How Tesla and EV charging networks threaten the future of gas stations

Slowly but surely, electric cars and trucks are taking over American roads. The White House is aiming for half of all new vehicles sold in the US to be electric vehicles by 2030, and auto giants like GM and Volvo want to go all-electric in a similar timeframe. As utilities race to expand the number of charging stations, a critical step in the transition to electric vehicles, the future of the gas station is in doubt.

These days, gas stations are a regular part of American life, a place drivers go daily or weekly to refuel and sometimes grab a snack. But the fuel-pump-plus-convenience-store concept has far less to offer the country’s small but growing number of EV owners.

While some gas stations have taken the leap and installed charging ports next to their pumps, people tend to do most of their electric vehicle charging at home. And since EV chargers can be installed almost anywhere that’s connected to the power grid (they’re now available in office garages and break areas, and soon to be in some Starbucks parking lots), the gas station is getting most unnecessary for some Americans. .

“The beauty is that you’re not locked in a gas station,” argues Rob Barrosa, senior director of sales and marketing for Electrify America, an electric vehicle charging network and subsidiary of Volkswagen. “How do we get the energy to where we want it? That’s a much easier problem to solve than having to deal with big gas tanks that you have to bury in the ground.”

This is worrying news if you’re in the gas station business. Analysts at the Boston Consulting Group estimate that if electric vehicles take off, as much as 80 percent of the retail fuel market could be unprofitable by 2035. If demand for gasoline were to disappear entirely, many of the more than 100,000 stations around the world country would be at risk of going out of business. If they can’t sell fuel, gas stations would have a hard time making money, as people often buy goods at their convenience stores while they fill up.

So if these companies want to survive, they must start reinventing themselves for a world beyond gas. That could be difficult to do, or even impossible. Installing EV chargers at existing gas station locations can be quite expensive. Meanwhile, those locations may become irrelevant as automakers, charging station companies and the government race to build a new network of electric vehicle chargers.

Some are already imagining what a post-gas station future would look like. It can be as simple as electrified parking spots located throughout a city, or driving to futuristic roadside stops where people can go to the gym or stroll through a garden while their electric vehicles are being charged. However, one thing is for sure: electric vehicles are bound to change our built environment.

How to adapt a gas station for electric vehicles

Gas stations currently serve as intermediaries between the fossil fuel industry and drivers. Oil companies need a place where they can easily distribute their product to customers, and drivers need a convenient and reliable place to fill up their gas tanks. And again, gas stations aren’t just in the business of selling gasoline and diesel. They also make money selling food, alcohol, cigarettes, and lottery tickets, among other things. Some gas stations offer mechanical services; some have restaurants within them.

To adjust this business model to the age of electric vehicles, some gas stations are now installing level 3 chargers, which can offer up to 20 miles of range per minute, alongside their old pumps and convenience stores. Some of these fast chargers make charging electric vehicles almost as fast as filling up a gas tank the old-fashioned way, and are much faster than the ones people usually use at home. Several gas station owners who have or are installing level 3 chargers told Recode their goal is to become “fuel agnostic” and appeal to electric vehicle drivers, as well as those with gasoline-powered cars.

Charging an EV is often as simple as parking it.
AFP via Getty Images

But for many gas stations, the cost of an EV charger outweighs the benefits. The charger itself can cost tens of thousands of dollars, which is a difficult expense for a small business. The total cost can be much higher, as installation often involves drilling into asphalt and running electrical wiring, and sometimes gas stations also need to purchase transformers to increase the overall electrical capacity of their sites. Chris Bambury, who operates several gas stations in California, told Recode that installing just four electric vehicle chargers at one of his locations would have cost about half a million dollars if government and utility programs hadn’t covered about the 90 percent of the bill.

An even bigger challenge is that filling stations already face intense competition from other public electric vehicle chargers. Data compiled by the Department of Energy shows that of the public charger locations the agency fully tracks, there are currently more public chargers located in hotels and inns, shopping malls, and government buildings than in gas stations and convenience stores. This is a limited picture of the country’s charging network and does not include the vast number of chargers made by private companies like Blink, Electrify America, and Chargepoint. These companies also seem to prefer installing these chargers in places with grid-connected parking spots, where EV drivers can find something to do while charging, such as going to a grocery store or restaurant.

The fight for the future of cargo

For various reasons, the government really wants to convince people that electric vehicles are as easy to use and can go as far as gasoline vehicles, so it is building a large number of charging stations in convenient locations. To accelerate this effort, the White House plans to spend $5 billion as part of a goal to build more than 500,000 public chargers across the country by the end of the decade. That money will be distributed among the states, and the hope is that there will eventually be chargers at least every 50 miles on the US Interstate Highway System. Meanwhile, state and local governments give grants to companies that install chargers in their facilities.

Gas stations aren’t exactly thrilled about the government’s efforts to put EV chargers anywhere and everywhere. In Georgia, where several automakers want to build new EV-focused manufacturing plants, gas station trade groups are advocating legislation limiting the potential role of the state power authority in charging electric vehicles. Nationwide, lobbying groups representing the gas station and convenience store industries have rejected a proposal in Congress to build electric vehicle chargers at public rest stops on the interstate because, they argue, it would undermine the ability to compete. of service stations.

But perhaps the biggest hurdle gas stations face: charging an electric vehicle is often as easy as parking it. Many electric vehicle owners buy chargers that plug into a standard home wall outlet just like their laptop or phone, and that virtually eliminates the need for frequent refueling trips. These are typically less expensive Tier 1 chargers that take a few hours to fully recharge a battery, which is perfectly acceptable for charging a vehicle overnight. And since the average EV can travel 260 miles on a single charge, most people only need to plug in their cars once a day.

Electrify America is opening luxury charging centers in California and New York, and concept renderings show they could include solar lounges and canopies.

So even if gas stations install fast chargers, people who travel long distances may be their main customers. This situation is already playing out in Norway, where around 90 percent of new cars sold are now electric or hybrid. While filling stations have moved quickly to set up charging ports, many electric vehicle drivers in Norway only visit them on a monthly basis.

The rise of electric vehicles could lead to a new generation of pit stops. Some private companies, for example, are opening their own luxury destinations with multiple charging stations. Electrify America plans to open a series of flagship EV-focused travel lounges with solar canopies and event spaces that could potentially offer valet services and curbside delivery in California and New York later this year. Automakers are also experimenting with the idea of ​​premium charging stations. In California, Tesla has already opened a charging center for its vehicles that incorporates a lounge, an espresso bar and free Wi-Fi. Porsche and Audi are developing similar plans for their own stations.

None of this is necessarily surprising. New innovations often make old technology obsolete. After all, the phasing out of horseback riding also meant the demise of the horse-drawn carriage industry and the reuse of stables. Now, after a century of building complex infrastructure around gasoline-powered vehicles, another transition seems inevitable. This means that electric vehicles are not only transforming the kind of cars people drive, but also where they take them.

This story was first published in the Recode newsletter. sign up here so you don’t miss the next one!

Leave a Comment