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Michigan Approves Electric Vehicle Charging Rates

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On: Thu, Aug 12, 2010 at 4:48PM | By: Chris Weiss

Michigan Approves Electric Vehicle Charging Rates

With cars like the Chevy Volt and Nissan Leaf hitting the U.S. market in just a few months, many potential buyers are probably wondering exactly how much charging a vehicle will cost (save) them. Sure, with today's AAA Fuel Gauge Report indicating a $2.95 average, you know that plug-ins are bound to save a couple of dollars each year, but it's difficult to estimate a reliable figure.

Well, an official figure has come out of the land of the U.S. auto capital, and it should help to give consumers an idea of just how much they'll be spending on electricity versus gasoline. This week, the Michigan Public Service Commission approved an EV home charging rate system designed by power company Detroit Edison Company.

The Michigan Public Service Commission approved a charging rate system that incorportates two options. The first is a flat, monthly fee of $40 per vehicle, and the second is a lowered rate for off-peak charging (outside weekday hours between 9 a.m. and 11 p.m.). Considering that many will likely charge their vehicles at night, the latter option may prove to be popular for EV owners.

Many customers will be equipped with a separate power meter dedicated specifically to vehicle charging. It will measure the amount of power and time of usage for electric vehicle charging. Detroit Edison will provide up to $2,500 worth of funding for installation of the metered charging system.

The two-tiered rate system is an experimental system that will help the utility analyze the effects of electric vehicle charging on the grid. Detroit Edison will run the experimental system through December 2012, allowing up to 2,500 residential consumers to opt in.

MPSC Chairman Orjiakor Isiogu said of the experimental rate system: "The program approved today will help Detroit Edison evaluate the effect of electric vehicles on its electric system, offers off-peak rates that customers can use to charge vehicles, and offers the infrastructure required to charge these vehicles."

Detroit Edison is the first Michigan electric company to offer a specific rate for electric vehicle charging. Michigan will be one of the first markets where the Chevy Volt is offered when it launches later this year. The Nissan Leaf will be making it to Michigan by early next year.

A 2010 report by Edmunds shows the monthly fuel costs of even the most efficient vehicles on the road exceeding well over $40. According to the organization's Monthly Fuel Cost calculations, the Toyota Prius costs $68 in monthly fuel costs, and the Honda Civic GX costs $56. Less efficient vehicles cost upwards of $100 and even $200 per month. For many, the $40 rate probably looks pretty attractive as a weekly rate, but for an entire month, it should be a welcome addition to many homes.

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