DCFC Price and Cost comparison - SCE

DCFC Price and Cost comparison - SCE

I believe many DCFC stations in high electricity cost areas lose money by operating and I'm not sure how I feel about it.

As an EV driver, I'm always glad to pay as low a cost as possible when using a DCFC station. As a believer in an EV future lower charging prices definitely help increase EV adoption. But!

Sona Energy is working on several projects where we plan to own and operate DCFC stations and in that regard, I would prefer we didn't lose money every time the station was used! Also, when costs and prices are "out of whack" it sends the wrong message to consumers (EV drivers) and reduces pressure on those who determine and set rates and fees (PUCs, IOUs, etc).

So let's do a very high level comparison of the Revenue and Electric Costs of two different DCFC operators: EVgo and Electrify America and their locations in CA (I'm assuming they are in SCE territory).

Charging Price:

I was clicking around PlugShare and I saw this comment from a user that was made on 4/17/22 about the EVgo station at 17600 Collier Ave, Lake Elsinore 92530 (shown in the upper left of the heading image):

With the session fee and the rate, it was nearly double in cost what it would have been at the nearby EA station at Walmart. I’ll probably never charge here again.”

EVgo names their stations and at this location they have qty 2, 50 kW stations. One of them is named Vania and the pricing structure is shown on the left of the image below. The SCE EV TOU periods are shown in this link and on the right side of the image below (I dig more into this in next section but show it here to demonstrate how Time of Use pricing lines up with how SCE structures the time periods).

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Note: PlugShare (which is actually owned by EVgo) actually shows a higher price when you first pull up pricing (below); however, when you click the "Show Detailed Pricing Info" link it shows the above. I also opened the EVgo app and it showed the above...so I'm not sure what to believe.

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Let's compare the above to Electrify America (EA). EA conveniently shows their pricing for any state at their page for Pricing and Plans for EV Charging and for CA they show a flat rate of $0.43/kWh...which is - I believe - what they charge anywhere in the country that they can charge for kWh (vs. charging for time). Below is a price comparison of the two:

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Charging Cost:

On the excellent Inside EVs podcast, Episode 3 the Chief Commercial Officer of EVgo Fast Charging, Jonathan Levy, mentioned that in some of the high electric cost areas that they operate in, the blended cost of electricity (all in cost/kWh) is around $1.00! If they're charging less than $1 (which I don't believe any operator approaches $1) then they actually have a perverse incentive - which nobody would ever admit to - for that station not to get used (unless it's utilized enough to spread demand charges over a larger base but...it's complicated)! This partly fuels my hunch on why station operators have historically been slow to repair non-working stations: If they don't make money on station operations they are better off having a broke station! But I digress and point being electricity costs can be very high.

In the linked document above on SCE's TOU-EV tariff they list TOU-EV-8 as available to customers with charging demands above 20 and below 500 kW so we're going to use that for this analysis. You can find all the SCE tariff schedules online here and their TOU-EV-8 here. Instead of writing out a bunch of boring words I put the below table together which summarizes things quite nicely IMO:

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I was surprised to see that the situation probably isn't as bad as my original assumption but I'd love to peek under the hood and see the utilization time periods of each station and see how often drivers are charging off-peak vs. on-peak.

One reason the picture is rosier than I originally assumed is because of Facilities Related Demand Charges (FRD) are currently set at $0! (they will be phased in starting in 2023) This article from Utility Dive on CA Time-Of-Use EV rates goes in-depth on the topic but I'll dig in more detail at another time.

"SCE's new C&I rate plan, to be implemented March 1, offers a five-year demand charge holiday, SCE Director of Pricing Design and Research Russ Garwacki told Utility Dive. It will be followed by a five-year demand charge phase-in to a new demand charge 40% below the current charge.
The demand charge normally covers utility costs to meet a C&I customer's highest demand spike, he said. But early-stage EV fleets often have very low loads except during the charging spike. With the demand charge holiday, we are "migrating a portion of our distribution costs toward energy and becoming less demand charge focused," Garwacki said. Incremental costs can be absorbed through the energy charge until charging loads grow."

And From SCE:

"Facilities-Related Demand (FRD) charges apply year round and are calculated per kilowatt (kW) according to the highest recorded demand during each monthly billing period, regardless of season, day of week, or time of day. Please note that from 2019-2023 FRD charges are not applicable."

Conclusion:

So...maybe stations in SCE from EVgo and Electrify America aren't currently losing money on operations based on high electricity costs, but 2023 is right around the corner so we will see! Also, this analysis doesn't look at any O&M costs. And yes, I know I didn't address LCFS but that's also for another time....

Jeff Wolfe

Visionary Cleantech Leader | Solar, Storage, EV Infrastructure | Innovator in Renewable Energy Policy

3y

Good reason to add co-located energy storage to the site, and power using a much smaller grid connection.

Graham Warnock

Analytics & Insights for the Energy Transition

3y

Well articulated! This is one of the reasons I love working at FreeWire Technologies - our Boost charger was designed to solve this problem by mitigating demand charges with our battery-integrated DCFC. No need to get “creative” with pricing.

Anders Thulin

Distributed fuel-flexible and resilient power to EV fleet operators, faster.

3y

Good read - thank you for sharing! Yes, the economics of public DCFC with demand chargers is crazy until utilization is way up and you can spread those demand charges against your earnings. There's probably a magic number in utilization you could calculate based on your service territory. And the challenge of demand charge throwing your business case out of the window is certainly NOT limited to CA. Greatplainsint put together a great analysis and DCFC ROI calculator which shows that in the vast majority of cases in the midwest, demand charge= death for a <5 year ROI. (https://betterenergy.org/blog/demand-charges-and-dcfc/)

Joey Bono

Microgrids | Utility Scale PV | Solar + BESS + EVC = 😁 | Fleet Electrification | EVC Planning & Design | Infrastructure Project Management |

3y

Rate Design is key! Utilities that provide special DC rate design helps operators avoid high demand charges and high kilowatt hour rates. @SaraRafalson and the EVgo team are hard at work on rate design.

AJ Perkins

Go-To Market Expert for Cleantech | Strategic Advisor | Ex-CEO | Built 3 Companies, Closed $15B+ in Contracts

3y

This is a great insight Chris Kaiser. Thank you so much for putting a little more clarity on such a dismal conversation. And you are right. it wasn't boring at all. That's a big kudos to you. I am passing this off to my many "simple minded" friends like me who will enjoy this read.

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