Pacific Gas & Electric filed a proposal yesterday for $654 million in ratepayer dollars to build 25,000 electric vehicle charging stations across its service area in northern and central California.
If approved by the California Public Utilities Commission, the program will be the largest deployment of electric vehicle (EV) chargers in the country. California, the leading market for plug-in cars in the United States, currently has about 6,000 public charging stations.
Consumer advocates, however, including the Utility Reform Network (TURN), are concerned that the program puts an unfair cost burden on ratepayers for infrastructure that only a small percentage of customers will use. A typical residential customer would pay an additional 70 cents per month to cover the costs of the program from 2018 to 2022.
"We are very skeptical about the value of investing so much ratepayer money and betting it all on electric vehicles," Mark Toney, executive director of TURN, told the San Jose Mercury News.
PG&E estimates it will incur $551 million in capital costs and $103 million in operating expenses over the course of the five-year program. Pending approval, installation would begin in 2017.
The utility says it’s justified in asking ratepayers to finance the program because it supports the state’s larger sustainability agenda, which will benefit all Californians.
Governor Jerry Brown has called for putting 1.5 million zero-emission vehicles on the road in California by 2025 as part of the state’s ambitious goal of reducing greenhouse gas emissions to 80 percent below 1990 levels by 2050. The PG&E proposal would install 25,000 Level 2 chargers and an additional 100 DC fast chargers at strategic locations, including workplaces and retail stores, to help reduce range anxiety and promote EV adoption.
Increasing load from EV charging could also reduce electricity prices by helping to cover the utility’s fixed costs, said James Ellis, PG&E’s director of electric vehicles.
“At scale, EV adoption and EV charging can help us [manage] grid assets more effectively…and put downward pressure on rates in the long term,” he said. “This is the first step in a long-term scenario where we’re looking at bringing on more renewable energy, more clean energy resources, including electric vehicles for long-term benefits for all.”
To support California’s climate goals, industry models suggest there needs to be about 100,000 Level 2 public chargers in PG&E territory by 2020. PG&E’s program would meet only one-quarter of that demand, leaving the vast majority to other market players, said Ellis.
“PG&E isn’t looking to control the market by any means,” he said.
Under the proposal, PG&E would own all of the infrastructure and contract with third parties to install and maintain the chargers. A managing company would buy electricity from PG&E like any other utility customer and then oversee driver transactions and billing.
Pasquale Romano, CEO of ChargePoint, said his company believes strongly that utilities should play a role in expanding EV infrastructure, but that allowing a monopoly utility to select the EV charging hardware, network and pricing will reduce flexibility for the site owner and create little incentive for third parties to provide better, more affordable services.
“In general, monopoly control of any particular market never yields a good outcome,” said Romano. “It tends to destroy competition, and competition is what leads to the best cost structure and innovation in the long term.”
The other two big regulated utilities in California -- Southern California Edison and San Diego Gas & Electric -- also recently submitted proposals to build EV charging infrastructure in their territories.
Romano said ChargePoint supports SCE’s filing, in which the utility would install the electrical infrastructure, offer a rebate for charging stations, and have control over compatibility requirements that third-party providers must meet, but would not own the chargers or select which companies to work with.
“I think the very appropriate role of the utility is to help get the power to the box,” said John Boesel, president and CEO of CALSTART, a public-private partnership promoting clean transportation. “But I think then, at that point, it should be open to the market to figure out who they want to actually buy their electricity from.”