The Maryland Public Service Commission (PSC) on Wednesday unanimously approved changes to the state’s Electric Vehicle Charging Pilot Program, increasing incentives aimed at boosting the number of EV chargers installed at locations often underserved by commercial charging companies — multi-unit dwellings, small businesses and nonprofits (Case 9478).

For Baltimore Gas and Electric (BGE), the PSC approved a new rebate program that will cover 50% of the cost of fleet and workplace chargers for 25 Maryland small businesses, with rebates capped at $30,000 for the installation of two DC fast chargers (DCFCs). A $30,000 cap also was approved for DCFCs installed at multi-unit dwellings, an increase of the current cap of $25,000.

Pepco and Delmarva Power were also approved for the $30,000 cap for a new workplace and fleet rebate program for small businesses and nonprofits, again targeting 25 installations. But both utilities will scale back the number of rebates they offer for multifamily dwellings — from 200 to 100 for Pepco and from 50 to 25 for Delmarva — but cover 100% of installation costs, instead of the 50% previously offered.

All three utilities, which are owned by Exelon (NASDAQ:EXC), also were approved to offer $50 e-gift cards as an annual incentive for residential customers to stay enrolled in EV charging programs that allow the companies to track their charging data through “smart charging” software.

Pepco and Delmarva also won approval to expand their residential programs for newer EVs with advanced technology that allows them to communicate charging data to a utility without needing a “smart” charger or extra meter to track usage. EVs with this technology will be eligible for an off-bill credit, $0.03/kWh, for off-peak charging, paid quarterly in the form of a cash card.

With Commissioner Anthony O’Donnell absent, approval of the changes marked the end of several months of negotiations over mid-course adjustments to the pilot program that was launched in 2019 and is scheduled to run through the end of 2023. Key goals include the installation of 1,000 utility-owned chargers in public locations — that is owned or leased by state or local governments — and filling specific gaps in EV charging infrastructure, such as for multi-unit housing and small businesses.

In its decision establishing the pilot program (Order No. 88997), the PSC laid out the number of public chargers each utility is supposed to install by the 2023 deadline: 500 for BGE, 250 for Pepco and 100 for Delmarva. According to information shared with the commission on Wednesday, BGE has installed 206 public chargers to date, while the combined total for Delmarva and Pepco stands at 149.

Two other utilities, Potomac Edison and the Southern Maryland Electric Cooperative (SMECO), are also part of the pilot program, but were not at Wednesday’s hearing.

The Multi-Unit Challenge

The changes approved, and those denied, reflect the complicated economics and changing technology in the EV market.

While the incentives are seemingly generous, the three utilities have not had a good response to the charger rebates for multi-unit dwellings, especially in low-income areas. According to Jamie Caswell, a spokesperson for Pepco and Delmarva, to date Pepco has installed 12 EV chargers at multi-unit dwellings in Maryland, with five more such projects in the pipeline. Delmarva has three multi-unit projects in the pipeline, but has yet to install any, Caswell said in an email to NetZero Insider.

As an alternative, BGE had proposed that low- and moderate-income (LMI) customers should be eligible for a $1,000 rebate to install EV chargers. The PSC turned down the request, siding with consumer advocates who pointed out that such incentives would not address the more significant obstacle of the higher upfront costs of EVs and were therefore “premature.” BGE should work with local organizations to better understand the needs of LMI customers and communities, the commission said.

The commission also rejected BGE’s request to expand its residential charger program to add rebates of $300 each for the installation of 2,500 smart chargers, which would allow the utility to track customers’ charging patterns. The PSC had originally approved the utility for rebates for 1,000 residential smart chargers, but BGE reported, the program was oversubscribed.

The commission said that for many, more well-off EV buyers, the $300 charger rebate was not an essential decision point. In addition, the PSC said, the extra expense of smart chargers is no longer justified since most EVs now have the technology to directly communicate their charging data to a utility. The utility is no longer offering rebates for residential chargers, according to an email from the company.

An Exercise in Balance

Both Maryland and the PSC are bullish on EVs.  According to the state’s most recent greenhouse gas inventory, transportation accounts for more than a third of Maryland’s emissions, and the state is pushing to get 300,000 EVs on the road by 2025.

However, “the state may be hamstrung to some extent” in reaching that goal, due to U.S. dependence on foreign sources for lithium and other minerals critical to EV battery production, said Commission Chair Jason Stanek, in opening remarks at Wednesday’s meeting.

Based on different industry sources, the state has about 40,000 EVs on the road at present (three of which belong to Stanek, Commissioner Odogwu Obi Linton and Commissioner Michael Richard). The state Department of Transportation reports 1,100 public chargers, with close to 3,000 ports in total.

Across the country, utilities are seeing the growing EV market as a major accelerator for demand growth but are also concerned about the impact of EV charging on local distribution systems, hence the interest in having access to charging data and designing special rates that encourage off-peak charging.

The Maryland EV Charging Pilot was intended to help remove obstacles to EV adoption. But, for the PSC, it has been an exercise in balancing the interests of the state’s investor-owned utilities in investing millions of rate-based or otherwise recoverable dollars in charging stations, and the impact of such initiatives on customer utility bills and the state’s competitive EV charging market.

For example, BGE’s original program proposal included plans for installing more than 18,455 residential, commercial and public chargers at a cost of $48.1 million. Pepco and Delmarva’s plans were more modest: $11.3 million for Delmarva to install 774 chargers, and $30.6 million for Pepco to install 2,264 chargers.

In its 2019 decision, establishing the program, the PSC knocked down those figures, stating the utilities had not “met their burden to justify the recovery of [millions] in cumulative program costs exclusively from ratepayers.” The decision gave approval for a scaled-down initiative including the residential rebates and time-of-use rates to encourage off-peak charging, the public charging targets and the multi-unit dwelling incentives.

Wednesday’s approvals were the latest iteration of this program dynamic. BGE, Pepco and Delmarva submitted a joint request to launch first a Fleet Calculator software platform that would “help educate fleet customers on the types of EVs that are available for purchase, what charging equipment to buy, and available EV rates.” The PSC approved the $300,000 price tag for launching the platform but balked at the $2.5 million the utilities requested to hire contractors to provide customers with more in-depth advisory services on fleet electrification.

Few utilities are offering this kind of service, the PSC said, and any efficiencies gained by a holistic approach to fleet electrification would be overshadowed by the cost to ratepayers, especially if a business decided not to electrify its fleet following an assessment.