here. So we work with give energy, which is the largest residential battery company in the UK, they also sell me the charger. We participate in the demand flexibility service and lots of other programmes of energy. That's what Octopus brand is saving sessions. And we had paid out well over 100,000 pounds directly to battery owners by the end of December and that number is continuing to rise. And then just to put that in context that programme started in the summer
So there's money to be made there. But how big is the market?
Yeah, so today we're participating in markets with about 12,000 customers to 12,000 households and businesses. We also support commercial as well. The rated capacity is about 65 megawatts. So flexibility across its customers, the, and of course what you're actually participating in at any given time varies based on the demands of the specific household and etc, etc.
As I sit and think about this, it occurs to me that there's going to be those people out there who will think "I can get a save a session via my Octopus energy account. Plus, I can leverage the Axle Energy integration via the particular charger I have'. How can you stop people gaming the system this way?
That's a very good question and something that happens all the time. The short answer is there's a central registry, so we'll need to register that meter number or a given property that has an EV charger or battery whenever else. And there is a clear rule that that meter can only participate in one programme. And if that meter is participating and octopuses programme, they can't participate with us. And vice versa.
If I put my economics hat on, I'm thinking, well hang on, you've got an extra layer in there. So you're obviously going to need some to make some money from this. So what's the incentive for companies like Podpoint to do this and get you involved, rather than doing it themselves?
There's a couple of reasons. So first of all, most of these flexibility markets, which is what we're participating on behind the scenes were designed for large fossil fuel power stations. And one of the implications of that is it tends to mean that you need quite a bit of volume to participate in those markets, there's something like one megawatt, perhaps in a region of the country to actually participate. And many of our clients don't necessarily have the volume themselves to do so. The other bed is, if you think about what these companies are good at, if you're making EV chargers, your focus is make the best hardware for the most competitive. And that's what you're, you're working on. And that's where you want to win. That's a bit different from building the software and technical integrations into a number of energy supplies. So there's also a question of specialisation, where we can build that back end infrastructure. And because we're able to provide this to many providers, we can do it at a at a relatively low cost, that they're able to participate in markets without going through the development work themselves.
As we've already discussed, Axle Energy also worked with some of the top battery manufacturers to ensure they can leverage the benefits of home storage during the demand management.
Exactly. But let's say we're connected to your battery, that typically means we get a data feed from your inverter. And what we can see based on both the inverter and what's happening at the overall home level is the power curve from from the different aspects in your home. And of course, the heat pump has a specific curve and the charger has a specific energy curve. And so when we're thinking about how to best optimise that battery to lead to the best results, or that individual household, we're taking that into account, so that you're still able to use your solar to charge your battery, which is then able to charge your EV once you plug it in later on.
So, Karl, what's your business model? How are you, Axle Energy, making money out of this?
So the short answer is we'll participate in these markets by taking 10s of 1000s of EVs, batteries, etc, figuring out what flexibility they have, and bidding those in the market will take a cut of the payment we receive for participating in the market. So then the rest will get passed on to to our partners and ultimately, the EV drivers.
So if I was an end customer looking at this, there'd be a couple of questions that would have. well, not me specifically because I think I know the answer is because of the area I work in. But if I was somebody who was fairly new to this, I'd be thinking, well, how good is this for my battery, because you're maybe taking energy out, you're maybe putting it in, this is going to degrade it over time. And the other aspect is going to be well, I want to make sure that when I wake up in the morning, I have 80% in my battery. And I can guarantee that, can I. So how would you address those questions?
Let's start with the first question. So the vast majority of people who have an EV today are not exporting energy back to the grid as you go. So what we're doing is we're not charging the EV anymore, we're just being smart about how and when we charge. So, so that's not putting any additional strain on the battery or on the car. And of course the car will always be charged in the morning when it's needed as as the default. That the other thing I'd say there is that the EV driver always maintains control. So a common pattern is we might pause charging during the evening, when the grid is constrained, say, from five to 6pm. If somebody needs their car to charge from five to 6pm, they can go into their app or speculator their charger and press charge now and their car will charge now. So they don't lose the ability to charge their car if they need it. It will still be charged more than we're just adding some smarts to how and when to do so.
And when people talk about demand management, primarily they're thinking about high power demand and low supply such as in winter when everybody's heating the house, et cetera, et cetera. But the other aspect of this is when we've got high supply and low demand, such as hot days in summer where people don't have any heating on, their cars might be full, they might have solar coming in off the roof. Is there any aspect of that with which you work?
Of course. So there are broadly two ways is to look at EV flexibility there is turn down and turn up. So turn down is pausing charging when there is is a constraint on the grid, there's there's not enough supply to meet demand. Turn up. This is the opposite, which is what you're saying, which is there is too much supply to meet to meet or it is exceeding demand at that point in time. So in that case, you can get paid to to charge your car at that specific time. So I mentioned we're already seeing that in Scotland today from wind power. And that's because this wind power otherwise gets curtailed, which is literally thrown away. So these typically offshore wind farms are getting paid to just let the wind disappear into the ether instead of produce power. And if you think about an EV perspective, in many cases, that happens overnight when the wind farms are chugging along at full capacity, but demand for electricity is quite low. That's a great time to charge an EV. So of course, that's a win win.
We all like Win Win situations, don't we? Many thanks to Karl Bach for chatting with us. Now, as Karl said, they do work directly with the customers so you can't sign up to use their services. But you can sign up to charger operators who use their services and get paid for letting them manage your charger and battery, which is always nice. This season we're looking at raising the awareness of carbon literacy with our listeners. One way we're doing that is with a carbon factor as rode by carbon literacy trainer, Anne Snelson.
Flying is one of the most climate change inducing things we do. So if you can cut your flights please do. You may have heard about sustainable aviation fuel. But if we want to keep flying at the rate we're doing we'd have to transfer half the UK is agricultural lands to crops are flying. And then what an earth would we eat?
It's time for a cool EV or renewable thing share with our listeners. You'll no doubt be aware that the range of public charge of pricing coupled with the propensity for CPOs to arbitrarily up their prices, often without telling anyone means that it can be difficult to know who charges what for public EV charging. Well puzzle no more. Although podcast sponsors Zapmap provide stats showing average pricing across all charge point operators. If you want specific up-to-date pricing for any charge point operator, I recommend you check out a site called chargenet. Although the website itself looks like something from the GeoCity's web design area, garish colour schemes, lots of text with bold neon background, and a general lack of a clear definable user interface, it does have some great information on there. If you can find a link to it, there's a page that shows the price per kilowatt hour for all the major charge point operators in the UK. It also shows the contactless payment pre authorization amount, and where appropriate, the maximum charge speed of the chargers. The beauty is in the colour coding of the information though. You can see at a glance where the specific network operator sits in the big scheme of things when it comes to pricing. CPUs with a red colour are expensive, Amber - moderate, and green - cheap. Well quote unquote cheap it's relative to the rest of the operators. It's a great little site to access for charge your pricing information
The short answer is there's a central registry.
Thanks for listening. Bye
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