PG&E’s EV Charging Plan Has Nothing to do With the Environment

PG&E’s Electric Vehicle Charging Plan Has Nothing To Do With the Environment

In California, cars are as ubiquitous as sunshine. While the transportation sector comprises around 26% of overall emissions in the U.S., they’re closer to 40% in California. As the state moves to decarbonize the energy sector, efforts to tackle the gas-guzzling engines polluting our skies are coming into focus.

One attractive solution is the electric vehicle (EV). Powered by a battery charged by the electric grid, these vehicles represent a potential shift away from internal combustion towards “fuel” that will increasingly come from renewable forms of energy in California. The EV thus represents a cleaner and more efficient form of transportation than most conventional vehicles in California.

That is one of the reasons why it is so unfortunate PG&E’s $160 million plan to “support” these types of vehicles, by installing and owning charging stations, falls flat on its face. While PG&E’s plan focuses primarily on large-scale expenditures funded entirely by utility ratepayers, TURN is instead urging a program that will yield quantifiable environmental benefits with enhanced consumer protections.

PG&E can limit the risk to customers. PG&E contends it should begin its “Phase 1” program for $160 million and over 7,000 charging stations.  But there is very little real-world data about the cost, need, market impacts, and optimal deployment of utility-owned charging stations. It obviously makes more sense to start with a small pilot project that will enable regulators, and PG&E, to learn more before experimenting with more customer money.

PG&E’s program should leverage private investment, not replace it. California, and PG&E’s territory in particular, is already the most successful charging station market in the world. Though the market is still in a nascent stage, it is important to let private capital lead the way, not ratepayer subsidies that may be wasted or unneeded to support state goals. Additionally, private companies will likely be placed at a significant disadvantage if PG&E is allowed to select and own charging stations, a model that strays far from PG&E’s core business and may result in anticompetitive behavior.

Charging infrastructure should be built for the future. Declining battery prices and improved technology will lead to increased EV range (miles per full battery charge) in coming years. Combined with consumer preferences to charge their vehicle at home, this means that more than 90% of charging will occur overnight at the residence, closing in on 100% for many consumers. PG&E’s proposal would likely deploy about 80% of the charging infrastructure at ill-defined public locations that may not influence a consumer’s decision to buy an EV. A pilot should gather data on where the private market for infrastructure is under-delivering and utilize a cost-effective approach to address needs that will actually spur EV adoption.

PG&E should effectively target low-income communities. Though PG&E claims it will to emphasize “disadvantaged communities,” the locations it has defined as disadvantaged include the Google and LinkedIn campuses, Twitter’s Headquarters and the Transamerica Building – workplaces that do not need ratepayer subsidy to install charging stations. Instead, at least 10% of the infrastructure should be targeted to low-income communities, and consumers that qualify for the CARE program (for low-income households in California) should receive an upfront rebate from existing low carbon credit funds if they purchase or lease an EV.

PG&E’s plan fails to acknowledge barriers to EV adoption outside of charging infrastructure. Ultimately we are asking consumers to select EVs over conventional vehicles that are generally cheaper, better understood, and come in hundreds of models that dwarf the relatively small selection of EVs available today. Current low gas prices don’t help either. Though these factors will likely improve in coming years, access to public charging infrastructure is not a magic wand that will solve other barriers to consumer adoption of electric vehicles.

California is truly a world leader when it comes to transforming its energy sector and achieving ambitious greenhouse gas reductions. But our progress will be impeded, at a cost to both the environment and utility ratepayers, if wasteful utility infrastructure programs are approved in lieu of smart, cost-effective solutions.