## Facts

- Maryland law set a goal of cutting greenhouse-gas emissions to 40% below 2006 levels by 2030.
- In Case No. 9478, the Maryland Public Service Commission received a petition from the Electric Vehicle Work Group (formed through a Commission public conference process) seeking approval of a statewide “EV portfolio” of utility-administered programs and rate options intended to expand EV charging and address barriers to EV adoption.
- The petition described objectives that included reducing EV drivers’ “range anxiety,” helping customers understand and manage EV charging load, increasing the use of smart (network-connected) charging, collecting charging-behavior data to inform future rate design, and studying EV charging impacts on the electric grid.
- The portfolio included multiple sub-portfolios, including residential measures and public charging offerings, with proposed cost recovery through regulated utility rates.
- Residential measures included incentives and other offerings estimated to cost Maryland utilities a combined $17.8 million.
- A central residential proposal was a rebate of roughly $500 for purchasing and installing a “smart” Level 2 charger; the rebate was intended to approximate the incremental cost of a smart charger compared to a non-smart charger, and to encourage equipment that would generate data useful for grid planning and managed-charging programs.
- The record showed that the actual price difference between smart and non-smart chargers was about $372, raising concerns that a $500 rebate would overpay relative to the incremental cost.
- Commission staff recommended lowering the rebate or, alternatively, using time-differentiated distribution rates (time-of-use pricing) to encourage EV charging during off-peak hours.
- Participants raised concerns about legal authority, cost and rate impacts, potential cross-subsidization (non-EV customers paying for EV benefits), and whether utility ownership or operation of charging infrastructure could disadvantage non-utility charging providers.
- The Commission considered the petition through a record that included written comments and related proceedings and then issued a decision addressing whether, and on what terms, a statewide EV portfolio should be approved.

## Issues

1. Whether the Commission could approve a statewide utility EV portfolio with cost recovery through regulated rates as part of the utilities’ provision of electric distribution service.
2. Whether the proposed residential incentive design—especially the roughly $500 smart-charger rebate—was reasonable in light of evidence of the actual incremental cost and ratepayer impacts.
3. Whether time-differentiated rates and data-collection measures should be used in lieu of, or alongside, rebates to encourage off-peak charging and support future rate design.
4. What limits and conditions were required for any utility involvement in EV charging infrastructure to manage ratepayer risk and address competition concerns.

## Decision

- The Commission granted the petition in part and approved a statewide EV portfolio only in modified, limited form.
- The Commission authorized a multi-year pilot structure for EV programs, with conditions and ongoing oversight rather than open-ended approval of all requested measures.
- The Commission modified the residential smart-charger rebate approach in light of evidence that the smart vs. non-smart charger price difference was about $372 rather than $500, and it considered rate-design tools as an alternative or supplement.
- The Commission approved time-differentiated rate approaches for EV charging as a way to steer charging to off-peak periods and reduce peak-related system effects.
- The Commission required data gathering and reporting aimed at informing future rate design and evaluating distribution-system impacts from EV charging.
- The Commission limited and conditioned utility involvement in charging infrastructure to address ratepayer exposure and competition concerns, relying on pilot scope limits and continued review.

## Legal Principles

- A public utility commission may approve utility programs and related rate treatment when the programs are sufficiently connected to regulated electric service and the public interest, including distribution planning and load-management objectives.
- Ratepayer-funded incentives must be supported by record evidence and structured to avoid unreasonable overpayment relative to the incremental cost of the targeted equipment or behavior.
- Time-differentiated pricing can be an acceptable regulatory tool to shift EV charging away from peak periods and to reduce distribution-system stress.
- Where market conditions and grid impacts are uncertain, pilot programs with defined conditions, data collection, and reporting provide a lawful basis for incremental implementation and later adjustment.
- Utility participation in EV charging infrastructure may be allowed subject to safeguards that address rate impacts and reduce the risk of distorting competition in EV charging services.

## Conclusion

In *In the Matter of the Petition of the Electric Vehicle Work Group for Implementation of a Statewide Electric Vehicle Portfolio*, the Maryland Public Service Commission partly approved a statewide EV portfolio, but only as a constrained, multi-year pilot with modifications aimed at ratepayer protection, including closer alignment of smart-charger incentives with demonstrated incremental cost, approval of time-differentiated rates to encourage off-peak charging, and limits and reporting requirements for utility involvement in charging infrastructure.


In the Matter of the Petition of the Electric Vehicle Work Group for Implementation of a Statewide Electric Vehicle Portfolio, 2019 WL 249400 (2019)