Plug-In Hybrid Electric Vehicles and Environmentally Beneficial Load Building: Implications on California’s Revenue Adjustment Mechanism

The paper argues that while PHEVs can reduce system-wide GHG emissions by shifting energy demand from transportation to the electric sector, California's current regulations penalize utilities for the resulting load growth and increased sector-specific emissions. It suggests three primary strategies to overcome these barriers: replacing decoupling (though not recommended by the authors), implementing independent metering to create a separate PHEV rate class, and allocating a portion of transportation-sector GHG reductions to the utility sector.

• Widespread PHEV adoption in California could significantly reduce system-wide greenhouse-gas emissions; modeling suggests that if PHEVs made up 50 percent of vehicles, annual reductions could reach 36 million metric tons of carbon dioxide (MtCO2).
• PHEVs with vehicle-to-grid (V2G) capability offer significant financial incentives for consumers, with potential net returns from selling energy back to the grid estimated up to $2,000 per year per vehicle, leading to a simple payback period of 2.5 to 4 years.
• PHEVs provide utility-scale benefits by acting as distributed mobile energy storage, which can flatten the load curve by increasing nighttime demand, reducing the need for inefficient peaking generation, and helping to integrate intermittent renewable energy like wind power.
• California's 'decoupling' policy, which severs the link between utility revenues and sales to encourage energy efficiency, creates a financial disincentive for utilities to support the load growth associated with PHEV penetration.
• PHEV penetration creates a conflict between sector-specific GHG targets; for example, a 30 percent penetration by 2020 could reduce transportation sector emissions by 22 million metric tons while increasing electric sector emissions by 6 million metric tons.
• To resolve regulatory barriers without abandoning decoupling, the authors propose independently metering PHEV load via conventional dual metering, advanced metering, or on-board metering to enable a separate rate class and time-of-use (TOU) pricing.
• The authors suggest that the utility sector should be 'made whole' regarding GHG emissions by receiving allowances equal to the expected emission increase caused by PHEVs, with the remaining reductions credited to the transportation sector.

APA

Swisher, J., Hansen, L., Mims, N., & Taylor, Z. (n.d.). Plug-In Hybrid Electric Vehicles and Environmentally Beneficial Load Building: Implications on California’s Revenue Adjustment Mechanism. RMI. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_Plug-In-Hybrid-Electric-Vehicles-Implications-for-Californias-Regulatory-Structure.pdf

Chicago

Swisher, Joel, Lena Hansen, Natalie Mims, and Zephyr Taylor. Plug-In Hybrid Electric Vehicles and Environmentally Beneficial Load Building: Implications on California’s Revenue Adjustment Mechanism. RMI, n.d. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_Plug-In-Hybrid-Electric-Vehicles-Implications-for-Californias-Regulatory-Structure.pdf.

Wikipedia

{{cite report |last1=Swisher |first1=Joel |last2=Hansen |first2=Lena |last3=Mims |first3=Natalie |last4=Taylor |first4=Zephyr |title=Plug-In Hybrid Electric Vehicles and Environmentally Beneficial Load Building: Implications on California’s Revenue Adjustment Mechanism |publisher=RMI |url=https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_Plug-In-Hybrid-Electric-Vehicles-Implications-for-Californias-Regulatory-Structure.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{swisherndplugin, author = {Swisher, Joel and Hansen, Lena and Mims, Natalie and Taylor, Zephyr}, title = {{Plug-In Hybrid Electric Vehicles and Environmentally Beneficial Load Building: Implications on California’s Revenue Adjustment Mechanism}}, institution = {RMI}, url = {https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_Plug-In-Hybrid-Electric-Vehicles-Implications-for-Californias-Regulatory-Structure.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }