"NRG Energy To Build A $100M Electric Car Charging Network For California"

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California announced Friday it has reached a $120 million settlement with NRG Energy over power contracts that contributed to the state’s energy crisis a decade ago, and it plans to use most of the money for building a network of electric car charging stations.

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The state plans to use $100 million of the settlement for the charging station network in regions such as the San Francisco Bay Area, San Joaquin Valley, Los Angeles and San Diego. The remaining $20 million will go to programs for lowering electricity costs for consumers.

The settlement will benefit NRG, which has gotten into the electric car charging station business and branded it eVgo. The company will be building the $100 million charging network over the next four years, NRG said. NRG was a co-owner of power plants

with Dynegy during the California energy crisis a decade ago that saw rolling blackouts and the subsequent ouster of then Gov. Gray Davis by Arnold Schwarzenegger. Price manipulations by power producers such as Enron who shut down power plants to jack up what they could charge California utilities led to the crisis. California sued Dynegy, and NRG later bought out Dynegy’s share in the power plants.

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The settlement still require the approval of the California Public Utilities Commission and the Federal Energy Regulatory Commission, said NRG spokesman David Knox. If all goes well, NRG will not only build the network but also own and operate it.

California wants to build an extensive charging station network to promote zero-emission cars. The state has an aggressive plan to reduce its greenhouse gas emissions through a variety of means, from using more renewable electricity such as sun and wind power to requiring carmakers to roll out less polluting vehicles.

Besides announcing the $120 million settlement, Gov. Jerry Brown also said he’s signed an executive order laying out goals that include putting 1.5 million zero-emission vehicles on the road by 2025. He wants state agencies to plan and simplify the permitting processes to encourage manufacturing and driving of zero-emission cars.

His plan could help many tech companies in California, which is home to several young electric car makers such as Tesla Motors, Fisker Automotive and Coda Automotive. Electric car charger makers such as Coulomb Technologies and ClipperCreek also are based in California.

Building a charging network has always been seen as a must to promote electric car driving. Existing battery technology limits the range of an electric car, unless consumers are willing to pay a premium for a supersized and therefore expensive – and heavy – battery.

Some car companies are rolling out hybrids that can switch over to a gasoline engine when the battery runs low. But those cars still command a premium over similar models that run only on gasoline. Electric cars also are more expensive now because they are not being made and sold in large volumes to help drive down production costs.

The Chevy Volt, which runs on both types of fuels, starts at close to $40,000. The all-electric Nissan Leaf costs $35,200. Coda recently began shipping its first model that it prices at $37,900. There is a $7,500 federal government incentive for buying electric vehicles.