Xcel Energy gets greenlight for EV pilots after opposition dismissed in Minnesota

Published on October 15, 2019 by Chris Galford


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In Minnesota, a cold war between electric and more traditional power interests heated up over the course of this year, as industrial groups attempted to stymie electric vehicle (EV) pilots proposed by Xcel Energy, only to be thrown out by the Minnesota Public Utilities Commission (PUC).

At one side of the debate was Xcel which, in October last year, filed a petition requesting approval to create two EV pilot programs. The company viewed the programs as a natural extension of its plans to provide 100 percent carbon-free electricity by 2050. The Commission approved the pilots in July.

“Electric vehicles present an opportunity to reduce carbon emissions and build on our clean energy plan to be 85 percent carbon-free in the Upper Midwest by 2030,” Chris Clark, president of Xcel Energy-Minnesota, said of the decision. “The Commission’s approval is a major step forward to ensuring all of our customers and communities realize the benefits of having access to and driving electric vehicles.”

Shortly thereafter, in August, a collection of five industrial groups – Covia Holdings Corporation; Flint Hills Resources Pine Bend, LLC; Gerdau Ameristeel US Inc.; Marathon Petroleum Company LP; and USG Interiors, Inc. – attempted to reverse that ruling. They argued that the PUC lacked the legal authority to regulate Xcel for behind-the-meter EV charging infrastructure – largely due to it not being explicitly stated in Minnesota law – and that Xcel’s ownership of that infrastructure would not benefit the public.

The PUC rebutted those charges on every point.

The commission ruled that not only does Minnesota law grant it powers, rights, functions and jurisdiction to regulate every public utility – a role of Xcel’s that is not disputed – it does not matter that the law does not explicitly label ownership of behind-the-meter EV infrastructure, because EV charging infrastructure is a facility for delivering electricity, meaning it falls under the commission’s comprehensive authority. Further, it dismissed the claim that such infrastructure wouldn’t benefit the public, noting this is contradicted by the record, where such pilots were shown to be beneficial. With Xcel behind them, the PUC reasoned, the availability of charging infrastructure would likely increase, alongside EV adoption.

“The Commission concludes that its July 17 decision is consistent with the facts, the law, and the public interest, and will therefore deny the petition for reconsideration,” the PUC wrote in its order last week. “The Commission will also deny the requested stay.”

With that, the path has been opened to a $25 million EV pilot program in the state. This includes public charging and fleet charging, as well as a subscription EV pilot that will allow residential customers to charge their EVs outside of peak use periods for a monthly fee.

“Xcel Energy is a clean energy leader and our Minnesota electric vehicle plan is the largest and most broad utility transportation electrification program in the Midwest,” Xcel Energy said in a statement to Daily Energy Insider. “We are pleased with the Commission’s decision and will continue to move forward with our innovative electric vehicle pilot programs that will benefit the environment, drivers, our customers and the state.”

The public portion of the pilot will focus on building the infrastructure for fast-charging networks, utilizing community mobility hubs along major corridors. Fleet efforts will focus on easing the integration process of EVs into major fleet operators, including providing electric infrastructure for the first eight of Metro Transit’s electric buses.

The industrial groups claim their concern was ratepayer-based, but no other groups, such as the state’s attorney general’s office, public organizations or other stakeholders joined them in opposition.

State interest in the topic of EV adoption is high, according to a recent report from the National Governors Association (NGA). More related programs, clarifying rules and investment considerations are opening throughout the nation, and many – Minnesota included – have put funds gained from the Volkswagen emissions cheating case toward implementing charging infrastructure and enhancing electrification. The adoption of EVs themselves remains low, however, and many PUCs have taken different views on utility cases like this.

“Kentucky became the latest state to decide that EV chargers should not be regulated as a public utility,” the NGA Transportation Electrification report said last month. “Nearly half of all U.S. states have issued similar rulings through their public utility commissions, which allows private investment from companies like ChargePoint and Electrify America. Opponents of these rulings assert that low-income individuals will be harmed due to private companies’ ability to charge higher rates.”

Such resistance could increase going forward, though, as companies like Xcel continue to invest in EVs and, as the NGA points out, adoption is likely to grow substantially, spurred by evolutions like technology improvements, cost declines and more widespread recharging infrastructure.