Government utility regulators are considering whether to approve an Evergy plan to promote electric vehicles in Kansas. Concerns remain, however, over the potential for a lack of competition and customer subsidies for clean energy.
“Transportation electrification is happening now, and it’s going to increase dramatically over the next few years,” said Glenda Cafer, a representative for Evergy, “and the utility company needs to be involved in that process to best manage the grid and educate customers as that growth occurs.”
Evergy needs approval from the Kansas Corporation Commission, which held about 11 hours of evidentiary hearings with the utility company and interested groups this week.
Post-hearing briefs will be filed over the next two months, and the commission is scheduled to issue an order in December.
Evergy filed its 146-page application in February for the proposed transportation electrification portfolio, which includes rebate programs, charging service rates, consumer education, administration budgeting and tracking of program costs.
The plan is “a small controlled step in the direction that we believe Kansas and Evergy needs to go,” Cafer said.
That position has proven controversial.
While Gov. Laura Kelly’s administration has backed the proposal, some organizations question whether a public utility should be stimulating demand for electric vehicles — and the electricity the company sells.
Expansion of electric vehicle use could help reduce greenhouse gas emissions from gas and diesel vehicles.
Evergy is asking KCC to approve a partial settlement agreement that would resolve many of the issues. The Citizens’ Utility Ratepayer Board and KCC staff have signed onto the proposed settlement.
Also involved are the National Resource and Defense Counsel, ChargePoint and American Fuel & Petrochemical Manufacturers, who didn’t sign onto the agreement.
What’s in Evergy’s Transportation Electrification Portfolio?
Evergy would offer rebates of $250 or $500 as an incentive for homeowners to install Level 2 charging, which use 240-volt outlets to charge vehicles much quicker than traditional 120-volt outlets.
Additional rebates would be available for developers who install such chargers when constructing new homes, as well as rebates for commercial charging infrastructure by third parties.
Rates would be designed to encourage off-peak charging for fleets and commercial vehicles, such as city buses.
Under the settlement agreement, Evergy would get a $10 million budget for its commercial charger rebates, with $1.6 million targeted to underserved areas. Evergy could seek a budget increase of up to $15.4 million.
The agreement didn’t explicitly state what the budget would be for residential customer and developer rebates. The original application called for about $1.7 million for those programs.
Evergy would also get a $2.3 million budget for marketing, customer education and program administration.
Evergy would commit to a third-party evaluation, measurement and verification analysis of charging behaviors and assess the effectiveness of the company’s program. There would be annual reporting requirements.
Not settled as part of the negotiations was Evergy’s plan to expand its Clean Charge Network. The CCN is a collection of hundreds of electric vehicle charging stations owned and operated by Evergy, primarily in the Kansas City metro area.
The company wants to spend $13.5 million on expanding the network with 102 new sites. The new locations would be primarily outside the metro area as part of an equity commitment to “filling gaps in the market and serving underserved communities.”
The plan would more than quadruple the number of charging stations in Evergy’s central Kansas region. The area had just 29 of the network’s stations when the application was filed, and the CCN expansion would add 99 more.
Evergy is asking the commission to find that its Clean Charge Network expansion is “prudent from a decisional perspective.”
Evergy claims its Clean Charge Network, consisting of more than 1,000 electric vehicle charging stations, makes the Kansas City area the nation’s “electric vehicle infrastructure leader.”
Evergy’s application claims the five-year plan’s benefits would include “lower costs, greater grid flexibility, reduced emissions, and a variety of local economic benefits”
The company’s move is a “proactive response” to major automakers moving toward electric vehicles while promoting “grid-friendly integration” through incentives and education.
Why are some groups opposed to Evergy plan?
Representing the American Fuel & Petrochemical Manufacturers, Jennifer Griffin said her clients are both customers and competitors of Evergy.
She pointed to a prior KCC decision in 2016, where commissioners denied a similar proposal from Evergy predecessor Kansas City Power and Light Co. to build electric vehicle charging stations in Kansas.
“While stimulating EV ownership and usage may be a laudable goal, it is not within the scope of Evergy providing sufficient and efficient service,” Griffin said. “Promoting ownership and usage is better left to the automobile industry.
“It is inappropriate and unlawful for the commission to allow Evergy to stimulate demand for electricity at the expense of its ratepayers and competitors so that its shareholders can profit.”
State statute 66-101b requires electric publicly utilities “to furnish reasonably efficient and sufficient service.”
She voiced concern over the millions of dollars in cost to ratepayers.
Griffin said Evergy has no “legitimate need or demand” for its plan. She said data shows less than one-half of 1% of the company’s customers drive electric vehicles, and existing charging stations have low usage.
Griffin argued that Evergy would be forcing customers who don’t drive electric vehicles to subsidize those who do while giving the utility “an unfair competitive advantage over competitors in the charging services and fuel space.”
“There also is no hard evidence that significant EV adoption will occur overnight or any time soon,” Griffin said.
Scott Dunbar, representing ChargePoint, said the settlement agreement didn’t go far enough to resolve their concerns.
“ChargePoint largely supports Evergy’s application in this proceeding, and there’s no provisions in the settlement agreement that we’re opposed to,” he said. “But we do think that the concerns we identified are important and warrant modification.”
The electric vehicle infrastructure company has asked the commission to approve the settlement, but with modifications to some of the details in the rebate programs.
The Citizens’ Utility Ratepayer Board signed onto the settlement but has concerns with a portion of the Evergy proposal.
“CURB’s position is generally supportive of efforts to promote cleaner transportation options, including electric vehicles,” though the group is opposed to the Clean Charge Network expansion portion of the settlement agreement, said Todd Love. “We simply believe the company has not demonstrated a need in Kansas for the CCN program. The company’s proposed program is potentially anti-competitive.”
The group shared the cross-subsidization concerns.
“We also believe the utility should not be determining public policies,” Love said. “This should be left up to our duly-elected representatives of this state.”
Despite climate change warnings from international scientists, many Kansas politicians have been critical of electric vehicles, or at least government attempts to promote the industry.
During a policy roundtable at a Kansas Independent Oil and Gas Association meeting last month, Reps. Jake LaTurner, Tracey Mann and Ron Estes said Green New Deal proposals are too expensive.
They argued the infrastructure bill’s funding for climate change research, electric vehicle charging stations and environmentally friendly building upgrades would be bad for the fossil fuel industry and the economy as a whole.
Evergy looks to future of electric vehicles
Cafer, the Evergy representative, said the 2016 KCC order made findings and cited data “that are unsupportive of utility involvement” in the emergence of the transportation electrification economy. Since then, Evergy has collected new data to support its proposal.
“How you view that evidence will be dictated by your perspective and overall approach to EV expansion in Kansas,” Cafer said.
“If you believe that EV is just a passing fad or that it’s just a toy for the wealthy, if you believe that only competitive forces should control or dictate how and when the EV market evolves in Kansas, and the regulated utility companies should not participate in supporting or managing that emerging market, or if you believe that when determining the need for EV rebates on charging stations we should look only at where we are now and not where we are going or where we hope to go in the future – then it’s very likely that you will not be persuaded by all of that evidence we’ve presented to you to support approval of Evergy’s investment in charging stations in Kansas.”
Cafer said a cost-benefit analysis concluded that “all Evergy customers in Kansas experience a net benefit” from the program.
She indicated that electric vehicles will become a primary mode of transportation in the future, and steps should be taken now to support and manage the evolving economy. She urged the commission to look to the future transportation needs of the state.
“Although Evergy’s plan is not to go into the charging station business in the long-term, its participation during these early stages is important for removing obstacles faced by customers in underserved areas of Kansas and making EV ownership more accessible to everyone,” she said. “Utility involvement equals regulatory control during these important early stages.”