As the popularity of electric vehicles (EVs) grows, so does the need for reliable and convenient charging solutions. While residential chargers are available, they are often slower than commercial charging stations, and drivers may forget to charge their vehicles before hitting the road.
This presents an opportunity for entrepreneurs to take advantage of the growing demand for EV charging capacity. But how do EV charging stations make money, and what are the steps involved in starting an EV charging business?
In this blog post, we'll explore the ins and outs of owning and operating an EV charging station, from finding the right location to choosing the best charging equipment.
Why Can an Electric Vehicle Charging Station Business Be an Opportunity?
To support the transition to EVs, the US Department of Transportation announced the National Electric Vehicle Infrastructure (NEVI) program in 2022, a $5 billion initiative to deploy a national network of EV charging stations on major highways.
The program is designed to instill confidence in drivers considering the switch to EVs, encourage private investment in charging infrastructure, and support President Biden’s goal of reaching an EV market share of 50% of all vehicle sales and establishing a network of 500,000 charging stations by 2030.
NEVI funding will be allocated over five years until 2026. The Biden Administration’s Bipartisan Infrastructure Law will invest $7.5 billion in EV charging and $10 billion in clean transportation. With more than 3 million EVs currently on the road and only 130,000 public charging stations in the US, there is a large gap to fill to reach the 2030 goal.
The financing from these initiatives will help businesses to cover the cost of installing and owning EV charging stations, making it an attractive investment opportunity. By getting in on the ground floor of this growing industry, entrepreneurs can help shape the future of transportation while generating a steady stream of passive income.
How to Start Your Own EV Charging Station Business?
Interested in starting your own EV charging station business? Here are four key steps to get you started.
Step 1: Identify Your Business Model
Before you invest in any charging station equipment, it is important to understand how to make money from an EV charging station. There are four primary types of EV charging businesses:
- Charging station companies that own and operate chains of chargers;
- Turnkey installers that supply and install charging station equipment and software for other businesses;
- Service providers that offer ongoing maintenance and financing programs to charging station owners;
- Consultants that provide advice to businesses on equipment and software selection and operation.
To streamline this guide, we will concentrate on the process of launching a charging station company.
Step 2: Choose the Right EV Charging Stations
To select the appropriate EV charging station, It is important to understand its key features, such as charging speed, power output, charging capacity, and the number of charging ports.
Conduct thorough research on equipment suppliers with a reputation for high-quality products and customer service. You should also research the needs of your local market to decide on the type of charging station that is likely to attract the most demand.
Choose equipment that is reliable, efficient, safe-compliant, weatherproof, and compatible with different EV models. Opt for smart software that supports Internet connectivity and enables remote maintenance, management, and control.
Step 3: Choose the Right Spot
The location of EV charging stations depends on visibility and access to a power source. Installing charging stations close to a power source will reduce setup costs while placing them in high-traffic and easily visible locations will help attract regular customers.
Targeting a single vertical market, such as multi-family housing units, workplaces, hotels, or restaurants on frequent travel routes, is a good starting point. Explore partnerships to set up your first charging locations and gradually expand your charging network.
Step 4: Design and Install Your EV Charging Stations
Consider factors such as electrical supply, safety, space, accessibility, energy efficiency, network connectivity, smart metering, and payment systems when designing and installing your EV charging stations.
Test the charging stations before opening them to the public, and ensure that the payment and network systems are fully functional.
Finally, promote the new charging station site to attract EV owners and encourage regular use.
What's the Cost of Installing EV Charging Stations?
The average initial cost of installing a Level 2 EV charger in the US is around $6,000. For a charging station with 5 or 10 charging points, the cost could range from $30,000 to $60,000, with ongoing expenses for the electricity supply and equipment maintenance.
The full cost of opening a charging station depends on factors such as materials, infrastructure, and installation.
Preparing the site can often constitute the most expensive stage, incurring expenses for purchasing and installing the electrical infrastructure, wiring, connectors, and concrete. Repainting and adding custom branding signage also raise upfront costs.
Once the site is ready, the cost of installation varies depending on the location, power supply service, number of chargers, labor, permits, and taxes.
Ways to Reduce the Cost
While installation costs can be significant, a reliable contractor can help minimize expenses by identifying bulk order discounts and other cost savings opportunities.
Additionally, tax incentives are available under government plans to attract investment for a national EV charging infrastructure. The Alternative Fuel Vehicle Refueling Property Tax Credit, extended under the Inflation Reduction Act, allows qualifying EV charging installations installed after 2022 to receive a federal tax credit of 30% up to $100,000.
In addition, there are local incentives available from some state governments and public utilities for buying and installing EV charging stations.
Another way to reduce ongoing operational costs is to install on-site solar panels to provide electricity supply rather than paying for power supply from the grid, although solar power systems have high upfront costs.
Electrly: A Reliable EV Charging Solution Provider
Electrly is the perfect partner for anyone who wants to start an electric vehicle charging station business. Our skilled and professional team offers a full range of services from research and development to after-sales service. We are committed to customer satisfaction and strive to improve the customer experience in every task we undertake.
Whether you are looking to level 2 AC EV chargers or DC fast EV chargers, Electrly has the ideal product to meet your needs. We take pride in our commitment to quality and reliability, ensuring that our products meet the highest standards.
Contact us today and we will provide the perfect EV charging solution for your business. Trust Electrly to be the ideal partner for starting your EV charging station business.
Capitalize on Growing EV Demand with a Charging Station Business
As electric vehicle adoption grows, the demand for charging locations will increase exponentially. To meet this demand, an extensive network of charging stations will be required, and charging businesses can play a key role in supporting and facilitating the transition to greener, sustainable modes of transportation.
Don't miss out on this exciting business opportunity. Get in touch with us and we'll help you achieve your business goals with our comprehensive EV charging solutions.