The Alchemy of Public EV Charging

A few months ago we wrote an article looking at the challenges of deploying smart charging in the public charging network.

So it was with considerable interest that we read the recent press release from ubitricity/Shell Recharge which announced that they were “shifting demand away from peak hours”.

Unfortunately there was almost no detail provided in the press release, and there was a lot of “spin” about how this would “directly contribute to lowering CO2 emissions.”

But if we turn to ubitricity/Shell Recharge’s pricing page, things become a little clearer.

They have introduced a new pricing structure:

Peak (1600 – 1900hrs) – 79p per kWh
Off peak (midnight – 0700hrs) – 37p per kWh
Standard (everything else) – 46p per kWh

The “smart” feature is that if you commence a charge before 1600hrs, you can opt to pause the charge during the peak period. This saves the customer money, and reduces the burden on the grid.

For context, 79p per kWh is more expensive than most rapid chargers.

Now going back to the issues raised in our previous article, none of these are addressed by this move from ubitricity/Shell Recharge.

In fact, we would say that this move has created additional problems.

For instance, dwell time on a charger will inevitably increase due to this move. If a car requires 4 hours of charge at 7kW, is plugged in at 1500hrs and opts for the “smart option” to pause the charge during peak hours, that car will now occupy a scarce resource (the public charger) for at least 7 hours [ie. 1500 – 2200hrs].

And unless there is a mechanism to ensure that the car is removed from both the charger and the associated car parking space, then it seems likely that the car will remain either plugged in or unplugged but occupying the car parking space for the rest of the night.

The new pricing structure has created a strong disincentive to charge at peak hours, but not a tremendous incentive to charge at off peak hours.

The issue of generating turnover on these chargers isn’t addressed and the practical problems of real people trying to use these chargers isn’t resolved.

And more than this, the public policy problems of entrenching a divide between the ‘haves and have-nots’ isn’t addressed.

Alchemy – What would Rory say?

Borrowing an idea presented by the great Rory Sutherland in his book “Alchemy”, in some circumstances, the ability to have certainty of outcome is worth paying a premium for. In the case of access to chargers, if the choice is between having certainty of outcome (ie. access to your own dedicated charger) or playing a lottery of trawling the streets looking for a vacant charger when you get back from work, you might imagine that most rational people would happily pay extra for the certain outcome.

So when you introduce the fact that the person benefitting from certainty of outcome also benefits from a tremendous price discount of between 30 – 50p per kWh, you can see that we have a problem.

So what would the Rory Sutherland solution be?

For Rory, the solutions are often a bit left-field. You meet the customer where they are, rather than forcing them to change their behaviour to suit you.

For instance, we like the concept of “grazing on energy,” but we worry that in practice this is unlikely to work at scale. Plugging in your vehicle whilst at the supermarket to gain 45 minutes of power at 7kW is actually not an easy sell to consumers that aren’t that engaged in climate action or the general concept of electric vehicles, since the average vehicle owner would need to plug in several times a day under this scenario if this was their only source of power. Is this realistic?

The key issue we need to overcome is the cost issue. How to enable everyone to be able to buy electricity at the same price.

So here are two ideas to address this:

Adopt the Ripple Energy co-op model.
- Our target customers have not installed their own charger. Let’s assume a cost of £1000 to do this. This cost saving gets re-deployed into a part share in a co-op, a little bit like with Ripple Energy. This co-op then installs local infrastructure which its members can then access. Members can buy electricity at cost.
Your electricity account is universal.
- This is an extension of the Octopus Energy Electroverse model. Presently, Octopus Energy customers who also have an Electroverse account can receive discounted pricing on electricity purchase from participating networks. The natural extension of this is for customers to pay the same price for electricity no matter where it comes from.
- Due to the cost of the infrastructure, doubtless this would be limited to slow (3kW) and fast (7kW) chargers. And even then there would need to be a fee collected which contributed to the installation and maintenance of the infrastructure. But the overall cost could be a lot lower than at present.

The co-op model also has additional benefits. It gets local community participation & engagement. If the local community owns a share in the infrastructure, they have a vested interest in enabling its roll out and will be more likely to care for and maintain the equipment following its installation.

We’d love to hear your thoughts on this.

One thing is certain – the status quo approach is unlikely to succeed. We are going to require innovative ideas to achieve the transition to electric vehicles at scale.