As we speak, proceedings are underway that will determine whether you’d be able to fuel up an electric vehicle and how much it will cost in New Hampshire. Three dockets are open at the Public Utilities Commission that will determine how much the utilities spend to prepare the grid for public fast-charging, whether there will be a business case for fast-chargers, and what it will cost to charge at home.
Here in this post, we’ll give you the basics of EV charging policy: why these dockets are necessary and what they’re trying to accomplish, and how EV charging can help the grid if we get these policies right.
First, Why It Matters
Why rob a bank? It’s where the money is. If reducing emissions is the goal, then transportation is where it’s at. As power sector emissions have fallen, those from transportation have remained flat.
Want more reasons? How about the fact that Consumer Reports found that driving an EV saves you something like $7,000 over the life of the car because of cheaper fuel and less maintenance? How about the fact that switching to EVs will literally save lives?
The future is cleaner, better, cheaper, but we'll need good EV charging policies to unlock all of this potential.
Demand Charges and Fast Charging
In the biz we call fast charging Direct Current Fast Charging, or DCFC. When folks who don’t own an EV think about reasons why they wouldn’t get one, the lack of fast charging infrastructure is high on their list.
While it's pretty rare that you need the entire range of your EV's battery, fast charging is important for tourism, road trips, and for getting people comfortable with the idea of owning an EV, and so more DCFC is an important catalyst for EV adoption.
That’s why the NH utilities’ proposals for DCFC electric rates are a real problem. The consultant that Clean Energy NH hired in partnership with the Conservation Law Foundation to review these proposals, recommended rejecting them. When I spoke with him in November Chris Villareal told me, “their heart is kind of in the right place, but what they’ve proposed is not going to work for the time frame of what we’re going to see for EV adoption rates.”
For customers that use a lot of electricity, utilities have a special billing mechanism called a demand charge. Demand charges reflect the fact that pulling so much electricity off the grid requires expensive grid upgrades. But they also cripple the economics of DCFC stations. Clean Energy NH learned last year, for instance that some of the few fast charging stations we have in New Hampshire pay the equivalent of $3.08/kWh, which is something in the neighborhood of 15 to 18 times what you likely pay per kWh at home.
The Rocky Mountain Institute has found that until there are enough EVs driving around that a car is plugged into a fast charger 30 percent of the time, demand charges will continue to be so expensive that they will make DCFC unprofitable. It's a chicken and egg problem: no fast charging makes it so people are afraid to get an EV, and no EVs make fast charging uneconomic. That’s why states around the country are proposing demand charge “holidays” until there are more EVs on the road.
But "they did not propose that in New Hampshire," Villareal points out, “In New Hampshire they proposed a simple three year increase over time, regardless of how it’s used.” This is why we recommend the PUC reject the utilities proposals, and come back with something more grounded in the reality of the pace of EV adoption in NH.
Time of Use Rates and Slow Charging
First, some EV charging lingo. Level 1 charging is when you simply plug your car into a standard wall outlet. That provides up to 6 miles of range per hour of charging. Level 2 is more like a dryer outlet, which provides around 35 miles per hour of charging. Compare those to DCFC, which can add 150 miles or more in an hour.
While fast charging occupies a lot of space in people’s thinking about owning an EV, slow charging will actually be the bread and butter. Currently, somewhere in the neighborhood of 80 percent of all charging happens at home, and the median range of an American EV is now over 250 miles. Think of it this way, how often would you need to stop at the gas station if you woke up every morning with a full tank?
What’s more, slow charging can actually reduce electricity bills for non-EV drivers. By ensuring that slow charging is happening at times when our grid is under-utilized, like the overnight hours, we push more electrons through the same wires. And more efficient use of our electricity infrastructure means lower electricity rates overall.
So when do we have spare capacity on our wires? Well, here are some examples of how New Englanders use electricity in the summer, winter and spring.
Encouraging people to charge overnight will help make the energy transition more affordable for all of us.
That’s why we at CENH likes Unitil’s proposal. Here’s what they laid out:
Charging overnight, from 8PM to 6AM would be cheapest
Charging during the day, from 6AM to 3PM would be in the middle
Charging in the evening, from 3PM to 8PM, when the grid is most stressed, would be most expensive
On average in Unitil’s proposal, there’s a 3:1 ratio between the most and least expensive times to charge your car. In other words, charging at 5PM would cost you three times more than charging at 10PM.
We like this scenario, because it puts the power to decrease stress on the grid in the customer's hands. What’s more, if other companies want to come in and offer “smart” charging--say a charger that you can leave your car plugged into all day, but will only activate once you hit 8PM--it gives them a strong price signal to respond to.
On the other hand, a proposal we didn’t like was Eversource’s proposal to do “managed charging.” Managed charging is when EV charging is turned off and on dynamically, from moment-to-moment, in response to the status of the grid.
“Managed charging is not a bad thing,” says Villareal, “It’s just that there’s no reason it shouldn’t be a competitive product.” We like the idea of managed charging, we just think that Eversource should leave that type of service to the competitive marketplace.
“Eversource is leveraging its utility role to expand their monopoly,” explains Villareal.
Opening up innovative market structures to any company that wants to compete will help keep down the cost of equipment that enables good ideas like interruptible, managed EV charging. The energy transition must be affordable, and we need to push for good policies to ensure it will be.