California Utilities Want To Charge Your Electric Car, Boost Stagnant Power Demand
Electric utilities have an existential problem. The demand for electricity is not growing like it used to, dampening the need for new power plants, power lines and other infrastructure that drive their profits.
“From the early 1900s, the utility growth model was built on just expanding the infrastructure to more and more places, and we’ve almost been a victim of our own success in that the country is electrified,” says Kellen Schefter with the utility trade group EEI.
So utilities are looking for new ways to make money.
A couple years ago, Schefter wrote a paper about one remaining, largely-untapped market—transportation.
“Against the backdrop of slowing growth in the electric power industry, bringing electricity to the transportation sector is a huge, albeit long-term opportunity for load growth,” it says.
Schefter explains that transportation is the second-largest type of power use in the United States, but it remains 92 percent reliant on petroleum.
“It’s really the last sector of the economy that has yet to be significantly electric-powered,” Schefter says. “It’s the single largest opportunity.”
The paper suggests utilities support the adoption of electric vehicles and play a key role, not just in supplying them power, but actually building the extensive new infrastructure those cars will need to plug into the electric grid.
California utilities are following this blueprint almost exactly in their quest for new market share. The state’s largest electric utility, Pacific Gas & Electric in Northern California, has already replaced a quarter of its own fleet of 14,000 cars and trucks with vehicles that run on electricity or natural gas.
At a company natural gas facility in San Ramon, rows of new, shiny white chargers sprout at rows of parking stalls ready to fill their electric vehicles.
“We have about 90 charging stations; it’s the largest charging infrastructure, I think, in California for a single building,” says the company’s Aaron Johnson.
Instead of filling its own cars with someone else’s gasoline, PG&E supplies them with its own product–electricity.
The San Ramon facility could also serve as a model for the power company as it looks to expand beyond its own fleet and into public vehicle charging.
California lawmakers and Governor Jerry Brown have set a state goal of putting 1.5 million zero-emission vehicle on the road by 2025, six times more than the current 250,000 such vehicles registered in the state.
Those cars will need places to fill up.
The state “needs about 100,000 chargers in our service territory,” says Johnson. “We think there’s public infrastructure like this for about 5,000 charging stations, so we have a long way to go.”
PG&E has spent more than a year lobbying the California Public Utilities Commission to approve a new pilot program. In that time, its proposal has undergone major changes, after comments from environmental groups, ratepayer advocates, electric vehicle charging companies and commissioners. Under the current version of the proposal, the company would oversee the build-out of 7,500 charging stations, paid for by adding 22 cents a month to each of its ratepayers’ bills.
The final version of the pilot program could either propel the growth of the nascent industry or imperil it as the century-old electric utility enters the vehicle charging business.. So far the industry is made up of tiny, start-up companies.
The three-year-old San Francisco-based startup Volta runs about 200 charging stations in the state.Two of them occupy prime parking spots outside of the Trader Joe’s at Stonestown Mall in San Francisco.
Volta CEO Scott Mercer says the chargers are used extensively, for as much as 18 hours a day. Electric car drivers park, plug in and fuel up for fifteen minutes or an hour.
“They go to the mall, do their shopping, plug their car in, and they get anywhere to 20 to 50 miles worth of range of free electricity,” Mercer says.
Volta has an unusual business model. Where other companies put an electric meter on the charger, so customers pay for the energy they use, Volta offers its electricity for free, making money off prominent advertisements on the charging stations.
