Electric vehicles are rapidly becoming more and more mainstream (currently less than 1% of new vehicles sales in US), however they are still in the early stages of the product development curve. In order to make the jump to a growth stage, a few questions must first be answered. How soon will EVs reach price parity with equivalent gasoline and diesel vehicles? Will automotive OEMs invest soon enough in the education of the public on electric vehicles? Will there be enough charging station infrastructure to serve the demand? Where will charging stations be installed and will the price be right for drivers? This last question is what will be focused on in this post.
Before we delve into free vs. paid charging, we must look at where we expect charging stations to be installed and utilized. Over the past few years, there has been huge growth in stations at retail locations such as malls, restaurants, and grocery stores. This was all well and good when the best and most popular EV on the road only had 80 miles of range (on a good day) and drivers had a high willingness to pay for that extra bit of energy to make it home comfortably. Retail located charging stations had high usage then, however as vehicles began increasing in quantity and getting longer and longer ranges, those retail locations simply became convenient ‘topping off’ points. Fewer and fewer drivers now rely on these stations outside of the rare emergency charge. This begs the question, if you can charge at home, why would you pay for charging in public? Let’s dig in...
Pros to free public charging
Drivers don’t have to pay for electricity
Less expensive charging stations can be installed, saving the property money
Cons to free public charging
Stations may not be maintained well due to nobody managing the station
Without revenue, the property will not be able to recoup capital or operating expenses
Drivers have no way of knowing the real-time availability of a station prior to arrival
Properties are unable to track usage of their stations if they opt for the less expensive charging station ($500-$1000). For a station that can track usage, the minimum cost is $6,000
Drivers can leave their fully-charged vehicle plugged in with no penalty, preventing others from charging their vehicle
While there is a fairly hefty list of cons to free public charging, the market will ultimately have to decide. Our prediction is that there are four primary viable locations for charging stations: residential housing, multi-family housing, inter-city stops, and long-term public parking. Residential locations will obviously not charge money for use for the homeowner, however there are companies like eMotorWerks working to make residential charging stations accessible to the public. Multi-family housing is a difficult scenario given that drivers live there but also don’t own their own parking space and electrical room. We envision most complexes charging enough to cover the cost of electricity so each tenant pays for what they use, while the capital expense is covered by the complex as an amenity for tenants.
When it comes to inter-city travel, we definitely see paid charging stations being installed along critical corridors (similar to Tesla’s superchargers which are only accessible to Tesla vehicles). These stations will have to be high power DC fast chargers (DCFC) that range in power from 50kW to 350kW and deliver a full charge in 30-45 minutes or less. Stations that can deliver this much power come with a hefty price tag in the tens of thousands, not to mention additional installation costs. In order to recoup expenses, these stations must charge for electricity, and they will most likely charge a significant margin over the price of electricity in order to break even in a reasonable amount of time.
Lastly, we have long-term public charging stations. As higher capacity batteries make their way into more cars, there will be less need for quick top-offs but rather only charging while your car is already parked. These can be found at some workplaces, as well as airports, public parking (i.e. Icon Parking, Lanier Parking, etc.), and even car dealerships. These properties have similarities to both multi-family housing and inter-city travel locations in that they will charge for electricity to recoup costs, but won’t charge extreme amounts due to lower capital expenses required for the lower power stations.
These are just our (fairly educated) predictions and only time will tell if we are correct. At TEQ Charging, we are working to remove capital cost as a barrier to entry for those installing stations, and at the same time ensuring that drivers have a superb experience across our entire network. If all goes well, we will be able to help lead the way to making these predictions a reality.