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Massachusetts’ attorney general says plans by the state’s major utilities to lower the cost of charging electric vehicles would offer little actual savings for customers.
In response to a 2022 Massachusetts climate law, the state’s two primary electric utilities, Eversource and National Grid, have proposed plans to create lower rates for charging EVs during off-peak hours, which they say would be implemented no sooner than 2029.
In a regulatory filing last week, however, the state’s attorney general said the utilities’ estimated savings for customers are based on faulty calculations and would be much lower in reality. Plus, a requirement that households and small businesses pay for additional meters to track their charging stations’ power use “negates all financial value for the customer.”
With this filing, the attorney general’s office joins climate advocates who support the idea of offering EV drivers the chance to save money by charging during off-peak hours but take issue with the way utilities propose to implement the strategy.
“If you require that people install a second meter and that they cover the cost of that installation, nobody’s going to do it,” said Anna Vanderspek, electric vehicle program director at the Green Energy Consumers Alliance.
Regulators have asked the utilities for feedback on the attorney general’s concerns and recommendations by February 20. A spokesperson for Eversource did not specifically address the attorney general’s criticism when asked about it but said the utility believes in the benefits of time-of-use pricing and looks forward to continuing the regulatory process. National Grid did not respond to a request for comment in time for publication.
More than a third of cars sold in the United States are likely to be EVs by 2030, J.D. Power forecasts, a prospect that has many industry and elected leaders wondering whether the country’s electric infrastructure is ready to provide power for this growing, gas-free fleet.
Massachusetts has set the ambitious target of putting 900,000 EVs on the road — and on the grid — by 2030. So, like other states facing the same challenges, Massachusetts has turned to the idea of using financial incentives to encourage EV owners to charge during off-peak hours and to lower the cost of charging for drivers in a state where electricity prices are among the highest in the country.
“Electric vehicle time-of-use rates could be a very valuable tool for helping to alleviate the load on the system as well as helping to incentivize people to think about when they’re using electricity,” said Priya Gandbhir, director of clean power at the Conservation Law Foundation.
In the 2022 climate law, legislators required utilities to propose these so-called time-of-use rates, which both Eversource and National Grid did in August 2023.
Eversource’s plan calls for a $15 monthly fee and an off-peak EV charging rate of 19 cents per kilowatt-hour, slightly more than half the proposed peak rate. National Grid would impose a $10 monthly fee and charge 14 cents per kilowatt-hour for off-peak charging, half what the peak rate would be. Both plans would require a separate meter, and both contend the rates cannot be implemented before advanced metering infrastructure is rolled out and tested, a process they expect to take at least four years.
Regulators must rule on these proposals by the end of October.
The numbers laid out by the utilities don’t add up to savings for consumers, the attorney general’s testimony argues. Thus, the proposals are unlikely to motivate more people to buy EVs or to shift their charging times.
The utilities did not estimate the cost of installing a separate meter, but online estimates run from $1,400 to more than $4,000. At the same time, the utilities drastically overstated the savings their plans would yield by using inflated estimates for how many kilowatt-hours the average driver would use to charge their EV, the attorney general’s testimony says. Rather than saving as much as $146 a month, as the utilities calculated, drivers would cut their bill by $21 per month at most, assuming they do all of their charging during off-peak hours. Customers who sometimes charge during peak hours could even see bill increases.
“The math just doesn’t work out,” Vanderspek said.
The attorney general’s office recommends that public utilities regulators reject National Grid and Eversource’s proposals and offers several alternative approaches. The simplest, the testimony says, would be to offer whole-home time-of-use rates, rather than separating out the vehicle charging load. Evidence from other states suggests such a rate could be implemented during the roll-out of advanced metering infrastructure, rather than waiting the minimum of four years the utilities say would be necessary for an EV-specific rate. The filing points to Colorado, where time-of-use rates are rolling out in concert with advanced metering infrastructure.
Another option would be to use data collected by vehicle computer systems or chargers themselves to issue rebates or apply lower rates for charging done at off-peak times. Utilities in California and Minnesota have already deployed this approach.
The same data could be used to offer other financial incentives. National Grid, in fact, already offers such a program in Massachusetts, giving customers 5 cents per kilowatt-hour for off-peak EV charging during the summer and 3 cents per kilowatt-hour the rest of the year.
Any of these approaches could be used not just to improve financial incentives for customers but also to speed up their implementation, to the benefit of both consumers and the environment, Vanderspek said.
“We’re all better off if we’re shifting that load off-peak right now,” she said.
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