How to Start an EV Charging Business?

Even if you don’t have an EV yet, you can still get in on the EV action by starting an EV charging business. As electric vehicles (EVs) grow in popularity, so does the need for places to charge. You can fulfill that need and there is no time like the present to enter the market. Why now? The federal government is offering billions of dollars to businesses that want to be site hosts to fast chargers.

Like gasoline-powered vehicles, EVs have a limited range. Unlike gas-powered vehicles however, they do not have a tank that can be filled in a couple of minutes. Instead, EVs take time to charge and need to be plugged in to special EV charger hardware units that sell electricity. Not only can you charge for the electricity you sell, you can also charge connection fees each time a person plugs in to your stations. In addition, EV chargers attract customers to your existing business that will spend more time there than customers filling a gasoline tank!

If you own the stations, you can set the prices you want to charge based on the time of day, market demand or other reasons through a smart phone application or web site portal.

To build a traditional gas station, special underground tanks have to be constructed which can be cost-prohibitive. EV charging stations can go almost anywhere – indoors, outdoors and even remote places where there is no electrical infrastructure.

Here is what you need to know to start an EV charging business that can benefit your entire community. EV chargers generate economic activity. As an added bonus, with more EVs in your community, air quality will improve which can positively impact the health of the general public in your area.

How to Choose a Good EV Charging Site

As more drivers switch to electric vehicles, clean, safe charging sites with reliable charging stations are sought after and have an opportunity to sell their electricity at a premium.

EV owners plan their commutes and driving routes around stations that offer the most consistent services. By being the first in your market to provide EV charging stations, you will establish yourself as a reliable charging site early on, allowing you to capture revenue and build loyalty as your station becomes part of drivers’ routines. In addition, if you start your EV charging business soon, you can take advantage of significant tax credits and government grants that may apply.

Once you have a location in mind with suitable space, consider the best place to install the chargers so they are visible and convenient for drivers.

EV drivers need to see your new charging stations to know they are there and available. Many businesses place them at the front or the center of their parking lots to ensure maximum visibility. This also helps protect the charger equipment and gives waiting drivers a sense of safety.

You need access to power to have a successful experience for your customers. Keep in mind the longer the distance electrical conduit runs from the power source, the greater your installation costs, which will take more time to reach profitability.

In very remote locations and areas where there is no power infrastructure, you can still offer EV charging with the use solar panels and a power storage system to provide energy to your chargers

What Are the Best Locations for EV Charging Stations?

As electric vehicles continue to increase their penetration in the automotive market, EV charging stations are an attractive business venture for several reasons.

If you already own another business, EV charging stations can bolster your existing revenue by adding a new revenue stream, and extending customer visits and spending at your business.

While EV drivers save significantly on charging costs when compared to using gasoline, it has been shown that they tend to spend more in site host businesses while waiting for their vehicles to charge. This additional revenue can significantly reduce your time to profitability.

EV chargers offer you a competitive advantage, giving drivers a reason to choose your business over competitors. In addition, they help you become part of the customer’s routine and build your relationship with EV drivers. In turn, those positive business relationships can improve customer satisfaction and loyalty.

Your EV chargers may also serve as an amenity to employees and increase your property value.

Although any location offers some potential, these spots are proven winners for start-up EV charging businesses.

• Business districts and shopping centers. Outside of home and work, people enjoy going out to eat at restaurants and shopping in stores. Public parking areas that host EV charging stations attract customers that will spend time and money while waiting on their vehicles to charge. If you own a retail development, having charging stations may be attractive to potential tenants.

Hospitality businesses stand to gain more customers when adding EV charging as a revenue stream. EV drivers arrange travel around where reliable charging stations are located. Installing charging stations can put your business on the many EV charging site maps for these visitors. Installation costs can be significantly lower for lodging businesses because they typically opt for level 2 chargers which take four to eight hours to charge and are lower cost to purchase and install. Because customers at hotels are parked for extended periods of time and don’t require a rapid charge, level 2 chargers are a great option. We will go into the different levels of charging in the next section.

• Multi-family complexes. Though EV drivers appreciate the convenience of charging at home, EV owners that rent homes may not be permitted to install charging hardware due to contractual limitations. Entrepreneurs can work with condos, apartment buildings, and townhouses to provide this valuable and attractive amenity for residents.
• In an era when attracting and retaining top employee talent is critical, EV charging is a valuable amenity.

What Level of EV Charging Stations Do I Need?

EV charging stations come in three different levels. Level 2 and Level 3 chargers are the viable options you should consider for your business.

Level 2 chargers are the most appropriate for commercial parking spaces where drivers will be parked for 4-8 hours. The amount of time a car is parked for charging is called dwell time.

You may see level 2 chargers mounted on walls or on pedestals.  Since they take about four to eight hours to fully charge a near empty EV, they are a great option to place at businesses where people tend to visit for a few hours such as shopping centers, multifamily/rental complexes, hotels, movie theaters and workplaces. Level 2 chargers add up to 40 miles per hour using up to 80-amp electrical connection.

Level 3 EV charging stations are DC models that offer the maximum convenience and revenue per kilo Watt hour because they charge batteries quickly. For this reason, they are rapidly growing in popularity and becoming the go-to for businesses like gas stations and grocery stores. Although they are more costly to install than Level 2 chargers, they are in higher demand and can generate much more revenue. Using the CCS1 standard connectors, they are compatible with more EV models than ever.

Level 1 charging primarily occurs at single family homes. They are very slow, which is why we do not recommend them for businesses. Level 1 chargers come with EVs, and plug into standard residential electrical outlets. These charge about five miles of travel for each hour it stays connected.

Selecting Appropriate EV Charging Stations

It is important to research EV charging hardware options to understand the costs, features, pros and cons of each product.

You should consider purchasing a long-term maintenance plan to help properly care for your investment.  If your charger is not functioning properly, not only is it not earning revenue, but it can also earn your site a negative reputation.  Drivers post reviews on charging site locator apps and websites, including Google. When stations are not functional, they are considered to be “down.” Achieving the highest possible “up-time” is critical to establishing a great reputation and ensuring sustainable success.

Focus on these qualities when choosing your hardware to be sure you select the right product to meet the growing demand for EV chargers:

• It helps to have EV charging stations with cloud-based features, remote maintenance, and online connections.
• Each product should have a lifespan rating that leads to profitability while having the flexibility to adapt to changing market conditions.
• The equipment should comply with all applicable safety and quality requirements.
• Repairs and maintenance can impact your profitability if you don’t have a maintenance contract for your chargers. Choose hardware that is designed to withstand weather in your area and other substantial impacts such as salty air near the ocean, frozen precipitation, excessive pollen or fallen leaves, while continuing to charge safely.

Marketing Options

Your new EV charging business should strive to be recognizable and visible, not only physically, but online. EV drivers use several apps to locate chargers available and rate them for functionality, safety and accessibility. For this reason, you want to be sure to promote your charging locations on these apps.

Encourage your users to leave positive reviews for your site to gain visibility and a reliable reputation on locator apps.

In addition to online promotion, some chargers can be branded with graphic wraps that feature  corporate branding. Some chargers have interactive screens that can feature advertising, inviting chargers to enter the site host and take advantage of special promotions.

Site Design

Charging station spaces require proper markings, consistent access, and supportive design features such as lighting and signage.

Video surveillance is crucial to the success of this venture because people need to feel that they and their EVs are safe before, during, and after the charging process. Using surveillance equipment will achieve this as well as protecting your investment in the chargers and infrastructure.

It is important to consider EV drivers that are disabled and may need special accommodations for parking and access. While this may cost extra, it is critical to make your site accessible to everyone. Typically, 4% of spaces need to be accessible for disabled according to the American with Disabilities Act. If you have less than 24 parking places, one space is sufficient to achieve the requirement.

Point-of-Sale Charging Software Solutions

The point-of-sale software platform running the charging stations for your EV charging business should offer a centralized view of your entire charging ecosystem. This maximizes profits by creating performance efficiencies and keeping you informed about the usage and revenue generated by your equipment, as well as its functionality.

Some chargers use a cellular connection or hard-wired phone connection and cloud-based software enabling the charger to accept payments.

Some chargers are not connected to a platform at all. While these are simpler to use, they have limited functionality.  Without these platforms, you may miss out on revenue or not know when your chargers go down.

Proper cloud software platforms deliver full control over the customization settings of each station, including power output, access, and pricing.

When shopping around for software providers, you’ll notice that some offer more features while others charge lower fees. The goal is to find a balance between your investment budget and the level of control you want.

Keep in mind, a few charger manufacturers do not allow third party software. This restricts your level of control and could lower your profit margins. Some cloud platforms allow drivers to reserve time at the charger and notify them when their vehicle is charged so they can move along and free up the space for another customer. Some platforms enable you to advertise the site host on the app, encouraging EV drivers to patronize the site host business.

Consider the level of customer service available from cloud platforms. You may need service and your customers may also require assistance.