EV Charging Stations Can Benefit Local Economies

Building enough charging infrastructure to capture the anticipated economic and health benefits will be an enormous undertaking. But can the country’s power grid handle the strain of so many EVs plugging in on a daily basis?

A row of Tesla electric charging stations.
Tesla charging stations in Hartford, Conn.
(Brad Horrigan/TNS)
Jurisdictions that hold off on building charging infrastructure until they are sure electric vehicles (EVs) are really coming are likely to be caught flat-footed. “We don’t really have a chicken and egg problem, we have a chicken and waffle problem,” says Chris Nelder, the EV grid integration manager for the Carbon-Free Mobility Practice at the Rocky Mountain Institute (RMI), a clean energy research organization. “The vehicles are definitely coming, so we should stop waffling and build some charging stations.”

Whatever short-term doubts policymakers and local officials might have about electric vehicles, the market has foretold the future. Tesla, the electric vehicle manufacturer, is more valuable than the next six car makers combined. Automakers including GM, Toyota, Honda and Volkswagen have all announced dates for the phaseout of vehicles with internal combustion engines, as have such luxury brands as Volvo and Jaguar.
 

President Biden’s proposed American Jobs Plan dedicates $174 billion to accelerate the shift to EVs. This figure, which encompasses consumer rebates, tax incentives and purchases of zero-emission transit vehicles and school buses, includes $15 billion to build 500,000 new charging stations. The most recent Republican counter-proposal is $4 billion in total, about 2 percent of the president’s target, and only about 13 percent of the amount for charging stations alone.

There’s no doubt that federal investment at any level would make a difference, but party disagreements about climate won’t be able to stop progress toward EV adoption, no matter what happens with the president’s bill. Enough things are right about this evolution that all stakeholders who examine it closely will be able to see reasons to embrace it.
The back of a school bus with a cloud of diesel fumes being emitted from the tailpipe.
A school bus is seen releasing a high amount diesel pollution in downtown Manhattan. Diesel exhaust contains more than 40 toxic air contaminants, including cancer-causing substances and nitrogen oxides, a component of urban smog.
(Luiz C. Ribeiro/New York Daily News)

A Virtuous Circle


The conversation about EVs could begin with health. The Centre for Research on Energy and Clean Air (CREA) estimates that burning fossil fuels was responsible for as many 300,000 premature deaths in the U.S. in 2018, with the economic impact from lost work and illness as high as $870 million. Transportation accounts for almost 70 percent of petroleum consumption, and tailpipe emissions are a big reason that half of all Americans live in areas with substandard air quality.

EV charging has unique potential to add growth and stability to the energy ecosystem. Continuous increases in efficiency have led to reduced demand for electricity in advanced economies. Whether from taxes on income and property or payments by municipal utility customers, governments stand to gain by developing infrastructure that will fill the growing need for electric “fuel.” RMI research has characterized EV charging as “the largest growth sector in the U.S. electricity market for the foreseeable future.”
This transition also makes every jurisdiction a fuel source, creating local jobs and establishing local control over the volatility of fuel price, a wild card that can destabilize the budgets of many citizens. Through education, outreach and incentives for charging during off-peak hours, utilities can drive down the price of fueling vehicles and the cost of electricity for all users.

The cost of generating solar power has dropped 90 percent in the past decade, and wind power has become 70 percent cheaper. A full-scale EV charging network can smooth this trend, with vehicles drinking up and paying for power during peak production hours, energy (and revenue) that might otherwise be lost. As technology develops, charging stations could be a conduit for vehicles to provide power back to electrical grids, a resource when outages occur or when demand exceeds supply.

The insurance industry has determined that the lifetime cost of owning an electrical vehicle is already less than that of a gas-powered one. The gap will widen when price parity is achieved, expected by 2023. The money saved on fuel and vehicle maintenance will be spent in other ways, creating jobs in the retail and service sectors.

These are just some of the known tangible benefits. Meanwhile, the pressure to reduce carbon emissions continues to mount. In 2020 alone, local communities in the U.S. suffered an unprecedented 22 separate billion-dollar climate and weather disasters. Estimates of the future social and economic impacts of global warming are truly alarming. While electric vehicles alone won’t keep rising temperatures at bay, reducing transportation emissions is vital.

Nelder is one of the authors of RMI’s From Gas to Grid report, which sums the situation up: “The world doesn’t need any more cost-benefit analyses; they’ve already been done, and they show that vehicle electrification has numerous benefits for drivers, utilities, communities, and society as a whole.” As Nelder puts it, it’s time to make waffles.
A worker kneeling in front of an electric vehicle charging station as they work on installing it.
Workers install electric vehicle charging stations in Canton, OH.
(Julie Vennitti Botos/TNS)

What Kind of Charging?


EV infrastructure includes three types of charging stations: Level 1, Level 2 and direct current fast chargers (DCFC). A Level 1 charger is equivalent to charging from a household outlet, and it’s not uncommon to see an extension cord coming from a house to a vehicle. A Level 2 charger has a 240-volt power source, equivalent to what is required by an oven, water heater or AC system. A DCFC charger has a voltage of 480 volts or more.

The exact amount of time it takes to fully charge a battery can vary on each of these systems due to several factors, but the more volts, the faster things will go.



Estimates of the current state of charging infrastructure vary. A map maintained by the U.S. Department of Energy’s Alternative Fuels Data Center shows about 43,000 charging stations in the U.S., including 5,000 fast chargers. According to the most recent report from the National Renewable Energy Lab (NREL), in Q3 2020 there were almost 80,000 public and private Level 2 charging stations and nearly 16,000 DCFC chargers.

A 2017 NREL analysis projected that 600,000 Level 2 and 27,000 fast chargers will be needed by 2030, but Nelder and his colleagues believe that there’s not enough data to estimate the necessary ratio of charging stations to EVs.

Whatever the numbers might be, Nelder says that government funding should focus on DCFC chargers. These high-speed stations, which are significantly more expensive, will be necessary to make EVs work for ride-sharing services, travelers on long-distance corridors and citizens in multi-unit dwellings that don’t provide charging. DCFC infrastructure is also the backbone of electric transit and school bus fleets.

Facilitating ride-sharing with sufficient fast charging can play an integral role in improving urban life. “A lot of us who have looked at mobility challenges understand that the future really has to have a big role for these services,” says Nelder. “If we’re going to reduce vehicle miles traveled, reduce congestion and achieve some of our other goals we have to enable that business.”

This is not to say that Level 2 capacity should be ignored. “It’s cheaper to build those chargers, cheaper for utility systems to operate them and cheaper for drivers to charge up with them,” says Nelder. “This is no time to be thinking, we should only do this and not that — we need all of the above.”
Major-cost-components-of-EV-charging-infrastructure-1-e1578526192871-786x1024.png
Eliminating government red tape can greatly lower the cost of charging station installation. (Graphic: RMI)
Aside from funding or incentives, government can play an important role in expanding charging availability. Nelder was co-author of another RMI report, Reducing EV Charging Infrastructure Costs, which found that the soft costs of installation were greatly increased by factors such as permitting delays, inconsistent regulations and utility interconnection processes.

“It’s mostly just red tape,” he says. “If we can address those issues, we can bring down the cost of charging infrastructure in a dramatic way.”
A group of electric vehicle charging stations.
Charging stations for AC Transit Zero Emission buses. (Photo courtesy of California Energy Commission)

Strong Signals, Backed by Incentives


The state-by-state ratio of chargers per EV driver is in constant flux, but in terms of sheer numbers California outpaces the rest of the country. NREL’s most recent report on infrastructure shows Vermont with the most chargers per 100,000 population, but based on data from the California Energy Commission’s ZEV dashboard, the Golden State is home to the great majority of all Level 2 chargers in the U.S., and nearly 40 percent of all DC fast chargers.

Nearly half of all the electric vehicles in the country belong to California drivers, and by 2035 the state will forbid the sale of new vehicles with internal combustion engines. A 2018 Executive Order from then-Gov. Jerry Brown set goals of 5 million zero emission vehicles on California roads by 2030 and 250,000 charging stations by 2025.

Major investments are being made toward infrastructure goals. Gov. Newsom’s May revision of the 2021-22 budget includes $500 million for EV charging and hydrogen fueling stations, as well as $415 million for targeted infrastructure to support heavy-duty vehicles (transit buses, school buses, and drayage trucks). A $436 million plan approved by the California Public Utilities Commission in January is the biggest-ever utility effort of its kind. The funds go to Southern California Edison to add almost 40,000 chargers in Southern California.
CA-charging-stations.jpg
The California Energy Commission maintains a dashboard with statistics on ZEVs, charging stations and electric school buses in the state, updated quarterly.(California Energy Commission (2021). California Energy Commission Zero Emission Vehicle and Infrastructure Statistics. Data last updated April 30, 2021. Retrieved June 6, 2021 from https://www.energy.ca.gov/zevstats)

Decades of clearly stated intentions, strong regulations and incentives to reduce the risks of a transition to EVs paved the way for California’s success thus far, says Hannon Rasool, deputy director of the California Energy Commission’s Fuels and Transportation Division. Now the state wants to make the most of the opportunities it has created.

Zero-emission vehicles were the state’s No. 1 export in 2020, he says. “We want more vehicle manufacturing in California, we want battery production in California, we want infrastructure done at the local level and local jobs — there’s a huge opportunity.”

In Rasool’s view, the fact that technology will continue to evolve is no reason to delay installation. EV infrastructure is more than charging stations themselves; there’s a back-end aspect that involves traditional electrical work.

“You dig a trench, lay down some conduit wire, put in a transformer, a lot of that will last 30, 40, 50 years,” he says. “Even if you want to change out a charging station with something newer and shinier, that other infrastructure is still going to do the same thing — there’s a wire taking electricity back and forth for you.”

The California Energy Commission (CEC) has been working with local jurisdictions to streamline permitting processes and reduce soft costs, says Rasool. “You can have a bit of a fragmented state at times, with different jurisdictions having different permitting requirements because they’re seeing electric vehicle charging for the first time.” California building codes require new construction to be ready to accommodate EV charging and establish requirements for charging spaces in multi-family dwellings and non-residential buildings.

California is also one of the few states to make a firm commitment to equity, allocating half of the CEC’s clean transportation budget to programs that benefit low-income and disadvantaged communities. “We expect the private market to make investments where they have the biggest bang for their buck,” says Rasool. “We need to take public dollars where they might not go.”
An electric vehicle charging.
A Seattle City Light vehicle charges at one of the utility s new electric vehicle charging stations in the city's SoDo neighborhood.
(Alex Brown/Stateline/The Pew Chartiable Trusts)

Utilities and Equity


Utilities can play an important role in ensuring equity is built into transportation electrification programs, says Peter Huether, senior research analyst for transportation for the American Council for an Energy-Efficient Economy (ACEEE). When it comes to low- and moderate-income households (LMI), this can have many dimensions.

Access to charging is important to low-income households, but it’s not the only equity consideration. Persons from LMI households are more likely to use public transit, live in proximity to roads traveled by diesel vehicles or near maintenance stations for transit buses. Charging infrastructure that supported electrification of such vehicles might have outsized benefits for such communities, improving the air they breathe each day.

As transit districts work toward fully electric fleets, they could prioritize placing zero-emission buses on routes that serve disadvantaged communities. A car-sharing program with electric vehicles is another possible option, says Huether. But the only way to really know what need should be filled is to talk to members of the community.

“We emphasize good community engagement early in the planning process,” he says. “You want to avoid the situation where you’re making investments that don’t pan out because it’s not what the community needed.”

Utilities have a history of support for programs such as energy efficiency and weatherization efforts in low-income communities, and can play a strong role in filling equity gaps in the electrification market, says Huether. “There are a lot of investments being made right now, and there are a lot of benefits to be gained from them. It’s important that we center equity in that work and make sure people aren’t left out.”
A building that says "Hyundai" on the side with a large construction crane in front of it.
Construction of expanded facilities at the Hyundai Motor Manufacturing plant in Montgomery, Ala. The Southeast is a hub of EV production, but lags in EV charging infrastructure.
(Jake Crandall/ Advertiser/TNS)

Closing the Circle


The Southeastern United States is an EV paradox: it has attracted a large share of investment in manufacturing electric vehicles, reaping economic benefits from this sector, and yet lags behind other parts of the country in advancing EV adoption and charging availability.

Growing recognition of the job growth that electric vehicle production has brought to the Southeast is beginning to drive a conversation about transitioning to electric transportation, says Stan Cross, electric transportation policy director for the Southern Alliance for Clean Energy. This is coinciding with the retirement of coal-fired power plants and the ramping up of renewable energy in North Carolina and Florida, which have become two of the top solar states in the country.

“Getting fast charging infrastructure deployed along highway corridors would be really important to facilitate mobility through the region,” he says. “It will also support out-of-region tourists who want to drive electric vehicles to come into the Southeast, which has a lot of the nation’s premier travel destinations.”

Other priorities include electrifying school buses and transit, and supporting companies willing to replace diesel trucks that serve the numerous ports in the region with electric heavy-duty vehicles. “We need open, standard protocols for the charging experience as we go to scale,” he says. “Folks who are deploying tens of millions of dollars on charging infrastructure need to make sure that those chargers don’t wind up abandoned assets, and that site hosts have the flexibility to change software providers if they’re not happy with the software.”

Cross is an EV driver, and cites his own experience with DCFC chargers whose connectors are not compatible with his vehicle as another example of the need for standardization. “Just that little hiccup is enough to stop a commissioner from approving a line item to put charging stations in the county,” he says. “Getting rid of as many little pieces of discomfort as possible has exponential value in getting people to say ‘yes’ to spending money on this transition.”

Evolving Needs and Demand


There are questions about the right pace for building out charging infrastructure while vehicle range and the charging preferences of owners are still evolving; as vehicle ranges increase, charging needs change. The current median range of new EVs is 250 miles, but some have shorter ranges and there are many older vehicles with ranges that are significantly less. Even though most Americans only drive about 25-30 miles a day, the tipping point for EV adoption may not arrive until new vehicles achieve both price and range parity with gas-powered competitors.

A recent study from the University of California, Davis Institute of Transportation Studies sought to evaluate the factors that might affect decisions about where to place chargers. Free charging, which is now available at some workplaces and public facilities, is not likely to be sustainable over the long run. Charging at home might be more or less attractive depending on whether utilities offer lower rates for those who charge their vehicles at times when demand for electricity is low.

“Policymakers need to develop pricing schemes that will prevent an unnecessary shift of charging behavior from home to non-home locations and allow optimal use of the public infrastructure,” says the UC Davis report.

To the extent that this remains a work in progress in jurisdictions across the country, planning the optimum deployment of stations may be difficult. The rate at which miles traveled in autonomous vehicles and ride-sharing services replace trips in personal vehicles is another unknown that could affect where charging stations will be needed.

Some worry that EVs will strain utility grids. Researchers at the University of Texas at Austin looked at how energy demand would be affected in every state in the U.S. if Americans relied entirely on EVs. They found that many states already have enough capacity, provided charging is managed properly, while states such as California and Texas would need to build new power plants or buy more electricity from other states.

“There’s no question that utilities can do this, but it’s not going to be trivial,” Nelder told The New York Times.
An electric vehicle charging at a solar-powered charging station.
An electric vehicle charges at a solar-powered charging station at a GM assembly plant in Detroit.
(GM/Chevrolet/TNS)

Back to the Sun


As capacity for renewable energy production grows, charging infrastructure offers a conduit for an infinite vehicle fuel supply. This is a paradigm shift from fossil fuels, an exhaustible resource with a continuously rising price, says David Roland-Holst, a research economist at UC Berkeley.

“This is a boundless resource,” he says. “There’s more of it than we can ever use.”

Technology has been the constraint on accessing this resource, but the technology issues are resolving faster than anyone expected, says Roland-Holst. “We don’t have to be digging up prehistoric carbon that was laid down millions of years ago and hurling it into the atmosphere, because that’s not necessary anymore.”

The biggest stumbling blocks for new technologies have to do with their adoption, and the challenge for EVs is finding ways to get more people to relate to them.

“We didn’t start driving cars because we ran out of horses,” he says. “The reason was that cars offered us things that we really found desirable compared to animals.”
Carl Smith is a senior staff writer for Governing and covers a broad range of issues affecting states and localities. He can be reached at carl.smith@governing.com or on Twitter at @governingwriter.
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