Case Background
Duke Energy
Florida, LLC (DEF, or the Company) filed its Motion to Approve Re-allocation of
Electric Vehicle Charging Station Pilot Segments (Motion) on April 17, 2019. In
its Motion, DEF requests a change in the required allocation of Electric
Vehicle Service Equipment (EVSE, “ports,” “charging stations”) to the four
customer locations, or segments, identified in its 2017 Second Revised and
Restated Settlement Agreement (2017 Settlement). The 2017 Settlement specified an EVSE
allocation to four different customer segments: Multi-unit dwellings (Multi-unit),
Workplaces, “Long dwell time” public locations (Public L2), and DC Fast Charging
Depots (DCFC). The 2017 Settlement, among other things,
established a five-year EVSE pilot program wherein DEF is authorized to
purchase, install, own, and support 530 charging stations in its service
territory during the term of the 2017 Settlement (through 2021). The maximum
capital outlay for this program was set at $8.0 million, along with reasonable
operation and maintenance expense, to be deferred to a regulatory asset and
collected during a period initiating after the term of the 2017 Settlement. In
addition, the 2017 Settlement required ten percent of the charging stations
must be installed in low income communities. The 2017 Settlement also
contemplated a shift in program expenditures from a segment for which the
Company is unable to find willing host sites to other segments or even new segments,
as approved in advance by the Commission.
In
its Motion, DEF maintains that it has become necessary to reallocate a portion
of proposed EVSE away from Multi-unit to the other segments due to the
significant challenge it has experienced in meeting the minimum number of EVSE
for that segment to date. Towards that end, the Company proposes revised
allocations at this time, as well as further reallocations at the end of 2019
to other segments, as necessary, of any revised Multi-unit EVSE assignments not
subscribed.
DEF
states in its Motion that it has conferred with the signatories to the 2017
Settlement and represents that the Office of Public Counsel, Florida Retail
Federation, and Southern Alliance for Clean Energy have no objection to the
Motion, while White Springs Agricultural Chemicals Inc. d/b/a PCS Phosphate - White
Springs and the Florida Industrial Power Users Group take no position on the
Motion.
The
Commission has jurisdiction over this matter pursuant to Sections 366.05 and
366.06, Florida Statutes.
Discussion
of Issues
Issue
1: Should the Commission
approve DEF’s Motion to Approve Reallocation of Electric Vehicle Charging Station
Pilot Segments?
Recommendation: Yes, staff recommends the Commission approve
DEF’s proposed reallocation of EVSE pilot segments. In the event DEF has fewer
than 210 Multi-unit EVSE subscriptions by December 31, 2019, DEF should be
required to supplement its 2019 annual data report to the Commission regarding
its Electric Vehicle Charging Station Pilot Program to include any further
reallocation of unsubscribed Multi-unit EVSE to other segments. Staff
recommends DEF’s filing of its 2019 annual data report may be delayed, as
necessary, until January 31, 2020 for this purpose. (McNulty, Redda)
Staff
Analysis:
DEF’s Motion
In its Motion, DEF explains that its goal is to have as
many installations of the targeted 530 EVSE as possible completed by the end of
2019 in order to maximize the information it gathers during the pilot program. However,
DEF has been unable to meet is subscription goals set forth in the 2017 Settlement
for Multi-unit. DEF offers two reasons for this deficit of Multi-unit EVSE
subscriptions, including limited available parking spaces at apartment
complexes and condominiums and lengthy lead times to conclude site host
agreements. Table 1-1 shows the
pertinent data regarding the original and requested allocations, ports
subscribed, ports installed, and further reallocation of Multi-unit EVSE by
percentage range at the end of 2019, if needed.
Table 1-1
EVSE by Segments
|
Segment
|
Multi-unit
|
Workplace
|
Public L2
|
DCFC
|
Total
|
|
Original Allocation
(11/2017)
|
325
|
100
|
75
|
30
|
530
|
|
Ports Subscribed
(4/2019)
|
62
|
73
|
76
|
14
|
225
|
|
Percent Subscribed
(4/2019)
|
19%
|
73%
|
101%
|
47%
|
42%
|
|
Ports Installed (4/2019)
|
23
|
31
|
32
|
4
|
90
|
|
Revised Allocation
(4/2019)
|
210
|
140
|
130
|
50
|
530
|
|
Segment Percentage
Range Target for Reallocation of MULTI-UNIT Ports (if needed - 12/2019)
|
|
20-50%
|
20-50%
|
10-30%
|
|
Sources: Motion, DEF’s response to Staff’s First Data
Request, No. 11 (ports installed).
DEF maintains that it is significantly behind in its Multi-unit
EVSE subscriptions and the Company makes its request for reallocation on that
basis. If, by December 31, 2019, DEF’s number of subscribed Multi-unit EVSE is
less than its revised goal (210 EVSE), DEF also requests that it be allowed to
reallocate any remaining unsubscribed Multi-unit EVSE to other segments in the
percentages shown in Table 1-1. In response to a staff data request, DEF stated
that meeting even the revised numeric goal appears unlikely given current
trends year-to-date.
Staff Review
Staff believes the current Multi-unit EVSE subscription
data, at just 19 percent of the goal, and the other segments’ subscription
data, ranging from 47 percent to 101 percent of the goal, provides strong support
for a significant reallocation of Multi-unit EVSE to the other segments. Given
DEF’s assessment that it is unlikely to meet its revised Multi-unit goal by
year end 2019, it is thus likely that a further redeployment of the
unsubscribed ports to other market segments, per the percentage reallocation
method quantified in Table 1-1, will be required at the end of 2019. In this
regard, staff believes the revised allocations may be considered a stretch goal
for the Company, augmented by a safety mechanism that can be activated at
year’s end.
Staff reviewed the other EVSE-related requirements of the 2017
Settlement to ensure that the Company’s reallocation strategy, if approved,
would be consistent the 2017 Settlement. First, the Company states in its
Motion that the reallocation process may be needed to meet the low income
requirement. With 23 of 221 ports subscribed located in low income communities,
DEF is currently on track to meet the 10 percent low-income requirement, but
all such subscribed low income community ports are located in the Public L2
segment. This is a clear indication that
the reallocation strategy by DEF is necessary to support the low income EVSE
target contained in the 2017 Settlement.
Staff also considered whether the revised allocation or
year-end redeployment scenario would potentially result in DEF incurring higher
capital costs than the 2017 Settlement’s investment cap of $8.0 million. DEF
reports that the projected total capital costs for the program under the
proposed pilot program reallocation is approximately $4.6 million, plus or
minus a 10 percent variance due to potential upgrades (i.e. transformer
upgrade, panel upgrade, etc.). This
is somewhat higher than DEF’s projected total capital costs under the current
allocation, which is about $3.8 million, due primarily to the higher per unit
capital costs associated with the DCFC segment. The EVSE per unit costs for
Public L2 and Workplace segments is in line with the per unit costs of Multi-unit.
It appears to staff that a reallocation of EVSE as contemplated, even under the
year-end redeployment scenario, is not likely to cause the Company to exceed
the Settlement’s $8.0 million EVSE investment cap.
Conclusion
Staff believes that DEF’s proposed reallocation strategy
is necessary in order for it to maintain the 2017 Settlement’s minimum 530 EVSE
subscription target. The strategy works in
conjunction with other requirements of the 2017 Settlement, such as the low
income EVSE percentage requirement and the EVSE $8.0 million maximum investment
cap. Furthermore, the reallocation increases the likelihood that the Company will
be able to collect sufficient EVSE deployment data by the end of the pilot
program to allow consideration of the merits of a permanent program. Per the 2017
Settlement, a permanent program may be requested by the Company at the
conclusion of the pilot program. Staff thus recommends the Commission approve
DEF’s Motion as filed.
Finally, staff believes DEF should take certain actions to
ensure that the Commission and the parties to the 2017 Settlement remain
apprised of developments in the Company’s EVSE reallocations, actual
subscriptions, and installations. DEF’s annual data report regarding its
Electric Vehicle Charging Station Pilot Program provides an excellent vehicle
in which DEF could report the results of the EVSE reallocations and, if needed,
identify further reallocations. In the event DEF has fewer than 210 Multi-unit EVSE
subscriptions by December 31, 2019, staff recommends DEF be required to augment
its 2019 annual data report to the Commission to include any further
reallocation of unsubscribed Multi-unit EVSE to other segments. In the event of
further reallocations, staff believes it would be appropriate for the
Commission to allow DEF to delay its filing of its 2019 annual data report until
January 31, 2020 in order to supplement its filing accordingly. Staff will
apprise the Commission should any further reallocations not comport with the
segment percentage range targets proposed by the Company as shown in Table 1-1.
