California Grants a Three-Year Break on Daytime Electricity
As Battery Busmaker Trumpets $23 Million Investment Round
The California Public Utilities Commission has granted a three-year reprieve on the daytime electricity rates paid by transit agencies with battery electric vehicles, following petitions by Proterra and Southern California Edison. The ruling means that Southern California’s Foothill Transit will pay about 15¢ per kilowatt-hour instead of 40¢ to charge its Proterra buses, and an onerous monthly demand charge will be eliminated.
Separately, Greenville, S.C.-based Proterra spread the word that it’s closed a $23 million Series B financing round led by a new investor, Hennessey Capital, with NMT Capital also joining in. They join previous the Proterra backers Kleiner Perkins Caufield & Byers, GM Ventures, Mitsui & Company Global Investment, 88 Green Ventures, and Vision Ridge Partners. Hennessey Capital president and founder Rajiv Ghatalia joins the Proterra board as an advisor.
“It’s been an exciting 18 months for the company,” CEO David Bennett commented, in reference to a June 2011 funding round. He told F&F that Proterra is evaluating new driveline and charging approaches for its battery buses. And, “We’ve got orders and deliveries of 20-plus vehicles,” he says.
Four New Buses for Reno
Proterra says it’s closing out 2012 with seven transit agencies onboard. Among the latest is Reno, Nev. (the Regional Transportation Commission of Washoe County) which confirms an order for four of Proterra’s EcoRide buses, backed by $4.65 million federal TIGGER funding. The other Proterra customers are Foothill Transit and Burbank Bus, both outside Los Angeles, San Joaquin RTD in California’s Central Valley (Stockton), San Antonio Via in Texas, StarMetro in Tallahassee, and Seneca/Clemson Area Transit (CATbus) in South Carolina.
Proterra markets its 35-foot EcoRide buses with modest battery packs that customer agencies charge en-route, during the passenger-carrying day. That limits single-charge range to about 30 miles (depending on customer needs) nut saves weight (as much as three tons per vehicle) and cost. But for agencies lacking their own electricity supply, it can mean paying high daytime rates.
‘Time-of-Use Rates Provide Clear Price Signals’
SoCal Edison and Proterra asked the CPUC for rate relief earlier this year. The agency cut a compromise between the two requests, stating, in essence, that zero-tailpipe-emission transportation is a thing to be encouraged, but that the emerging battery bus sector must also be cognizant of peak demand concerns.
“We do not believe that it would be appropriate to eliminate time-of-use rates,” states the ruling. “Time-of-use rates provide clear price signals that encourage off-peak usage and discourage summer peak usage… Proterra’s rate proposals would provide no incentive for electric bus operators to efficiently manage their electricity usage or explore potential electrical storage options.”
Accordingly, CPUC has directed SoCal Edison to make available its Time-of-Use General Service rate option for transit agencies with battery buses, for three years. TOU-GS-1 is an option hitherto offered to small-sized commercial customers, like small restaurants, grocery stores, and print shops, the utility says, with an expected electrical demand of 20 kilowatts or less.
“Preliminary modeling of this rate in Foothill Transit’s deployment indicates that the average charge should be about 15 cents per kilowatt-hour,” says Lauren Cochran, director of maintenance and vehicle technology at Foothill Transit.
The CPUC has also eliminated, for three years, a “demand charge” of $13.87 per kilowatt per month, which for two 500-kilowatt chargers would come to $13,870.
“We are strongly committed to zero emission technology as it has a direct impact on the quality of life – and air – of our communities,” Cochran told F&F this morning. “That the PUC supports these efforts is huge, and clearly illustrates the value of this technology.
Key to Future Deployment
“Our future deployment of more electric buses depends on this support and we feel promotes the interests of the public we serve,” Cochran said.
David Jickling, director of public transportation and operations for Washoe RTC in Reno, says that his agency will employ a single high-power charger serving a circular route. Charge times will be kept to just three to four minutes.
Washoe RTC will be getting a different bus and charging system than those pioneered by Foothill, Jickling says. The vehicle will have a new driveline and improved doors, and a new fast-charge system replacing the original chargers from AeroVironment. “Proterra has developed a more compact, more efficient and lower-cost charger system,” CEO Bennett told F&F. He also indicated that Proterra is “making some upgrades” to the UQM drivetrain in the Foothill buses.
Proterra is staying with nanostructured lithium-titanate batteries from Altairnano, Bennett says, which Proterra promotes as “Terravolt” battery packs with a proprietary BMS – battery management system. The packs have active cooling and are said to be the “industry’s only system that can be fully charged in less than 10 minutes.”
Jickling told F&F that in the time between the initial award of his agency’s Transit Investments for Greenhouse Gas and Energy Reduction grant by the U.S. Federal Transit Administration in October 2010, and execution of the purchase contract in September 2012, Proterra was able to reduce the cost of the battery buses by enough that Reno will have four buses, not the originally anticipated three.
He also says that he initially expected to get his buses in March, but that Proterra is now promising delivery in January.
Proterra notes that its EcoRide vehicle is the first heavy-duty electric transit bus ever to complete FTA Altoona testing, “demonstrating best in class energy efficiency and noise levels.”
A $60 Billion Market
“Our investment in Proterra demonstrates our firm belief and that of our fellow investors that the company’s EcoRide has solved a major concern for the world’s aging transit fleets – that is, how to deliver emissions free, quiet bus transit that provides an attractive financial return for struggling transit agencies,” Hennessey Capital’s Ghatalia says in Proterra’s financing announcement. “Proterra’s innovative products, industry leading customers, top flight management and talented work force have this company poised for tremendous future success.”
“We intend to use the funds and to leverage Mr. Ghatalia’s global finance expertise and keen business acumen to continue our growth,” said Bennett.
The latest investment round, the company says, “will accelerate Proterra’s revolutionary EcoRide bus deployment to new U.S. transit customers, open new markets and spur next-generation system offerings.
“The $60 billion global transit market continues to recognize the ideal fit for battery-electric fast-charge systems, which yield 500%+ energy efficiency gains and 80% emission reduction and provide an attractive passenger experience.”
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Source: Proterra release, CPUB ruling, Fleets & Fuels follow-up