Electric Vehicles

Wash. law opens door for PUDs to invest in EV infrastructure

A new law authorizes public utility districts in Washington State to invest in transportation electrification infrastructure.

Transportation electrification investments were not barred under previous law, but they were not explicitly allowed.

The law, H.B. 1512, which takes effect on July 28, provides “assurance that PUDs who seek to support this emerging industry are not in violation of the state law,” Christine Pratt, public affairs officer at Grant PUD, said via email. Grant PUD supported the bill.

Specifically, the state constitution prohibits the gifting of public funds for public entities. The constitution provides an exemption for energy conservation, but the gifting clause presented a challenge for utilities that wanted to support electric vehicles, by creating incentives for electric vehicle charging equipment, for instance, without running afoul of the law, said Nicolas Garcia, policy director at the Washington Public Utility Districts Association, which supported passage of H.B. 1512.

The new law applies to any PUD or public power utility in the state, as well as to investor-owned utilities.

The new law notes that by making more efficient use of energy resources and of the electric delivery system, transportation electrification may result in cost savings and benefits for all ratepayers. It also notes that “state policy can achieve the greatest return on investment in reducing greenhouse gas emissions and improving air quality by expediting the transition to alternative fuel vehicles, including electric vehicles.”

More widespread adoption of electric vehicles with appropriately timed charging could make better use of energy resources and infrastructure and could possibly avoid system upgrades that might otherwise be required, Garcia noted. In addition, the efficiency language in the law could be useful if the law is challenged in court, he added.

Washington State Gov. Jay Inslee recently signed S.B. 5116, which requires utilities in Washington to sell greenhouse gas neutral electricity by 2030 and 100% GHG free electric power by 2045.

Unlike many other states, utilities in Washington are not the major contributor to greenhouse gases. The transportation sector is responsible for 57% of the state’s carbon dioxide emissions. Public utility districts in the state are responsible for just 1.4% of GHG emissions.

The law allows a public power utility or a public utility district to adopt a transportation electrification plan as long as it does not increase net costs to ratepayers by more than 0.25%. The authors of the law wanted utilities to approach electric vehicle infrastructure projects with a plan, but they did not want to give unfettered license to spending on those plans, Garcia said.

The law also allows the state’s investor-owned utilities to earn an additional rate of return of up to 2% on capital investments in electric vehicle supply equipment.

The law “opens the door” for PUDs to offer transportation electrification incentives, as appropriate, for their customers, Liz Anderson, director of communications for the Washington Public Utility Districts Association, said.

She noted that some PUDs in the state may have more of an impetus to take advantage of the change in the law than others, depending on the unique needs of their community.

The Grant PUD has no immediate plans to adopt a transportation electrification plan, Pratt said. “We’re in the early stages of studying the new law and its potential cost impacts. Keeping electric costs as low as possible for our customers is a top priority.”

But the law “could eventually have certain advantages for Grant PUD,” Pratt said, adding that Investments in transportation electrification “appear to be an acceptable form of alternative compliance to the governor’s new Clean Energy Standard bill, post 2030.”