A proposal by Montezuma County commissioners to install a fast-charge electric-vehicle station in Cortez has hit a hurdle because of high operating costs.
The county wants to take advantage of a $250,000 grant from the Colorado Energy Office to install the public charging station at the county annex on Montezuma Ave. Total project cost is $315,000.
The two-dispenser station would be a Level 3 DC Fast Charge system, which provides the fastest charge available to the traveling public. It would have a 156.25 kilowatt power block and is designed to be upgraded to four charging units.
The state is working to develop a network of the fast-charge stations to accommodate the increase in electric vehicles, or EVs.
Prime location“Cortez is a strategic location to enable EV users to travel across Colorado and through the mountains. E-charging corridors facilitate economic development and reduce air pollution,” said Zach Owens, program manager for transportation and fuel technology with the Colorado Energy Office. “Getting infrastructure in place is a critical component of EV adoption.”
At a Level 3 fast charger, EV drivers would pay around $20 to $25 for a full charge, which would take around 40-60 minutes, officials said.
By comparison, Level 2 charge stations cost up to $30,000 and take around 8 hours for a full charge.
During a county commissioner meeting with the Empire Electric board of directors, it appeared the operation costs for the fast-charge project would need to be subsidized until enough EV customers covered expenses.
But who is willing to pay the subsidy is not determined, and could be a deal-breaker. The county was considering accepting the grant and operating the station.
But based on Empire’s $29 per kilowatt hour demand charge to power the station, and assuming an initial customer base of one vehicle per day during peak demand, the county faces a potential $6,000-$7,000 per-month electric bill until utilization increases, officials said.
Attracting visitors“With this we can be on the EV corridor and attract visitors, but the demand charge seems insurmountable,” said commissioner Keenan Ertel.
Operating costs would be less if charging occurs during off-peak demand, but calculations were made assuming use during higher cost peak demand.
The commissioners hoped to negotiate lower demand charge, said Larry Don Suckla. But Empire officials said the rate structure is in place to cover use of the charging station during peak demand, which in turn covers Empire’s costs from its supplier, Tri-State.
“The more utilization (by EVs), the more attractive the rate is,” said Empire General Manager Josh Dellinger.
“We would like to navigate a solution with the county and Empire because we see this location as critical to enable EV travel across Colorado,” Owens said.
He said Colorado has signed a memorandum of understanding with seven Western states to standardize electric charging stations, and Colorado is on the front edge of implementing the stations.
ChargePoint, which was contracted by the state to organize the statewide fast-charge network, would contribute $19,000 to build the Cortez station. They said the break-even point is estimated to become five to seven EV vehicles per day used the station.
That use is on its way, said Commissioner Jim Candelaria. “We’re looking to be proactive and get in front of this. If we are on the map, (EV) drivers will come,” he said.
Ertel said the station would also provide an economic boost.
“When they are waiting for the charge, they will walk downtown, have lunch or go to our museum,” he said. “Many manufacturers are making electric vehicles now.”
Roy Moore, ChargePoint director of program development, said charging stations are the foundation needed “so people have the confidence to buy an electric car, so manufacturers say ‘Yes, Colorado is a good market for us.’ It is a challenge at the beginning, but once the revenue comes in, the investment is protected.”
Evolution of carsElectric cars have evolved quite a bit, Moore said. Newer models have a range of 250 miles on one charge, more than double from 10 years ago.
Empire Business Services Manager Chris Snyder said limited use at the station is the issue, not the demand charge.
“It poses the question, is this idea ahead of its time?” he said.
ChargePoint finance manager Rebecca Paruch responded that the challenge at first is a combination of the demand charge and utilization.
The initial costs to attract use “is a bit of the chicken-and-egg type thing,” she said.
Snyder suggested starting out by working with local hotels to install Level 2 chargers for guests, which allow for a full charge overnight.
“It invites them to stick around and spend some money,” he said. “I think that is the best bang for our buck.”
Ertel said that does not accommodate EV travelers who don’t plan to spend the night but want to drive here and enjoy the area.
Utility wary of subsidiesEmpire board member David Sitton was not in favor of reducing the rates for the station. He said the board has been eliminating subsidies in their rate structure so “in all fairness, people are paying for the power they use. Our rate structure is there because that is what it costs.”
Some electric utilities are exploring lower EV charging rates, and that is something the board may consider, Paruch added.
Empire board members were concerned that lowering the demand charge would unfairly pass on the cost of the charging station to rate-payers. Another comment was that in 10 years, gas stations may see the revenue value of investing in fast chargers.
Moore said that may be true, but currently, if there is no fast charger in Cortez, “EV drivers won’t come,” and they will go to towns that do have them.
Officials said options for charging stations in Cortez are ongoing, and outreach will be made to businesses to see if there is interest at another location.
The Colorado Energy Office announced $10.33 million in grants for 33 additional electric vehicle charging stations throughout the state. The funding is derived from Colorado’s share of a Volkswagen emissions settlement.