Why convenience stores need to start investing in EV charging infrastructure
1. What is the electric vehicle charging market in Canada right now and what should we expect to see in the coming 12-18 months? Are you expecting to see more chargers being incorporated into public locations such as convenience stores, gas stations and other retail operations?
At a national level, we are continuing to see growth in the charging market. The density and locations vary by region, but we are starting to see more retailers get into EV charging in various capacities. The most visible are the national companies like Suncor, Parkland, and Circle-K continuing to invest in their charging infrastructure. Parallel to this stream we are seeing some sectors electrifying their fleets and installing behind-the-fence infrastructure to support those purchases.
2. As National Energy Equipment is a supplier of electric vehicle chargers, can you tell us, first, who is the manufacturer of them and which ones do you have for retail operations such as convenience stores and gas stations?
We work with several manufacturers with diverse technologies that cover essentially any use case. Our key focus is to ensure we can support our national customer base before, during, and after the installation of chargers regardless of the manufacturer and variety of technology they chose to procure.
3. Why is it important that more convenience stores and gas station operations begin to make investments and install EV chargers at their locations? What are the benefits to them for doing so—increased sales opportunities, building customer loyalty and return business, etc., and the consequences for not doing so?
EV chargers are a great fit for gas and convenience locations. Gas stations already utilize the distribution of energy (gas and diesel) to draw customer traffic for their onsite convenience, car wash, and food offerings. EV charging does the same thing but has the added benefit of a little longer dwell time. Where a customer might be fueling their vehicle for 6 minutes an EV driver will typically be on site for 15-30 minutes with the highest speed chargers. This makes the additional onsite amenities more important and attractive to EV drivers.
Additionally, you are retaining loyal customers who will typically have both ICE (internal combustion engine) and BEV (battery electric vehicle) or PHEV (plug-in, hybrid electric vehicle) vehicles in their family and attract different clienteles.
With liquid fuels, the gas station is typically a local community service. Customers tend to be geographically nearby and may grab lotto or a pack of gum while fueling up on the way home unless it is a highway location. EV drivers typically use public charging infrastructure when they are not near their home. Most EV drivers have charging capability at their home, so they are stopping at convenience charging locations like gas stations where they are more likely to also be interested in onsite restaurants, road trip snacks and beverages, washroom amenities, etc. Given the difference in use case, it’s likely that more EV charging customers will have ancillary purchases than liquid fuels customers.
As we start to see most of the national companies getting into this segment, delaying too long could lead to a loss of loyal customers who transition to EV. Regardless of a customer's preferred retailer, once they move to EV, the priority becomes where are the most capable and reliable charging stations. Since there is not plentiful infrastructure in most of the country, brand loyalties are less relevant at this early stage and need to be re-established.
From another perspective, this new industry means there are still many government incentives to help early movers get involved. These incentives won’t last forever but there is federal funding available right now and some provinces go above and beyond that funding which makes the capital investment significantly more attractive.
4. What are the challenges for convenience stores and gas stations in looking to install electric vehicle charging stations? Are there regulatory hurdles or local ordinances that make it difficult to do so?
The two biggest hurdles are power availability and cost.
With this being fairly new technology, the economies of scale haven’t really taken hold yet, but we are starting to see reduction in equipment cost. The technology and companies providing it are evolving rapidly and these advancements are enabling increases in capability with decreasing cost. Lock step with these advancements, auto manufacturers are increasing the capabilities of the vehicles. As these advancements progress the ideal charging solution also progresses. Two-three years ago, a 50kw charger would meet the capabilities of virtually all vehicles on the road. Today there are multiple vehicles charging with peak power between 240kw—360kw. Additionally, for locations that serve medium / heavy duty vehicles, new standards are soon being launched that will see charging speeds an order of magnitude higher.
Serving the medium / heavy duty market is also relevant to the power availability challenge. While the grid is strong and adaptable in much of Canada, there are regions that require grid resilience and capacity improvement to be able to support this type of infrastructure. Even in the strong grid regions, this level of power usually requires significant planning and acquisition of key components like transformers which can delay projects by months or in some cases a year or two. There are solutions to mitigate this such as grid scale battery storage to buffer the peak power requirements. This adds cost and complexity to a project, but the benefit of lower grid connection provides customer benefit in demand charges and smaller grid connection infrastructure. This also has the potential to strengthen the local grid if integrated with the power utility correctly and can possibly provide another revenue stream via energy arbitrage to help the utility smooth the peaks and valleys of their grid demand.
5. How do you work with clients to decide upon the right set of chargers or mix of chargers for their location or multiple locations?
This is very much on a case-by-case basis. For a newer customer, it starts with education of the technology basics and a conversation about their desired outcomes. From there we are able to suggest technology they should be considering in broad terms and compare their site capabilities to the ideal solution. Usually at this point we can narrow down the options and charger mix which is best suited to their priorities for current and future needs.
