EV advocates say rate changes could pave way for more chargers
The state needs more businesses to step up to host fast electric vehicle charging stations, part of a plan to create a 600-mile corridor of chargers between Homer and Fairbanks.
But as it stands, hosting a charging station in Alaska is expensive. That’s why utilities are rethinking their rate structures, to make hosting more attractive and incentivize EV use around the state. Homer Electric Association and other Alaska utilities filed their plans with the state’s regulatory agency last month.
The news excites EV advocates like Paul Clayton, of Homer. He travels between Homer and Anchorage a good deal for work but has to use his gas car in the absence of consistent fast chargers.
"I would upgrade to a new car, a new EV in a heartbeat, as soon as the public here gets those stations up and running," he said.
The charging corridor plan is sponsored by the Alaska Energy Authority, a public corporation of the state. It’s paying some station installation and maintenance costs with money from a 2017 Volkswagen settlement.
But the businesses that will land those chargers on their properties have to pay for their own electricity. Fast chargers – which can charge EVs in under an hour – consume large amounts of energy.
That’s why the Regulatory Commission of Alaska said utilities could create new rate designs to take high-demand charges out of the equation for now. Each utility has to propose its own rate structure to the commission.
HEA's proposed rate change, filed with the commission in January, would bring costs for fast charger hosts in line with residential charging rates and could add between $1 and $2 to ratepayers’ annual bills.
Michelle Wilber is part of the Alaska Electric Vehicle Working Group, which has been working on the EV corridor plan. She took a look at several filings and said utilities took different approaches to the problem.
“There seemed to be two different choices of how to do this between different utilities," Wilber said.
Those different approaches hinge on one part of the equation, called the load factor — "an assumption of the amount of time the station might be used," she said.
HEA chose a load factor of 50 percent, and Chugach Electric – which covers Anchorage and part of the Kenai Peninsula – chose load factors close to 50 percent.
J.D. Draves, HEA's manager of regulatory affairs and rate design, said the co-op knows chargers in its area won’t be used 50 percent of the time. But he said the 50 percent load factor makes electricity costs for hosts more affordable across the board. Someone who hosts a public station would pay about the same as someone who has a slow charger at home and pays a residential rate.
The flipside is that HEA might lose money from the new rate structure, though that’s not a given, either. Most EV charging happens at home. And as more people buy EVs and charge them at their houses, HEA could actually add load to the grid, which could save ratepayers money in the long term.
“We’re banking in the long run of getting that penetration, going up that curve faster," Draves said. "In the long run it will be a money saver for the cooperative member. So it’s kind of like an investment.”
On the other side, Golden Valley Electric and Matanuska Electric – in the Interior – chose 5 percent as their load factors. Their rationale there, Wilber said, was the fast chargers probably won’t be used very much.
“Considering that many EV owners, currently at least, have a place to charge at home and do most of their charging at home, that puts most of the fast charging that you do when you’re out in a special charging category," Wilber said.
In a way, the utilities are all just taking shots in the dark. They don’t have much data yet on how EVs will be used in their areas. HEA said there are only about 50 EVs active in its service area today.
EV advocates like Clayton, in Homer, hope the addition of new chargers will change that.
"As a many-decade Alaskan, I’ve been waiting for this for a long time," he said. "I’m pretty excited about it.”
The Regulatory Commission of Alaska is taking comments on the utilities’ proposals through the end of the month. You can find HEA's notice here.