APP Honors: Electric Vehicle

For full report click here [1].

The California Public Utilities Commission (CPUC) is the state agency that regulates investor-owned electric utilities, comprising about 80% of California's electricity service.¹ The CPUC has authority to determine a wide range of electricity-sector policies, such as setting all electricity rates and metering regulations for regulated utilities. The CPUC has a mandate to ensure that customers have consistent access to safe and reliable electricity service at reasonable rates while protecting customers and the environment.

Auto manufacturers have announced that plug-in hybrid electric vehicles may be commercially available in 2010.² Hybrid vehicles are very popular in California. In 2007, over 26% of new hybrid vehicles in the country were registered in California.³ If plug-in electric vehicles become popular in California, the increased electricity demand could overwhelm state electricity supply capacity. Insufficient capacity could lead to substantial increases in electricity rates and rolling blackouts, similar to the situation during the 2001 electricity crisis.

To address responsibly the potential increase in electric demand, my primary contact at the CPUC, Judith Iklé, has requested information about potential plug-in vehicle electricity demand levels over the next 20 years and policy recommendations to help the state absorb the increased demand in ways that meet California's public policy goals. These goals include reducing energy costs for residents, increasing the supply of renewable energy to the grid, and decreasing greenhouse gas emissions.

This report provides data and policy recommendations to inform and advise CPUC decision makers. The recommendations focus on meeting the needs of customers who will be able to park their plug-in electric vehicle(s) in a location with access to their household electricity service. The report also discusses, to a lesser extent, ways for the CPUC and other entities to address the needs of plug-in vehicle drivers who are unable to connect to their household electricity service.

The report contains the following findings:

• Plug-in electric travel can be substantially less expensive than gasoline-powered travel–sometimes costing as little as $0.38 to $1.77 with current California rates for the amount of electricity equivalent to one gallon of gasoline.⁴
• Plug-in electric vehicle travel in California causes the emission of 80% less greenhouse gas per mile than gasoline-powered travel.⁵
• Plug-in electric travel may comprise 10% of all California vehicle miles traveled in 2020 and 40% of all vehicle miles traveled in 2030.⁶
• Plug-in electric travel in California may consume 5 million MWh in 2015, 14 million MWh in 2020, and 72 million MWh in 2030–the latter amount is approximately one-third of total current statewide demand.⁷

As indicated by the title of this document, "Five Birds with One Stone," the report shows that plug-in electric vehicle travel can have five major benefits for California:

1. Decreased motor vehicle air pollution
2. Decreased overall greenhouse gas emissions
3. Decreased overall energy costs
4. Decreased dependence on foreign oil
5. Increased ability for utilities to utilize intermittent renewable sources of energy

To achieve these benefits for California in ways that are consistent with the CPUC's mission, the report provides the following recommendations for the CPUC:

1. Implement an intermittent-service rate plan for plug-in vehicle owners.
2. Prepare for moderately increased electricity demand due to plug-in vehicles, amounting to one-third of current demand by 2030.
3. Develop programs and information campaigns, such as informing consumers about the cost of electricity equivalent to a gallon of gasoline, to help encourage consumer migration to plug-in electric travel.
4. Encourage and support businesses and other agencies trying to provide inexpensive electricity access for electric vehicle owners who do not have access to their home electricity service where they park their vehicle.
5. Provide educational information to businesses and other institutions about the cost of letting motorists charge vehicles on their premises during peak-demand periods.
6. Provide educational information to businesses and other institutions about how to prevent motorists from recharging vehicle batteries on their premises during peak-demand periods.
7. Develop programs to increase the total amount of household devices that can be cycled off during peak-demand periods, such as air conditioners, clothes dryers,and water heaters.

¹ Statistics for 2007 from the California Energy Consumption Database, Energy Consumption Data Management System, California Energy Commission, http://www.ecdms.energy.ca.gov/Elecbyutil.asp [2] , accessed February 2, 2009.
² Ben Stewart, "2010 Toyota Prius Plug-in Hybrid Prototype: Next-Gen Test Drive," Popular Mechanics, October 22, 2007, http://www.popularmechanics.com/automotive/new_cars/4227944.html [3] accessed January 30, 2009.
³ Associated Press, "Hybrid Sales, Led by Prius, up 38 Percent," April 21, 2008,
http://www.msnbc.msn.com/id/24230209/ [4] , accessed March 3, 2009.
⁴ Cf. Appendix Table AT8 Row (G).
⁵ Cf. Appendix Table AT7 Row (H).
⁶ Cf. Appendix Table AT6.
⁷ Cf. Appendix Tables AT1 and AT6.