EV charging stations -- unused -- in a parking lot
AFP via Getty ImagesGas stations are a business. They sell gasoline to drivers and make a profit, just like any commodity vendor. But charging for electric cars is very different. Even though it was estimated in 2020 that there are 26,000 EV charging stations with over 86,000 plugs, and a much larger number of home charging points, they are generally not a business with a few exceptions.
EV buyers tend to be homeowners. That means they install some sort of charging at home. There they buy electricity at the consumer price, but usually arrange for “time of day” pricing where the electricity is cheap at night, and that’s when they charge. That costs from 8 to 16 cents/kwh, or roughly 2 to 4 cents per mile of driving. The power company sells electricity but is not even aware they are in the EV charging business.
Many others charge at work. Even homeowners do this because many employers offer the charging free to employees as a perk and to encourage green driving. If they do charge a fee, they’re not in it as a business like a gas station.
For the modern generation of EVs with 200 miles of range, their owners can charge at home or work and never need to do any more for all their driving around their town. They may see EV charging stations at stores and parking lots but have no great motive to use them, though they will use them if they are free. A lot of them are free, put there as a perk for customers or again to just promote green driving. But many drivers don’t even bother plugging into the free ones. It’s a hassle, and a typical parking stop for shopping or dining would be unlikely to get even $1 worth of electricity.
There are charging stations that cost money and try to be a business. But they usually cost a bunch of money — 25 to 55 cents/kwh. That’s 2 to 5 times the cost at home, and nobody’s going to plug in unless desperate.
Imagine what gasoline would be like if everybody had a gas station at home where they filled up slowly every night for $1.00/gallon. How often would they stop at an ordinary station charging $3.00/gallon? Only in a desperate situation, or when far from home. Running a gas station would not be much of a business!
As noted, this changes when far from home, on inter-city trips. There, one must charge at public charging stations, ideally fast ones. (Not always, as many hotels offer free charging for guests, reducing some of that need, and more will in the future.)
This EVgo station has 2 stations, each with both types of plug -- plus a Tesla adapter for rent. ... [+] It's one of the few run as a business. The store owner doesn't get revenue but hopes people stopping to charge will come and shop since they have nothing else to do.
Brad TempletonThe fast charging world began with Tesla TSLA . When Tesla first built their supercharging network, they made it free for all customers. It wasn’t there to sell electricity, it was there to sell cars. Later, Tesla stopped giving free lifetime supercharging, and charges a rate around 25 to 30 cents/kwh. That’s quite a bit more than charging at home, but Tesla says it is their break-even price. Again, they are not running the charging network to profit off selling electricity, they want to sell cars.
The largest non-Tesla network is being built by Electrify America/Electrify Canada. This project has been funded by Volkswagen, as a penance for the “Dieselgate” scandal. While it operates a bit more like a business, that’s not why it’s being built. A typical price there is 43 cents/kwh (31 cents for users who pay a $4/month membership fee.) This price could make a profit, but it’s not as easy as it seems. Fast charging stations are expensive to build, and electricity prices vary during the day, and can exceed that 43 cents during the peak hours of summer. Fast charging stations are rarely used at night when the power is cheap. Tesla’s claim that they break even around 28 cents suggests EA doesn’t make a lot of profit and is there to be something other than a business.
Truth is, at 43 cents/kwh, interest also wanes. That’s 11 cents/mile. With today’s $2/gallon cheap gas, a hybrid car like a Prius can be a fair bit cheaper than that, and while EVs have many other advantages than fuel price, people don’t like paying more than the price of gasoline.
If you’ve charged an EV, you’ve probably come upon a station with the Chargepoint brand. They’re the largest brand in making and managing charging stations. The key is that they only manage them. Chargepoint don’t generally sell you electricity — Chargepoint just sells the station to somebody else who wants to sell or give you electricity, and most of them are not trying to run a business. Chargepoint figured out early that selling electricity wasn’t the business it wanted to be in.
Not all agree. EVgo is a charging station operator who sells electricity with both slow and fast-charge stations. Even they admit there may not be much business from the ordinary consumer. In the city, they face the issue of most people having that $1/gallon station at home every night. Instead, their plan is for a business charging EV fleets. While many fleets can charge at a base, running and installing a charging array there may not be that much cheaper than making a fleet contract with a provider like EVgo — particularly if they want to charge mid-day or away from base.
Because charging is not a business, it has had negative consequences on charging stations. Many stations were installed thanks to government subsidies. They were often put in odd places nobody would want to charge and sit vacant a great deal of the time. Worse, because the money to build them came from sources other than the money (or lack of money) to operate them, they are often in bad repair. One of the best directories of charging stations, plugshare.com, has many stations reported as broken or offline. This even extends to the fast-charging networks, where reports of outages are common and repairs can come slowly. This is a problem for people attempting to do road trips with CCS or Chademo fast charging, since you are absolutely dependent on there being a working charger in many of the locations.
Tesla superchargers tend to be reliable and help sell Tesla cars, rather than make a profit on ... [+] electricity.
NurPhoto via Getty ImagesTesla’s network is not run for profit but because Tesla owners are very vocal and buy their cars in part for the ability to do these road trips, Tesla maintains the network which is exclusive to their cars and does it well. Other networks get frequent complaints of outages, with occasionally stranded drivers, though smart drivers check reports and plan for potential outages. While Tesla tends to build large charging stations placed further apart, where the outage of one sub-unit is not a problem, other networks tend to make stations with just 2-4 chargers, but spaced more closely so that with planning, drivers can get to a different one if equipment has failed.
According to reports, many networks have problems, but apparently the stations operated by Plugshare have a higher reliability result. Problems are more common in networks run for other reasons, such as state-funded EV-kickstart networks and power company networks or other networks put in for political reasons rather than business ones.
The real problem is that customer service is only given to customers. And if the driver wanting to charge isn’t the real customer, the service will not be great.
There are many drivers who can’t charge at home or at work. They buy fewer EVs today but want them. They are forced to charge at public charging stations. This is not nearly as attractive a proposition — the price at those stations is more than gasoline in a hybrid, and and stopping and charging can be very time consuming. People with such cars hear the regular promises of fast charging that takes 10 or even 5 minutes and salivate, but charging at that speed is going to be expensive because of the immense power flow required. There might be a business selling these drivers power at the higher price, but those drivers will always want to find another way to get their power at a better, more convenient price.
That demand will lead more apartment blocks to install charging in portions of their parking lots. They will either do it because it becomes a necessary amenity to get such tenants, or in rent-controlled units and other situations, they may install it to sell electricity. Charge-where-you-park does not need to be fast charging, and as such the installed cost is lower, and charging while you sleep requires no travel or time compared to fast charging, so this will be more profitable than selling fast-charging to these customers. To top it of, night power can be 1/3rd the price of the daytime power needed at fast-charging stations, another big advantage for installing charging in these lots.
It should be noted that while gas stations do sell fuel at a profit, many try to get more of their profit from convenience stores, car washes and other services. In effect, EV charging stations located with shopping may also use this approach. Today, though, it’s not that productive to charge at level 2 during a 30 minute shopping stop.
On the other hand, fast charging on intercity road trips is often paired with a meal. Because charging today takes 30-60 minutes, it is the common practice to eat while doing it — making it take effectively zero time rather than an unacceptable wait. Everybody on a long road trip has to eat, it’s just a question of where and when. It is obviously not an ideal choice to eat only in limited locations, but in time this will improve. Today, the restaurants next to fast chargers don’t do any “combination” deals but this could change, with food and charging bundled together in some fashion, or even things like pre-ordering food delivered to your car or ready when you arrive to speed up the process. A fast-charge of 50kwh is about $15 at Tesla’s break even price, so it would have to be a fancy restaurant that bundled it in for free, but this is an area for entrepreneurs to explore. People stopping for charging definitely want to make productive use of their time. That will be true until the mythical 5 minute charge is developed, and even so, the 5 minute charge is likely to be more expensive than slower charges because of the cost of megawatt-capable charging gear.
Today, the cheapest power is at night. The most expensive power is from 3pm to 9pm. As more and more solar power is put on the grid, however, this will change. 3pm to 9pm will continue to be expensive, but there will eventually be a surplus of solar power from 8am to 3pm. Indeed, those imagining future grids wonder what to do with all that extra solar power, since it has to be stored to be useful, since the demand to use it is not present.
When this happens, the power prices will flip, and the 8am-3pm period may become the cheap power while night becomes more expensive, since it can’t come from solar and must come from storage, nuclear, hydro, wind or fossil.
The best place to put that extra power is into cars. Unlike almost all other loads on the power grid, cars can be very flexible about when they take the power. 95% of the time, they just need to add their average demand every few days. On special days with long trips they are more demanding. As such, they would be very happy to get low prices on power by being flexible about when they take it. That means, once plugged in, they will charge opportunistically when there is a surplus, including from solar and from wind. (Wind turbines are even more eager to be sure somebody will take any unplanned power they have. There are times when the price on the grid goes negative because nobody nearby wants it.)
To make this work, cars need to be plugged in during those hours. Cars that don’t commute and are still at home can do that, but otherwise it means putting in charging connections where commuters park. That includes parking lots and even along the streets.
The need of those with surplus power to sell it is so great in the world of renewable power that providers expect power companies might well pay to install charging in these commuter spaces just so that they can be sure to sell their extra power. These stations will still work at night for people who need to park on the street and want to have electric cars.
Of course, before too long, it will be very common for cars to be able to move on their own to charging stations and even plug in without human help. This actually reduces the need for building too much of the infrastructure described above. Cars will get a notice, “there’s surplus solar right now. If you’re free and need power, get yourself to a charging station now to get a great price.” And so they will. (With good forecasting, surplus power is often predictable well in advance, too.)
Many imagine that these cars will also feed the power they picked up during this surplus period back into the grid during the peak demand times and even the night. This idea is called “vehicle to grid” and requires special inverters and other tools to let the car’s battery feed the power back, ideally with custom waveforms to also offset unusual power factors in grid demand. While this is expensive, it is possible, but the reality is that just having the cars pick their charging time based on messages from the grid about price breaks (or to meet contractual agreements) provides a great deal of the value without needing any special equipment at all.
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