The transition to electric medium- and heavy-duty vehicles may do more than just clear the air; it could also lower the monthly electric bills for average homeowners, according to a study released Tuesday by Energy and Environmental Economics (E3).
The report, funded by Powering America’s Commercial Transportation (PACT), suggests that as more electric trucks and buses hit the road, the increased demand for electricity allows utilities to spread fixed grid costs across a larger volume of sales—a dynamic could lower residential rates, provided that utilities and regulators proactively manage the transition.
"Electrification is generally beneficial to utilities and their customers," according to the report. "With new electric load, a utility's fixed costs can be spread among more kilowatt-hours, thus putting downward pressure on customer rates over time."
State-specific impacts
The study analyzed two distinct markets—California (Pacific Gas & Electric) and Georgia (Georgia Power)—to forecast impacts through 2035.
In California, where electric vehicle adoption is high, the study found that residential customers could see annual bill savings of up to $20 by 2035.
In Georgia, which has more modest adoption forecasts, the impact was described as "neutral to slightly downward," with estimated residential savings of about $1 per year by 2035.
The researchers noted that these benefits are most certain when fleet operators use managed charging, where vehicle charging takes place during off-peak hours when the grid is less stressed and electricity is cheaper to produce.
The infrastructure challenge
While the report is largely optimistic, it warns of bottlenecks in local distribution systems. High-powered fast-charging stations for heavy trucks can require significant upgrades to local transformers and substations.
In a high distribution cost sensitivity analysis for California, researchers found that if grid upgrade costs are significantly higher than expected, rates could actually climb in the short term. However, the study noted that even in this scenario, the long-term growth in electricity sales would likely return rates to a downward trend by 2035.
To mitigate these risks, E3 recommends "least regrets" strategies, such as siting charging depots near existing substations with extra capacity and implementing "smart" rate designs like time-of-use pricing.
Avoiding data center risks
The report also addressed concerns that utilities might over-invest in infrastructure for projects that never materialize—a trend sometimes seen with large data centers.
Because truck and bus fleets represent smaller, more flexible loads that are tied to existing shipping and commerce patterns, the research concluded there is a lower risk of abandoned upfront utility investments compared to sprawling, single-site industrial projects.
"Early coordination between fleets and utilities... can lower system costs, prioritize cost-effective investments, and mitigate risks associated with uncertain load growth," the report concluded.
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