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SCE's EV vs Domestic Rates - Driver Beware!

05/12/14

  10:13:00 am, by Jim Jenal - Founder & CEO   , 918 words  
Categories: Solar Economics, SCE, Electric Cars that Run on Sun, Residential Solar

SCE's EV vs Domestic Rates - Driver Beware! - UPDATED

UPDATE - As its very own Christmas present to EV drivers, on December 24, 2014, SCE announced that as of January 1, 2015 the TOU-D-TEV rate structure would be closed to new participants, and that all existing SCE residential customers on this rate schedule will be migrated to another residential rate following their next meter read date after February 1, 2015.  No explanation for the change was provided.  We will write more about this in the coming days.  (H/T Joseph Gray.)


SCE has devised an extremely complicated rate structure designed for residential customers who drive electric vehicles.  Instead of having a separate meter for EV charging, this rate structure is designed to replace the Domestic rate and apply to the entire household’s energy use—presumably at a savings.  But does it? What we discovered may come as a shock…

Meet TOU-D-TEV

SCE has long offered a rate structure that was designed for separate meter charging of EVs.  But as more and more people acquire EVs there were relatively fewer consumers looking to go through the hassle of installing a separate meter just to charge their EV.  SCE’s combined household and EV charging rate, known by the unmelodious monicker of TOU-D-TEV ("EV Rate,” for short), is designed to provide a lower-cost option for customers who were previously on SCE’s standard, Domestic rate structure.

As the acronym implies, the EV Rate is a time-of-use rate structure which means that what you pay for a kilowatt-hour of energy is directly tied to when you use it.  There are three time classes: On-Peak (weekdays, excluding designated holidays, from 10 a.m. to 6 p.m.), Super Off-Peak (everyday, midnight to 6 a.m.) and Off-Peak (all other times). In addition to the time of use component, the EV Rate includes tiers.  While Domestic rate customers are used to four tiers at which energy gets progressively more expensive, the EV Rate has only two tiers. Put this all together and you have the potential to pay wildly different amounts for your energy, as this table shows:

SCE's TOU-D-TEV rate structure

Stay within Level 1 and use your energy during Super Off-Peak and you pay just 9.4¢/kWh.  But make the mistake of using energy during the middle of the day in the summer in Level 2 and you will be pay a shocking, 46.4¢/kWh!  Yikes!!!  Sure hope you aren’t at home during the day running your A/C.

So Why Switch?

EV owners are not required to take service under the EV Rate structure (at least not yet), so why switch?  SCE advises customers that they can save money using this rate and we wanted to see if that was really true.  We decided to model two different users and see how their bills would change between the Domestic rate and the EV Rate.  The first user, our “average” user, consumes roughly 1,000 kWh per month (probably on the low end for most EV owners), or a little more than twice the baseline allocation.  The second user, our “large” user, consumes more like 2,500 kWh per month and reflects a large home with heavy A/C use.

Let’s start with the average user:

Average user on SCE's TOU-D-TEV rate

This graph compares what our average user would have paid under SCE’s Domestic rate (the constant, orange line) against what she would pay under the EV Rate (the blue line) as a function of what percentage of the total monthly usage occurs during On-Peak hours. (Throughout we assume that 20% occurs during the Super Off-Peak hours of midnight to 6 a.m., and the balance occurs during Off-Peak).

Under the Domestic rate, our average customer would pay $3,200 for the year.  If she manages to keep her On-Peak usage down below 30% of the total energy consumption, she will save money—as much as $355 or 11% off her bill, if her On-Peak usage is jut 5%.

But those “savings” can quickly disappear if she isn’t careful (or her children aren’t).  Let her On-Peak usage climb to 60% of her bill and she will get hit with a 12% penalty and end up paying $388 more than if she had not switched.

What about our “large” user, how does he fare?

 Large user on SCE's TOU-D-TEV rate structure

Most likely, better.

While his overall bill is much higher—he would be paying $8,500 on the Domestic rate—his potential savings versus penalty comparison is much more forgiving.  He can save as much as 13% ($1,100) compared to a penalty of only 6% ($478).  Plus, his breakeven point is higher, as he doesn’t start losing money until his On-Peak usage gets to 45%.

(This actually continues a trend with SCE’s residential rates where increases are highest at the lowest end of usage and the very highest users are actually getting a bit of a break.  What an odd sort of mixed message.)

Bottom line—it is possible to save money, even significant money, if you are very careful about when you use energy.

Most EV’s are designed so that you can program them to charge during off-hours and anyone under this rate structure would absolutely want to insure that they use that feature.  Indeed, there may be other energy users that could be similarly re-programmed such as pool pumps, dishwashers and washing machines, to run during the Super Off-Peak window.  Unfortunately, it is very difficult to avoid running your A/C during the day if anyone is at home from 10 a.m. to 6 p.m. on weekdays—and doing so could be very expensive.

Solar to the Rescue

It should be obvious, but adding solar to the mix here could be huge since On-Peak hours directly coincide with the greatest production from a solar power system.  Put most simply, if you own an EV and are considering making the switch to this EV rate structure, you need solar.

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Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
Run on Sun also offers solar consulting services, working with consumers, utilities, and municipalities to help them make solar power affordable and reliable.

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