Public Charging Stations: A few business ideas.
For the purpose of full disclosure, I’m yet to open and run my own business but having worked with entrepreneurs my age and academic background, I have made a rough picture in my head on the business aspects of EV charging stations. EVs are beginning to take a greater and greater share of the automobile market but still, currently less than 2% of all vehicles plying on the world’s roads are EVs and the number if far less in developing countries such as ours. In a situation where the number of potential customers in the short to medium term isn’t very high, an EV charging station does not seem like a very profitable idea. On the contrary, I feel that with just a little bit of innovation, one can make decent profits from an EV charging station provided they’re willing to go the extra mile of doing a little bit of research and making a few trips to their respective state’s electricity department.
Let us first discuss on the kinds of chargers that are generally used for charging up EVs,
· Level-1 or AC slow charging (1.25kW to 3kW)
· Level-2 or AC fast charging (7kW to 22kW)
· Level-3 or DC fast charging (25kW and above)
Level-1 Charging;
In case of Level-1 charging very little work needs to be put in for setting up a charging station as it can be done from any 15A wall socket like the one shown in the figure. Though not mandatory, always prefer installing a socket that comes with an MCB as it provides protection against various electrical faults such as short-circuits, over-voltage, over-current etc.
A Nexon EV would take around 8–10 hours to get fully charged, so setup isn’t viable for people who might be using your charging station for a short period of time. Such a setup would be quite viable if you own any of the following businesses,
· A restaurant where people generally spend about an hour, their EVs could gain around 10% charge, you could charge EV owners lower parking fees and make money by charging them extra for using your charging station, you could either charge on the basis of the overall duration your station was used or on the basis of the number of units consumed by your customer’s EV.
· A movie theatre where customers generally spend upwards of 2 hours, you can follow the same business model given above, you might also offer EV owners discounted tickets or complimentary popcorn as you’ll be covering up the cost from your charging station. This will not only bring you profits but also encourage your customers to buy EVs thereby increasing their adoption, reducing pollution, making the environment cleaner. In a nutshell, a multi-win situation.
· A hotel where your customers generally stay for upwards of 5 hours. Here, you’ll have to make a few adjustments to the above models. Here, there is a probability of you customer’s EV reaching 100% state of charge and under these circumstances, you’ll have to setup a system that immediately disconnects the EV once it is fully charged, else you’ll end up in a situation where your charging station is being used but isn’t making much money. And other customers who might be needing a charge might not be able to get it as an available charging station is connected to a vehicle.
In case your business has space for 2-wheeler parking, you could install 5A sockets, a typical Ather 450X would take around 2.5 hours to get fully charged from such an outlet.
None of the above models require you to do unnecessary steps such as speaking to officials in the electricity department, getting additional power connections etc. as this process simply involves purchasing a few 15A outlets and installing them. Your overall investment in installing such as charging setup should not exceed ₹20,000 even when you’re planning to install dozens of outlets. (Including cost of wiring, installation, materials etc.)
Level-2 Charging;
Most commercial establishments come with a 3-phase power connection, so you’re good to go connection wise. Installation of 3-phase outlets is slightly more complicated than installing an ordinary outlet, speak to a qualified professional before proceeding with such a step. You could use a 3-phase outlet in the above situations, but remember, you’ll have to charge more from your customers as 3-phase charging stations are more expensive and the fixed cost component in your electricity bill may go up in case you decide to install one.
You can offer this as an “express charging” service and have a limited number of charging stations. Remember, a mere 3-phase outlet may not be sufficient as most portable chargers that EVs are equipped with don’t support 3-phase power. Instead, you’ll have to speak to automobile manufacturers who have the skill and technology to install such charging stations at your place.
You’ll have to go through the hassle of producing and reviewing several documents before you can get these installed. Alternatively, you could purchase an EV like the MG ZS EV and have them install a charging station at your business establishment. This will smooth out the process, but obviously, do this only if you’re planning to buy an EV. Since only a limited number of EVs support Level-2 charging, install only a limited number of outlets and consider this only if your business is in or close to an area where people own such EVs.
The cost of such charging stations is upwards of ₹37,500 each, so choose wisely before installing such a charging station in your business.
Level-3 Charging
DC fast charging stations require you to have an industrial 3 phase connection that is capable of delivering more than 25kW of power. Go through your state electricity department’s website before obtaining approval for such a connection.
Such a charging setup is suitable mostly in cases where the customer won’t be parking their EV at your business for more than an hour or so. In case you own a fueling station, you could setup one to ensure that you don’t go out of business once EVs become mainstream. Since you’ll be going for an industrial connection, you’ll be charged more by your electricity company both in terms of fixed cost and per unit cost. So be sure to charge your customers accordingly.
In addition to state government regulations, there are some set by the central government as well, several online portals such as ecogears have most of the necessary information regarding these in a well curated manner.
A DC fast charger (under 50kW) will set you back by at least ₹1.5 lakhs, this does not include the cost of getting an industrial connection, wiring etc.
How about setting up a dedicated EV charging station business?
Installing Level-1 chargers as a dedicated business might not be a very good idea as the revenue flow would be too slim for you to justify any investment. Level-2 and Level-3 chargers cost more but there are a few ways you could make money off of them if you were to think innovatively.
One of the ways that I think can ensure a steady stream of revenue irrespective of whether EVs come up for a charge or not is using grid-connected solar systems. Such a solar system supplies power to the grid during the day and draws power from the grid at night.
You could install a 6kW solar system for your charging station and equip it with a 3-phase inverter, this would supply power to the grid while not in use during the day and when an EV does come up for a charge, it could either use Level-2 charging or Level-3 charging depending upon the equipment that is installed in the charging station
Opting for Level-3 charging would be a better option in the Indian context as the most popular EVs in India such as the Nexon and the Mahindra E2O aren’t equipped with 3-phase chargers but are compatible with DC-fast charging, this will allow you to reach a greater customer base and you’ll continue making money even if the chargers aren’t in use. Additionally, you could use the available space at the station for advertising or you could partner with companies such as Coca-Cola and have them set up vending machines at your station, this will keep a steady flow of revenue into your pocket. Note that a solar system would cost you around ₹3 lakhs for a 6kW unit, so plan your investment and calculate your RoI accordingly.
Note that you could setup charging stations using solar power at parking lots within the city as well.
All in all, it would suffice to say that EV charging stations are a viable business if planned the right way. Do go through the following sources that I had consulted for the purpose of this article as they will help you make a more informed decision in this field.
Bibliography
2. https://tsredco.telangana.gov.in/PDFs/Solar_Energy/Solar_Rooftop_Net_metering_Guidelines.pdf
3. https://www.indiamart.com/proddetail/dc-fast-chargers-for-ev-20695981388.html
4. https://ecogears.in/electric-car-charging-station-installation-cost-in-india/
5. https://www.indiamart.com/proddetail/ac-7-kw-home-charger-22398670462.html
6. https://www.solarexpertsindia.com/systems/6kw-solar-panel-inverter-battery-plant-price/
7. https://www.loomsolar.com/blogs/collections/how-to-apply-for-net-metering-state-wise-procedures
8. http://mohua.gov.in/upload/whatsnew/5c6e472b20d0aGuidelines%20(EVCI).pdf
10. https://powermin.gov.in/sites/default/files/uploads/Revised_MoP_Guidelines_01_10_2019.pdf
