the impact of incentives on electric vehicle adoption...purchase price discount home charging...

© 2019 Electric Power Research Institute, Inc. All rights reserved. w w w . e p r i . c o m

Jamie Dunckley Technical Leader Min Long Engineer Scientist II Brattle Group: Ryan Hledik, Armando Levy, Nicole Irwin October 2019 E- Mobility Power System Integration Symposium

The Impact of Incentives on Electric Vehicle Adoption From the utility perspective, what incentives or actions are most effective in influencing EV adoption?

http://www.epri.com/

https://www.linkedin.com/company/epri

https://www.facebook.com/EPRI/

https://twitter.com/EPRINews

© 2019 Electric Power Research Institute, Inc. All rights reserved. w w w . e p r i . c o m 2

About the Electric Power Research Institute (EPRI) Independent, not-for-profit organization performing research and technology

development and demonstration across all aspects of the electric power system for the benefit of the public

450+ participants in more than 30 countries

EPRI members generate approximately 90% of the electricity in the US



Presentation Outline Project

Overview Methodology Salt River

Project Specific Results

EVs are at an inflection point: • More Vehicles: 132 different models available by 2022, in

USA • Faster Charging: Some vehicles will have 350kW charging • Public charging density is increasing: 70% increase in

DCFC (18 months) • Battery prices are decreasing rapidly, $70/kWh by 2030

NetworkRechargeAccessInnogyFLORecargo NetworkShorepowerIrvine CompanySun CountryCarChargingOpConnectWebastoVoltaGE WattStationEV ConnectGreenlotsEVgoBlinkElectrify AmericaSemaChargeSuperchargerTesla DestinationChargePointNon-networked

Public charging locations in the USA (L2 and DCFC)



Project Overview: What incentives or actions are most effective in influencing EV adoption?

– Made a customer survey: testing 8 incentives/actions Utility influenced, limited by survey length

– Conducted 3,200 surveys (400 for each utility, 8 utilities) – Created a modeling tool to quantify incentive impacts on a regional basis. Combination of DCE (discrete choice estimation) and MA3T (ORNL)



Project Stats: Driver Survey Attributes tested for: Purchase Price Discount Home Charging Station incentive Electricity Price Discount Workplace Charging Green Rate HOV access Free Parking Charging Station Density Increase

Mor

e D

irect

M

onet

ary

Valu

e In

dire

ct V

alue

Survey Stats: • 93,900 surveys sent out • 3,195 final surveys collected

after cleaning • 8% of panelists responded • 3% were kept (once eligibility

requirements were applied)

Survey: 10 choice tables were presented to drivers



It forecasts adoption of vehicles from today to 2050 (2030 for this purpose) It uses vehicle and fuel costs and a representation of customer behavior to estimate how

quickly new automotive technologies will be adopted. Some factors included are:

– Range anxiety, – access to recharging points, – daily driving patterns and – willingness to accept technological innovation.

Also included segments for: – Low, medium and high driving patterns – Urban, suburban and rural drivers – Early adopters and later majority – Access to home or workplace charging infrastructure

Project Stats: Vehicle Model - MA3T: Market Acceptance of Advanced Automotive Technologies

Why did we choose this model? It uses a segmented market model that divides customers based on driving habits. Most models represent drivers based on yearly driving, typically 12,000 miles per year. However, for example, a driver who drives 33 miles every day is going to have a different experience than a driver who drives for 0 miles 6 days a week and then 230 miles each Saturday.

MA3T was updated reflect current gas and electricity prices, utility service territories, historical EV sales



National Results Example: What might incentives look like over time? This is a simulation with the introduction of 3 incentives at different years. Each incentive is offered for the remainder of the years. This example is based on the results of the 8 utilities applied to the national baseline. Note that each incentive is modeled in isolation and doesn’t account for any nonlinear effects that may result from offering combinations of incentives.



Salt River Project Specific Results



About Salt River Project ~ 1 million electric customers

Area 3,000 Sq miles

Annual sales: 37 M kWh

Peak 7M MW

Previous work:

EV study: Tracked 100 EVs over 2 years (minute data): Public report

Has an EV group with ~2,000 EV drivers ($50 amazon card to sign up at time of vehicle purchase(

Has EV charging rate 11PM – 5AM

Charging locations during 18 months

Example load over one day

https://www.epri.com/#/pages/product/3002013754/ https://www.epri.com/#/pages/product/3002015601/


https://www.epri.com/#/pages/product/3002013754/

https://www.epri.com/#/pages/product/3002015601/


Demographics Age: Similar to sample average, with slightly higher concentration of middle-aged customers (36% in the ages 40–59 bracket for SRP, versus 32% for the overall sample) Income: Similar to sample average Education: Lower proportions of “High school graduate” and “College degree” customers in SRP relative to the sample average (24% versus 29% and 30% versus 34%, respectively), with the difference distributed across other education levels Employment: Very similar to the sample average Number of cars per household: Very similar to the sample average

Political Identification Employment Status

Democrat 37% Full-time 47%Republican 26% Part-time 8%Independent 25% Retired 25%Other/Not sure 13% Other 20%

Age Family Income

Under 25 5% Less than $40,000 28%Ages 25 - 39 26% $40,000 - $80,000 33%Ages 40 - 59 36% $80,000 - $150,000 21%Ages 60 - 79 29% Over $150,000 9%80 or older 5% Prefer not to say 9%

Education Level Number of Cars per Household

No HS 6% 0 4%High school graduate 24% 1 35%Some college 25% 2 38%College degree 30% 3 16%Post-grad 14% 4 4%Prefer not to say 0% 5 or more 2%

* "Other" Employment Status consists of students, the temporarily laid off, homemakers, the permanently disabled, the unemployed, and respondents who answered "other".*Due to rounding, totals may not sum to 100 percent.



Vehicle Preferences Buy vs. Lease: SRP customers have similar buy/lease preferences to the overall sample. Purchase Price: SRP customers preference for vehicles across price range brackets is also very similar to the sample average.

Buy vs. Lease Future Vehicle

Buy 91%Lease 9%

Purchase (Lease) Price of Future Vehicle

42%49%7%2%

Less than $20,000 ($250/Month)Between $20,000 ($250/Month) and $40,000 ($500/Month)Between $40,000 ($500/Month) and $60,000 ($750/Month)Over $60,000 ($750/Month)



What is the current state of EVs in SRP? Current Registrations and historical trend

PHEVs: 3,258 BEVs: 6,182 Total: 9,441

As of March 2019

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3

2011 2012 2013 2014 2015 2016 2017 2018 2019

Tota

l reg

istr

atio

ns

Cumulative registrations by vehicle type

PHEV BEV



What is the current state of EVs in SRP? Percentage of monthly new vehicle registrations

0,0%

0,5%

1,0%

1,5%

2,0%

2,5%

3,0%

3,5%

1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3

2011 2012 2013 2014 2015 2016 2017 2018 2019

Tota

l reg

istr

atio

ns

Monthly market share

Remaining PHEV Remaining BEV Model 3 Bolt Model X Model S Prius Prime LEAF

As of March 2019



Modeling Results



Modeling Variables, Limits and Baseline Assumptions Incentive Input options Baseline

Purchase price reduction PHEV $0 to $10,000

Federal: Decrease by 15% per year, no incentive by

2025 BEV $0 to $10,000 No state incentive applied

HOV access PHEV Yes/No No BEV Yes/No No

Free parking PHEV Yes/No No BEV Yes/No No

Green rate PHEV Yes/No No BEV Yes/No No

Home charging installation program (Charging station: $1,500 total)

Availability Yes/No None Cost to

customer $0 to $1,000 None

Workplace charging availability Yes/No No Electricity price discount 0 - 100% discount No

Increased charging station density 1-10 added per 10,000 households No Years the incentives are applied can be chosen (from 2020 to 2030).



How sensitive are adoption rates to incentive levels in 2025? SRP Y

axis

is a

ddit

iona

l inc

reas

e fr

om b

asel

ine

adop

tion

0,1% 0,1% 0,2% 0,6% 1,2% 2,4% 3,9%

7,2%

18,4%

0%

5%

10%

15%

20%%

incr

ease

of n

ew v

ehic

le

sale

s in

202

5

Purchase price reduction ($)

3,3%

1,4%

0,3% 0,0%

0%

1%

2%

3%

4%

0 (free) $500 $800 $1,000% i

ncre

ase

of n

ew v

ehic

le

sale

s in

202

5

Cost to consumer for home charging station ($) [home charging ~$1,500]

1,2%

2,5%

3,9%

5,5%

0%

2%

4%

6%

25% 50% 75% 100%% i

ncre

ase

of n

ew v

ehic

le s

ales

in

202

5

% Reduction of electricity price

0,3% 0,7%

1,1% 1,5%

1,9%

4,1%

0%

1%

2%

3%

4%

5%

1 2 3 4 5 10% i

ncre

ase

of n

ew v

ehic

le s

ales

in

202

5

Number of charging stations added per 10,000 households



SRP Example: How do we compare incentives? Attributes tested for: Purchase Price Discount ($500) Home Charging Station incentive ($500 customer

benefit). Charger assumed to be $1,500. No benefit perceived if customers pay $1,000 or more for a charging station.

Electricity Price Discount (20% decrease*) – *2700 kWh/year, for 10 years, at .1/kWh (with a 20% decrease

in electricity price) =~ $540 savings

Workplace Charging Green Rate HOV access Free Parking Charging Station Density Increase (3/10,000

households)

Mor

e D

irect

M

onet

ary

Valu

e In

dire

ct V

alue

Total cost for each action will vary by utility

It is important to note that the survey states that charging stations would be based on a mix of chargers that could provide 20 miles of charge in anywhere from 10 minutes to 4 hours of charging time.

MA3T alterations will be discussed in modeling presentation

SRP has ~941,000 households, ~282 additional charging stations

0,6%

0,0%

0,9%

0,00%0,20%0,40%0,60%0,80%1,00%

Purchase PriceDiscount ($500)

Cost to customerof home charger

($1000) -$500benefit

Decrease inelectricity price (20

%)% in

crea

se in

202

5 ab

ove

base

line

leve

ls

Cost tangible

0,9% 0,7%

0,9%

0,6%

1,1%

0,00%0,20%0,40%0,60%0,80%1,00%1,20%

WorkplaceCharging -

yes

Green Rate -yes

HOV access-yes

Free Parking- yes

Chargingstation

increase(3/10,000

households)

Non Cash Benefits

In 2025, each 1% is about 1,300 vehicles



Cost Considerations:

Cost for $500 on the hood of the car: – For all new EV purchases (even those who would have purchased the

vehicles without an incentive) – $ for implementation of the incentive Cost for 20% electricity reduction

– Could be offered to all EV buyers past and current – $ for implementation of the incentive Cost for 3/10,000 households of public charging stations

– Balance between DCFC and L2 (and cost implications) – Cost of maintaining the stations – Ownership structure (Utility owns all, part or none of the stations)



An example model run: incentives for all years – SRP

$500 vehicle purchase price incentive,

20% reduction in electricity price for EV charging,

Increased charging infrastructure 3/10,000 households,

HOV lane access

Green rate

Workplace Charging

Free Parking

3,4% 4,2% 5,0% 6,0% 7,2% 8,8% 10,3% 12,1%

14,1% 16,3%

18,6%

3,0% 3,8%

4,4% 5,2%

6,1%

7,2% 8,3%

9,3%

10,4%

11,5%

12,6%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

% o

f new

veh

icle

sal

es

EV Share of New Vehicle Sales with Incentive Portfolio for

With new incentives

With existing incentives (baseline)

SRP



Example Model Run: Incentive comparison SRP 2025 Incentive Levels Tested

$500 vehicle purchase price incentive,

20% reduction in electricity price for EV charging,

Increased charging infrastructure 3/10,000 households,

HOV lane access: Yes

Free parking: Yes

Green rate: Yes

Home charging program: Yes: $500 (customer pays $1,000) – not shown as no influence.

8,8% 1,1% 0,9% 0,9% 0,9% 0,7% 0,6% 0,6%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

Base

line

adop

tion

Char

ging

sta

tion

dens

ity in

crea

se(+

3 st

atio

ns p

er…

HO

V ac

cess

Elec

tric

ity p

rice

disc

ount

(20%

)

Wor

kpla

ce c

harg

ing

Gre

en r

ate

Free

par

king

Purc

hase

pri

cedi

scou

nt ($

500) -

% o

f new

veh

icle

sal

es

EV Share of New Vehicle Sales with Incentive Impacts for

11,800 EVs per year

SRP 2025

Note: Analysis assumes each incentive is offered in isolation and does not account for any non-linear impacts that may result from offering combinations of incentives

Hom

e Ch

argi

ng P

rogr

am 0

%



Conclusions

Useful tool for looking at magnitude comparison of incentives Focuses mainly on current non EV driver preferences Allows to test for electric vehicles that don’t exist yet such as

electric trucks Work needs to be done on the used EV market



Together…Shaping the Future of Electricity


the impact of incentives on electric vehicle adoption...purchase price discount home charging...

Documents