Commercial EV Charging Stations - Operational Strategies and FAQs

Public charging piles are set up on the roadside and long-term parking places, which are an important supplementary option to meet the needs of electric vehicle owners. Coupled with the fact that electric vehicles have entered many new markets after falling prices, especially low- and middle-income households that lack home charging conditions, the status of public charging is particularly important.

Commercial property owners can play an important role in expanding public charging infrastructure. But of course, as a business owner, you may be more concerned with the profit potential and associated costs of a commercial EV charging business.

Who is Suitable for Installing EV Charging Stations for Business?

Electric car owners need to charge their vehicles outside the home, and business owners just have the space and conditions to meet this charging demand. But what kind of businesses and commercial properties are best suited to install and host public charging stations?

Here are a few ideal business prospects:

• Residential: Commercial charging stations are essential to attract tenants, residents, and tourists to the city center. Installing electric vehicle charging stations in multi-family residential buildings such as apartment buildings and apartments can increase property value and attract potential customer groups.
• Workplace: Given that people park more often for work than anywhere other than home, offering charging stations is a great way to attract EV owners to the workforce. According to a survey by the U.S. Department of Energy, 80% of employers with on-site charging stations said that this has helped them attract and retain top talent.
• Retail areas and shopping malls: Most car owners look to EV charging locations for additional convenience—they can hang out or catch up on errands while their car charges. Shopping centers, restaurants, commercial areas, and malls can install electric vehicle charging stations to attract these types of shoppers.
• Public service places: Hospitals, universities, and public buildings usually have set sustainable development goals, and installing charging piles can help them obtain LEED certification or government funding. These locations are also often well-staffed, and as mentioned earlier, commercial EV chargers are an environmentally friendly way to attract talent.

What Are the Operation Modes of Commercial EV Charging Stations?

Commercial EV charging stations typically operate in one of two models:

• The owner is either a business owner-operator, i.e. owns the equipment and bears all of the above costs, including installation and ongoing maintenance;
• Only pay a monthly service fee.

Both modes of operation have their pros and cons, and choosing the right mode requires consideration of many factors, such as site location, total number of electric piles, and how the charging infrastructure is used.

One thing to keep in mind is that in the long run, the enterprise owner-operator model has high upfront investment and heavy economic burden, but it has the right to choose the pricing structure and control the customer experience. In a word, the economic risk of the owner-operator model is great, and the profit potential is also great.

Cost of EV Charging Stations

The cost of installing a commercial electric vehicle charging station varies widely, depending on factors such as the type of charging station, the number of charging stations, and whether additional features are required. But when estimating the cost, the priority and what should be considered is what level of charging pile to install.

Generally speaking, the higher the charging pile level, the faster the charging. But keep in mind that due to the impact of the charging capacity of the onboard battery, different cars will charge at different speeds on different levels of charging piles.

Unlike home charging, where owners typically leave their vehicles charged overnight, public charging stations tend to have shorter charging times, so most commercial facilities will need to use Level 2 or DC fast charging stations.

Cost of Different Levels EV Charger

Below is a brief breakdown of the various types of charging stations and their associated equipment costs:

• The Level 1 EV Charger requires a 120-volt single-phase AC power outlet, which is similar to a household power outlet. The cheapest, between $300 and $1500, but also the lowest wattage, usually not suitable for commercial charging businesses.
• The Level 2 EV Charger also uses a single-phase AC power outlet, but the current is stronger and faster, with a voltage of 208 to 240 volts and a rated power of 3 to 20 kilowatts. Level 2 commercial charging pile pricing depends on the specific model, ranging from 400 to 6,500 US dollars.
• Level 3 EV Charger, also known as DC Fast Charging (DCFC), is the fastest commercial charging option. The input voltage is 480 to 600 volts, and the rated power is 25 to 50 kilowatts. The hardware cost of a DC fast charger ranges from $10,000 to $40,000.

You can read this article EV Charger Levels to know the different parameters of them.

Of course, there are many more factors to consider when developing a charging station budget. Add in the following add-ons, and the final budget climbs even higher:

Cost of EV Charging Station Infrastructure

Infrastructure is the main factor that determines the final cost, because no matter what level of charging piles need dedicated infrastructure to provide matching voltage and power output. Infrastructure can include feeders and poles, overload protectors, power protection systems, supporting wiring and installation labor, and more.

Depending on specific installation requirements, infrastructure costs can range from $200 to $1,500 (level 1/2 charging piles) and even as high as $40,000 (level 3/DCFC).

The article EV Charging Station Facilities is recommended to learn more about the facilities you may consider when starting a commercial EV charging station business.

Soft Cost

The “soft costs” of commercial charging stations mostly refer to the various necessary permits and other modification costs required for installation. Including the cost of charging parking ports, charging pile logos, signaling systems, protective pillars, etc.

Generally speaking, soft costs will account for about 5% of the total cost of charging stations.

Cost of software

Utilities require commercial charging stations to be equipped with connected toll payment systems and net metering system software that monitors, secures, and analyzes data.

Most commercial charging station software costs less than $300 a year.

How do EV charging stations make money?

Installing public charging stations on commercial properties is a great way to attract new tenants, residents, and customers, increase average dwell time, and boost on-site sales.

Not only that, these charging piles can also bring direct income to the property. But how profitable are they, exactly? Can installing a charging station really bring in substantial income for commercial owners?

Simply put: it depends on the situation. The operating model chosen by commercial real estate owners determines the control rights, but there are currently two main ways of direct income from charging piles:

1. Usage fee: membership fee or charging fee paid by the driver. The common billing method is based on the electricity used or the charging time. Some sites combine the two forms, which can not only reduce the hourly rate but also ensure that there is no need to “camping” on the spot to wait for the battery to be fully charged.
2. Location-based advertising: Charging piles with digital screens can sell digital out-of-home (DOOH) advertising spaces to generate revenue. These ad slots can be sold directly to advertisers based on frequency, location or time period, or programmatically for specific audience targeting and advertising goals.

While usage fees are an effective way to offset the cost of operating charging stations, a fee structure that makes money solely on charging services can be counterproductive—especially given that many car owners can charge at home for a fraction of the cost.

Depending on your specific charging infrastructure, you can generate additional revenue by choosing a fee structure that increases utilization and increases customer dwell time.

Can I Make Money Running Electric Vehicle Charging Stations? What is the rate of return?

Consulting companies CleanTechnica and GreenWay jointly released a research report on charging infrastructure, taking the existing conditions and costs in Europe as an example to calculate the commercial return rate of operating charging stations.

As shown in the table, if it is a fast DC charging pile, the initial investment is not less than 25,000 euros, and the electricity price is 0.18 euros/kWh. At this time, as long as the charging price of the customer is 0.34 euros/kwh, the average daily use time of the charging pile is 4.8 hours. Then the internal rate of return can reach 25%. If the charging cost is as low as 0.26 euros/kWh, and the average daily utilization time of charging piles is halved to 2.4 hours, then it is a loss-making business, and the net present value of income is negative.

If it is an ordinary AC charging pile, the initial investment is only 2,500 euros, and the electricity price is 0.18 euros/kWh. At this time, as long as the charging price of the customer is 0.25 euros/kWh, and the charging pile is used for an average of 7.6 hours a day, the internal rate of return can reach 39%. If the charging cost is as low as 0.20 euros/kWh, and the average daily utilization time of charging piles is halved to 3.8 hours, then it is a loss-making business, and the net present value and internal rate of return of income are both negative.

FAQs

Is it suitable for you to invest in EV Charging Station?

Favorable market and policy support… Many people are optimistic about the charging industry, so who are suitable for investing in charging stations?

In fact, whether you have land resources, power capacity expansion and access capabilities, new energy vehicle resources, or financial advantages, you can consider joining the charging industry. Among them, six types of cooperative units can be given priority: those with experience, funds, and venues Small and medium-sized operators; photovoltaic companies and other energy resource providers; new energy vehicle dealers, time-sharing leasing, online car-hailing operating companies; logistics companies, logistics parks; investment companies that prefer heavy assets; charging pile construction index requirements and commercial parking developers of farm resources.

If you plan to invest in EV charging stations, you can refer to this article: How to Invest in EV Charging Stations – 6 Best Tips.

How to plan the site selection and construction of a Commercial EV Charging Station?

A commercial EV charging station is like a store, the most important thing is the location, so the planning and location selection of the station construction is very important! The size of the site, vehicle capacity and growth rate, whether it is convenient to stop, whether it is prone to competition, the remaining capacity of the 10KV line, etc.

Another point that is often overlooked is the problem of power loss and power consumption. All equipment in the charging station, including box transformers, metering equipment, cables, charging piles, lighting and other equipment, heat and other losses are power losses. The low proportion of this consumption accounts for about 8% of the total input power, and the high proportion reaches 20%. %. Therefore, in the equipment selection of charging station construction planning, high-efficiency and low-loss box transformers must be selected. Poor metering equipment, poor cables, and commercial EV chargers will cause power loss and power consumption in the later period to be an expense that cannot be ignored!

Can the EV Charger you bought stand the test of time and the market?

The construction of charging stations generally includes the site, high-voltage power off, equipment installation, low-voltage construction, acceptance and commissioning, and operation system installation. If you consider the station rent, maintenance costs and labor costs, the investment will be even more.

The operating income of traditional commercial EV Chargers is mainly based on charging fees and service fees, with a single source of income and limited room for growth. The standard warranty period for charging equipment in the industry is 2 years, and the depreciation cycle for EV charging station equipment is 3 years. The maintenance cost and station depreciation cost after the equipment is out of warranty are quite high. Therefore, when investing in charging stations, one must consider whether EV Charger modules and systems can support technological upgrades in the next 5-10 years.

Why is the EV Charging Station operation management platform important?

At present, the operation mode of most EV charging stations is based on business thinking, that is, waiting for customers to come to charge after the station opens, and the operation is not strong enough, resulting in low efficiency of commercial EV Charger use. The operation management platform is the key to the operation management and drainage of charging piles. There are also many third-party SaaS platforms in the market, but the common point is that the relative price of a good platform will be relatively high.

Generally speaking, the EV Charging Station operation management platform is divided into 8 modules including monitoring center, operation center, customer center, operation and maintenance center, statistical report, financial center, and system settings, and requires stable operation, rich marketing activities, and The car-machine systems of major OEMs have completed interconnection. And the platform can complete the connection with the regulatory platforms of various provinces to meet the needs of operators and users.

What factors need to be considered when opening an electric vehicle charging station?

To open an electric vehicle charging station, there are several factors to consider:

Location: First of all, a suitable location is needed, such as shopping malls, parks, hotels, public parking lots, etc. The site needs to have enough space, and factors such as site rent and maintenance costs need to be taken into account.

Charging equipment: Electric vehicle charging stations need to install charging equipment, including commercial EV chargers, distribution boxes, etc. The price of charging equipment depends on factors such as charging speed, power, and brand.

Investment cost: The investment cost of an electric vehicle charging station includes site rent, equipment costs, labor costs, maintenance costs, etc., depending on factors such as the selected site and equipment. It should be noted that the payback period of an electric vehicle charging station depends on many factors, including the geographical location of the site, utilization rate, operating costs, etc. If the location is good and usage is high, the payback period will be shortened accordingly.

Here are the different solutions for different EV charging station locations.