Covington isn’t getting those free electric car chargers after all, because the firm handling the federal project, ECOtality, is reportedly on the verge of bankruptcy and has had its stimulus funding cut by the U.S. Department of Energy.
Covington grant writer Randy Conner wrote a memo to the mayor and council Aug. 22 saying the city would not be participating in the EV (electric vehicle) Project because of questions surrounding ECOtality.
"Earlier this week, we received a call from Ace Electrical informing us that ECOtality was now under investigation by the Federal Trade Commission and, allegedly, some very unscrupulous business practices have taken place which allowed ECOtality to receive the $100-plus million in grant funding," Conner said in the memo.
"For this reason, we are going to pursue other options as we continue to seek facilities for charging electric vehicles. I have a call in to Don Francis with Clean Cities Atlanta, who is our main contact with the Department of Energy, to investigate further options."
Conner said the city didn’t have a chance to fully investigate the deal because of the quick deadline required to apply for free electric vehicle chargers; San Francisco-based ECOtality revealed its financial woes in an Aug. 12 filing with the Securities and Exchange Commission.
The city had hoped to get two to three electric vehicle chargers at no cost through the Energy Department’s $114.8 million EV Project, which was set to enable the building of between 12,000 and 15,000 electric chargers of different sizes and capabilities in major metro markets across the country. Covington’s participation was going to test how often the chargers were used in an outlying area.
Conner said Thursday the city will continue to explore electric vehicles for its fleet. As an electricity wholesaler, the city would see even bigger savings from electric vehicles than the general public; Conner previously estimated the electric equivalent cost to a gallon of gasoline would be around 25 to 30 cents for the city.
"Our analysis still shows this to be the optimum fueling source for our short-range fleet; our funds may need to be spent on the charging facility instead of the vehicles," Conner said in a Thursday email. "We are applying for funding to acquire CNG (compressed natural gas) and electric vehicles."
According to the Associated Press and other media, ECOtality has suffered several setbacks, including limited commercial sales of its electric vehicle chargers and equipment, poor test results for a new charger for industrial customers, overheating issues in existing chargers and being forced by the U.S. Department of Labor to pay $855,000 in back wages and damages. The company is also being sued by multiple law firms for allegedly misleading investors.
The company said it hired FTI Consulting to find new sources of financing, cost-cutting steps, staffing needs and to help with the possible sale of the company or its assets, according to the Associated Press.