Tariff impact to be negligible if utilities invest in EV charging infra

Majority of the state public utilities have said that there will be a marginal increase in electricity tariffs if discoms invest in public electric vehicle (EV) charging infrastructure in their respective license areas.

While, one state public utility said that tariff could be recovered through the annual revenue requirement (ARR). However, another said that whatever it invests will be passed through the ARR, as guided by the state’s policy and hence some impact on tariff would be expected.

These insights came in a study presented during the recently held Distribution Utility Forum in Bengaluru organised by The Energy and Resources Institute. About 23 discoms including both public and private gave their perspectives on issues associated with EV charging.

“TERI has carried out a study for two distribution utilities of NCT of Delhi and West Bengal, and it shows that if the discoms go ahead with 400-500 public charging stations within their licensee area, it would hardly have less than one paisa impact on their retail electricity tariff,” Alekhya Datta, fellow and area convenor, Electricity and Fuels Division, TERI told ETEnergyworld.

He added that in addition to a major policy push under FAME-II on EV charging infrastructure, there was a need to enable discoms with appropriate funding mechanisms in order to establish public charging infrastructure within their licensee area.

“It would make sense for the respective states to allow discoms to pass through this investment into the ARR until the charging business is commercially viable. Evenmore, once the utilisation of those charging stations will increase, the impact would be further negligible,” Datta added.

On regulatory aspects related to increased power procurement during peak-hours for EV charging load, some utilities said that suitable tariffs for EV charging were required to recover investments.

ET Energy World
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