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An Action Plan to Integrate Plug-in Electric Vehicles with the U.S. Electrical Grid

3 Creating a Consistent Regulatory Framework Nationwide

With different pilot programs and varying incentives for PEV and charging infrastructure deployment across the United States, there is inadequate harmonization between regions developing regulations that affect PEV deployment, such as those related to electricity distribution. While progress and experimentation at the state and local level are critical to PEV market growth, without consistency, markets may develop more unevenly than they would otherwise or set precedents that will harm overall PEV deployment.

As regulators, policymakers, and the PEV industry implement policies, the Group advocates developing best practices and using accepted common standardsto guide governments and industry.

This chapter first discusses the regulatory issues and then how the Action Plan addresses them. The Action Plan includes detailed actions that will lead to a consistent regulatory framework nationwide guided by best practices and accepted common standards.[24]

3.1 Regulatory Issues

The PEV Dialogue Group developed recommendations for actions to accomplish the following two regulatory objectives for PEV deployment:

The Group focused mostly on regulatory issues related to the electricity distribution system including EVSE installation requirements and electricity rate structures for residential and commercial EVSE. In particular, the Group considered whether PEV-specific rules and regulations are necessary since existing regulations already address some EVSE installation issues. The Group also identified and addressed key regulatory problems related to vehicle charging standards,[25] protecting consumer privacy, and maintenance of the transportation system. The Group differentiated some actions based on early and mainstream PEV adopters.Regulatory issues related to safety were not the specific focus of this Group, although the Group recognizes that safety- both of the vehicle and the charging equipment-can have an important impact on PEV deployment.

The Group focused on a series of key questions to develop the framework for approaching regulatory issues related to electricity distribution, including:

Box 1. Utility Notification

Early notification of utilities by consumers of PEV purchases or home EVSE installations helps utilities plan for infrastructure improvements and upgrades. This becomes more important over time if the trend is towards higher-power charging. Notification can also help consumers learn about programs like PEV-specific electricity rates and PEV incentives. Some consumers may not notify utilities due to privacy concerns or lack of awareness of any notification requirements. Auto dealers may also be reluctant to support this additional step if it hinders the chance of a PEV purchase.

If done correctly, mass PEV deployment nationwide provides an opportunity to maintain, and eventually improve the reliability of the U.S. electrical grid and potentially lower the marginal cost of electricity for all utility customers if charging is done during off-peak times. Strategic action by regulators could accelerate investments by the private sector. At the same time, inaction could result in some electrical grid problems in areas that see concentrated PEV adoption. In developing the Action Plan, the Group considered the short-term objectives of accelerating PEV adoption while also laying the foundation for a possible future consisting of greater PEV and grid integration.

3.1.1 Residential and Commercial EVSE Installation

Experts expect PEV owners to charge their vehicles mostly at home, although public EVSE can help address range anxiety and is being installed in locations nationwide for a variety of reasons (e.g., demonstration purposes and business opportunities).

Major issues related to EVSE installation include determining if PEVs should be treated differently from other comparable electric loads,[26] ensuring utility notification of EVSE installation (see Box 1), EVSE charging level restrictions, utility ownership of EVSE, regulatory treatment of PEV charging service providers, and addressing new technologies like vehicle-to-grid (V2G).[27]

As PEVpenetration increases, residential and commercial electricity service and infrastructure upgrades, like new transformers,may be needed.To equitably recover costs associated with the integration of new electrical loads, utilities and utility regulators rely upon a well-established set of rules included in utility tariffs. These rules do not discriminate between comparably demanding electrical loads (e.g., hot tubs or air conditioners). Any additional costs borne by the EVSE owner are a disincentive to the purchase and installation of charging stations in residential or commercial locations. If the EVSE owner does not pay, then utilities must either fold the cost into the rate base or pay out of company profits.

In the past, many utilities have paid for service extension and upgrades to accommodate air conditioning and other high-power demands in order to take advantage of the economies of scale from adding new customers or additional load from existing customers. Many utilities took these actions even if the cost of doing so exceeded the incremental benefit as long as expected net present value of future utility revenues remained positive. If incremental service extension exceeded a certain cost level, then customers paid for the difference in service extension.

Installations in multi-unit dwellings pose additional challenges including determining who pays for installation and any associated electricity service upgrades, who maintains the EVSE, who can use the equipment, and how the electricity is paid for. Other issues include insurance, damage liability, and common property use. Responses to these challenges can depend on whether the residence is a condominium or a rental property. For condominiums, co-owners will likely determine where, how, and when charging can take place, while renters are dependent on their property owners to provide charging. Many condominiums and rental properties share a master electricity meter and are not set up to accommodate additional meters without significant cost.

State regulators such as public utility commissions (PUCs), state energy offices, and local government may need to develop or revise guidance and policy. For instance, a condominium association may be able to charge its own fees for EVSE use if the equipment is in a private parking facility. Also, lowering EVSE installation cost through building codes for new or refurbished multi-unit dwellings is a key opportunity to lower the upfront cost of EVSE installation. Building codes could require that during construction or renovation, electric wiring for EVSE in parking facilities be installed, which is much less expensive than upgrading as a discrete project.

Table 2: Charging levels included in Society of Automotive Engineers (SAE) J1772 standard. See Section 3.1.5 for more details on charging standards.

Level

Nominal Operating Voltage(V)

Max Rated Current

(A)

Max Rated Power

(kW)

AC Level 1

120

12/16

1.4/1.92

DC Level 1*

200-450

80

36

AC Level 2

240

80

19.2

DC Level 2*

200-450

200

90

* The SAE is currently finalizing a connector for DC charging Level 2 "fast" charging (there has been relatively little industry dialogue to date around DC Level 1 charging).

Another issue is whetherregulators should provide incentives to influence or institute restrictions on the type of charging equipment that can be installed. Table 2 identifies the different charging "levels" as they relate to power, current, and voltage.[28] The most commonly referenced charge levels for PEVs are alternating current (AC) Level 1, AC Level 2, and direct current (DC) Level 2, which is often referred to as "fast" charging. The amount of power required is the most important characteristic to utilities and regulatory bodies. Considering the average demand for power in a home is about 1.5 to 2 kilowatts (kW), home installation of a high-powered AC Level 2 charger could potentially cause reliability issues in a neighborhood. Although a passenger PEV's internal charging circuitry will not support the maximum 19.2 kW charging for the foreseeable future, grid reliability will become increasingly relevant as charge levels increase. After a year of early notification to select utilities of 3.3 kW charging for both the Nissan Leaf and the Chevrolet Volt, there were relatively few concerns with this level of charge. However, issues could arise in residential neighborhoods from PEVs increasingly capable of higher charging rates, such as 6.6 kW.[29] Additionally, some PEVs will have hardware that enables DC fast charging, which could cause surges in demand in areas with commercial EVSE.

Whether utilities are able to provide residential and/or commercial charging is another regulatory issue. Utilities have inherent advantages over third-party companies in providing PEV charging services.Utilities control thelocation of electricity infrastructure, will likely have access to information on prime charging locations, can often attain cost recovery for investments thereby eliminating risk, and have guaranteed revenues from other electricity sales. Many third-party providers, however, believe they could provide cheaper and more efficient service. They stress that a competitive marketplace will foster innovation and high-quality service.[30]Overall, numerous states are in the process of determining which entities will be allowed access to emerging PEV charging markets, and a common approach to regulating businesses thatprovide PEV services including electricity does notexist. Utilities could be asked to establish unregulated affiliates, which are subject to the same regulations and competition as other third-party providers.

Third-party charging service providers would like to be exempt from regulations placed on public utilities,such as cost-based pricing, to encourage competition, investment, and innovation. However, some rules would need to apply to all, for example, to ensure the safety and the quality of charging equipment used, since it is important to maintain grid reliability and consumer safety. In addition, electricity procured at wholesale for PEV charging should be subject to the same regulations governing the procurement of electricity for any other use.

In the future, automakers or aftermarket companies could eventually integrate technologies into PEVs that provide additional vehicles services, such as V2G. V2G could ultimatelylower the overall cost of owning a PEV by enabling owners to offer grid services competitively, while also improving the cost-effectiveness of grid maintenance. Policies implemented now could affect the motivation to implement V2G.

3.1.2 Residential and Commercial Electricity Rate Structure

Managed charging-i.e., using information technology protocols or financial incentives to require or encourage PEV charging at times of excess grid capacity-is necessary in order to maximize the number of PEVs deployed using existing electrical grid assets.[31] It is also necessary to maintain grid reliability and avoid the need for generation and distribution capacity additions to serve incremental PEV load. Though the amount of excess capacity varies by location, the time of day, and the season, a large amount of capacity exists during off-peak times in most places.[32] Thus, encouraging off-peak charging through time variant pricing is a good way to maintain grid reliability and minimize the cost of large-scale PEV deployment. Varying rates by electricity demand can encourage off-peak charging while also saving consumers money by enabling providers to satisfy demand at a lower cost.

Historically, most residents have paid a fixed rate for electricity. PUCs based these rates on the average cost of electricity delivery so electric utilities can recoup their costs and make a profit. As wholesale electricity markets and overall electricity demand have grown, PUCs introduced new rate structures across the United States. Many utilities offer electricity rate structures for households that encourage consumers to shift electricity usage to low-cost, off-peak hours through smart meter and other advanced technology efforts. The states these utilities operate in include many of the expected early PEV markets. If the PEV market grows beyond the early adopters, other regions may need to adopt similar rate structures-or special rate plans targeted to PEVs- to manage PEV electricity demand.

Like residential customers, commercial customers generally pay a fixed rate for electricity. They tend to pay more for their electricity than industrial customers, but less than residential customers. Commercial rates are lower than residential rates because the distribution and service costs are lower (i.e., fewer customers per kilowatt-hour or kWh served). Thus, the benefits of PEV charging using existing rate structures can differ by customer class. Commercial entities are also subject to demand charges, which are surcharges that occur when instantaneous power needs exceeds a threshold; such charges could increase the cost of charging PEVs at workplaces and shopping centers or could discourage EVSE installation in commercial locations.

3.1.3 Transportation Infrastructure and the Motor Fuel Tax

State transportation agencies receive a significant portion of their funding from federal and state revenue raised through the motor fuel tax. The original fuel tax was based on the historically strong link between fuel consumption and vehicle miles traveled. However, the lack of sufficient funding to maintain an efficient transportation system from this tax and other means has negatively affected economic growth for some time.[33] The federal fuel tax has not increased since 1993, and as a result, inflation has reduced the real value of the tax significantly. In addition, the decoupling of fuel use and vehicle miles traveled began in the late 1970s due primarily to vehicle fuel efficiency standards.[34]

In the short term, any comprehensive solution to this divergence between tax revenues and transportation infrastructure needs should address inflation, which is the primary driver of current deficits. In addition, rising vehicle fleet fuel economy should also be considered as new standards take effect and fleet turnover occurs.Regarding PEVs, even if President Obama's goal of one million PEVs by 2015 is met, losses due to the use of electricity as a transportation fuel will comprise about one percent of projected revenue shortfalls. Moreover, an additional tax on electricity as a motor fuel diminishes the total value proposition of PEVs, especially in the crucial early stage of development.

However, the threat of additional losses in funding due to gasoline and diesel use displacement by alternative vehicles like PEVs must be addressed before equity problems between the share of PEV and non-PEV drivers' contributions to transportation infrastructure maintenance are noticeable to transportation agencies. These shortfalls only occur for electric miles; EREVs and PHEVs can also run on motor fuel and pay the motor fuel tax accordingly.[35]States with substantial PEV adoption could see an impact sooner. To make up for the revenue shortfall, states have proposed methods such as a fixed charge or road user fees, which assess a tax on PEV owners based on miles driven per year.

Box 2. DC Fast Charging Standard

The lack of a common DC fast charging coupler could lead to consumer problems. The SAE is currently finalizing its version (DC Level 2). Meanwhile, some PEV service providers and automakers are pushing ahead with the existing CHAdeMO compliant connector. It is critical that the SAE and all PEV stakeholders agree on a coupler soon to maintain as much industry- wide compatibility as possible.

PEV advocates have resisted these PEV-specific measures because they believe the fees threaten PEVs' viability. In addition, privacy advocates resist methods that require mileage-measuring devices to be installed in vehicles. There are suitable ways to track mileage, however, such as annual mileage readings, without using personal identifiable information like vehicle location. The deployment of PEVs today should have an eye towards the long-term consequences for a transportation system that obtains its funding from gasoline and diesel taxes.

Another potential source of revenue for transportation infrastructure is the commercialization of the rights-of-way along the U.S. Interstate System (e.g., PEV charging stations at rest areas). The creation of the Interstate Highway Program prevented this in its inception in 1956.[36] Interstates built before 1960 (e.g., Interstate 95) are exempted. In general, areas with commercial offerings such as refueling stations must be located off the highway. The commercialization of interstate highway rest areas nationwide including the installation of PEV charging stations could bridge some of the funding gaps facing transportation agencies.

3.1.4 Consumer Privacy

Concerns exist about the use of data collected from PEVs and EVSE that could be used to personally identify a driver. Deployment projects sponsored by the DOE have instrumented thousands of vehicles with the goal of understanding PEV driver behavior.[37] In addition, PEV service providers are collecting data about the use of their EVSE, including residential installations.[38] Because the data being collected could be used to identify an individual driver, care must be taken to mask identifiable information when performing analysis to better understand PEV driver behavior.

3.1.5 Vehicle Charging Standards and Best Practices

Vehicle charging standards include, but are not limited to, standardized vehicle charging plug connectors (i.e., the coupler), PEV interconnection with the electrical grid, residential and commercial building codes, and international harmonization. Nationwide compatibility is critical for automakers, PEV service providers, and consumers. Adopting voluntary technical standards like the Society of Automotive Engineers (SAE) J1772, the most common PEV electrical connector standard, will ensure that PEV owners can use EVSE anywhere so long as interoperability standards are finalized.[39] These standards define physical and electrical characteristics related to power, safety, electrical interconnections, and electrical signaling. Future standards will incorporate functionality for smart grid applications.SAE has agreed upon a common, compliant coupler for AC Level 1 and Level 2 charging, but there is no industry agreement yet on the coupler for DC Level 2 fast charging (see Box 2). SAE is expected to finish the DC portion of the J1772 standard in early 2012. As a result, PEVs may contain two different connectors in the short term - the SAE J1772 for AC Level 1 and AC Level 2 and a DC fast charging connector (such as a CHAdeMO connector).[40]

Automakers may not choose to use the CHAdeMO connector once SAE finalizes a Level 2 coupler for DC. However, it is an option in BEVs on the road in 2011 and PEV service providers have already installed some CHAdeMO-compliant infrastructure. Hopefully, new infrastructure that uses the CHAdeMO connector will also be compatible with the connector for the SAE's DC Level 2 standard through relatively inexpensive modifications, but the extent of compatibility between CHAdeMO and the SAE DC Level 2 is not fully known yet.

No single standards body is responsible for all aspects of PEV charging. The number of standards bodies related to PEVs is very large. A partial list includes the SAE, federal agencies like the National Institute of Standards and Technology (NIST), the American National Standards Institute (ANSI), the International Code Council (ICC), Underwriter Laboratories (UL), the National Electrical Code (NEC), the International Association of Electrical Inspectors (IAEI), the National Electrical Contractors Association (NECA), and the Institute of Electrical and Electronics Engineers (IEEE), all of whom are actively engaged in developing PEV technical standards. SAE, NEC, and UL work on vehicle charging connector standards including the SAE J1772. ICC develops building codes while NECA and IAEI deal with EVSE installation standards. NIST and IEEE work on industry standards related to smart grid and V2G, two critical aspects of managed charging; these bodies consider the privacy issues identified earlier. All these bodies consider safety-related issues. ANSI convened the ANSI Electric Vehicles Standards Panel to address all of these issues together in April 2011; the panel plans to release the first version of its roadmap of the "standards and conformity assessment programs needed to facilitate the widespread acceptance and deployment of electric vehicles" in early 2012.[41]

3.2 Regulatory Framework Actions

Automakers, PEV service providers, electricity providers, and government should cooperate on a consistent regulatory framework for PEVs that follows common principles for utility regulation, reflects observed best practices, and advances consumer interest in PEVs. - The PEF Dialogue Group

The PEV Dialogue Group believes consistent electricity distribution regulations that capture best practices and are based on common standards can lay a foundation for PEVs to help improve the reliability of the U.S. electrical grid. But incompatible regulations could harm budding consumer perception of PEVs and diminish stakeholder interest in developing PEV infrastructure and services. Numerous pilot programs and consumer studies are now being conducted to identify best practices and common standards for managing consumer demand and understanding stakeholder responsibilities. In addition, several state and local governments have already defined key rules and regulations for PEV markets. As described above, a number of standards bodies are also engaged in developing common standards for PEVs and PEV charging.

Ultimately, jurisdictions do not need to issue the same regulations, but certain principles should be common. To that end, the Group identified the following four guiding principles for utility regulations:

Utility Regulation Principles

  1. Protect the Reliability of the Electrical Grid: The reliability of the grid is paramount to PEVs' and the broader economy's success. Policies and regulations should avoid increasing the risk of grid unreliability.
  2. Minimize Cost to the Electricity Distribution System: There is adequate capacity in the existing electrical distribution system for millions of PEVs. Policy and regulations should aim to leverage existing assets and use managed charging to handle demand on the system.
  3. Encourage Transportation Electrification: The societal benefits provided by PEVs warrant policies and regulations that support PEV adoption while also supporting the previous two goals.
  4. Provide Consistent Treatment of PEVs with Comparable Power Requirements within each Rate Class: Over time, homes have demanded more power from clothes dryers, air conditioning units, and flat-screen televisions. Commercial demand has also changed significantly over time. The key is to treat incremental PEV power demand no differently from other incremental electricity loads.

The Group concluded that, in some instances, policies to accelerate PEV adoption must distinguish between early adopters and mainstream users. The regulatory framework should foster a sustainable, open, and competitive marketplace where innovation is encouraged. All the while, regulators should not compromise electrical grid reliability, for example through the premature introduction of technology.

3.2.1 Residential and Commercial EVSE Actions

Electric utilities, PUCs, NGOs, state governments, auto dealers, automakers, PEV service providers, and local governments should jointly create a competitive and innovative market for residential and commercial PEV charging services. Decisions by PUCs, local government, and PEV service providers regarding household EVSE installation should streamline the installation process. Regulations should reflect the local characteristics of markets, potential PEV users, PEV service providers, and electric utilities.

Since there will be little, if any, impact of early PEV adoption on the reliability of the electrical grid, residential and commercial installations of EVSE should be treated the same as similar electric loads. As part of a larger multi-stakeholder collaboration, electric utilities could work with their local inspection or permitting organizations to develop and offer faster permitting or other services for PEV owners who self-report their vehicle purchases.

The costs of electricity service or system upgrades necessary for residential and commercial charging should follow current rules for infrastructure improvements, including any costs that are part of the electricity rate base.

The experience of early adopters should guide long-term residential requirements. Local government and state regulators should provide clarity on legal issues related to multi-unit dwellings including condominiums and rental properties. Local government should also consider building codes that lower EVSE installation cost by requiring electric wiring for EVSE in new and refurbished multi-unit dwellings where practical. PUCs shouldsupport and encourage effortsby auto dealers, EVSE service providers, Departments of Motor Vehicles (DMVs), state energy offices, permitting authorities, or utilities that encourage consumers to notify utilities before purchasing a PEV or installing a home EVSE.

Creating a competitive market place that offers affordable and wide-ranging service should be the focus of early and later charging infrastructure regulation. Relevant business models are not limited to EVSE operators, but also include V2G service providers; the introduction of common standards should guide the widespread introduction of technology that could be disruptive. State and local jurisdictions should encourage innovative business models at the outset with the goal of minimizing the cost of charging infrastructure build out to the public. Thus, applying current utility regulations to PEV service providers that are not acting like a utility could stifle innovation and the emerging PEV industry. However, PEV service providers that wish to procure electricity directly at wholesale should be subject to the same rules and regulations as any other entity with access to wholesale markets. In any case, typical consumer protections related to market competition should be enforced. Utilities wishing to act as a PEV service provider should do so through unregulated affiliates as the use of ratepayer dollars could provide utilities with an unfair competitive advantage. Further, utilities should be allowed to own and operate EVSE for internal use, for demonstration purposes, and in areas that the private market would not support otherwise.[42]

Current Examples

The following examples illustrate ways to streamline EVSE installation and maintain grid reliability:

Guided by the characteristics of their local markets, several states have already defined key regulations regarding PEV infrastructure. The lessons learned from these early movers should help in defining best practices for the larger PEV market.

Action Summary

Key Questions Considered by the Group

Government and Stakeholder Actions

Distinguished between Early Adopters & Mainstream Consumers where Noted

How should the cost burden for PEV integration be shared?

PUCs should stay consistent with existing regulations based on comparable electric load and rate class; this includes surcharges related to high-power charging.

How should charging services be provided in multi-unit dwellings?

State and local government and PUCs should provide clarity on legal issues. Local government should define an approach for new and refurbished buildings to accommodate EVSE installation more easily.

Should utilities be notified when a new PEV is sold or an EVSE is installed?

A mechanism (e.g., state DMV, or EVSE permit application) may be advised to notify the local utility ofthe home address of a newly purchased PEV or EVSE with higher charge rates (e.g., in excess of 5 kW). Local government, EVSE commercial stores, and utilities should encourage notification at EVSE purchase time including informing consumers of existing rules on utility notification for significant new loads.

Can utilities own EVSE?

PUCs should allow utilities to provide service for demonstration purposes, for internal use, through unregulated affiliates, or for areas that the private market would not accommodate otherwise.

Should PEV service providers be regulated as utilities?

PEV service providers not acting as utilities should not be regulated as utilities, but PEV service providers that wish to procure electricity at wholesale should be subject to the same regulations as any other entity with access to wholesale markets. State and local government should require typical consumer protections related to market competition.

How can the groundwork be laid for V2G?

Early Adopters: PUCs should enable electricity power providers to buy electric power from PEV owners for demonstration purposes.

Mainstream Consumers: PUCs should enable more widespread usage once common standards are established for V2G as it relates to EVSE, PEVs, etc.

3.2.2 Residential and Commercial Electricity Rate Structure Actions

Electric utilities, PUCs, NGOs, and state governments should work together to identify electricity rate structures that maintain the reliability of the electrical grid and reward households for charging PEVs at off-peak hours. Rate structures should offer households choicesincluding options that better reflect the cost of electricity generation.

PUCs should direct electricity providers to educate early adopters on how to maximize savings on their energy bills, which will help protect grid reliabilityand minimize infrastructure upgrades.PUCs should also authorize recovery of reasonably incurred costs associated with such efforts. Since early adopters are likely to depend on home charging, regulators should require residential rates that encourage off-peak charging.Stronger pricing incentives to encourage off-peak charging may be necessary if analysis indicates grid instability will increase with PEV adoption.

The following are measures to improve theconsumer experience:

As PEV adoption moves beyond early adopters, electricity providers will face different demand patterns and may need to take steps to maintain grid reliability.Initial consumer pricing options include conditions that will have to be reevaluated as more PEVs are deployed:

Current Examples

The following examples illustrate special electricity rates to manage PEV charging.

Rate Name

Time

Price ($ per kWh)

On-Peak

9AM-11PM Monday-Friday

$0.18195

Off-Peak

All other times

$0.07695

Rate Name

Time

Price ($ per kWh)

On-Peak

2PM-7PM Weekdays (June-September)

$0.25

Off-Peak

7AM-7PM (October-May)

7AM-2PM (June-September)

$0.10

Super Off-Peak

11PM-7AMDaily

$.06

Rate Name

Time

Price ($ per kWh)

Peak

12PM-6PM

$0.257

Off-Peak

5AM-12PM

6PM-12AM

$0.167

$0.167

Super Off-Peak

12AM-5AM

$0.144

Through its pilot programs, utilities should collect information necessary to identify the best practices for that particular utility in time to implement lessons learned before mainstream consumers adopt PEVs and market penetration is at a level where reliability and electric service cost impacts of PEVs are significant.

Action Summary

Key Questions Considered by the Group

Government and Stakeholder Actions

Distinguished between Early Adopters & Mainstream Consumers where Noted

How will utilities manage demand?

Early Adopters: PUCs and utilities should offer rates to encourage adoption and off-peak charging (e.g., whole house TOU, PEV-specific TOU) Utilities, NGOs, and state government should run education campaigns on the public and private benefits of off-peak charging.

Mainstream Consumers: PUCs and utilities should encourage off-peak charging and pricing plans that proved effective in early adoption.

3.2.3 Transportation Infrastructure Maintenance Actions

NGOs, PUCs, electric utilities,and state and local governments should work together to determine how PEV owners can pay their fair share of transportation infrastructure maintenance. Permanent or temporary methods should be implemented that do not affect PEV market growth before PEVs have a noticeable impact on tax revenue for a state.

The loss of motor fuel tax revenues from early PEV adopters should be small for some time. Although financing the maintenance of the transportation infrastructure is the responsibility of all users, collecting tax revenue from early adopters should not be an immediate concern in most states. However, states with concentrations of PEVs may consider transitional policies such as short-term annual excise fees. States should carefully consider such fees since additional costs of PEV ownership could diminish market growth in the short term.

State and local governments should craft revenue collection plans during the early adoption phase and enact them before PEV adoption noticeably affects revenues, when technically feasible, and without stunting PEV market growth. The revenue could be collected at the vehicle charge point based on the amount of energy consumed (similar to the existing motor fuel tax) or devices could be installed on the vehicle itself to track actual vehicle miles travelled. Consumer resistance to tracking is stronger with respect to where the vehicle travels versus how many miles the vehicle has traveled, but any device installed on the vehicle could meet resistance. Since EREVs and PHEVs driven on motor fuel are subject to the motor fuel tax, additional revenue collection is only needed for the electric miles traveled by those vehicles.

Current Examples

Action Summary

Key Questions Considered by the Group

Government and Stakeholder Actions

Distinguished between Early Adopters & Mainstream Consumers where Noted

How will PEV drivers contribute to transportation infrastructure maintenance?

Early Adopters: NGOs, PUCs, electric utilities,and state and local government should define a suitable method for estimating or determining mileage data and payment collection that continues to encourage efficient vehicles similar to the existing motor fuel tax; consider transitional actions for some areas. Proposals should aim to minimize impact on PEV market growth in the short term.

Mainstream Consumers: State government should enact a method based on effectiveness, consumer acceptance, and technological feasibility.

3.2.4 Vehicle Charging Standards and Best Practices Action

Voluntary standards bodies should work together, with the assistance of electricity providers, regulatory authorities, NGOs, automakers, and federal and local government, to develop vehicle charging standards and best practices related to the vehicle charging connector, PEV interconnection and communication with the electrical grid, and EVSE installation.

While some national standards (e.g., SAE charging level standards) are necessary right away, best practices and other standards are best identified over time. National organizations like NIST, ANSI, NARUC, NASEO, UL, NECA, IAEI, ICC, NEC, IEEE, and SAE can identifybest practices and national standards (e.g., vehicle-grid interconnection, smart grid compatibility) for charging infrastructure.

Current Examples

Action Summary

Key Questions Considered by the Group

Government and Stakeholder Actions

Distinguished between Early Adopters & Mainstream Consumers where Noted

Who will establish vehicle charging standards and best practices?

Stakeholders should work with standards bodies, such as SAE, NIST, ANSI, UL, NEC, ICC, and IEEE to develop PEV charging standards and best practices.

3.2.5 Consumer Privacy Actions

Electric utilities and other electricity providers, PEV service providers, and PEV pilot project participants should ensure that individual identity is impossible to glean from data collected from EVSE and vehiclesreleased to NGOs, government, and other researchers while also maintaining the usefulness of these data for researchers.

Consumers should have to agree to how any of their personal information is being used. Thus, data collection should be voluntary and mostly anonymous without the ability to identify individual consumers; the data collected should assist in maintaining grid reliability and optimizing charging infrastructure build out. The parties that use or collect data (e.g., automakers, PEV service providers, utilities, researchers, and governments) should store data in secure locations and prevent outside access. Wherever possible, analytical outputs should be used instead of raw data to prevent the sharing of personally identifiable information.

Current Examples

Action Summary

Key Questions Considered by the Group

Government and Stakeholder Actions

Distinguished between Early Adopters & Mainstream Consumers where Noted

Who will have access to charging and driver data collected?

PEV service providers, electric utilities and other electricity providers, and PEV pilot project participants should have strict privacy agreements that (at minimum) mask individual identification from data collected while also maintaining usefulness to the data user (e.g., utility, research laboratory, private company, NGO).

The regulatory framework laid out in this chapter identifies several actions that will enable PEVs to be integrated with the electrical grid. The goal of the framework is to encourage regulatory compatibility across the country. Although it is unlikely that all states will adopt the same regulations for all aspects of PEVs, the growth of the PEV market depends to some extent on the degree of compatibility of these important regulations. Another key challenge is optimizing public and private investments, which the regulatory framework partially addresses. The next chapter delves deeper into this in order to accelerate private investment while also balancing efficiency and equity.

Updated: 10/29/2014
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