It’s common knowledge by now that California is ending the sale of all new gasoline-powered vehicles by 2035, and several other states have or are set to follow California’s lead. But while the electric vehicle market continues to grow, with EV sales projected to reach close to 30% of total new vehicle sales in the U.S. by 2030, so-called “range anxiety” amongst EV owners remains a problem that will doubtless persist as the percentage of new EVs on the road continues to climb.
As the name rather directly states, and as EV charging station companies already know, range anxiety is the psychological turmoil with which EV owners often contend when planning to drive their EV outside of their known network of local charging stations. It’s very real, with a 2022 survey by Forbes Wheels revealing that more than 60% of EV owners report either frequently or always rearranging travel plans or suffering from anxiety over the range of their EVs.
The solution, of course – and again, it’s one that both EV owners and EV charging station companies already know – is more cowbell EV charging stations. But what challenges do EV charging companies face in the market?
To answer those questions, let’s begin by taking a brief detour (warning: there are plenty more driving and fueling puns ahead!) through the early days of gasoline vehicles, and how the gas station market developed together with the growth of the automobile market. We’ll then wrap that up with some key takeaways that EV charging companies can use to better serve the EV market – and in the process, help to eliminate range anxiety.
The Early Days of Gas Stations
While there’s some debate as to the location and year of the first actual gas station, what is certain is that by 1905 the U.S. was manufacturing 25,000 automobiles annually – and along with that came the need for the first gas stations, which were (at best) just pumps at the side of the road. From those humble early days, the next 25 years saw staggeringly rapid growth in the market:
- By 1910, there were approximately 500,000 automobiles in the U.S.
- In 1913, the first drive-up gas station as we know them today was opened
- By 1919, gasoline sales surpassed kerosene sales in the United States
- By 1929, there were more than 120,000 gas stations in the U.S., with sales of gasoline just short of $2 billion annually
It was a staggering growth market for gas stations, necessitated by the 4500% growth in the number of autos on the road over just 20 years – a number which was to reach 23 million vehicles in the U.S. by 1930.
The Early Days of EV Charging Stations
The analogy is probably already clear: The growth in the gas-powered automotive market drove the gas station market, and we can expect that the kind of growth in that market will be similar to the trajectory of the EV charging market as more and more EVs hit the road in the coming years.
That expectation, however, is driven by more than historical analogy. Aside from California’s 2035 sunset on new gas vehicle sales, there are other forces that will drive the EV charging station market. The State of Connecticut, for example, has already mandated that beginning January 1 of 2023, most new State buildings and many new commercial and multi-family dwelling units will be required to devote certain percentages of parking spaces to EV charging stations. Nor is And Connecticut is not alone: All 50 states and the District of Columbia currently have laws and incentives relating to EV charging stations.
The ubiquity of state laws and incentives are driven by federal government requirements under the Bipartisan Infrastructure Bill (BIL), which has EV market-drivers in place. The Federal Highway Administration (FHA), for example, is overseeing a $7.5 billion National Electric Vehicle Infrastructure (NEVI) Formula Program in what it calls the “most transformative investment in EV charging in United States history.”
How EV Charging Companies can Capitalize on this Boom Market
There’s a universal truth when it comes to go-to-market strategies, and it’s as true now for EV charging companies as it was for companies like Standard Oil in the early days of gas vehicles: eEstablishing yourself early in a market that’s about to boom establishes yourself in the minds of the consumers who will be driving that rapid growth.
From that basic premise, a question arises: what steps should EV charging companies take to establish themselves before they’re outcompeted for consumer mindshare in the EV charging market? A logical place for EV charging companies to start is to ensure that they’re adhering to FHA rules and requirements relating to the NEVI program, which will also ensure that the EV charging companies are in compliance with state programs nationwide. The entire FHA-proposed rule for the NEVI Formula Program is available online, but here are a few key takeaways from the FHA rule that are designed to set expectations on which drivers of EV drivers can rely, which in turn will define the market:
- Planned EV charging stations should adhere to NEVI requirements on payment methods, customer support, and the density and type of EV chargers.
- EV charging stations nationwide should all be able to communicate on a set of common software platforms.
- EV charging stations should be able to communicate with mapping applications, providing drivers of EV vehicles with real-time access to information on things like pricing and charger availability.
- EV charging stations should have secure, reliable network connectivity that enables charger-to-charger network communication, charging network-to-charging network communication, and charging network-to-grid communication.
This latter point is especially crucial for both current and future EV charging station operations and enables a variety of features like remote monitoring and control, diagnostic capabilities, and software and firmware updating – the latter of which are crucial to proper cybersecurity.
As mentioned, the NEVI Formula Program proposed rule goes into much more detail. But the few bullet points above do serve at a high level as a reliable roadmap for guiding EV charging companies into a market that, like the gas stations of yore, is about to take off in a big way – the result of which will be success for EV charging companies, and the elimination of range anxiety in the minds of EV owners and operators.
If you’re an EV charging company and would like to talk with Kajeet about our multi-carrier approach to providing EV charging station connectivity, please contact us here.