EV Myth 1: As EVs flood the marÂket, the cost of elecÂtricÂiÂty will increase and will driÂve up rates for non-EV drivers.
Myth BUSTED: Recent studÂies have shown that utilÂiÂties bring in more revÂenue than costs with more EVs on the road, leadÂing to a decrease in elecÂtricÂiÂty rates for all cusÂtomers, includÂing non-EV drivers.
EV Myth 2: The elecÂtric grid does not have the capacÂiÂty to supÂport high numÂbers of EVs on the road and infraÂstrucÂture overÂhaul will be required.
Myth 2 BUSTED: With time-of-use rates and propÂer manÂageÂment of the grid, capacÂiÂty is not a conÂcern, even with large numÂbers of EVs chargÂing. This is espeÂcialÂly true when EVs are chargÂing over a wideÂspread length of time and durÂing off-peak hours.
You may see naysayÂers toutÂing the “fact” that large-scale adopÂtion of elecÂtric vehiÂcles will lead to a highÂer elecÂtricÂiÂty cost for consumers—putting the burÂden of an EV driver’s choice to switch to a plug-in vehiÂcle on non-EV driÂvers. This arguÂment is false.
The arguÂment goes that the more EVs are on the road, the less elecÂtric capacÂiÂty the grid will have to charge them—and the added strain on the grid will lead to highÂer elecÂtricÂiÂty prices for all cusÂtomers (not just EV drivers).
A brief explaÂnaÂtion of the elecÂtric grid:
ElecÂtric utilÂiÂties vary rates based on the time of day: chargÂing highÂer for peak demand and chargÂing less for off-peak use. Off-peak hours typÂiÂcalÂly run between 11 pm and 8 am, though hours vary by utilÂiÂty and seaÂson. Peak hours typÂiÂcalÂly run from 8 am to 12 pm and from 2 pm to 6 pm. These hours are based on when elecÂtricÂiÂty is in highÂest demand.
Many utilÂiÂties have startÂed to impleÂment “time-of-use” rates which are espeÂcialÂly imporÂtant when talkÂing about EV chargÂing. Time-of-use rates are a way of pricÂing an enerÂgy user’s conÂsumpÂtion based on when the enerÂgy is used. If you are chargÂing your car at 4 pm on a summer’s day, the price you’ll pay for that elecÂtricÂiÂty will be highÂer than if you charged at 1 am on that same day.
In actuÂalÂiÂty, wideÂspread growth of EVs will make our grid more effiÂcient and will driÂve down rates for all cusÂtomers. Below is a graphÂic depictÂing the “VirÂtuÂous Cycle of UtilÂiÂty EV InvestÂments” which outÂlines how an increase in EVs will lead to increased elecÂtricÂiÂty demand (and sales) durÂing off-peak hours, which allows for betÂter utiÂlizaÂtion of the grid. This means that revÂenues will outÂpace costs, which will bounce back to the conÂsumers by allowÂing the utilÂiÂty to decrease the rate of elecÂtricÂiÂty and lowÂer elecÂtric bills for all ratepayers.
This conÂcept has been demonÂstratÂed in a study conÂductÂed by Synapse EnerÂgy EcoÂnomÂics in 2020. The study looked at the stresÂsors on the grid in PG&E and SCE’s terÂriÂtoÂries – two pubÂlic utilÂiÂties in CalÂiÂforÂnia, where EV adopÂtion is highest.
The study found, “over the eight years examÂined [2012–2019], EV driÂvers in PG&E’s and SCE’s serÂvice terÂriÂtoÂries have conÂtributed $806 milÂlion more in revÂenues than assoÂciÂatÂed costs, driÂving rates down for all cusÂtomers,” (Frost, et al. 2020). With greater EV adopÂtion, utilÂiÂties have increased revÂenues more than costs, leadÂing to a downÂward presÂsure on elecÂtric rates for both EV-ownÂers and non-EV ownÂers alike.
AddiÂtionÂalÂly, “Load Research Reports show that EVs are requirÂing few disÂtriÂbÂuÂtion sysÂtem upgrades and, when on [time-of-use] rates, are chargÂing at low-cost times [i.e. off-peak hours] for the grid…By chargÂing durÂing off-peak hours, EVs impose minÂiÂmal costs on the grid and help to utiÂlize resources more effiÂcientÂly,” (Frost, et al. 2020). It is imporÂtant to note that coorÂdiÂnatÂed chargÂing and incenÂtivizÂing off-peak chargÂing is key. If these methÂods are not used in tanÂdem, elecÂtric grids may very well need to expand capacÂiÂty. AddiÂtionÂalÂly, elecÂtric grid capacÂiÂty and potenÂtial expanÂsion will vary greatÂly across the nation, (DavidÂson, et al. 2018).
FinalÂly, vehiÂcle-to-grid (V2G), a techÂnolÂoÂgy that allows enerÂgy to be transÂferred between elecÂtric car batÂterÂies and the powÂer grid, are quickÂly accelÂerÂatÂing and pilot projects have begun. These projects will act as a secÂondary powÂer source to furÂther uphold the powÂer grid durÂing periÂods of maxÂiÂmum demand—a sceÂnario that would be imposÂsiÂble withÂout elecÂtric vehicles.
Source: Jason Frost, MelisÂsa WhitÂed, and Avi AlliÂson “ElecÂtric VehiÂcles are DriÂving ElecÂtric Rates Down.” June 2020. <https://www.synapse-energy.com/sites/default/files/EV_Impacts_June_2020_18-122.pdf>.
Source: F. Todd DavidÂson, Dave TutÂtle, Joshua D. Rhodes, Kazunori NagaÂsawa “SwitchÂing to elecÂtric vehiÂcles could save the US bilÂlions, but timÂing is everyÂthing.” DecemÂber 4, 2018. The ConÂverÂsaÂtion. <https://theconversation.com/switching-to-electric-vehicles-could-save-the-us-billions-but-timing-is-everything-106227>.