PEC Letter on EV Infrastructure Legislation

April 6, 2018

To: Members of the Pennsylvania House of Representatives
Re: Support for House Bill 1446 and Opposition to Non-Technical Amendments

Dear Representatives:

The Pennsylvania Environmental Council (PEC) would like to express its support for House Bill 1446 (P.N. 3161), the Clean Transportation Infrastructure Networks Act. On March 13, the House Transportation Committee passed HB 1446 by an overwhelmingly bipartisan vote of 25 to 1, and the bill is currently scheduled for second consideration on April 9. We respectfully urge you to vote YES on HB 1446 and, concomitantly, to vote NO on all non-technical amendments that may come to the floor, namely A6055, A6099, A6102, A6103, A6120, A6122, A6124, and A6125.

Electrification is shaping nearly all levels of the transportation industry. Advances in battery technology have enabled the development of light-, medium-, and heavy-duty electric vehicles (EVs) that increasingly outperform their fossil-fuel counterparts in terms of emissions, total cost of ownership, and performance. Last year, cumulative U.S. light-duty EV sales exceeded 750,000, with Pennsylvania’s cumulative sales reaching approximately 12,000.

While improvements in vehicle cost, performance, and model offerings will result in still greater EV adoption in the Commonwealth in the near term, challenges to EV adoption still exist. A lack of access to charging stations is a critical barrier – particularly in home, workplace, and highway corridor settings. Charging infrastructure for medium-duty, heavy-duty, and off-road vehicles is also needed to increase access to electrified transportation and reduce local air pollution emissions.

HB 1446 addresses this barrier by giving electric utilities a role, under the supervision of the Public Utility Commission (PUC), in developing a strategic, comprehensive charging network that is designed to expand the usage of transportation electrification in the Commonwealth by at least 50% over current projections for 2030. The bill will drive local economic development in Pennsylvania and help ensure that we are ready for the fundamental changes to transportation technology that lie ahead.

Electric utilities are uniquely positioned to facilitate the deployment of charging stations necessary to support greater EV adoption, and under HB 1446, utilities’ infrastructure development plans will have to include strategies that optimize the use of the electric grid. For these reasons, we strongly support HB 1446 and urge the electric utilities to make the benefits transportation electrification accessible to all, including Pennsylvanians in urban and low-income communities.

We urge you to oppose several non-technical amendments that have been proposed to HB 1446 as they would weaken the effectiveness of the bill. These amendments include:

• A6055 – This amendment would fundamentally undermine HB 1446 by preventing utilities from recovering costs associated with developing EV infrastructure. If utilities submit transportation electrification infrastructure development plans that are in the public interest and meet the review criteria set forth by the PUC, they should have an opportunity to recover the costs associated with implementing those plans.

• A6099 – This amendment eliminates the core goal of HB 1446 – to accelerate transportation electrification by at least 50 percent above market forecasts – and sets an artificial ceiling on transportation electrification in Pennsylvania.

• A6102 – The ability of utilities to set time of use (TOU) rates at the PUC is one of the central provisions in HB 1446. The amendment imprudently bars electric distribution companies from setting TOU rates that encourage “off-peak” electric charging, which strengthens grid reliability and benefits all utility customers through more efficient utilization of electricity system assets.

• A6103 – This amendment unwisely limits utility customer choice in selecting EV charging models that fit their needs. Different market segments – including those most underserved by the EV charging services market today – will benefit from a fuller array of deployment models that ensure equitable access to EV charging.

• A6120 – The “interoperability” of charging infrastructure –  essentially, the capacity of different hardware and software systems to support charging for all EVs –  is essential to ensure that all EV drivers have easy, universal access for charging. This amendment threatens interoperability by eliminating PUC-established interoperability standards that would create market and regulatory certainty.

• A6122 – This amendment would limit the application of HB 1446 in Pennsylvania’s small metropolitan areas (including Harrisburg, Lancaster, and Wilkes-Barre/Scranton), and could prevent those areas from benefiting from transportation electrification. We want to ensure that as many communities as possible – urban, suburban, and rural – have increased access to electric transportation.

• A6124 – This amendment would require utilities to pay revenues from charging stations that they own over to their distribution customers. While we strongly support the PUC’s accounting for these revenues when setting customers’ electricity distribution rates, we oppose A6124 because it is confusingly worded. Moreover, we believe that the PUC’s mandate to ensure just and reasonable rates already requires that rates be adjusted downward to reflect charging station revenues.

• A6125 – This amendment would unreasonably shift cost recovery for transportation electrification plans to default service customers. This is an inequitable and unsustainable way to set cost recovery considering that all utility customers have the potential to benefit from plans to accelerate transportation electrification.

Five other amendments that have been filed to HB 1446 are technical in nature and do not fundamentally alter the character of the bill; consequently, we would support HB 1446 whether or not they pass. These technical amendments include:

• A6100 – While we fully support the inclusion of retail electric suppliers (EGS) in the regional framework development process, we do not think A6100 is necessary to ensure this result. Under HB 1446 in its current form, the PUC can and should encourage EGS inclusion in its guidelines for the review of utility plans; furthermore, there is no reasonable basis for A6100’s requirement that retail gas suppliers be included in the plan development process.

• A6118 – We support this amendment as it clarifies what existing incentives and funding sources are available to defray the costs of EVs and associated charging infrastructure; these resources should be leveraged to complement utility transportation electrification plans and increase EV adoption.

• A6119 – This amendment could expose utilities to potential penalties if the usage of transportation electrification in Pennsylvania does not expand enough by 2030 to meet the target that will be set under HB 1446. We do not support A6119 because usage is not a sound metric for utility performance, given the other market and regulatory factors that will also affect usage. The PUC should assess utility performance – and provide for penalties and incentives, as appropriate – on the basis of how utilities implement their PUC-approved plans.

• A6121 – We support this amendment because it harmonizes the terms of cost recovery with standard PUC practice.

• A6123 – We support this amendment because of its intent to increase the participation of minority-owned and women-owned businesses and foster a broader, more diverse EV market.

HB 1446 presents a significant opportunity for Pennsylvania to accelerate transportation electrification, and thereby reduce harmful air pollutant emissions, improve public health, drive economic investment and job opportunities, and strengthen the flexibility and reliability of the electric grid. We urge you to support this legislation, and to oppose further amendment that will weaken its purpose or implementation.

Thank you for your consideration,

Alissa Burger
Senior Policy Advisor, Energy and Climate
 
John Walliser
Senior Vice President, Legal and Government Affairs

Pennsylvania Environmental Council