Friday, February 20, 2015

Utilities Push into Fuel Stations for Electric Cars

A charging station at a Walgreen's in California. (Credit: Max Whittaker for The New York Times) Click to Enlarge.
In several regions, utilities — big companies experienced in financing, building and managing power infrastructure as well as selling electricity — are getting into the vehicle charging business.

Their goal is nothing less than making the electric car a viable alternative for millions of consumers and, in the process, helping shore up their own flattening business of supplying electricity.
[I]n California, Pacific Gas and Electric recently became the last of California’s three big utilities to file a proposal with regulators that would allow it to install 25,000 public chargers — costing $654 million — in a state that has about 6,300 public chargers, at about 2,000 stations.  In all, three major utilities envision building as many as 60,000 chargers in California in the coming years.

Nationwide, there are about 9,000 public stations, with about 22,900 chargers, according to the Energy Department.

The electric vehicle industry has a long way to go to catch up to the availability of gas.  In 2012, there were about 114,000 gas stations in the United States, according to the Census Bureau.
Although California leads the nation in electric vehicle sales, with about 40 percent of the market, it is under pressure to meet aggressive goals that would require 100,000 chargers that are faster than traditional home outlets — enough to support one million vehicles — by 2020.

Beyond California, automakers face strict federal mandates to improve fuel efficiency and reduce carbon emissions.  By 2025, their fleets must average at least 54.5 miles a gallon, more than double the current average of about 25 miles a gallon.
For the utilities, whose revenue is being squeezed by slowing growth in electric demand and, especially in states like California, the explosion in residential solar power, the charging business represents a potential boon.

Utilities could benefit not only from increased electricity sales but also by investing in building the underlying infrastructure, on which they earn a set return recovered through customer rates.  In addition to that, executives said, passenger cars sucking up power at public stations during the day could absorb excess electricity flowing from the solar farms that are increasingly coming online.

“There’s a significant opportunity to actually operate the grid more efficiently by managing electric vehicle charging,” said Jim Avery, senior vice president for power supply at San Diego Gas and Electric, whose proposal would install equipment that allows customers to manage their charging based on price, convenience or other factors through their smartphones.

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