Ruling opens door for Oregon utilities on EV charging
By Lee van der Voo
Sustainable Business Oregon contributing writer
A decision by the Oregon Public Utility Commission paves the way for utilities in the state to get into the car-charging business.
Oregon’s Public Utility Commission has paved the way for utilities to enter the electric vehicle charging market.
The commission’s decision, made last month, comes over objections from purveyors of EV charging stations, chiefly ECOtality Inc., the San Francisco-based transportation and storage technology company. ECOtality argued that large utilities like Pacific Power, Portland General Electric and Idaho Power could have a marketing advantage in the new sector and should not be allowed to recoup infrastructure through rates — something competitors can’t do.
The decision puts Oregon squarely in the middle of policy tracks being carved out by states as power commissions across the country grapple with what role — if any — utilities will play in the car-charging market.
California has excluded utilities from entering the sector. In Michigan and Virginia, utilities are allowed to own charging infrastructure, with some crafting pilot programs to test variable rates, according to PUC utility analyst Adam Bless.
In Oregon, utilities will now be allowed to offer EV charging stations, but the PUC will set a high bar before allowing the utilities to recoup infrastructure costs from rates.
The decision is in part designed to respond to the issues raised by ECOtality and also answer concerns about whether rural areas of the state will be adequately served by private companies alone, particularly as early adoption of electric vehicles takes place around cities.The PUC has been mulling the matter since 2009.
ECOtality officials said in a statement they respected the decision “and look forward to working with our utility partners to promote and grow the EV market in Oregon."
Barry Woods, an attorney and board member for Drive Oregon who has watched the issue closely, said it’s not yet clear how the rule will evolve.
“A lot of it is just a question of how the utilities feel themselves about whether they want to get into this business right now," Woods said.
He said utilities might be more inclined to wade into electric vehicle charging after ECOtality completes work in Oregon for the six-state EV Project, set to wrap in June 2013. Woods suggested utilities also might spy opportunity in the commission’s decision to allow costs for infrastructure for charging to be recouped through rates in some cases. The utilities must show the charging station is essential, unlikely to be provided by a third party, and that the rate fair and the utility has a separate EV rate class.
“It will be very interesting to see how PUC applies the language… because if I were PGE, I would be really interested in seeing how far I could push it. The line there is not as clean a line as perhaps it might seem,” he said. “It may be this is a green light for them to develop a subsidiary of an affiliate that's more directly affiliated with the charging business.”
Spokespeople for Pacific Power and PGE — two of three major utilities to weigh in on the PUC decision – said there are no clear plans for utilities to dive in to the market, though Pacific Power has said there are circumstances in which it would own and maintain charging stations, but would expect to recoup costs for stations that provide public benefit.
The PUC took a different tack with its order than Pacific Power advocated, said spokesman Paul Vogel. “We’re anxious that – despite what some project the ‘market’ to be, that the ‘markets’ represented by our particular customers and communities be the real driver on any related investment,” he said.
Charlie Allcock, director of economic development for PGE, also said he doesn't see the utility getting into the car-charging business.
"We see ourselves more as the fuel provider, and we see ourselves as understanding the technology and working with our customers who want to use electricity as a fuel," Allcock said.
Automakers had little to say. While Mitsubishi Motors and Nissan North America have tracked the issue, they remained neutral in comments to the PUC about whether private companies or utilities should provide ongoing charging services.
“They don't see the electric utility rates as the big make or break. They're interested in selling cars. And selling cars depends on marketing and gas prices and federal incentives,” said Bless.
“Electricity prices are not going to be a major factor in whether or not somebody is going to buy an electric car,” particularly, he said, while monthly bills for EV charging vary between $5 and $7 compared with gas bills of $100 or $200.
Though PUC staff suggested the commission take a firmer stance on time-of-use rates, advising they be mandatory for commercial fleets, for example, the commission decided that time-of-use rates must be offered but voluntary for consumers. Consumers who opt in will pay lower charging fees during off-peak hours.
The Citizen’s Utility Board supported that approach, saying mandatory time-of-use rates do not make sense for all customers. CUB was also happy with a decision to avoid regulating charging station owners as utilities, a prospect the group viewed as needless and potentially cumbersome.
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