Electricity Isn’t Like That Other Automotive Fuel

Unlike gasoline, electricity is not routinely stored (yet). Accordingly, its availability and hence price varies wildly from time to time and place to place. All EV drivers can minimize their fuel costs by paying attention to the price tiers highlighted below. Spoiler alert: charge at home or when use of slower chargers is practical.

Ways to charge your EV, in order from cheapest to most expensive (charging speeds for a source can usually be found in your EV navigation software):

1) There may be opportunities for free charging at work or with municipal chargers (= $0/kwh; e.g., long-term parking at the Durango Airport).

2) If you have solar panels at home, charge during the day. ($ cost depends on size of solar array, etc.).

3) If you do not have solar panels, charge during any off-peak hours. Those vary from power company to power company. In the LPEA service area (e.g., Durango-Pagosa) flat rate residential power is off-peak from 9 PM to 4 PM the next day (~$0.12/kwh).

4) Public metered slow chargers (<15 kwh, sometimes called Levels 1, 2, or Destination chargers: $0.10-0.25/kwh).

5) Public metered semi-fast chargers (15-50 kw: $0.30-0.50/kwh).

6) Public metered very fast chargers at normal times-of-day (>50 kw: $0.25-0.70/kwh).

7) Public metered fast charger with congestion charge ($1-$3/kwh). So far, I have only seen congestion charges at Tesla stations; these triple the cost of electricity when nearly all of the chargers at selected stations are occupied.

8) On-peak charging at home can cost up to $6/kwh.

Notice the wide cost range: the fillup of a medium-size pure EV battery (e.g. 80 kwh) can run anywhere from $3 (or free) to more than $100.

Once you get into on-peak or congestion costs, EV fueling can match or even exceed the fuel cost for a comparable gas car. Paying this ghastly price is sensible to meet rare emergencies (as an EV can save money under most other circumstances). It is, however, unwise as a routine.

Let’s return to #2 above, the fueler with a home PV (solar) array. The optimal cost-saving strategy depends on the rate structure adopted by the electric delivery company and the size of the homeowner’s solar array. For the sake of simplicity let’s assume that the array’s output at midday exactly matches the input needed for the car charger (e.g. 8 kw = 8 kw). Under those conditions the marginal cost of charging is zero dollars per kwh. [Marginal costs are “new” costs and exclude expenses that are now irreversible (e.g., purchasing the solar array)]

However, if the owner has competing power demands, the cost savings of the solar array are divided among the competing uses. If the car charger draws more than the array puts out at that time of day, the difference is made up by purchasing retail grid power at the prevailing rate (~$0.08-0.15/kwh).

If the car charger draws less than the solar array produces, the surplus production may result in a payment from the power company to the homeowner. In the case of the Durango power company – LPEA – the refund or credit is about $0.035/kwh (called the “avoided” or “wholesale” rate). Under anticipated changes in LPEA’s rate structure, the reimbursement may increase. In some other localities, the overly productive solar homeowner is simply stiffed.

Notice that the credit for this excess production (“wholesale”: $0.035) is substantially less than is the cost to the homeowner for purchasing the same amount of retail power (~$0.12). Not a coincidence!

This difference means that charging your car at a solar-equipped home when the sun is shining is substantially less costly than it is when charging it at night. The details vary with the rate schedule of the electric company, but for many flat rate billings, nighttime charging is 1.5-4 times as costly for solar homeowners as is daytime EV charging. Charging during the day saves the retail cost of electricity whereas charging at night costs the retail rate and credits the electricity sent to the grid during the day but that credit is at the paltry wholesale rate.

For the average worker bee, however, this difference is moot. The car is needed during the day, and available for charging only at night. Convenience wins out over price and in any event, charging an EV is far cheaper than buying gas.

How can a daytime employee working at a business but having home solar take maximal advantage of electricity costs?

   1) promote and use workplace charging (because of solar generation, our region has surplus electricity during the day and businesses enjoy exceptionally low daytime electricity costs).

   2) charge during the day on weekends if you can, or when working remotely at home during workdays,

   3) if one has a large enough car battery to drive for several days without recharging (i.e., most EVs), save up charging until a day when low-cost daytime charging is possible (e.g., weekends), and,

   4) if one has a stationary storage battery for storing up daytime production, draw the charging current off that stationary battery at night and recharge the stationary battery the next day.

The vast range of electricity prices offer opportunities for cost saving by EV owners. For entrepreneurs, the same price spread will energize the installation of stationary battery storage – to the benefit of all electricity consumers.

Thanks to Deborah Lycan and Rich Farrington for insightful discussion on this topic.