California has seen significant growth in the adoption of zero-emission vehicles and charging infrastructure in recent years. Today, one in four vehicles sold in California is a zero-emission vehicle (ZEV), of which an overwhelming majority are electric vehicles (EVs). Now the biggest question is: can California's supply of charging infrastructure keep up with the demand? As California continues implementing its transportation electrification policies, the growth of ZEV use and the need for charging infrastructure will require significant grid upgrades throughout the system.

To ensure deployment of charging infrastructure occurs apace while addressing the collateral effects of such rapid and sizable deployment, the California Public Utilities Commission (CPUC) recently issued a new Order Instituting Rulemaking (OIR). The new rulemaking will address:

  1. The timely energization of electrical vehicle charging sites;
  2. Grid planning for transportation electrification;
  3. Rate affordability;
  4. Vehicle-grid integration; and
  5. Deployment of behind-the-meter charging infrastructure.

Stakeholders with an interest in transportation electrification should become parties to this new CPUC proceeding and participate in the rulemaking process. As an initial matter, the OIR solicits party comments on the scope of issues to be addressed in this proceeding. Party comments on the Order Instituting Rulemaking ("OIR") are due February 19, 2024, and reply comments are due February 29, 2024.

Below, we provide more background on California's EV ambitions and the emerging issues that are likely to be discussed by the CPUC.

Background: State Goals and New Legislation

California has established many goals for transportation electrification to accelerate the adoption of ZEVs and increase access to charging stations to guide the CPUC's work on transportation electrification. Two key Executive Orders stand out:

  • Executive Order B-48-18 (2018) set a state goal of five million ZEVs on California's roads by 2030 and 250,000 public charging stations operating by 2025, including 10,000 direct current fast-charging stations.
  • Executive Order N-79-20 (2020) established a goal for all in-state sales of new passenger cars and trucks to be zero-emission by 2035. It also established a goal that the state's entire fleet of medium- and heavy-duty vehicles be zero-emission by 2045 where feasible, a goal that all drayage trucks be zero-emission by 2035, and a goal that all off-road vehicles and equipment be zero-emission by 2035 where feasible.

California's legislature has also passed a number of bills to support the acceleration of widespread transportation electrification. Most recently, two new pieces of legislation addressing transportation electrification were signed into law in October 2023.

  • Assembly Bill (AB) 50 (Wood) requires the CPUC to establish criteria for timely provision of energization to customers. AB 50 proposes several policies to address delays in connecting customers to the electrical grid, including improved information sharing with local governments, reporting by the electric utilities, and other measures.
  • Senate Bill (SB) 410 (Becker) requires the CPUC to establish by September 2024 reasonable average and maximum target energization time periods in order to connect new customers and upgrade the service of existing customers to the electrical grid.

Emerging Issues to Be Addressed by the CPUC

The CPUC's prior transportation electrification proceeding, R.18-12-006, was initiated in 2018. Through that proceeding, the CPUC adopted an array of decisions that aimed to: (1) develop policies, guidelines, and implementation strategies to accelerate widespread adoption of transportation electrification; (2) put in place cost-effective strategies to implement transportation electrification programs and investments; (3) investigate new strategies related to access to EV charging rates; and (4) explore transportation electrification charging investment ownership models.

However, considering the anticipated growth of EVs and the implications of such growth for the electric grid, the CPUC now must address how the electric utilities will effectively and affordably support the pace and scale of transportation electrification growth required to achieve California's ZEV goals. The OIR identifies the following emerging transportation electrification issues to be addressed in this new rulemaking:

  1. Timely energization of EV charging sites: The acceleration of EV adoption, coupled with new CARB ZEV regulatory timelines, has created a significant increase in energization requests from customers, particularly EV service providers. Reforms may be necessary to adapt existing electric utility processes to accommodate current market growth, including improvements to the electric utilities' EV infrastructure rules and coordination with Tariff Rules 15 and 16.

    Translation: Infrastructure developers are complaining about the time to get their sites energized, which impacts the willingness of investors to finance the development. We need to help speed it up!

  2. Grid planning for transportation electrification: The increased pace and scale of the distribution and transmission infrastructure needed to support this transition will require reforms to grid planning. It is critical that the CPUC assess how the electric utilities can support this accelerated need within the EV market while ensuring investments are affordable for ratepayers.

    Translation: We need to figure out if grid upgrades are actually needed and where. And we need to know now so that they are in place when we need them.

  3. Rate affordability: Accelerated spending on transportation electrification has the potential to impact affordability for ratepayers. For example, the investor-owned electric utilities (IOUs) have spent more than $300 million on ratepayer infrastructure programs to support different segments of the EV market. The CPUC also authorized IOUs to spend up to $1 billion in ratepayer funds for the statewide transportation electrification Funding Cycle 1 rebate program. Additional capital investments will be needed to accommodate transportation electrification loads. Collectively, this level of behind-the-meter and utility-side-of-the meter spending on accelerating transportation electrification has the potential to substantially impact rate affordability.

    Translation: This kind of capital investment has the potential to make already high electricity rates even more expensive. We need to be on top of the overall costs.

  4. Vehicle-grid integration that is oriented to evolving business models, market strategies, and vehicle support of grid needs.

    Translation: We need to maximize the benefits of EV deployment, especially if it can help with reliability and resource adequacy needs. Let's figure out how to do it.

  5. Deployment of behind-the-meter charging infrastructure to support statewide charging infrastructure goals.

    : There is a whole untapped arena to develop EV charging infrastructure that has the potential to not impact the grid in a material way. We should explore that.

California's transition to ZEVs represents promises and challenges for the Commission – and for the many stakeholders invested in the future of all Californians. When it comes to overcoming hurdles and realizing promises, the best solutions arise out of consideration of diverse perspectives. Everyone needs a seat at the table so we can figure out the best path forward that accounts for the inevitable impact of rapid spending without losing sight of the goal: a zero-emission future.