ORIGINAL REPORTING: CO-OP OFFERS RENEWABLES ONLY EV CHARGING, HIGHLIGHTING NEW OPPORTUNITY FOR UTILITIES

Co-op offers renewables only EV charging, highlighting new opportunity for utilities; Selling off-peak renewable kWhs to beat the rising cost of gasoline could also drive an EV boom

Herman K. Trabish, June 17, 2015 (Utility Dive)

Utilities could drive the success of electric vehicles and electric vehicles could drive the success of the new utility.

That is because electricity generated by renewables is what EV drivers want to charge their cars, and selling off-peak renewables-generated electricity is what utilities need to do. Great River Energy (GRE) just leapt at this growing opportunity with Revolt, a new program that will let some 1.7 million people choose to charge an EV with 100% wind energy.

“We think we are the first utility to offer a program like this at no additional cost,” explained GRE Sr. Marketing Specialist David Ranallo. “And, most importantly, it uses the electricity at the right time.”

GRE, a generation and transmission (G&T) cooperative that sells power to 28 local distribution co-ops serving 1.7 million Minnesotans, will retire renewable energy credits to cover every kWh consumed through the Revolt program. That guarantees the money EV owners pay for charging their cars goes to buy wind energy.

The program, which GRE calls an upgrade, is for current and future EV owners whose biggest concern is the environment, Ranallo said.

“EV owner-members told us they look for the environmental benefit when they make the switch from an internal combustion engine so we decided our promotion needed to be tied to that,” he said.

A lot of EV owners have heard people say that driving electric is “just burning more coal,” explained Steve Nisbet, VP of GRE-member Wright Hennepin Electric Cooperative, who drives his co-op’s Nissan LEAF. “This makes it easier for them to feel good about what they are doing.”

EVs are also good business for utilities, Tesla CEO Elon Musk recently noted. As drivers transition to electric powered cars, Musk expects electricity demand to at least double, creating new market opportunities for utilities ready to meet it, Utility Dive’s Gavin Bade just reported.

Minnesota’s estimated 3,100 EVs represent only about 0.5% of the state’s light duty vehicles and only about 400 of those are in GRE’s territory, Ranallo said. But the utility business model is evolving and this kind of program will allow utilities to both serve and engage its customers while at the same time leading what Ranallo expects to be a revolution in EV use.

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EV charging programs

Utilities across the country are looking at the transition to electric vehicles but they are not all coming to the same conclusions.

Driven by emissions reductions mandates, California utilities are making hundred million dollar plans to get into the EV charger installation business.

PG&E wants to build 25,000 level two charging stations and 100 DC fast charging stations at a cost of $653.8 million. Southern California Edison’s $355 million Charge Ready Programs would build 31,500 charging stations by 2020. SDG&E’s $103 million electric vehicle-grid integration (VGI) plan was designed to test customer response to variable charging rates by installing 550 charging stations by 2025.

GRE offers a $500 rebate to customers who install a 220-volt Level 2 chargerand move to one of the special GRE EV rate plans, Ranallo said. “But a lot of our members don’t need the level 2 charger and just charge on a 120 volt charger overnight.”

The research showed that what customers really want is a program “that leaves no doubt there are virtually no emissions because the charging is backed with wind energy,” Ranallo said. “That is why we brought this program to market.”

GRE customers who upgrade to Revolt get no special rate for driving electric but they also do not pay extra for driving “green,” Ranallo said. “We think it is the first one in the U.S. that offers 100% renewable electricity at no premium.”

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Special EV rates

Wright Hennepin members made only modest use of special charging rates, Nisbet said, echoing the experience of GRE and other cooperatives.

Dakota Electric, which gets it power through GRE and will be a part of the Revolt promotion, began developing a very low rate for EV owners in 2012, said Energy Services VP Mike Fosse. It also offered a time of use schedule with reduced rates for off-peak charging and rates three times as high for charging at peak demand periods.

They didn’t know at the time whether they would have 5,000 EV drivers in their territory or 50,000 but the rate plan fit with the utility’s demand response program so they decided to offer it in anticipation of long term market growth.

“We have just shy of 50 members participating,” he said. ‘We saw acceleration in 2013 through 2014. We went from about 10 vehicles to 44 vehicles by August of 2014. It has flattened since.”

Whether it helps the utility will depend on how the market matures, he said. “But if our member-EV owners charge during off-peak times, it is a win-win because it helps manage our wholesale power costs.”

South Carolina Central Electric Power Cooperative, which like GRE is a G&T, has been experimenting with EVs since around 2008, when it had a Prius adapted for electric driving, according to Strategy and Emerging Technologies Director Michael Smith.

When the Chevrolet Volt and Nissan LEAF became available, Central Electric bought one of each. It also bought early Eaton Pow-R Station chargers to get its member co-ops thinking about the new driving technology.

Recently, it sold the vehicles and purchased a plug-in hybrid Ford Focus for its fleet.

“It is not a circus show anymore,” Smith said. “It is part of how we get around and there ultimately will be more than this one in our fleet.”

Smith believes a transition to EVs is inevitable. “There is no denying the electric drive train, whether fueled by hydrogen fuel cells or electric batteries,” he said. “There is nothing that compares to the efficiency of that drive train.”

Berkeley Electric Cooperative, which gets its power through Central Electric, provides two rate programs, said Director of Marketing and Energy Services Eddie Plowden. Although one of the plans can cut the per-kWh rate for charging in half if the car owner takes on the upfront payment for a dedicated submeter, only one member has shown interest.

“A typical electric vehicle that drives 1,000 miles per month will use about 300 kWh per month. At our retail rate of $0.12 per kWh, that is $36 per month,” he explained. “It isn’t worth the expense and effort to get on the time of day rate and save $18 per month. $36 per month for 1,000 miles is a lot cheaper than gasoline. They have accomplished their goal by getting the car and plugging in.”

South Carolinians are definitely buying EVs but the vehicles will remain no more than today’s 0.5% to 1% of the market while gasoline prices are affordable, Plowden believes. Plug-in hybrids have a better chance at growth as vehicle manufacturers seek ways to meet new CAFÉ standards, he added.

Berkeley Electric has no plans for EV promotions, Plowden said. “If there was a group planning to purchase a large number of the vehicles, because each would add 300 kWh per month in sales, then we might consider some kind of promotion. But we won’t be doing that in 2016.”

New load sources for utilities

Wind energy and electric vehicles are the perfect combination for utilities and the grid because wind-generated electricity is often abundant and unused at night while EVs are usually parked and ready to charge, noted American Wind Energy Association Clean Energy Consultant Carl Levesque.

“For a utility, wind-powered EVs are a new market for their product (electricity) and they’re providing it in a way that’s good for the environment and good for energy security,” he said.

“EVs are the first time in a long time that electric utilities have the opportunity to grow load and have people be happy about it,” Nisbet said. "And most people in Wright Hennepin’s membership who do solar are also interested in EVs and vice versa so renewables are definitely tied to EVs and if the GRE program encourages that, it is a good thing.”

GRE customers are predominantly residential, said Communications Manager Therese LaCanne. “At night is when we have our valleys and we work very hard to sell those valleys.”

GRE’s load curve begins to peak when residential customers begin getting home from work and slowly declines into the evening. But the overnight hours are when the MISO market has abundant low cost wind-generated electricity. “If we raise the low part of the curve, it would have an overall positive rate impact,” Ranallo explained.

By 2017, a 200 mile battery range will be more common for EVs, Ranallo said. “We feel like we’re setting the stage right now. We want to be ready to provide that electric service by then.”

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