Electric vehicles require you to change the way you think about reducing energy costs. Let me explain. Facility managers try to reduce energy costs by reducing energy consumption. They buy more efficient equipment and install energy management systems, all in the name of reducing consumption. When you use less energy, you spend less on energy.
Electric vehicle charging is different. The primary requirement for an EV charging system is that it provides 100% of the energy needed to fully charge the electric vehicles’ batteries. At some point during the charging cycle all of the energy used during driving must be replaced. You cannot lower EV charging costs by reducing the amount of energy used unless you replace your existing EVs with more efficient ones. Instead of saving energy, you lower EV charging costs by controlling when and how fast charging is completed.
A strategy to lower EV charging costs by controlling when and how fast you charge your EVs works for one fundamental reason: the cost of electricity varies based on how and when it’s used. Utilities set the price of electricity to encourage customers to use power at certain times of day and to limit their peak consumption. These pricing methods (“tariffs”) aren’t arbitrarily designed to penalize customers; instead, they mirror the utility’s cost to supply power.
Utilities are in the business of supplying energy. They are also in the business of making money for their shareholders. Delivering energy quickly and reliably isn’t cheap. Generating capacity, distribution systems, and on-site microgrids cost money. Lots of it. And when demand spikes, delivering power gets more expensive. Utilities pass these costs through as a Demand Charge which they base upon the peak amount of power used during specific time periods. The greater the demand for energy, the higher the cost of energy.
The key to lower EV charging costs is not to use less energy, but to buy cheaper energy. You do that by managing when you charge and how fast you charge.
How much can you lower EV charging costs? The answer is significantly! Let’s look at a simple example that includes 10 medium powered AC chargers:
- 10 ea. 10 kW chargers serving 10 EVs that require 50 kWh of power in this case older Nissan Leafs)
- EVs operate Monday – Friday, arriving at the charging location between 4 to 6 pm daily and departing each morning at 7 am
- For this example, we are using energy costs based on PGE’s BEV EV tariff schedule
Even in this simple small fleet example, the savings are quite large. Without charging control, annual electricity costs would be approximately $43k. Using the EVauto Fleet Charging Control System, annual fleet charging costs drops by almost 60%, to as low as $19k. (Email us at firstname.lastname@example.org for a spreadsheet detailing these results.)
As the move towards electrification of vehicle fleets grows, it’s likely that energy tariffs will change to further encourage off-peak usage. The only way to use these changes to your advantage and lower EV charging costs is to control when and how fast you charge your EV fleet. A flexible fleet charging control system like EVauto that can change charging rules on the fly to react to utility rate changes and discount programs will lower EV charging costs no matter what the future brings.