Car Culture/Corbis
One of the biggest obstacles to the widespread adoption of electric vehicles is the lack of on-the-go charging. It’s easy enough to charge at home if you have a garage—not so useful for apartment-dwellers who could benefit the most from EVs—but, unless you have a Tesla and access to the company’s Supercharger network, plugging in on the go is a pain.
That’s why build-out of the EV charging network is so important to the longterm success of the technology. According to PG&E, the utility that provides electricity to 16 million people in northern and central California, that state will need 100,000 public Level 2 chargers in its service territory by 2025, to support the 1.5 million EVs that Governor Jerry Brown wants in the state.
To do its part, PG&E wants to install 25,000 charging stations through 2022 in its service area, it announced Monday. The infrastructure will cost some $650 million, to be raised by increasing electric rates paid by all its ratepayers. The company says the average residential customer would see their bill rise by 70 cents per month. This means the whole project is essentially free for PG&E, because the tab would be picked up entirely by its rate paying customers.
PG&E would own all the physical infrastructure, at no cost to site owners, such as parking garages and malls. The utility would pay third party companies to install and maintain the chargers, as well as handle billing and payment of electricity to drivers, who will pay some amount of money for the privilege of plugging in (pricing hasn’t yet been ironed out). California’s Public Utilities Commission has jurisdiction over all rate increases in the state, and will hear public comment and hold hearings throughout 2015 and perhaps have an answer by the end of this year.
This all sounds great—adding all those places to charge could encourage more people to buy electric cars and reduce air pollution. But don’t think the PG&E execs are doing this out of the goodness of their hearts.
The company stands to sell a ton more electricity over the next couple of decades to electric car buyers and, thanks to the increase in rates on all its customers, doesn’t really have to pay for a lot of the infrastructure. It also has to play its part in meeting the state’s ambitious clean air and climate change goals, which include reducing greenhouse gas emissions to 80 percent below 1990 levels by 2050. Electric cars make renewable energy more practical: One problem with things like solar panels and wind turbines is they produce energy sporadically, and the grid is designed to deliver power, not hold onto it. EVs, with their big batteries, are made to store power, so they can help line up supply and demand. That’s good for everyone.
But the charging station scheme would also give PG&E a major advantage over competitors that don’t have millions of captive users to cover the tab for construction. And that could decimate the existing market for EV infrastructure, which is not so good for everyone.
The utility argues that its plan would spur growth in the market for electric chargers, but who can compete with free?
“We should have the freedom to compete on innovation and we’re happy to exist in a market where we’ll compete on price,” says Pasquale Romano, CEO of ChargePoint, the nation’s largest charging provider. “If they [PG&E] own the hardware, they have no incentive to bring the price down.” Why would a mall choose to buy EV chargers from ChargePoint when it can get them for free from PG&E?
And what incentive will PG&E have to innovate and offer a good charging experience for its customers? “We compete for site owners’ business by bringing innovative features” to our chargers, says Romano. “What a retailer wants is to attract customers to the store.” ChargePoint offers services like the ability for retailers to offer free charging for a few hours, then raise the rates to encourage turnover, or to pay extra for retracting charge cable.
An electric utility is not one of many brands like Exxon or Shell, where you can choose from a ton of different places to fuel up your gas-burner. If PG&E were to build their 25,000 charging stations, they might end up being the only charging game in town. Good for PG&E shareholders, bad for everyone else.
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