Electric Vehicle Infrastructure
Issue:
The Pennsylvania Department of Environmental Protection unveiled a plan on Wednesday February 17, 2019 to boost Electric Vehicle adoption, in part by encouraging utilities to invest in transportation electrification (Pennsylvania Electric Vehicle Roadmap). Pennsylvania has only about 15,000 EVs registered, a tiny fraction of the roughly 8 million vehicles in the state. But the DEP estimates an aggressive approach to boosting adoption could mean about 31% penetration by 2033.
IECPA Position:
IECPA is not against the development of an EV charging system. However as we indicated in the IECPA comments in case M-2017-2604382, utility cost associated with EV charging need to be collected from those customers that benefit from the charging stations and not just broadly allocated to all utility customers. Additionally, the should not be the entity required to develop and file a transportation electrification infrastructure development plan. This is outside of the core mission of providing safe, adequate and reliable service to all customers.
Details:
2018 HB 1446 (Rep. Quinn, R-Bucks) amends Title 66 (Public Utilities) of the Pennsylvania Consolidated Statutes and raises an important issue regarding the best approach to fostering the development of the market for Electric Vehicle (EV) charging stations. The number of electric vehicles in Pennsylvania has steadily increased and it is expected that the number of EVs purchased in Pennsylvania and across the nation will continue to grow. Most EV charging currently occurs at home or at work , but there are currently about 723 public EV charging stations in Pennsylvania. As the number of electric vehicles increases across the country, and EVs are used for more transportation needs, the demand for EV charging stations will also continue to grow. As the Keystone State, with many transportation corridors, it will be important to work toward the development of a robust market for public EV charging stations. There are two basic components associated with EV charging stations. The first component is the distribution system grid that brings the electricity to the EV charging station location. This is a monopoly function that generally must be provided by the utility that serves the area in which the station is located. The second component is the EV charging equipment that provides the charging service. The EV charging station equipment is not a monopoly function and need not be provided by utilities. Utility ratepayers support the overall electric grid that delivers the electricity to all customers residing or physically located within the service territory. That is different from providing a transportation charging service to EV owners, many of whom may only pass through the service area. This is outside of the core mission of providing safe, adequate and reliable service to all customers. This bill would create several problems:
- EV charging station equipment is not a monopoly function that needs to be supplied by a regulated utility. There is an active competitive market for EV charging station equipment. Utilities should be providing the distribution system grid connection to the EV charging stations in their service area.
- Provides an unfair advantage for utility ownership of EV charging station equipment by providing monopoly ratemaking treatment for the associated costs from ratepayers. This could significantly limit the development of a competitive EV charging station market in Pennsylvania.
- Adds additional non-core responsibilities to the electric utilities for developing a transportation infrastructure regional framework. The bill would also allow for the collection of all costs associated with these transportation studies and plans to be collected from electric utility ratepayers. Additionally the utilities could establish a structure that further provides a competitive advantage for their ownership of EV charging equipment.
IECPA worked to get modifications to the legislation that protect industrial class utility distribution customers and require cost recovery from those who benefit from the EV charging stations.
IECPA Letter to House Majority Leader Read re HB 1446
IECPA Letter to House Speaker Turzai re HB 1446
07.23.18 Update: This bill was not been taken up for a vote in the House.
October 2019 Update: SB 596 was introduced which contained many of the same problems as HB 1446. Senate Bill 596 adds additional non-core responsibilities to the electric utilities for developing a transportation infrastructure regional framework. Additionally, the utilities could establish a structure that further provides a competitive advantage for their ownership of EV charging equipment. This framework should be the responsibility of the Department of Transportation. Once that framework is developed then the appropriate electric distribution company(s) can develop the associated electrification infrastructure development plan.
Electric vehicle (EV) charging station equipment is not a monopoly function that needs to be supplied by a regulated utility. There is an active competitive market for EV charging station equipment. Utilities should be providing the distribution system grid connection to the EV charging stations in their service area. Many times, utility ownership of EV charging stations provides an unfair advantage for the utility through monopoly ratemaking treatment for the associated costs from ratepayers. This could significantly limit the development of a competitive EV charging station market in Pennsylvania. “Missouri, Michigan and Kansas all have turned down utilities’ requests to build charging stations with customers’ money. Massachusetts allows utilities to build the underground infrastructure for a charging station but leaves the above-ground installation to a private company. This is an arrangement called a “make ready.” As a result, the utility National Grid is proposing to spend $24 million on 140 sites. This approach may relieve private companies of the fear that utilities will squeeze them out of the market.
Senator Mensch was determined to get the bill through committee. At least three groups went in seeking amendments and were denied. All those groups will be seeking a House option.
On November 19, 2019 SB 596 passed the Senate. On December 2, 2019 the bill was referred to the House Consumer Affairs Committee. IECPA sent a letter to the committee members along with proposed amendments.
Docket No. M-2017-2604382
On May 4, 2018, the Pennsylvania Public Utility Commission ("PUC" or "Commission")
entered a Proposed Policy Statement in the above referenced docket in order to support increased investment in Electric Vehicle ("EV") charging infrastructure and to eliminate regulatory uncertainty surrounding the operation of EV charging stations in the Commonwealth of Pennsylvania. The Commission's Policy Statement was specifically designed to accomplish these objectives by "(1) making clear that it is the policy of the Commission that an EV charging facility open to the public for the sole purpose of recharging an EV battery should not be construed as a sale to a residential consumer and (2) requiring that EDCs expressly address EV charging stations in their tariffs." Proposed Policy Statement, pp. 1-2. With the issuance of the Proposed Policy Statement, the Commission also solicited Comments from interested parties within 45 days.