The ABCs of EVs – Policies to Effectively Grow Electric Vehicle Market

Experts

Policy Counsel, Energy and Environment
Senior Communications Associate, Energy Policy

By Jason Kuruvilla on Monday, May 22nd, 2017

Electric vehicles (EVs) are on the cusp of a market breakthrough – going from a small niche market to mainstream vehicles. EV sales set a record in 2016, increasing by over a third from the year before, and 2017 is already on track to blow past that record.

But EV growth has implications beyond clean driving. A rapid expansion of EVs could place a heavy burden on the utility grid, leading to higher costs for consumers. But with the proper planning and foresight, growth in EVs could actually help save consumers money.

How? That is the subject of a new report from the Citizen’s Utility Board (CUB), an Illinois based consumer advocacy group, to help policymakers and local utility companies think through these implications and develop strategies to promote EV growth while lowering costs. The report, The ABCs of EVs, lays out a series of strategies that communities and regulators should consider in order to benefit from EV growth and optimize the electrical grid.

There is no one-size-fits-all solution to designing a system for the EV-era. But, according to CUB, a comprehensive approach to developing effective EV solutions should include the following elements:

  • Deployment of smart charging technology;
  • Development of new rate designs;
  • Support for infrastructure investment;
  • Consumer education; and
  • Regional cooperation and planning

For example, EVs do not necessarily have to be a burden on the electrical grid. Rather, through the deployment of “smart” systems (chargers, meters, and rate designs), EVs could be a hub in a broader network of distributed energy resources. New technologies could help shift how EVs are charged, from peak hours to non-peak hours, leveling out the load on the grid and reduce usage spikes. Plugged-in EVs could also help provide energy back to the grid when needed (and compensating EV owners in the process).

Electricity regulators have a range of options when it comes to supporting electric vehicle expansion, from just ensuring grid reliability when issues arise to funding a public charging infrastructure, and many options in between. The key is to ensure that investment decisions weigh concerns about whether utility-owned and -operated charging stations limit competition and innovation and what public benefits would come from utility investments. The report highlights several examples of pilot projects in California designed test the charging market and how utilities can best support it.

Finally, any EV utility policy should be consumer-centered. This includes offering time-based rates to offer charging at lower costs, connecting EV chargers to the grid easily and efficiently, and ensuring low-income households have access to the benefits of EVs through subsidized EV transit and car-sharing programs. Policy-makers should take a regional approach to EV infrastructure to save money and share benefits, while also providing drivers with a uniform customer experience. And finally,regulators should prioritize opening service areas to competition to further innovation and drive down costs.

Policymakers have many options to address growth of EVs. Over the next decade, EV market share is expected to increase significantly.  Done right, policies to support transportation electrification can achieve gains in both traditional goals – safe, reliable and affordable service – and new goals of sustainability, efficiency and customer choice.

Read the full report here.

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