Minnesota electric vehicle legislation would allow Xcel Energy to dominate the charging market, retailers warn

diving letter:

  • The Minnesota legislature is considering legislation to introduce a $2,500 rebate for electric vehicle purchases, require utilities to submit transportation electrification plans every three years beginning in 2024, and authorize utilities to own public charging stations and to operate.
  • Retailers and other companies represented by the Charge-Ahead partnership say allowing fee-paying utilities like Xcel Energy to own EV charging infrastructure will stifle the private market and increase customers’ electricity bills.
  • Similar laws were enacted in New Mexico and Colorado, where Xcel also operates, the utility said. The Minnesota measure would “provide a more robust framework for utility transportation electrification plans, with greater clarity and direction in terms of the types of things that are expected of utilities,” the company said in a statement.

Dive insight:

Ownership of charging infrastructure by utilities can help set up stations in emerging markets and hard-to-serve areas, supporters of the policy say. Critics say the approach would give the energy company competitive advantages that discourage others from entering the market.

“We believe this legislation will provide a strong foundation for utility support for transportation electrification, which will serve Minnesota well, and we look forward to working with lawmakers to support them in this session,” Xcel spokeswoman Lacey Nygard said in an email.

But utility company ownership of EV chargers is having a “deterrent effect on anyone even considering making private investments,” said Ryan McKinnon, spokesman for the Charge Ahead Partnership. Group members include the National Grocers Association, the National Retail Federation, energy marketers, truck stops and convenience stores.

Utilities have too many advantages, McKinnon said, including benefiting from the subsidized capital cost of their chargers by tariff payers.

“But because they’re the ones who generate, distribute and sell the electricity, they don’t charge capacity for their own stations,” McKinnon said. “And as a result, they’re able to sell EV charging at a price that no private company could compete with because it’s fully subsidized by all fee payers.”

The legislation, HF 413, was introduced by Rep. Zack Stephenson, a member of the Minnesota Democratic-Farmers-Labor Party. The Minnesota House Sustainable Infrastructure Policy Committee scheduled a hearing on the bill on Wednesday.

Stephenson did not immediately respond to questions about the bill.

The proposal states that public transport electrification plans may include “utility investments and incentives to facilitate the deployment of EVs, customer or utility owned EV charging stations, EV infrastructure and other utility infrastructure.”

Xcel has already submitted a plan to the Minnesota Public Utilities Commission to add about 730 high-speed charging stations across Minnesota between 2024 and 2026, including up to about 1,470 charging ports in total.

“Our proposal will create a basic public charging network to fill just a portion of this massive gap and help the state of Minnesota meet its goal of having 20% ​​of light commercial vehicles electrified by 2030,” Nygard said.

Because the EV directives are relatively new, the issue of utility ownership is not specifically addressed in most jurisdictions at this time, he said McKinnon. “I would predict that within the next few years most states will pass legislation addressing this, but at this point it’s something most are silent about,” he said.

The California Public Utilities Commission approved a new state rebate program for EV charging investments in November, but regulators made it clear the rebates could not be used by utilities.

“Utilities must not own this infrastructure,” former CPUC Commissioner Clifford Rechtschaffen said at the November deliberations. “It means lower costs for tariff payers.” Lawful left the PUC earlier this year.

“While there was a case for utility ownership in an emerging market … by the middle of the decade, utility ownership shouldn’t be necessary.” righteous said.

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