The Call To Establish A National EV Charging Network
With the number of EVs on US roads projected to reach 18.7 million by 2030, is it time to establish a national charging network? A coalition of businesses, associations, and individuals called Charge Ahead Partnership (CAP) says yes, and they want us to reexamine the way that EV charging is done across regions and states in the US.
Charge Ahead Partnership is working with policymakers to ensure that the nation’s system of charging locations is positioned to meet drivers’ expectations of quality service, safety, and affordable pricing. To do so, they envision a national charging network that would duplicate many of the norms that accompany the established US gasoline refueling network.
Charge Ahead Partnership says it’s time to empower the consumer, instead of letting power companies monopolize the industry.
“Whether you care about the environment and want to reduce GHG emissions by increasing the use of EVs, are in the EV charging service market (or want to be), or are looking out for consumers who are being unfairly charged on their home electric bill to pay for charging someone else’s EV,” Charge Ahead Partnership says it is there “for you!”
Charge Ahead Partnership believes the best way to develop a national charging network is through a competitive, market-based approach that gives consumers the confidence to purchase EVs and meets the needs of today’s drivers. They argue that utilizing the current, established fueling network is the first step to alleviate “range anxiety” and incentivize drivers to make the switch to EVs.
The Dilemma of Demand Pricing
Charge Ahead Partnership members have a common goal of efficiently and effectively developing a charging network for EVs across the US. I learned about the organization after I wrote a CleanTechnica article that discussed how difficult it is for convenience stores to install chargers due to the high costs of demand pricing. “We agree 100% with you that demand charges can make it impossible for small retailers to get into the EV charging business,” Ryan McKinnon, direction of communications for the Charge Ahead Partnership, wrote to me. “We have members who have told me that they would not offer EV charging, even if they got a high-speed charger for free, because they can’t afford the demand charges.”
Demand charges are a component of commercial and industrial electric bills that assess a fee based on the highest amount of energy used in any 15-minute period throughout the month. A demand charge applies when a business draws a lot of power at once — say, 4 EVs charging at the same time — even if only for a short time period. Designed originally to make sure customers are paying their fair share to keep the grid ready to deliver at all times of day, demand charges have become a tremendous financial burden to small business owners who’d like to add EV chargers on their sites.
Even if the base price of electricity is high, base price is a predictable metric that can be passed along to the consumer, according to McKinnon — it’s the same way you would mark up any retail item. He went on to describe the major challenges with demand charges and how unpredictable they can be for a small business. “You don’t know how much it is going to be until the month is over, and you can’t accurately pass that cost along to the consumer,” he explained. He offered a scenario to help us understand thi small business dilemma.
Imagine you have a 4-port, 150 kW charger. If 4 cars are plugged in at once, you would be pulling 600 kW of power, likely your peak usage for the month. Your demand charge is $10 per kW.
- Month 1: You have 300 customers over the course of a month, but they are evenly spaced out, and there is never more than one person charging at once. Your peak demand, as a result, is 150 kW. With a $10 per kW fee, your demand charge that month is $1,500 ($10 x 150).
- Month 2: You have 300 customers over the course of the month, but 4 of them come at the same time. Your peak demand, as a result, is 600 kW. With a $10 per kW fee, your demand charge that month is $6,000 ($10 x 600).
Such a distinction makes demand charge rates one of the most important — and detrimental — factors when small businesses consider adding an EV charger.
My article also discussed a way that small businesses and others could manage demand costs: through the addition of an onsite storage battery system. McKinnon commented, “While your solution of onsite battery storage is definitely an option, it also brings with it the cost of buying a massive battery and having space for it on site. At the rate battery technology is improving, it’s not far fetched to assume a battery you buy in 2023 may be outdated within a few years.” He also speculated that the “environmental impact of disposing of huge batteries would be pretty significant.”
Charge Ahead Partnership asks us to consider how utilities’ current approach is to install EV chargers “where it is convenient for them, not the driver.” Utilities seem to be funding the costs of EV charging installation and energy used at the chargers by increasing the rates for their current power utility customers. “It is wrong for power companies to build and operate EV charging stations that are paid for through home electric bills by lower income families,” the Charge Ahead Partnership says on its website, “most of whom do not have EVs.”
The current charging system was established based on policies largely dictated by the power companies and does not benefit consumers nor incentivize the growth of the EV charging network. Charge Ahead Partnership argues that charging should be run by consumers and not power companies. Their position is that, while power companies are an integral part to the future of EVs, they should not solely lead the establishment and expansion of the EV charging network.
Final Thoughts about a National Charging Network
What legislative solutions are states taking to mitigate demand charges?
Massachusetts has charging legislation that dates back in 2021. McKinnon notes that EV charging retailers “are just catching wind of it now and are opening up shop in MA. This example is (by design) a long-term solution, as the Massachusetts program suspends the charge for up to the first 10 years of a charger’s life.”
Charge Ahead Partnership offers a page on their website that lists states with legislative and/or regulatory developments that directly impact the free market for EV charging. Does your state have laws that require utilities to propose alternatives to help customers avoid large demand charges that can come with installing EV fast chargers? You can help by advocating with your elected representatives to reduce or reconsider demand charges.
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