For businesses transitioning to electric vehicles (EVs), understanding charging costs is crucial. Time-of-Use (TOU) programs offer a way to manage and potentially reduce these expenses. These programs, often available through utility providers, structure charging rates based on the time of day, encouraging EV charging during off-peak hours when energy demand is lower and often renewable energy sources are more available.
One common structure for business EV charging involves a monthly subscription charge combined with TOU rates. The subscription fee is typically based on your business’s anticipated maximum monthly EV charging consumption (kW). Businesses can adjust this subscription level throughout the billing cycle to avoid overage fees, providing flexibility to manage costs.
Overage fees are applied if actual energy consumption exceeds the subscribed level. These fees are designed to incentivize accurate subscription level selection. For instance, if a business subscribes for 60 kW but consumes 61 kW, they will pay for the 60 kW subscription plus an overage fee for the additional 1 kW, calculated at twice the standard kW rate. Understanding this structure is key to effectively utilizing these programs.
To help businesses adapt, many programs include a grace period, often for the first few billing cycles. During this period, overage fees are waived, allowing businesses to determine the optimal subscription level without penalty. In some cases, if overage fees are incurred at the end of the grace period, the subscription level may be automatically adjusted upwards, ensuring coverage for actual usage and providing a buffer for future needs.
Beyond the subscription, the actual cost of charging is determined by a volumetric rate (kWh) based on when energy is used. TOU periods typically include off-peak, super off-peak, and peak hours. Charging during midday, when renewable energy is often more available, is usually the most cost-effective. These time-of-use periods are generally consistent throughout the year, allowing for predictable budgeting and charging schedules. For detailed rate specifics, businesses should consult the specific Business EV Tariff provided by their utility provider.
