Duke Energy has proposed an electric vehicle (EV) charging program that could allow some residential customers in North Carolina to charge a vehicle for a fixed monthly fee as low as $19.99. In exchange, the customer would allow Duke to manage the vehicle's charging, in order to avoid grid stress and higher costs.

The utility is trying to provide a "seamless customer experience and an ecosystem of EV products," while also avoiding costly grid upgrades necessary to meet rising peak demand, Duke Vice President of Rate Design and Strategic Solutions Lon Huber said.

The proposed pilot is "all you can charge," said Huber, though some limitations apply. 

Customers who consume more than 800 kWh for charging in a month, or opt out of several managed charging events during which charging may be paused, could receive warnings and be removed from the pilot. According to Duke, that amount of energy will get a typical EV close to 2,000 miles of range. But clean energy advocates say the program limits are an indication that subscription-based managed charging plans may not work for all customers.

Duke is moving rapidly to implement its electrification plans, and has asked the North Carolina Utilities Commission (NCUC) to approve the charging pilot within 60 days. Electric transportation is expected to be one of the most significant drivers of Duke's load growth over the next 20 years, the utility told regulators, and managed charging is a key to controlling costs.

Regulators have been amenable to Duke's plans so far, which support North Carolina's broader electrification strategy. In January, North Carolina Gov. Roy Cooper, D, issued an executive order calling for zero-emission vehicles to comprise 50% of in-state automobile sales by 2030.

Last week, the NCUC approved Duke's proposed Make Ready Credit, which will allow the utility to compensate customers who install EV charging at homes or businesses. And regulators have asked for comments on how the utility can access federal infrastructure funds to assist with its transportation electrification plans. 

As customers transition from traditional gas-powered cars to EVs, utilities must be thinking about "how to make this a frictionless experience," Huber said, and "accentuating the benefits of electrifying transportation."

The proposed $600,000 subscription EV charging pilot would run 12 months and include an initial 200 participants split evenly between two service territories, according to Duke's application. As part of the pilot, Duke will "actively manage" vehicle charging and can schedule up to three managed charging events per month.    

Duke Energy Carolinas (DEC) customers would pay a fixed monthly rate of $19.99 for the charging pilot, while Duke Energy Progress (DEP) customers would pay $24.99. "Historical cost structures" of the two utilities account for the difference, said Huber. Participating customers can save on charging, he said, while the pilot's load management aspects are designed to benefit all of Duke's customers.

Managed charging key to limiting cost increases 

EV load is expected to grow as Duke is transitioning to a lower-carbon portfolio, which "will cause increases in the proportion of capacity or demand costs," the utility said in its application. That's due, in part, to renewable energy typically having higher capacity costs and lower energy costs.

Demand costs account for roughly 59% of DEC's revenue requirement and 49% for DEP, according to Duke's application.

"Because demand costs correspond to system peaks and charging an EV adds demand to the system, costs will be primarily driven by peaks on the generation, transmission, and distribution systems rather than energy costs," the utility warned regulators.

Unmanaged EV charging that occurs during or near the coincident peak could mean Duke "will need to build or obtain additional capacity resources to avoid power interruptions or damage to the system," the utility said. "This could result in increased costs for all customers."

On the other hand, if EV charging is managed effectively Duke said it will be able to "delay or avoid adding additional capacity resources" and reduce costs in both the short- and long-term. System assets will also be used more efficiently, "and these savings will be shared among both EV drivers and non-EV drivers."

Duke said it is working with BMW, Ford Motor, General Motors and American Honda Motors, testing an Open Vehicle Grid Integration Platform developed with the Electric Power Research Institute that provides interoperability with the automakers' vehicle telematics applications. That would allow Duke to use charging data from the vehicle to measure a customer's usage and demand, rather than require installation of an expensive second meter.  

"The beauty is that you don't need a second meter — at least, that's our going-in assumption," said Huber. "We're going to be testing out the accuracy of the telematics. 

Active charging will allow Duke to "shape the EV charging patterns to ensure charging occurs during low cost, environmentally friendly periods, and that adequate charge levels will be reached by a designated time set by the customer," the utility said.

Some restrictions apply 

Duke will be able to pause a customer's charging for up to four hours, three times per month. Participants will receive twelve hours advance notice that a managed charging event will occur, and can opt out of two such demand response events throughout the pilot.

"Any participant who opts out of more than two managed charging events may be removed from the pilot at the companies’ discretion," according to Duke's application. 

There are other limitations on the program, and they indicate subscription charging may not work for everyone, said Stan Cross, electric transportation policy director for the Southern Alliance for Clean Energy.

Duke may also send warnings to a participant using more than 800 kWh/month for EV charging "that they have consumed a potentially excessive amount of energy for one vehicle" and could be removed from the pilot.

Participants who receive three warnings can be removed at Duke's discretion. And any participant consuming more than 1,200 kWh in any month "may also be removed from the pilot immediately at the company’s discretion," according to Duke's application.

"We are big fans of managed charging and are excited that Duke is looking to innovate," Cross said. "We have concerns about subscription-based tariffs. EV efficiency and customer needs vary greatly. So a flat rate might not be an appropriate way to base a managed charging program."

One issue, said Cross, is that managed charging programs are new in general, and in particular when paired with EV charging. "We want to be really careful ... that we're really controlling the variables and making sure that we're testing for the right things," he said.