Listen to Episode Two here!

In this episode, we break down important considerations for property owners and the steps retail sites can take to install EV charging stations. We also discuss public charging networks, the NACS connector and the future of Tesla’s Supercharger network.

Podcast Transcript

The Clean Energy Chronicles with Sona Energy Solutions – Episode 2

JS: Hello and welcome to The Clean Energy Chronicles! My name is Julia Segal, Marketing Associate with Sona Energy, and we’re back today with Eric Arroyo and Chris Kaiser from the Sona team to discuss today’s topic: electric vehicle charging in retail. First, I’m going to bring in Eric Arroyo.

EA: Hey Julia, great to be here. As we know, electric vehicles are quickly becoming a part of the fabric of everyday life. Installing chargers in the places where drivers need to charge, provides accessibility, convenience and promotes sustainability.

JS: And especially when EV drivers know they will be able to charge where and when they need to – at their homes, restaurants, shopping plazas, highway rest stops – more consumers are going to start being able to comfortably make the decision to go electric.

EA: Yeah, and when it comes to retail stores, installing charging stations benefits both the people who work and shop at the property. Charging access attracts and retains customers because your shoppers will return to a site where they know they will be able to charge. With retail sites specifically, dwell time positively correlates with customer spend. This may mean more time spent in the store while vehicles are charging, leading to a greater spend on the products.

JS: Exactly. Take a grocery store for example. Having chargers on site provides an amenity and enhances the customer experience. It also helps to improve the sustainability of the store and increases their green image, so that drives brand loyalty.

EA: Now that you’ve decided to install chargers at your retail site, let’s talk about some important considerations. When you’re installing EV chargers at your stores, it is crucial for property owners to have a clear understanding of the key variables involved – the choice of the optimal system to deploy, the budget for the procurement, installation and operation of the chosen system, and each step involved in the planning, permitting, procurement and installation of the system.

JS: You should take into consideration any constraints around electric supply availability, budget of the site owner, and any regulatory constraints with respect to your location.

EA: You’ll also want to determine the charging speed you want to offer. We recommend Level 2 and 3 chargers as they allow property owners to maximize the number of customers who can use their chargers.

JS: The charging system should ideally facilitate communication between charger owners, utilities, and users. Smart management features can allow owners to manage access and gather data on the stations to then analyze later.

EA: Another factor is safety. The chosen system needs to have built-in safeguards including software that monitors the charging process and well-designed cabling to connect to the EVs. The charging system also needs to be energy efficient both while charging and idle.

JS: Chargers should be in highly visible locations not only because they help establish the green credentials for the property owner, but this also creates an attractive opportunity for branding and digital marketing communications. A charging system that’s integrated with a digital display system can generate additional revenue for the property owner.

EA: In terms of cost, the total investment for EV charging infrastructure is not just about the costs of the charging hardware and software but also includes a variety of other hard and soft costs. Hard costs include the electric power supply infrastructure needed to support the chargers, onsite wiring, civil construction costs for the chargers, marking charging spots and providing access for the spots, and any relevant signage at the spots. Soft costs include planning, permitting and project management costs.

JS: Including EV charging stations as a part of your marketing strategy helps build up a competitive advantage and brand loyalty.

JS: We’re going to bring in Chris Kaiser, Sona’s VP of Business Operations and break this all down.

CK: Hey Julia. Thanks for having me today.

JS: So lots of retail sites are offering charging now, so what might incentivize customers to charge at your site when they have their choice of charging options?

CK: I think the main thing is customers are going to be drawn back to a location for reliable chargers. Charger speed is obviously important but at the end of the day, people want to charge where they know they can charge, and this means access to stations and that those stations actually work. Of course they’re also going to want nice amenities, so somewhere to maybe use the restroom, somewhere to buy food, drink, shop, etc. and of course that’s the retailer’s main business.

But the biggest knock on the existing public charging networks outside of Tesla Supercharger is that EV drivers experience a lot of broken chargers, chargers that they can’t rely on. And so the thing I hear time and time again from EV drivers is reliable chargers.

JS: So, in terms of going about installing, how do you recommend that properties install fast chargers? Is it ever beneficial to work or partner directly with a public charging network?

CK: I think that definitely makes sense if it’s a retailer’s first fast charging experience. For instance, in April, Walmart announced that they’d be building their own EV fast charging network. They have about 1,300 EV fast chargers currently available at Walmart facilities, and almost all of those are exclusively owned and operated by Electrify America.

Now, charge point operators typically take operating losses in the early years of EV chargers going online. So, it seems that Walmart is letting Electrify America bear the brunt of that early risk and then once those stations are online and have been active for a while, eventually it sounds like Walmart’s going to take those stations over from Electrify America.

We’d recommend that approach for retailers who aren’t ready to hire a team and spend the capital to become their own charge point operator. And then that way, they can partner with someone who will get the data and then eventually, if they want to, they can always look at installing their own chargers, and possibly building out their own network.

And when we talk about network, we’re essentially talking about the software that operates the chargers and that the EV drivers interact with. And there’s a lot of third-party software providers who will provide that back end and then the retailer just provides their marketing and displays on the front end of that software. If the retailer wants to own and operate themselves, you know, right out of the gate and not rely on a third-party charge point operator, that can work as well. They just need to be aware of the risks and challenges associated with doing that.

But also, there’s a lot of great incentives both from programs like the NEVI program, which is operated by the states, which are going to be grants to fund charging stations. Also, a lot of electric utilities will have incentives available. Typically those are for the installation of the charging stations. But occasionally those incentives will also cover the hardware itself.

And luckily, Sona can help in both scenarios, because in some scenarios, we will own and operate with our retail partners or if our retail partners want to own and operate themselves, we will help with engineering consulting and design services.

JS: So given how quickly public charging networks seem to be dominating the charger space with all things considered, do you think that they are the best option for moving the EV industry forward?

CK: For right now, the answer’s definitely yes. Kind of the elephant in the room in news recently is Tesla Supercharger network. I used to tell retailers that going with Tesla was great. They definitely have the highest rating from EV drivers from reliability, but if a retailer went with Tesla Supercharger hosted on their property, they’d only be able to serve Teslas. But in June of this year, Ford and GM and then later Volvo and Mercedes announced that in 2025, the Tesla North American Charging Standard, which a lot of people just refer to as NACS, will be available on their electric vehicles. And the reason they did that is those vehicles will have access to the Supercharger network, which I mentioned is recognized as the gold standard.

You know, one of the biggest impediments right now for EV drivers to go out and purchase an EV is they’ve heard all these horror stories about you know, existing EV drivers getting stranded because the EV charging station they pulled up to was not working. And with Tesla having the highest reliability, EV OEMs have realized that if they put the Tesla NACS connector on their vehicle, then they can allow those vehicles to charge at the Tesla Superchargers, thus increasing the reliability for EV drivers and increasing sales of those EVs.

So now in the near future, if a retailer wants to host a Tesla Supercharger, they’re going to be able to charge Teslas which are, you know, the highest brand of EV on the road. And then now Ford, General Motors, Mercedes, Volvo and then of course, you know, any other future OEMs. There’s not many other ones out there, maybe Volkswagen is the biggest one who hasn’t yet made the announcement. And so, you know, it’s really hard for other charge point operators to compete with Tesla. But I think there are areas where, you know, maybe Tesla may not be the right fit, and maybe there’s an existing Supercharger a mile or two down the road, and Tesla doesn’t want to add another one, or maybe a retailer is a quick service restaurant and their parking lot might be too small where Tesla’s not interested in looking at the location. In which case there are other niches I think, where other charge point operators can still be effective. Of course, those charge point operators are probably going to want to have EV chargers that have that NACS connector in addition to the existing common connector type, which is called the CCS.

JS: So how should these other OEMs go about deciding whether or not they are going to integrate to the NACS charger? Or is it a matter of a decision making point for them? Should they consider multiple options? What is your general take on what non-Tesla EV companies should be looking to do going forward?

CK: Oh, that is a good question. I think you know, it seems that at first when it was just Ford who made the announcement, it could have gone either way but now with all these other companies announcing that they’re going to use the Tesla standard, it seems like there’s a lot of momentum behind that. And it seems that a lot of people in industry feel it’s inevitable that in the next five years, all OEMs are going to adopt that Tesla connector and then that’s going to be a true standard. You know, right now, it’s not a true standard, it’s operated by Tesla. But Tesla has announced a willingness to work to make it a standard, so that connector can be used by all OEMs and then it’s just a matter of getting the EV charging station manufacturers to figure out how quick they can find those Tesla cords and integrate them and get UL approval on integrating those cords with their charging stations.

JS: So is this something that’s all going to be happening rather quickly? How far into the future are we looking for all this to start shaking out?

CK: Yeah, that’s a great question and the one thing I always say on all things EV charging related, is they always take longer than everyone thinks they will. And so you know, Ford and GM made the announcement that starting in 2025 – we’ll see, that is probably going to be the case. How quick Tesla’s going to open up those stations or, you know, their stations will probably be open right away, but then, you know, what are the ripple effects are going to be a result of this decision and does that mean that those stations are going to start getting too crowded, in which case, maybe that’s going to be beneficial for other charge point operators, because now you’re going to have Tesla drivers who might be looking to find stations that don’t have a queue waiting to charge now that you have, you know, Ford and GM vehicles now going to be lining up at Superchargers. But I think there will be a fairly long timeline for this to fully roll out and for us to fully see the impacts of these announcements that were made last month.

So right now we’re in a little bit of a wait and see, at least as it pertains to other charging manufacturers and charge point operators. So you know, the manufacturers being companies like ABB and Tritium and Charge Point and other charge point operators, specifically, the big ones, EV Go and Electrify America. They’ve all made announcements that they too plan to integrate the NACS connector, but there haven’t been specifics made on when those new stations are going to be available.

So we’re kind of in a wait and see but right now, there has been kind of an upheaval in the EV charging industry over the last month or two with these recent announcements.

JS: And do you think this is going to drive any sales away from Tesla? Or not necessarily? Is it going to encourage people to look to buy from other manufacturers? Or do you think Tesla is going to keep climbing?

CK: That is another good question. And honestly, I don’t know. For the longest time one of the biggest reasons to buy a Tesla was the fact that they had the Supercharger and if you bought any other vehicle, you couldn’t use the Supercharger. But now that more vehicles will be able to use the Supercharger, I don’t know if that’s really going to sway people. You know, at this point, Tesla has become so much bigger than just an EV, it’s become a, you know, one of the most famous brands in the world. And so people who are going to buy a Tesla kind of have their mind made up, it seems like before they start doing a lot of research. The vehicles have great reputations, the chargers have great reputations, but it certainly makes that decision I think a little bit harder.

JS: So looking forward, do we want all public EV charging to be dependent on and revolved around a single company?

CK: That is another one where it’s kind of like wait and see. And I think there’s certainly parallels to discussions around Amazon, right. So when Amazon, you know, they started selling books, and then they now sell everything and there’s an Amazon package at my door like every other day. But I don’t necessarily know if that’s a bad thing. You know, it seems like it’s been good for my family. And so you know, I don’t know if Tesla becomes this, I’m trying to shy away from the word monopoly. If they continue to have excellent charging experiences and excellent reliability, then, you know, maybe that’s not a bad thing.

Now, one thing I question is, you know, are the Tesla Supercharger locations going to start getting very, very, very crowded, and Tesla is the best company at deploying those stations. But it’ll be interesting to see if they can keep up the deployment with the number of people who want to use those stations and if that becomes an issue, what opportunities might present for other ChargePoint operators.

I know one thing we’ve spoken about at Sona with our quick service restaurant customers is because they’re smaller footprint parking lots, Tesla, you know, at this point is typically looking for locations that they can charge more than a quick service restaurant might want to give up in terms of parking spaces. So there’s kind of a niche for maybe smaller charge point operators who are fine with a smaller footprint but to the question of you know, is it a bad thing if Tesla continues to dominate the EV charging space? I don’t think so just because their track record so far has been so good.

You know, the main thing to look out for I think would just be congestion at those Supercharger locations, but I think most people would trade congestion for reliability or in other words, they might be fine waiting a little bit if they know they can actually charge when they need to verse, what is often the case in the non-Tesla charging experience world right now where there might not be a line, but the charging stations don’t work. You know, is it good or bad? It certainly provides a more interesting competitive environment and time will tell how that plays out.

JS: I think that’s a good place to wrap up for today and I know that Chris, you as well as Sona’s LinkedIn page will definitely have more to say about this in the coming few weeks and months as things start to play out so definitely keep up to date on Chris’s newsletter and on Sona’s page. And thanks for tuning in, you can be sure to check out our website, www.sonaenergy.com and you can find the transcript from today. We’ll also be posting that to LinkedIn. Make sure to follow along and stay tuned for episode three. See you next time!