The transportation sector, specifically electric vehicles, is a whole new world for utilities. Indeed, EVs are a whole new world for everyone.
In theory, EV charging offers opportunity for public power utilities. As electricity sales otherwise flatten, EVs create new demand.
As public power utilities begin to scope out getting involved in EV charging, significant questions loom about how people will charge EVs: Where will they charge, when will they charge, and how will they react to price signals and other motivators?
Fortunately, some pioneers and researchers are beginning to tease out answers. Even though EVs remain nascent in use, certain charging patterns are emerging.
“We don’t really even understand how people drive their conventional vehicles,” said Jamie Dunckley, a data scientist at the Electric Power Research Institute, who has researched EV charging in partnership with about 35 utilities. “People drive their cars 5 percent of the day, and 95 percent of the time they are parked and could be charging.”
New phobia: Charge anxiety
Initially, “range anxiety” — the concern of a driver about having fewer miles of charge on a battery than the distance to a charging station — served as an inhibitor to EV growth. But with more chargers now installed, range anxiety is giving way to a new fear, what Dunckley calls “charge anxiety.”
“You are confident that you can get to a station. But when you get there, will it be working? Will there be a big line? And is the network I’m part of (e.g., Blink, ChargePoint, EVgo) compatible with the network where I stop? Will I be able to pay?” she said.
Tesla appears to be aware of this issue and prides itself on producing reliable charging stations where lines are short. As a result, the company’s charging stations are receiving favorable reviews from customers, she said.
But for people who don’t own Teslas, “it’s a smattering of different networks,” Dunckley said. The business model for charging stations remains undeveloped, so a sizable number are run by startups that tend to “either flop or change their business model,” she said. As a result, service stations fall into disrepair.
No quick remedy exists. Having utilities own and operate the charging stations is one possibility. However, the investment in charging infrastructure requires first understanding the business case for the utility, when and where customers would want to charge, and any state rules or regulations regarding utility involvement in EV charging.
“Each state, each utility is different. And if you think about long-distance driving, you are going to be crossing from one utility territory to another,” said Dunckley.
For now, charge anxiety might require time and market maturity to quell.
Where to locate chargers
Minnesota’s Elk River Municipal Utilities, a public power utility within commuting distance of Minneapolis-St. Paul, has learned the importance of location when it comes to charging stations.
The utility installed two public chargers — a 240-volt Level 2 charger and a 480-volt DC fast charger — that are powered by 100 percent renewable energy. In addition, ERMU recently purchased a second Level 2 EV charger, which will be located at ERMU’s headquarters and will serve its own and the city’s fleets.
ERMU’s goal is to garner data about charging patterns and preferences that it can share with the broader utility industry, in keeping with a grant it received through the American Public Power Association’s Demonstration of Energy & Efficiency Developments program. The utility is working with the city of Elk River and FleetCarma, which provides utilities with technology and services to plan for EVs and support charging operations.
Utilities win praise from EV supporters when they install new charging stations. But others, such as store owners whose income is tied to gasoline sales, are not always happy with the move. ERMU contemplated this problem and came up with a diplomatic solution: Make potential competitors into partners.
“We intentionally tried to identify some adversaries and make them partners. We knew that convenience stores and gas stations were probably not going to be happy about electric vehicles and electric vehicle public chargers,” said Troy Adams, ERMU’s general manager.
Such partnerships benefit both the store owners and the EV owners. While the vehicle charges, the owner is likely to shop, providing revenue for the convenience store. In addition, the customers can get a cup of coffee while waiting, which speaks to another important consideration in terms of location: Is there a way EV owners can occupy their time while waiting for a vehicle to charge?
“We tried to locate the chargers on heavily trafficked corridors, but also close to businesses that can support someone walking there, having a cup of coffee, having a doughnut. Our DC fast charger is by a fuel station, a grocery store, a liquor store. You can walk to them easily within two or three minutes. Plug in your vehicle, run some errands, and come back,” said Tom Sagstetter, ERMU conservation and key accounts manager.
Is nighttime the right time?
Like many utilities investing in EV charging, ERMU found appeal in the load pattern changes EVs offer. The expectation is that EV owners will do most of their charging when demand for electricity is otherwise low and supply at a surplus.
“From the highest level, we started looking at EV as a part of a strategic planning initiative. We identified EVs as one of the very unique opportunities where we can grow load at the right time of the day while being environmentally responsible,” Adams said.
The “right time” is nighttime in Elk River’s home state of Minnesota — and in most places.
California, however, is becoming an exception, with its vast amount of renewable energy leading to a daytime energy surplus. Sacramento Municipal Utility District, an early leader in researching EVs, is exploring how to encourage daytime charging.
Potential exists to help tackle California’s infamous “duck curve” by encouraging some EV charging during the day, according to Lupe Jimenez, manager for electric transportation and energy storage research and development at SMUD. The duck curve is a graphic representation of the flood of solar energy that creates a daytime energy surplus. The surplus is depicted in the form of a fat duck belly. Jimenez sees the possibility of trimming the chart’s belly by absorbing the energy through EV charging during the day.
“As renewables continue to proliferate and as electric vehicles become more common, we are going to have the opportunity to help shape that in real time, and we’d rather get ahead of it than wait until it’s a problem,” Jimenez said.
Of course, many people are not at home during the day; they are at work. So, encouraging employers to install EV charging stations is key to shifting the demand pattern.
There are good reasons for employers to do so. For one thing, the presence of EV charging stations improves the business’ image as a forward-looking, sustainable enterprise. Businesses also may offer charging as an employee benefit.
But Jimenez points out that many obstacles must be overcome before employers readily embrace EV charging. Capital costs for installation can be high. The employer might not have the space within a parking lot for the chargers. Moreover, many simply know little about EVs and how to install chargers. On top of that, administering the programs creates new work. If there is not a 1:1 ratio of chargers to EVs, who gets to charge first? Is it first-come, first-served, or should the employer create a schedule for who charges when? And who pays for the electricity — the employer or the employee?
To help with the cost, SMUD offers customers a $1,500 incentive for each Level 2 charging station. Business customers can take advantage of the incentive for installing up to 20 chargers per location. SMUD also offers up to $120,000 for DC fast charging stations with public access.
EPRI’s Dunckley pointed out that EV drivers tend to be clustered in terms of geography. Often they are centered in high-income areas, not evenly spread out over a service territory. This will affect how utilities use them in managing load and planning capacity. “It’s something to consider — not necessarily a bad thing, but something to watch for.”
Changing fuels and changing habits
How people pay for electric refueling, not just how much they are charged, has an impact on habits and expectations, a lesson learned by ERMU.
Unlike EV operators, most drivers of gasoline-powered cars fall into common refueling patterns. One popular habit is to wait until the gas needle hits near full and then “top off” the tank with two or three clicks (shut-offs) of the pump handle.
Another is to “run on empty,” which is the habit of putting just enough gas in the tank to get you from point A to point B and maybe back again. This is the “pump upon need” model.
When ERMU studied EV driver behavior, it found some resistance to the charging fees it levied on its users — one for the connection and the other for the energy itself. It turned out that the resistance was a result of drivers’ EV charging needs.
“Our rate design works well if you are going to completely charge your vehicle. Our initial observation of behavior is that it doesn’t work well if you are going to just charge for 15 minutes to grab milk,” Adams said.
The ERMU study found that the source of concern centered on unique EV driver behavior. Drivers liked to “top up” their vehicle while out running errands. The practice let them put in a few kilowatt-hours of charge to get them through the day. They then did the bulk of their charging at home at night. The fixed connection fee made the cost for just a few kWh very high and noncompetitive with third-party stations that have nominal fees.
The fact that most EV charging occurs at home could provide a challenge to utilities that seek to use connection fees to recover the costs of installing public charging units.
In general, time-of-use rates seem to hold appeal, at least to early adopters. EPRI tracked 100 EVs over 18 months, gathering data every minute. Researchers found that even Tesla buyers — those driving vehicles that can cost in the six figures — “shifted their behavior to save a couple of dollars,” Dunckley said.
“When there is a time-of-use rate effectively communicated, EV drivers — at least in two studies I’ve been working on — adhered to them across the board,” she said.
EV charging is opening new opportunity for utility supply and demand, but it requires careful thinking about the logistics of getting customers to plug in at the right time. Understanding the inspirations and anxieties behind EV charging behavior not only helps utilities make effective installation investments, but also creates happier EV owners, which makes more of them, opening up a new business path for electric utilities.
Incentivizing electric
Charging electric vehicles offers benefits to utilities whether as a new source of electricity sales or a load management tool. So, how does a utility encourage more EVs in its service territory? That’s the topic of an ongoing Electric Power Research Institute study with eight utilities.
The study, which finishes up in December 2018, looks at a range of triggers, from HOV lane availability to gasoline prices in various regions.
“What motivates someone in Hawaii might be different than what motivates someone in Tennessee or Nebraska,” said data scientist Jamie Dunckley.
A clear commonality is that EV owners are the best promotion for EVs. Utilities can play a strong role in helping them have a good experience so they will encourage peers to join the club.
“When someone buys an EV, it can be overwhelming in terms of thinking about what they can do next and how charging works,” she said. To address this problem, Dunckley gave the example from Arizona’s Salt River Project, which offers a $50 Amazon card to EV buyers who provide their contact information. The public power utility then includes them in a group that receives educational information and invitations to EV events.
“If the EV owners are having a great time with their EVs, they will tell other people about it,” she said.
