A Duke Energy pilot would use three cutting-edge electric vehicle technologies, a flat subscription rate, in-vehicle communications, and some utility management of charging during demand peaks, to enable the utility to maximize customer savings and minimize system impacts “without burdening drivers,” said Smart Electric Power Alliance Senior Director for Electrification Garrett Fitzgerald.
The little-tested residential subscription rate in Duke Energy’s pilot will allow EV owners an estimated 2,000 to 3,000 miles of driving per month at a fixed rate as low as $19.99 per month. Subscription rates have been studied by the Sacramento Municipal Utility District, and Pacific Gas & Electric ran a trial with some of its business customers. This new pilot will likely provide important lessons about residential customer applications in California and other states, advocates told Current.
“The volatile average $170 monthly gasoline bill becomes a steady $19.99, which simplifies pricing for EV owners,” Duke Energy Vice President of Rate Design and Strategic Solutions Lon Huber told Current. Managed charging shifts price signal complexities to the utility and allows the optimization of customers’ individual preset charging preferences with utility needs to manage demand spikes, he added.
The utility’s active management of charging will demonstrate transportation electrification can offer system benefits. It will be done by the utility through EV telematics, the wireless technology that connects the vehicle to GPS and other network information, allowing charging to be managed without the need for a home charger or separate meter.
Managed charging offers “a massive opportunity for utilities to influence customer charging habits” and “maximize benefits to the power sector without compromising driver convenience,” SEPA’s Fitzgerald said. Managed charging and vehicle telematics-based programs are key parts of the transportation electrification future, he added.
Duke’s pilot will monitor the costs and benefits of managing EV charging through a flat rate. But the risk and reward of that management are transferred to the utility because the participants’ costs are fixed and any gaps in cost to serve will be absorbed by Duke.
Ford, BMW, Honda, and GM support the program and, if North Carolina regulators approve, they will share its total $600,000 cost, according to Duke’s proposal to regulators.
If done well, using vehicle telematics “will allow anyone to plug in anywhere, and pay for the charging on their own electric bill, with their own preferences,” such as charging times, rate design authority consultant Jim Lazar told Current.
Managed Charging Emerging
Stakeholders across the power and transportation sectors agree high EV penetrations “are both inevitable and necessary,” according to the Smart Electric Power Alliance’s report from last November, The State of Managed Charging in 2021.
“Over the past five years, managed charging programs have grown in number, program size, sophistication, and diversity in approach,” SEPA wrote. In 2021, there were at least 71 utility active managed charging programs, up from 26 in 2019, some of which have offered customer bill savings of up to $200 per year using 70% “lower-carbon electricity” for charging, it added.
Duke’s proposal is unique in combining a flat rate and managed charging through vehicle telematics, Fitzgerald said. If EV charging is managed away from peak demand and unplanned spikes, savings from delayed or avoided costs for new or upgraded generation and delivery infrastructure will be shared by customers, it added.
The flat rate is designed to simplify Duke’s time-varying rates, reduce costs, and increase the predictability of charging, Duke said. It will “shift the risk” of charging costs to the utility but give the utility the financial incentive “to maximize the performance of the load shaping and to reduce the impact of EV charging on the grid,” the filing added.
Austin Energy’s three-year EV360 subscription rate for EV charging pilot paid for itself before ending as scheduled in 2019, its Utility Strategist Lindsey McDougall told Current. A $30/month flat rate covered unlimited off-peak period charging and unlimited charging at Austin’s network of public chargers, and nearly every customer avoided on-peak charging, she added.
Xcel Energy Minnesota’s subscription EV charging three-year pilot launched in February 2020 and is fully subscribed, spokesperson Matt Lindstrom told Current. Its 144 customers get unlimited EV charging off-peak for $33 per month to $44 per month and the possibility of a full-scale program is now being assessed, he reported.
Like Duke, Green Mountain Power offered unlimited off-peak charging for $30 per month for 155 customers who accepted limited utility management of charging with opt out provisions, spokesperson Kristin Carlson said. The 18-month program terminated in 2019 as scheduled, providing a net savings of “about $6,200 for all customers,” and led to two time-varying EV charging rates, she added.
But Lazar is dubious of subscription rates. “They work for cell phone plans because the data speed slows down during periods of network congestion, but that may not work for EV charging, he said. The real problem is that “if the subscription price is too high it excludes small users and if it is too low the utility loses money.”
Effective management of charging will allow Duke to “optimize events on a day-ahead, hour-ahead, or even minute-ahead basis,” its filing said. And the pilot will demonstrate if using vehicle telematics and limiting the impact of EV charging on demand spikes can improve the value proposition, and if so, by how much.
How Duke’s pilot works
Up to 100 EV owners in Duke’s Carolinas territory will be able to charge at the fixed rate of $19.99 per month for 12 months. The price for up to 100 customers in the nearby Duke Progress area will be $24.99.
To shave demand spikes, Duke will be able to call, with 12 hours notice to participants, up to three 4-hour maximum managed charging events per month. During those events, scheduled charging may be interrupted. Participants can opt out of events twice during the pilot, but further opt outs could result in removal from the pilot.
“The customer will be able to charge through a 240-volt home outlet with no need for additional hardware,” Huber said. Charging speed depends on battery size and a full charge might take 12 hours. But most residential charging is partial, which will shift charging to when costs are less and when renewables are abundant, he added.
The fixed subscription price is based on 800 kWh of charging per month per EV, enough for an estimated 2,000 to 3000 driving miles. Charging over that limit will draw a “notice of excess charging” from Duke. If three notices are issued or charging goes over 1200 kWh in a month, the participant “may be removed,” according to Duke.
The participating carmakers will use the pilot to test a new iteration of their Open Vehicle Grid Integration Platform, Duke said. The two-way interface will connect the utility and EV telematics through utility industry communications standards to allow Duke to see charging activity, battery state of charge, and events when needed.
Because everything is done through the vehicle telematics, the subscription rate could eventually be used wherever the car goes, Huber said. “If the tech works and customers respond, it could even open up the possibility of engaging with public fast-charging providers.”