I hope Tesla Lowers the Supercharging Rates

[happyzod]

So, yes, the RAV4 hybrid at about $2/gal is close to the Supercharging rate. But that's already a hybrid and assumes that the price of gas doesn't go back up. So what Tesla's done is to make long distance travel a little more expensive, but still cheaper the 90% of the vehicles on the road, even with current gas prices.

So the moral of the story is to not use Superchargers. Charge at home or L2 chargers more.

I've taken at least 5,000 miles of long distance travelling and (while at the old rates) I don't think that I spent over $100 in Supercharging. That's because there were a number of other options along the way, charging at hotels, at homes, etc.

Also, go look at the competition for DC fast charging.

And look at it from a business model. Just how much do you think it costs to build a Supercharger? to maintain one? Amortize that over a few years and see what the cost of charging should be.

Sure, the price increase stinks. And here in Georgia it is really weirdly set. Superchargers across the street from each other have different rates.

Have you done your research? It costs around between $250,000 and $300,000 to get a supercharger up and running that is between 8-12 stalls.That is capex depreciated over 10 years. Opex for supercvharging stations we don't know but , let's say it's equal to depreciation which is 10% of cap-ex. So the running cost per year of the supercharging station would be capex + opex which is 20% of $300,000 which is $60K. In the US, there are around 500 stations? Tesla would need to charge 30 million a year over electricity costs to break even.

However, it seems that the majority of people charging now after the price increase are S and X cars leeching from the system because they have free lifetime supercharging. So tesla will need to cover what the S and X cars leech, which is why I think they really increasing the rate for Model 3.

 

[rickjames]

Have you done your research? It costs around between $250,000 and $300,000 to get a supercharger up and running that is between 8-12 stalls.That is capex depreciated over 10 years. Opex for supercharger we don't know but , let's say it's equal to depreciation which is 10% of cap-ex. So the running cost per year of the supercharger would be capex + opex which is 20% of $300,000 which is $60K. In the US, there are around 500 stations? Tesla would need to charge 30 million a year over electricity costs to break even.

However, it seems that the majority of people charging now are S and X cars leeching from the system because they have free lifetime supercharging. So tesla will need to cover what the S and X cars leech, which is why I think they really increasing the rate for Model 3.

Your last point is the real problem. FUL leeching supercharging when they have home charging access. I have spoken to these people at superchargers. Nothing against them, but I would say this is an issue for the network. Without knowing the numbers, it is hard to estimate the potential cost to Tesla per yer but it would have to be significant.

 

[TexasEV]

A FEW YEARS AGO. When the average Tesla owner made a 100k average income, owned an S or X, and charged in their garage. A few years in the future here in 2019, superchargers are jam packed in California, 135k Model 3s are on the road and 50% or 70k+ of those are in California.

That "95%" is way down now and supercharger congestion proves it.

Most people still charge in their garage, even in California, even with the less expensive (but still expensive for a new car) Model 3. Census data shows 56% of housing in California is single family detached house. I suspect that percentage is even higher when just considering new car buyers.

 

[Electroman]

If I do a 50/50% mix,

Why are you supercharging half the time? I understand there are some who are only on the road doing long distances most of the time, but is that your use case? Or are you just trying to pick up an edge case just to nitpick?

For 90% of the users, 90% of the fueling is at home. For them even if SpC rates go up by another 50%, it is still cheaper to drive a Model 3.

 

[ℬête Noire]

I agree. I don’t expect $0.06 a kw electricity. But charging Tier 3 electricity rates is too much. It should be on par with tier 1 electricity rates. $0.16 a key in California.

Peak rate utility surcharges, inherent in running a high rate charger, on top of all the other overhead of operating a "store front" make that very difficult to work economically. Tesla has an advantage in that so far a lot of their leases are borrowed space for a nominal fee to help in a lot of locations, but capital for gear and ongoing maintenance will make that very difficult.

BTW I do wonder if per site costs are what is driving different SC pricing even within Texas? It now ranges from 14c/min in Austin to 12c/min in some far flung places like Childress. Most are at 13c/min. Or if those pricing differences are being driven by usage numbers? I missed this happening and haven't yet tried to parse the larger thread on this to see if there's word from Tesla on why that is the case.

 

[TeeEmCee]

However, it seems that the majority of people charging now after the price increase are S and X cars leeching from the system because they have free lifetime supercharging. So tesla will need to cover what the S and X cars leech, which is why I think they really increasing the rate for Model 3.

Can't help but draw the parallel between this argument and government-administered funds.
First you pay into them through the nose and then, when it's time to draw the benefits that you paid for, you're "leeching".

Must be that the early S/X buyers were just thrown a freebie by overly-generous Tesla.

 

[happyzod]

Can't help but draw the parallel between this argument and government-administered funds.
First you pay into them through the nose and then, when it's time to draw the benefits that you paid for, you're "leeching".

Must be that the early S/X buyers were just thrown a freebie by overly-generous Tesla.

The argument made by most people is that Tesla needs to cover the costs of the supercharger network. The costs of the supercharger network is the cost of replacement (depreciation) + cost of rent+repair+maintenance (operating expense) + cost of electricity (variable costs). If S and X users who got free supercharging are using electricity, the people who are paying by definition of covering costs will need to pay extra for the leechers unless tesla is willing to take a loss on the network.

 

[ebmcs03]

Agreed, TOU is a scam. California needs to get away from this privatized utility setup. It failed. No competition to lower rates. Just go to a public utility setup or bring in another company.

Thank you. Someone who actually did some math and realized this!

 

[ℬête Noire]

If S and X users who got free supercharging are using electricity, the people who are paying by definition of covering costs will need to pay extra for the leechers that unless tesla is willing to take a loss on the network.

"Included in the purchase cost" is different than "free". Whether or not Tesla accounted for that accurately in the price may be another question, but "leeching" strikes me as a rather poor tone. :/

 

[happyzod]

"Included in the purchase cost" is different than "free". Whether or not Tesla accounted for that accurately in the price may be another question, but "leeching" strikes me as a rather poor tone. :/

You can classify it anyway you want. If telsa is setting rates based on having the supercharging network break even, then those who pay will need to cover for those who don't pay. Yes, it is accounting.

 

[DrDabbles]

Tesla has recently raised the national average price for supercharging significantly.

They're paying to roll out the network. If you want chargers in more places, you need to pay for them.

Fayetteville N.C. - .26c/KW (going rate is .06c for the city and state average)

I could believe that 6c is for generation cost, but not the total delivered cost.

Why is it that Tesla decided to raise the rate so high that my model 3 now cost 6c per mile to supercharge

They're charging you for the electricity, for the rollout and maintenance of the network, and the convenience of fast charging. Compare Tesla's prices to other paid EV charging networks and you'll find Tesla is much cheaper.

the same as if I would have bought a Rav4 Hybrid (5-6c/mile).

As long as you don't include maintenance costs. And if you're doing business travel, you should be including maintenance and depreciation. That's why you can get reimbursed/write off $0.55 per mile. So really, you're still _making_ money for every mile you drive.

It is also priced WAY above utility rates in the state.

They don't just have to pay for the electricity.

Now I would have been better off to just get an ICE with the rates going up like they have.

When gasoline prices spike during the summer, will you retract this thread? Electricity prices are much more stable than gas prices and don't fluctuate with the season. Fuel prices in the winter are almost always at their lowest.

It is now not only less convenient to use my car for business travel, but also more expensive, something I honestly did not expect when purchasing the car.

It's also better for the environment.

I could get the best of both worlds with a Hybrid like the volt

GM isn't making those anymore. They're going all battery. I guess you could have bought a used Volt, though.

Tesla, why are you doing this?

Money? Supply and demand? Profitability? Or maybe they just don't like you personally. Maybe this is all your fault and we should be mad at you.

Especially at a time where gas prices are seeing historic lows with a national average of $2.25/gal.

Using national average for gas prices when complaining about the rate you're paying in your exact location isn't very helpful. There are places with lower and higher fuel costs, and fuel costs vary greatly based on population and demand. Electricity prices are generally the same for a whole market. So someone in Texas feels like they're getting ripped off compared to North Carolina, but someone in Hawaii is happy as can be.

 

[ebmcs03]

Tesla should start implementing the surcharge for charging <75 miles within your registered address.

Anything further should have this ridiculous surcharge.

And monitor how often a super charging station is used. If used more than 5 times a month you’re clearly not traveling but using the SC as primary charging.

 

[talkingevs]

So let me get it straight, the more free *sugar* Tesla gives away the more people will take it? Sounds novel!

Listen, I’m not a fan of the prices going up but I understand that as a Model 3 owner, I’m enjoying the SC network that was paid for by the premium of the Model S and Model X. The rapid ramp up of the Model 3 has created congestion at the SC and thus they need to build capacity. How would you expect them to do that? Certainly not by giving it away or breaking even. They are going to have to generate some revenue from SC users in order to continue to build out the network.

Sorry, no free lunch.

Im not asking for a free lunch. I pay for my supercharging. But $.30+ is ridiculous when I pay $.05 at home. Tesla will not succeed long term with the mainstream public if there is no price advantage vs an ICE and now there isn't. Yes Tesla's are cool cars and I love then. But look at history and you will see that the car companies that succeed are the ones that create cost effective cars. Which now ICE vehicles cost less up front, cost same now to operate, and have a far better fuel network worldwide.

Instead of raising costs, just release adapters for Tesla's to use EVgo, Charge Point, and Electrify America fast chargers. Bam problem solved.

 

[GeoX750]

I hope Tesla can lower the cost of supercharging. But most of all, I hope Tesla can maintain supercharging.

The recent news coming out of Tesla shows signs of a company in distress. And then the rapid increase in supercharging prices tells you something.

I am sure they do not want to be charging as much as they now are, because it does take away a large part of the narrative to buy a Tesla.

Even after the success of the 3 and with the other products coming, they must know things are going to be in tough time and trying to do the best they can to stay afloat.

 

[SageBrush]

But $.30+ is ridiculous when I pay $.05 at home.

Do you charge at 120 kW at home ?

 

[ℬête Noire]

You can classify it anyway you want.

How about we all shoot for accuracy on it? "Leeching" is an entirely loaded and inappropriate word in this case.

Those S & X vehicle purchases included an advance to Tesla for all future charging. Tesla then turned those advances, loans in effect, around and used them for Capex to build the network. Both charging gear and the IT backend.

This means that Model 3s are in effect mostly using infrastructure that was paid for by past Model S & X purchases. And you've got the nerve to point "leechers" in one particular direction here?

But wait, it goes deeper! Assuming Model 3s are turning a modest profit if you only account for Opex, and not those sunk Capex, and if Model 3 use is at least somewhat elastic based on price, then you risk driving down charging revenue and an inordinately high % of your customers are those legacy "free to charge" vehicles.

Probably what's driving this though is CA, where Tesla would rather try moderate Capex going forward and less Model 3s (and new S & X) in the mix means lower per quarter Capex requirements trying to stay on curve with SC gear demand.

 

[ℬête Noire]

I could believe that 6c is for generation cost, but not the total delivered cost.

Yeah, maybe there's some deals somewhere in NC that get close to that. Or it's the grid wholesale price or something. But average residential, all fees included, is considerably higher.

https://www.chooseenergy.com/electricity-rates-by-state/

 

[PoitNarf]

I’d gladly pay 2X the newer rates if that meant their supercharger deployment rate increased dramatically. If you’re able to do most of your charging at home and not capitalizing on that then you’re doing it wrong.

 

[SageBrush]

I’d gladly pay 2X the newer rates if that meant their supercharger deployment rate increased dramatically.

Not to mention Supercharger V3 and its higher charge rates.

Regarding costs:
I pay attention to my local electric co-op in rural Colorado, fed by Tri-state that is mostly run off coal. My home charge is about 10 cents a kWh of which 4.3 cents is generation charge from Tri-state and about 2.7 cents is a pass-through transmission charge. That is residential.

'Large power customers,' defined as having loads > 75 kW are charged a $150 a month connection fee, 4.3 cents a kWh, $10 a kW co-op charge and $20 a kW peak fee from Tri-State.

The people whining here just have NO CLUE how expensive demand charges are.

 

[happyzod]

How about we all shoot for accuracy on it? "Leeching" is an entirely loaded and inappropriate word in this case.

Those S & X vehicle purchases included an advance to Tesla for all future charging. Tesla then turned those advances, loans in effect, around and used them for Capex to build the network. Both charging gear and the IT backend.

This means that Model 3s are in effect mostly using infrastructure that was paid for by past Model S & X purchases. And you've got the nerve to point "leechers" in one particular direction here?

But wait, it goes deeper! Assuming Model 3s are turning a modest profit if you only account for Opex, and not those sunk Capex, and if Model 3 use is at least somewhat elastic based on price, then you risk driving down charging revenue and an inordinately high % of your customers are those legacy "free to charge" vehicles.

Probably what's driving this though is CA, where Tesla would rather try moderate Capex going forward and less Model 3s means lower per quarter Capex requirements trying to stay on curve with SC gear demand.

You're a bit confused here I guess. First, Tesla has had a long history of losses. That means all the model X and S cars that Tesla sold ended up losing the company money. The fact is that none of the X or S cars made any GAAP Profits for Tesla and none of the supercharging network was technically paid for by S and X "profits". Remember that Tesla had a few capital raises through share sales and debt sales. Those are what ended up paying for the Model 3 build and the supercharging network, not your fictitious loans by Model X and S owners.

Next, Tesla was GAAP profitable in Q3 2018 and supposedly GAAP profitable in Q4 2018 according to Musk. CapEx essentially turns into depreciation, so YES the model 3 ramp has made Tesla profitable through both opex AND sunk CapEx (we call that depreciation).

Finally, you are right to ponder about the elasticity of demand for supercharging. Tesla has sort of created a monopoly situation with Model 3 DC fast charging in the United States. They have a proprietary connector for the Model 3 and no adapter for any of the other 2 charging standards. Understand what that means for demand elasticity when you have a monopoly.