(Courtesy: Fleet Owner)
When it comes to charging commercial battery electric vehicles, a good motto is: Make no assumptions. By now we probably all have heard the horror story of the regional transportation district in Denver that ended up paying 60% more per mile to power their electric buses than it did to power their diesel counterparts.
That kind of thing really throws the whole TCO out of whack.So what is the reason for the increased cost? It’s a little thing called a demand charge.
An associate of mine was talking to Muffi Ghadiali, founder and CEO of Electriphi Inc., who explained demand charges this way: “When you design a new site the utility has to come in and make sure there is enough capacity so they can meet the energy needs of the site.”In other words, they have to plan for peak demand.
Consider this example: your normal consumption is 700 KW but if you are charging a lot of vehicles at one time you might hit 1.5 MW. The utility has to make sure that 1.5MW is available all the time because it does not know when you will hit peak demand. This involves installing the right infrastructure to supply that demand. In order to recover the cost of the infrastructure needed to deliver that peak demand, the utility looks at your maximum power usage in a given month to determine peak demand and then charge a fee for that when you operate at that peak.