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Apartments Rarely Have Charging Stations. But Electric Vehicles Need Them

As EVs make more inroads, giving tenants somewhere to plug in their cars could become a selling point.

Americans have now purchased more than 800,000 electric vehicles, counting both plug-in hybrids and all-electric models. That may sound like a lot of EVs, and it is a big jump from the less than 5,000 that were on the road in 2010. But this is still less than 1 percent of all U.S. registered vehicles, despite the recent availability of longer-range, more affordable EV models like the Chevrolet Bolt.

Policymakers nonetheless see EVs as having great potential to reduce carbon dioxide emissions and other forms of pollution, and are supporting tax credits and other policies to encourage people to buy EVs. California, for example, aims to have 5 million of them on its roads by 2030.

But to meet ambitious goals like that, EVs will need to stop being a niche product and appeal to as many drivers as possible. In a new Energy Institute working paper I look at newly available data to try to understand why people purchase EVs. It turns out that renting a home may be one of the biggest barriers.

A Striking Difference

New federal data show that homeowners are more than three times more likely than renters to own an EV. And since 43 million U.S. households – 37 percent of all households – rent their homes, it is worth thinking hard about why this gap exists.

gap

By analyzing the Transportation Department’s newly released 2017 National Household Travel Survey data, I found striking differences in EV ownership between homeowners and renters. In California, homeowners are three times more likely to own an EV than renters.

The gap is even wider for the rest of the U.S., where homeowners are six times more likely to own an EV than renters.

Income Isn’t Everything

You might be thinking that this gap is caused by income. It is true that EV ownership is higher for richer people, which is only natural since EVs cost more to buy than comparable gasoline-powered vehicles although charging them is cheaper than filling a tank.

But I learned that homeowners are more likely than renters to own EVs, even when they have similar income levels. For example, among households earning between US$75,000 and $100,000 per year, 1 in 130 homeowners owns an EV, compared to 1 in 370 renters.

gapbyincome

Parking and Charging

The other big difference between homeowners and renters is having a place to park. Most homeowners have a garage, a driveway or both. That makes charging extremely convenient for them because they can charge their vehicles at night.

It’s not so easy, however, for many renters. Renters are more likely to live in multi-unit buildings and parking spots may not be assigned, or there may not be any parking spots at all. The federal data doesn’t provide any information about parking availability, but this likely helps explain the disparity between homeowners and renter EV ownership rates.

There is also the related question of charging equipment. For homeowners, it is relatively straightforward to invest in a 240-volt outlet, electric panel upgrades and other improvements to speed up charging. These investments can cost $1,000 or more, but are a good investment for a homeowner planning to stay put.

Making this investment is trickier for renters, however. They may not want to invest their own money in a property they don’t own and their landlords may be unwilling to let them do it in any case due to liability and other concerns.

This quandary is what economists call a landlord-tenant problem. In theory, a landlord could make investments like this, and then charge higher rent to recoup the cost. In practice, however, this can get complicated.

Even if the current tenant has an EV – the next tenant may not. And if future tenants don’t have EVs then they won’t need – or appreciate – having charging equipment handy. Several studies, including work by economist Erica Myers, show that renters tend not to value the energy-related investments their landlords make.

Electric car charging station in a Miami, Fla., garage.
Shutterstock.com/Rudy Umans

Public Support for Charging

California policymakers are well aware of these challenges and that is a big reason why they are investing heavily in charging stations. The state is spending $2.5 billion to bring 250,000 charging stations statewide by 2025. Each of these stations will support several EVs, so this will make charging much easier for EV owners.

Much of this funding will cover the cost of building charging stations in communities with a lot of renters. The big utility Pacific Gas & Electric, for example, is making multifamily residences a high priority as it builds thousands of new charging stations across the state. As this charging infrastructure grows, the EV market is bound to expand as well.

I’m eager to see whether these investments will narrow the homeowner-renter gap.

While writing this article, I searched on the Zillow real estate website for rental listings in San Francisco and could find only four apartments that mentioned EV charging as an amenity.

The ConversationThis isn’t many compared to the more than 1,000 of the apartments on the market, but I have no doubt that there will be many more landlords giving their tenants a place to plug in their cars as more renters buy EVs in the near future.

 

For more information see “Evidence of a Homeowner-Renter Gap for Electric Vehicles“, Energy Institute Working Paper #291, July 2018.

This blog is available on The Conversation

Lucas Davis View All

Lucas Davis is the Jeffrey A. Jacobs Distinguished Professor in Business and Technology at the Haas School of Business at the University of California, Berkeley. He is Faculty Director of the Energy Institute at Haas, a coeditor at the American Economic Journal: Economic Policy, and a Faculty Research Fellow at the National Bureau of Economic Research. He received a BA from Amherst College and a PhD in Economics from the University of Wisconsin. Prior to joining Haas in 2009, he was an assistant professor of Economics at the University of Michigan. His research focuses on energy and environmental markets, and in particular, on electricity and natural gas regulation, pricing in competitive and non-competitive markets, and the economic and business impacts of environmental policy.

9 thoughts on “Apartments Rarely Have Charging Stations. But Electric Vehicles Need Them Leave a comment

  1. Sounds like a coordination problem. If you dedicate a stall to charging, you need a way for people to take turns. But do you really need the huge unit in the picture to charge a fee? If you’re not worried about collecting a fee, the landlord can just install a bunch of dryer-type outlets. People can buy their own chargers. You can get a little portable one cheap.

  2. Public charging infrastructure is important not only to apartment dwellers, but also to middle income homeowners. How many houses in Berkeley, for example, have one-car garages — more important, one-car garages that actually have open space for a car?

    But the issue of charging time and charger tier (voltage) is also important. Installing chargers that take 8 hours to charge an EV is space-inefficient; and, I don’t know how many people would be willing to charge their cars overnight at a public location. Workplace charging at 240V makes more sense than overnight public charging but still means only one Tesla or Chevy Bolt will be charged per space per day.

    As to rates, yes it seems unfair for apartment dwellers to pay more for their “fuel” but that is in part defraying the capital and installation cost of the charger and the cost of a “service provider”. Maybe if the charger-equipped parking space rented with the apartment the power could run through the tenant’s residential meter, avoiding the service provider. But I just got gas yesterday and even at $.38/kWh EV charging is comparable in cost to or cheaper than Northern California gasoline.

    • Whether $0.38/kWh charging is cheaper than $3.30/gallon fueling depends on the fuel efficiency of your vehicle. An analysis (https://avt.inl.gov/sites/default/files/pdf/fsev/costs.pdf) from Idaho National Lab indicates that, (with gas @ 3.30/gal), fueling a Prius or comparable HEV with gasoline is significantly cheaper than charging a BEV at $0.38/kWh. For late-model ICEVs getting 28+ MPG, it appears to be close to a toss up –but of course fueling with gasoline is much more convenient.

  3. PG&E’s new EV Charge Network program is helping MUDs overcome the otherwise prohibitive infrastructure cost of supplying EV charging power to their parking lots (transformer upgrades, trenching, conduit). Unfortunately though, PG&E’s EV infrastructure program is planning to apply commercial electricity tariffs (A6 or A10) rather than residential EV charging tariffs (EV-A & EV-B) to residential MUDs in its service area. This means renters or condo owners living in MUDs served by the PG&E program will pay 65% more for off-peak electricity: $0.20/kWh rather than $0.13/kWh. In addition to this core rate mark-up, service providers managing the MUD charging equipment (such as Greenlots) are tacking on additional service fees that bring the fully loaded off-peak EV Charging rates under the program to $0.38/kWh, another 85% markup. Perversely, residents of high-density housing (MUDs) are being asked to pay about three times as much to charge their EVs as neighbors living in single-family homes who can benefit from the residential EV rates.

  4. Hello thanks for your work on this topic. I agree it is an important face if EVs are to become widely adopted.

    I’d like to make a small point, not central your overall argument. It concerns the assertion in the paper (not the blog):
    “Economists have pointed out that in many parts of the United States, the external damages associated with driving an electric vehicle
    actually exceed the external damages of driving a gasoline-powered vehicle (Holland et al., 2016).”

    This is an out of date claim. The paper uses electricity emission rates from 2010-2012: “our analysis is based on a simple snapshot of the electricity grid in the years 2010–2012. We might expect the grid to become cleaner over time by integrating
    new lower-emission fuels and technologies.” Indeed, this has happened

    Using current data, UCS finds that EVs are cleaner in 99% of the country today

    https://blog.ucsusa.org/dave-reichmuth/new-data-show-electric-vehicles-continue-to-get-cleaner

    Additionally, the Holand et al. work only considers the “short-term” impact. It addresses whether it is reducing emissions at the moment of purchase. “In this paper we analyze whether electric vehicles do indeed generate short-term environmental benefits…” Vehicles are lasting for about 17 years these days. From that perspective, this is really is an investment with long term consequences. To focus on whether a vehicle reduces emissions at the moment of purchase doesn’t seem to very important from a climate change perspective.

  5. Multifamily EVSE is particularly important in wind-rich areas of the country, where overnight charging is the optimal strategy. And this article touches on some of the challenges there.

    Most multi-family buildings have a “house meter” for the security lighting, elevators, pools, and other common areas, and individual electric meters for each apartment. The EVSE will likely be served by the house meter, and if the loads are significant, will be on a demand-metered tariff. Since the security lighting is also an overnight load, these structures may have overnight-peaking load profiles. A traditional non-coincident demand charge would make the EV charging unaffordable, so rate design reform may also be needed, to limit demand charges to site infrastructure costs, and use TOU energy charges to recover all generation, transmission, and shared distribution costs.

    In solar-rich regions, however, the better solution may be workplace charging, so the vehicles are charged during the solar day. This will also require the same kind of rate design reform, to eliminate the use of demand charges for the shared system costs, or employers will be unwilling to offer workplace charging.

    Our handbooks on Smart Rate Design for a Smart Future and Smart Non-Residential Rate Design address these and other challenges imposed by archaic utility rate design.
    .
    https://www.raponline.org/knowledge-center/smart-rate-design-for-a-smart-future/
    https://www.raponline.org/knowledge-center/smart-non-residential-rate-design/

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