N.Y. regulators approve $32M fast-charger plan

Source: David Iaconangelo, E&E News reporter • Posted: Tuesday, February 12, 2019

New York utilities won approval from regulators last week to install more than 1,000 fast-charger plugs for electric vehicles, setting the stage for charger providers to expand their business in the state.

With authorization from the New York Public Service Commission on Thursday, utilities can spend almost $32 million to install up to 1,074 fast chargers for public use. The seven-year program allows utilities to recoup their costs from ratepayers.

“More and more New Yorkers are seeking out cleaner and greener means of transportation, and we must ensure there is necessary infrastructure in place across the state so drivers can travel any distance without fear of losing power,” said Democratic Gov. Andrew Cuomo in a statement.

The new public incentives, doled out on a per-plug basis, also help get around an issue that’s been a disincentive for charger companies to install fast chargers: demand charges imposed by utilities for peak power-use. Those fees have made the fast-charger business untenable for operators in some of the nation’s major markets, according to EV experts.

“Every regulatory commission in the country is grappling with the demand charge problem,” said Chris Nelder, who heads the Rocky Mountain Institute’s mobility practice and acted as a consultant to the New York Power Authority (NYPA) in the state’s ongoing EV proceeding.

NYPA, the state’s largest public power provider, and three other state agencies originally asked the Public Service Commission to temporarily exempt fast-charger operators from utility demand charges, but ended up pursuing the idea of incentives as an alternative after the utilities objected.

Power customers who want a direct-current fast charger built at a public site can claim monthly incentives ranging from $4,000 to $17,000 for every plug installed, depending on where the station is located and how much power it can deliver. They can’t exceed the total cost of power delivery over the course of the year.

“Once the market grows up, and we have charging stations at 30 to 40 percent utilization rates, demand charges won’t be a problem,” said Nelder. “The problem is, we need to bridge this gap.”

Another theme of recurring importance in EV proceedings — the proper role for utilities in the charger business — is due to be addressed in a white paper by the commission staff, along with topics like the electrification of fleet vehicles.

Authorities in New York say just 78 DC fast-charger plugs are available across the state. They think about 1,500 fast chargers will be necessary to support the state’s zero-emissions vehicle goal of 800,000 cars by 2025. And they generally see utilities as partners in jump-starting demand for a private EV-charger market.

“Addressing barriers to deploying fast-charging stations is essential if we want to accelerate the public embrace of EVs,” said Gil Quiniones, president and chief executive of the New York Power Authority. “These efforts represent a critical step toward attracting EV charging companies to rapidly expand in New York.”

In 2023, or after 45 percent of the eligible plugs are deployed, the New York PSC will carry out an interim review of the program. Utility officials have said they believe that after the seven-year period is over, further incentives won’t be necessary.

Incentives for the plugs will come from two sources: a state-controlled pot siphoned off of power bills and set aside for renewable and energy-efficiency projects, and a new surcharge on customers who don’t already contribute to that pot of funds.

“Our fear was that both the public and private sector would never fund the installation of DC fast chargers,” said John Markowitz, NYPA’s lead energy services product development engineer.

But he said he hopes the PSC won’t need to take additional action on the demand-charge issue.