High-Power Charging for Electric Fleets (Part 2)

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In this post, we will build on the hypothetical high-power charging site introduced in Part 1 (ten 150kW fast chargers) and explore a few different ways to achieve positive outcomes for high-power charging sites at scale.

From Part 1, we learned that consistent annual cash flows from charging are key to unlocking investment. Annual cash flows are a function of 1) achieving adequate site use and 2) charging customers a rate moderately higher than the average cost of energy. Of course, the greater the site use, the lower the charging cost (and vice versa!).

Now, how do we achieve the modeled cash flows needed to make the site viable? For the hypothetical site, we modeled $283,450 per year in target cash flow from charging operations. With this target, we can produce the following chart illustrating different combinations of site use (energy throughput) and rate spreads to achieve the target cash flows.

Rate spread is the difference between the average energy cost from the utility and the average fee charged to the fleet ($/kWh).

As shown above, a reasonable rate spread of $0.10/kWh is achievable at an annual site energy throughput of 2,834,500 kWh/year. For a site in San Francisco, this might mean an average charging cost of around $0.30/kWh (assuming average utility cost is $0.20/kWh). Charging costs can be reduced by increasing site use.

What does this mean in terms of vehicles? Assuming an average vehicle efficiency of 3 miles per kWh, here are some possible scenarios:

As you can see, depending on average daily vehicle energy consumption, we need a large fleet of 100 to 300 vehicles to achieve the target site use.

The other main operational consideration is the average vehicle charging speed. At a charging speed of 50kW, the site occupancy rate is 65% which means each charging station is occupied for an average of over 15 hours per day — quite high! A more reasonable site occupancy rate of 22% (5.3 hours per day) can be achieved if the average charging speed is increased to 150kW.

Conclusion

Using this hypothetical site, we can begin to understand the economic and operational considerations of high-power fleet charging and draw some conclusions about how to help scale high-power charging for fleets.

1. Guaranteed utilization agreements (e.g. solar PPA-like contracts) will be essential for third-party developers to build out infrastructure and provide long term $/mile or $/kWh charging-as-a-service type agreements.
2. Local, state, and federal incentive programs, like California’s Low Carbon Fuel Standard (LCFS) can help bring down project costs resulting in lower charging costs or lower site use requirements. This unlocks economically viable high-power charging sooner for more fleets.
3. Larger fleets will have an advantage in reaching the scale needed to achieve low-cost charging. However, we believe that shared charging where multiple smaller fleets use the same stations in a well-coordinated manner may enable low-cost charging for smaller fleets. Software is a key enabler to achieve positive outcomes for shared charging sites.

Thinking about fast charging for your fleet? There is much more to unpack here — contact us!

This article was written by Eric Soenksen at Stable Auto.