As electric vehicles (EVs) become more prevalent on the roads, the way they are charged is also evolving. One of the significant changes is the shift from billing based on time to billing based on the amount of power consumed. While this new approach may bring transparency and simplicity to charging costs, it also means that the price of charging an EV is going up.
The Ivy Charging Network, a joint venture between Hydro One Ltd. and Ontario Power Generation, recently introduced per-kilowatt-hour pricing as a pilot project at its ONroute locations along major highways. This shift in billing method is in line with a ruling by Measurement Canada that allows network owners to have more flexibility in their pricing models.
On the surface, billing by power seems like a positive change. Drivers now know upfront how much they will pay, and comparisons to the cost of gasoline become easier. However, the reality is that the price for charging an EV has increased significantly.
For instance, Ivy’s new rate is 62 cents per kilowatt-hour (kWh), which means a full charge for an average EV could cost around $36. In comparison, the previous billing model based on time would have cost under $16 for the same charge. This represents a 125 percent price increase.
While EVs still offer savings compared to gasoline-powered vehicles, these increases in charging costs are disappointing. The initial allure of EVs was the potential for significant savings on fuel expenses. However, if charging costs continue to rise, the estimated annual savings for EV owners could decrease from $1,000 to $500.
It’s crucial to note that not all charging stations have adopted the same pricing model as Ivy. Charging at home or using public charging stations with lower rates can still offer cost-effective alternatives. For example, overnight rates for home charging in Ontario can be as low as 8.7 cents per kWh, while some public chargers offer flat rates of just 5.2 cents per kWh.
While the shift to per-kilowatt-hour pricing brings transparency to charging costs, it also highlights the need for a diverse and competitive charging infrastructure. As EV adoption continues to grow, it is essential for charging networks to explore cost-effective solutions that provide EV owners with more accessible and affordable charging options. Otherwise, the rising costs of charging may deter some drivers from making the switch to an electric future.