Utility load growth from EVs can actually benefit all ratepayers by providing societal benefits and reducing utilities’ average cost of service.
Nancy Ryan is a Partner at Energy and Environmental Economics (E3), and an economist with over two decades of energy experience. Dr. Ryan was formerly a Commissioner at the California Public Utilities Commission, where she held a number of other senior positions. She taught applied economics at UC Berkeley’s Goldman School of Public Policy for many years, and has held senior climate advocacy roles at Environmental Defense Fund. Lucy McKenzie is a Consultant at E3, where she focuses on electric vehicles and other distributed energy resources. She holds a Master of Public Policy degree from UC Berkeley’s Goldman School, and spent 5 years working on energy projects at economic consulting firm Analysis Group, Inc.
The authors would like to thank former CPUC Commissioner Rachelle Chong, as well as Hilary Staver and Eric Cutter of E3, for their thoughtful suggestions and review.
Mass adoption of electric vehicles (EVs)1 is increasingly recognized as a viable and necessary step to meeting climate and air quality goals. As we see more and more EVs on the road, regulators and stakeholders are asking what role utilities should play in developing the charging infrastructure needed to reach mass adoption.
In the March issue of Public Utilities Fortnightly, the authors investigated three key questions: whether public investment in charging infrastructure is needed to meet EV adoption goals, how best to inject public funds into the market, and how to apportion costs and risks between the many industry players.
This follow-up article seeks to explore a related question: How can regulators ensure that utility investments in charging yield benefits to the general body of ratepayers?
We present evidence from our analysis showing that transportation electrification offers broad societal benefits, and that the resulting load growth can benefit all ratepayers by reducing electric utilities' average cost of service. We also examine approaches to encouraging flexible charging, ensuring ongoing charger maintenance, and expanding EV access beyond high-income customer segments.