1. Avoiding pitfalls when pricing
PEV charging services at
government and non-profit
stations
October 12, 2012
J.R. DeShazo, Director deshazo@ucla.edu

2. Avoiding pitfalls when pricing PEV
charging services at
government and non-profit stations

3. Key Finding
Some common pricing policies:
• Severely discriminates against small-battery
PHEVs (e.g. Prius), and
• Discourage general utilization of stations,
• Suppresses revenue and diminishes station
financial viability

4. Residential Cost Structure
Cost Per kWH
$0.10 $0.15 $0.20 $0.25 $0.30 $0.35
$/gal $/gal $/gal $/gal $/gal $/gal
Equivalent Equivalent Equivalent Equivalent Equivalent Equivalent
$ - $0.92 $1.38 $1.84 $2.30 $2.76 $3.22
$500.00 $1.12 $1.58 $2.04 $2.50 $2.96 $3.42
Installed Charger Cost
$1,000.00 $1.32 $1.78 $2.24 $2.70 $3.16 $3.62
$2,000.00 $1.71 $2.17 $2.63 $3.09 $3.55 $4.01
$3,000.00 $2.11 $2.57 $3.03 $3.49 $3.95 $4.41
$4,000.00 $2.51 $2.97 $3.43 $3.89 $4.35 $4.81
$5,000.00 $2.90 $3.36 $3.82 $4.28 $4.74 $5.20
$6,000.00 $3.30 $3.76 $4.22 $4.68 $5.14 $5.60
$7,000.00 $3.69 $4.15 $4.61 $5.07 $5.53 $5.99
$8,000.00 $4.09 UCLA Luskin Center for Innovation
$4.55 $5.01 $5.47 $5.93 $6.39
deshazo@ucla.edu

5. Residential Costs Per e-mile Driven
Daily Miles Driven
10 20 30 40 50 60
$/gal $/gal $/gal $/gal $/gal $/gal
Equivalent Equivalent Equivalent Equivalent Equivalent Equivalent
$ - $1.73 $1.76 $1.17 $1.81 $1.83 $1.85
$500.00 $2.32 $2.06 $1.99 $1.96 $1.95 $1.95
Instaalled Charger Cost
$1,000.00 $2.91 $2.35 $2.19 $2.11 $2.07 $2.05
$2,000.00 $4.10 $2.95 $2.59 $2.41 $2.30 $2.25
$3,000.00 $5.29 $3.54 $2.98 $2.71 $2.54 $2.45
$4,000.00 $6.48 $4.14 $3.38 $3.00 $2.78 $2.65
$5,000.00 $7.67 $4.73 $3.78 $3.30 $3.02 $2.84
$6,000.00 $8.86 $5.33 $4.17 $3.60 $3.26 $3.04
$7,000.00 $10.05 $5.92 $4.57 $3.89 $3.49 $3.24
$8,000.00 $11.24 UCLA Luskin Center for Innovation
$6.52 $4.97 $4.19 $3.73 $3.44
deshazo@ucla.edu

6. Economies of Scale in Residential Charger
Utilization
$4.50
$4.10
$4.00
$/gallon-e
$3.50
-28%
$/gallon-e
$3.00 $2.95
-12% $2.59
-12%
$2.50 $2.41
-7%
$2.30
-4% $2.25
-2%
$2.00
10 20 30 40 50 60
E miles traveled
UCLA Luskin Center for Innovation
deshazo@ucla.edu

7. Why adopt a pricing policy ?
1. Recover costs or make a profit,
2. Encourage efficient use of charge station,
3. Legal/administrative/ethical prohibitions on
gift or unequal treatment,

8. Desirable properties of pricing policies
1. Simple to set and modify.
2. Collection costs are low.
3. Transparent: clear what the unit cost are.
4. Fair: unit price is the same for all drivers.
5. Maximizes revenues and financial
sustainability.

9. Common pricing policies
1. Flat hourly rates ($1 per hour)
2. Flat hourly rates plus fixed connection fees
($1 per hour plus $1 connection fee)
3. Flat month rate ($25, or $75)
4. Markup on unit costs (10%, 20%, etc)

10. Benchmarking Driver Costs
Cost of Charging at home (Single family)
VS
Cost of Charging non-residentially
(Workplace stations,
Governmental stations,
Commercial retail)
UCLA Luskin Center for Innovation
deshazo@ucla.edu

11. Driver and EVSE Assumptions
PEV10 PEV20 PEV40
Daily miles electric 10 20 30
10 year electric miles 36,500 73,000 109,500
Charger utilization (hours) 0.91 1.81 2.72
Daily kWh purchased 3.482 6.964 10.446
UCLA Luskin Center for Innovation deshazo@ucla.edu

12. Driver Costs: Electricity Only
PEV10 PEV20 PEV40
Revenue $/Electric $/Gal $/Electric $/Gal $/Electric $/Gal
Scenario Mile Equivalent Mile Equivalent Mile Equivalent
Baseline ‐
Electricity $0.06 $1.80 $0.06 $1.80 $0.06 $1.80
Cost Only
UCLA Luskin Center for Innovation deshazo@ucla.edu

13. Flat Hourly Fees and connection fees
PEV10 PEV20 PEV40
$/Electric $/Gal $/Electric $/Gal $/Electric $/Gal
Revenue Scenario
Mile Equivalent Mile Equivalent Mile Equivalent
Hourly Fee ‐ $1 $0.08 $2.40 $0.08 $2.40 $0.08 $2.40
Hourly Fee ‐ $1 +
$0.17 $5.05 $0.12 $3.71 $0.11 $3.28
Connection Fee ‐ $1
Hourly Fee ‐ $2 $0.16 $4.81 $0.16 $4.78 $0.16 $4.79
Hourly Fee ‐ $2 +
$0.25 $7.45 $0.20 $6.10 $0.19 $5.67
Connection Fee ‐ $1
UCLA Luskin Center for Innovation deshazo@ucla.edu

14. Flat Monthly Fees
PEV10 PEV20 PEV40
$/Electric $/Gal $/Electric $/Gal $/Electric $/Gal
Revenue Scenario
Mile Equivalent Mile Equivalent Mile Equivalent
$25 Monthly Fee $0.07 $2.17 $0.04 $1.09 $0.02 $0.72
$50 Monthly Fee $0.14 $4.34 $0.07 $2.17 $0.05 $1.45
$75 Monthly Fee $0.22 $6.51 $0.11 $3.26 $0.07 $2.17
UCLA Luskin Center for Innovation deshazo@ucla.edu

15. Electricity Markup
PEV10 PEV20 PEV40
$/Electric $/Gal $/Electric $/Gal $/Electric $/Gal
Revenue Scenario
Mile Equivalent Mile Equivalent Mile Equivalent
Electricity +
$0.09 $2.72 $0.09 $2.72 $0.09 $2.72
$0.10 Markup
Electricity +
$0.11 $3.18 $0.11 $3.18 $0.11 $3.18
$0.15 Markup
Electricity +
$0.12 $3.64 $0.12 $3.64 $0.12 $3.64
$0.20 Markup
UCLA Luskin Center for Innovation deshazo@ucla.edu

16. Desirable properties of pricing policies
1. Simple to set and modify.
2. Collection costs are low.
3. Transparent: clear what the unit cost are.
4. Fair: unit price is the same for all drivers.
5. Maximizes revenues and financial
sustainability.

17. Summary of findings
Clearly best pricing policy:
Markup on unit costs (e.g., 10%, 20%, etc)
Second best
Flat hourly rates (e.g., $1 or $2 per hour)
Discriminating policies
Flat hourly rates plus fixed connection fees ($1 per
hour plus $1 connection fee)
Flat month rate ($25, or $75)
UCLA Luskin Center for Innovation
deshazo@ucla.edu

18. Thank You
UCLA Luskin Center for Innovation deshazo@ucla.edu

19. PEV vs. Conventional Driver Costs
Financial assumptions Vehicle assumptions
Conventional fuel
Years 10 30.2
economy (mpg)
PEV fuel consumption
Gasoline price $4/gallon 34.8
(kWh/100 mi)
kWh price variable* kWh/mile purchased .348
Discount rate 5% Auto maintenance excluded
Growth rate 3%
*Based on SCE's residential EV rates (TOU‐DTEV, TOU‐EV‐1, and Schedule D)
UCLA Luskin Center for Innovation deshazo@ucla.edu

20. Present Value of Monthly Savings
Daily Miles Driven
60 50 40 30 20 10
$ ‐ $ 140.14 $ 116.79 $ 96.25 $ 72.19 $ 48.12 $ 25.00
Installed Level 2 Charger Cost
$ 500.00 $ 136.00 $ 112.64 $ 92.10 $ 68.04 $ 43.98 $ 20.86
$ 1,000.00 $ 131.85 $ 108.50 $ 87.96 $ 63.89 $ 39.83 $ 16.71
$ 2,000.00 $ 123.56 $ 100.20 $ 79.66 $ 55.60 $ 31.54 $ 8.42
$ 3,000.00 $ 115.27 $ 91.91 $ 71.37 $ 47.31 $ 23.25 $ 0.13
$ 4,000.00 $ 106.98 $ 83.62 $ 63.08 $ 39.02 $ 14.96 $ (8.16)
$ 5,000.00 $ 98.69 $ 75.33 $ 54.79 $ 30.73 $ 6.67 $ (16.46)
$ 6,000.00 $ 90.40 $ 67.04 $ 46.50 $ 22.44 $ (1.63) $ (24.75)
$ 7,000.00 $ 82.10 $ 58.75 $ 38.21 $ 14.15 $ (9.92) $ (33.04)
$ 8,000.00 $ 73.81 $ 50.45 $ 29.92 $ 5.85 $ (18.21) $ (41.33)
UCLA Luskin Center for Innovation deshazo@ucla.edu