The economic advantages of electric vehicles
A city in Ohio is projected to save $8.15M after investing in EVs and microgrids
By Michael Benson
When the chief of the Logan (Ohio) Police Department presented the idea of leasing electric vehicles to replace aging gas-powered ones, the Logan City Council recognized it was a good idea and made it happen.
The plan was to save money on fuel, similar to the Bargersville (Indiana) Police Department, which has been buying Tesla police cars for more than a year, with savings from fuel and maintenance around $6,000 per car per year. Logan hoped to do the same. What they did not know was choosing to buy electric vehicles (EV) as police cars created an opportunity to save even more.
Logan Police Chief Jerry Mellinger planned to install wall connectors at his police station to charge the new patrol EVs. He received a grant through the Sustainable Ohio Public Energy Council to pay for the new circuit and the installation. This plan only works for two cars, because they are assigned to individual officers, and they remain at the station in between shifts. This allows the time necessary to fill them up to be ready for their next shift. It is not a resilient system, because there is no backup if the building electrical system goes down, an officer forgets to plug their car in, there is a problem with one of the connectors, or any other adverse situation occurs.
Through my consulting company, Command Consulting LLC, I began working with Chief Mellinger on a better charging plan for his vehicles. The first thing to know is currently available commercial, electric grid-based charging will not meet the needs of public safety agencies. They need their own reliable and resilient source of power separate from the grid because of the mission-critical nature of their work. Fire trucks, ambulances, police cars and snowplows cannot wait to charge overnight. They need a quick charging system that does not overtax the electric grid and avoids the high cost of buying electricity at peak times or creating demand charges on municipal electric bills. The answer is a Mission-Critical Microgrid (patent pending).
What is a microgrid?
A microgrid is a miniature version of the electric grid, serving the facility, area, or community it is built on. Like the larger grid, it includes power generation, distribution (wires) and loads (devices using power).
In this case, Logan’s proposed microgrids are a combination of solar arrays (generation), battery storage (load) and integrated direct current (DC) fast chargers (another load). They provide power even during a power outage, which supports the city’s critical infrastructure on which it is based, while also being a resilient EV charging system. This ability to operate as an island during a disaster improves the resiliency of the whole city because emergency and disaster response agencies will remain operational even when everything else is shut down due to a bad storm or power outage.
Mission-Critical Microgrids (patent pending) also have other advantages. If they are included as part of the larger electric distribution grid, they will provide resiliency for whole neighborhoods depending on their size and configuration. They can support community warming or cooling centers during winter or summer. Best of all, they save money, and they can be developed using private investments instead of city funds.
Analysis predicts $2.85M direct savings for Logan
Command Consulting LLC analyzed the whole city fleet and energy use by the city’s physical infrastructure to see how the combination of EVs plus a Mission-Critical Microgrid (patent pending) would allow the city to reap the economic and performance benefits of both.
The city will save $1.75 million over the next 30 years as it transitions its fleet to all-electric. There are EV options available in 2022 for every vehicle the city operates, except for the fire trucks. Electric fire trucks are coming to market right now, but the ranges on these early EVs are too low to cover the Logan Fire Department’s response area. The ranges on these vehicles will increase and their costs will drop within the next 5-10 years, and by 2030 an electric fire truck will be cheaper than a diesel one.
The analysis also showed the city will save approximately $1.1 million in electric costs by installing Mission-Critical Microgrids (patent pending) at their city facilities.
Command Consulting LLC’s analysis recommended the City of Logan use a power purchasing agreement (PPA) to develop and build the microgrids, which avoids spending tax dollars to cover the capital cost themselves. Similar to fleet leasing economics, private investors will cover the capital cost and take advantage of the tax credits and annual returns from solar plus storage microgrids. Municipalities are unable to use tax credits as tax-exempt entities, and avoiding tying up capital budget funds provides them with greater budget flexibility. Letting a private investor cover the capital cost, fixing the city’s energy cost for 20 years at a lower rate than the city pays today, and the other inherent advantages of a microgrid are a true public-private win-win.
Combining the savings from EVs and Mission-Critical Microgrids (patent pending), the City of Logan will save $2.85 million, or $95,000 per year. When you add in the avoided costs, which is taxpayer money not being spent, by using private investor money for the microgrids, the city will save an additional $3.5 million. Another avoided cost is not having to buy commercial DC charging systems. Over the next 30 years, the city will use sunshine from their microgrids to fuel their EVs, helping them to avoid spending an additional $1.8 million.
Overall, if the City of Logan follows the recommendations laid out in the electrification analysis done by Command Consulting LLC, they will save $8.15 million over the next three decades, which equates to $271,000 savings annually.
Logan, Ohio is leading the way. Every city should follow their example with savings just waiting to be discovered.
About the author
Michael Benson is the co-owner of Command Consulting LLC which focuses on municipal electrification, emergency services and shared services. He has 30 years of experience innovating at every level of local government. He is a Board Member for Green Energy Ohio, a member of the Critical Services Microgrid Group in Asheville, NC and Drive Electric Ohio. Retired Fire Chief Benson lives in Northeast Ohio with his wife and three adult children, and he has been driving an electric car for three years.