The electric mobility revolution continues to accelerate throughout the world and in our service territory. Electric vehicle (EV) adoption provides substantial environmental and economic benefits for society. It will also have substantial impacts on many major industries, including the electric utility industry.
According to a 2018 study by the Edison Electric Institute (EEI), there are more than 1 million EVs on the road today. Another million EVs are expected over the next three years, and by 2030, the total number of EVs will climb above 18 million in the U.S. AEP is working to help customers and communities achieve the benefits and rewards of electric transportation by improving customer awareness of and education about EVs, supporting EV charging options where we park, and helping to mature transportation corridors to enable long-distance electric travel for all drivers. We are seeing greater adoption: at the end of 2018, there were more than 10,000 registered EVs and plug-in hybrid electric vehicles (PHEVs) across our service territory, with nearly half of those in Ohio.
We are also providing tools and guidance to our customers on how to better manage their fleet. These analytical tools show that replacing a vehicle with a similar EV that is on the market can provide a 50 percent reduction in first-year fuel cost, as well as a 40 percent reduction in first-year tailpipe emissions. When fleet managers understand these benefits specific to their needs, they are empowered to make decisions to adopt EVs that benefit their business, customers and communities.
We are working today to identify and deploy technologies, solutions and programs to address the challenges and opportunities that EVs will present. Our objective is to increase adoption of electric transportation in our service territory and provide charging options that optimize the use of the grid for the benefit of all customers. This will require leading by example with our own fleet transformation, customer outreach and education; managing charging to optimally integrate EVs with the grid; increasing public infrastructure; and engaging with our legislative and regulatory stakeholders to get the rules right.
We believe we are well-positioned to play an important role in supporting EV market development. We are actively working with policymakers and customers to develop and implement incentive programs to help jump-start and support adoption of EVs in our service territories.
2018 EV Accomplishments:
In 2018, AEP began expanding the use of EVs throughout our own company, including integration of EVs into our fleet of work vehicles. We have a program in place to prioritize EV charging stations, with approximately 100 ports installed across our facilities and plans to install more. This workplace EV charging system received an Electric Power Research Institute (EPRI) Technology Transfer Award in 2018, demonstrating its applicability across our industry.
In April 2018, AEP Ohio received regulatory approval to implement an EV charging station incentive program. The program offers incentives for up to 375 charging stations at government-owned properties, workplaces, multifamily housing units and in low-income neighborhoods. In 2018, 54 projects were approved through this program, representing 136 Level 2 charging ports and nine DC Fast Charging Stations. Read more in Smart Columbus.
As we optimize our existing grid assets, we are offering customers options and rates that encourage the efficient use of the grid. Our goal is to simplify charge-at-home options and enable our customers to charge their EVs in an affordable way. For example, having a special rate for night-time charging would make it more cost-effective for customers to recharge their EVs later at night to save money. It would also help us better manage the demand on the grid to ensure reliability.
Indiana Michigan Power (I&M) received approval to update its EV tariff to improve home charging options and make it easier for customers to gain access to EV infrastructure. This type of policy change is what’s needed to enable quicker adoption of EVs and the supporting infrastructure.
Following a legal settlement between Volkswagen and the federal government over violations of the Clean Air Act, Volkswagen agreed to provide $2.7 billion to the states for environmental mitigation projects. AEP continues to advocate for using these funds to support EV charging infrastructure.