Regulators consider mandatory electric vehicle programs for large utilities

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    Wisconsin (Wisconsin State Journal) — In an effort to address the growing electric vehicle market, Wisconsin regulators are considering forcing utilities to develop test charging programs for residential customers.

The Public Service Commission voted 2-1 Thursday to request utility feedback on a draft order that would require the five largest utilities to submit plans for approval next year.

Programs would need to address issues such as the up-front cost of purchasing vehicles and charging stations, rate design, and ways to manage demand as more people begin plugging in their cars at night. Utilities could also propose programs for commercial and industrial customers.

Under the proposal, the commission would use the same framework to evaluate plans from the roughly 120 smaller electric utilities, though they are not required to submit them.

Utilities will have 30 days to offer feedback on the proposed order.

PSC Chair Rebecca Valcq said the proposal is a response to utility requests for regulatory clarity as they develop electric vehicle programs and is an opportunity to guide the future impacts to provide benefits for ratepayers, drivers and utilities.

In recent years, the commission has approved electric-vehicle charging programs for Madison Gas and Electric and Xcel Energy but last year denied proposals from We Energies and Wisconsin Public Service Corp. to subsidize customer charging stations.

“Because there haven’t been guidelines … we’re asking applicants to kind of shoot in the dark,” Valcq said. “I view it as a way to telegraph to people what’s important to us when we look at these programs.”

Commissioner Ellen Nowak said she favors providing a framework but objected to making charging programs mandatory.

“It’s not the role of our commission or utilities to promote the vehicle. It’s their job to assist when customers have them,” Nowak said. “Even though you can do it doesn’t mean you should, and I’m not sure we can. This is a dangerous precedent.”

Commissioner Tyler Huebner noted that while some utilities have developed electric-vehicle programs on their own, under the regulated monopoly system other ratepayers have no choices.

The proposal is a product of an 18-month long investigation into electric vehicles, including barriers to widespread adoption and the roles utilities and regulators should play in supporting them.

While battery-powered vehicles account for less than 1% of new vehicles sold last year in Wisconsin, they are a fast-growing market and present unique opportunities and challenges for utilities.

Under typical use, a battery-powered vehicle could lead to a 50% increase in the average Wisconsin home’s energy consumption, and the Smart Electric Power Alliance says widespread adoption could result in the largest new electricity demand since the proliferation of air conditioning in the 1950s.

Plugging in a car also creates a huge spike in load — the instantaneous power required to keep the lights on and run appliances. In order for everyone to do that at the same time, utilities would need to upgrade the system.

Selling more energy can spread the cost of power plants and wires, theoretically lowering electricity prices, but not if utilities have to invest heavily in new infrastructure. So coming up with creative ways to manage that charging is key to saving ratepayers money.

“It’s important for us to make sure utilities are getting in front of this. … so when adoption grows, we’ve skated to where the puck is,” Huebner said. “If we don’t move forward we risk having some utilities behind where their customers are.”

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