• Large US Fuel Retailers See 'Impediments' to Installing EV Chargers

  • Large US Fuel Retailers See 'Impediments' to Installing EV Chargers

    As consumers shift to electric vehicles, large retailers Pilot Co. and RaceTrac
    say they want to provide EV charging sites, but the two companies currently see
    substantial hurdles to building the EV infrastructure, according to an online
    panel discussion Monday sponsored by NATSO, a trade association representing
    truckstops and travel centers.

    The companies are looking for policymakers to provide government rebates, tax
    incentives, grants -- even a Renewable Identification Number (RIN), similar to
    the renewable energy credits provided blenders under the federal Renewable Fuel
    Standard program -- to make installing and operating EV charging equipment cost
    effective.

    Based on the discussion, the greatest "impediments" include competition from
    utilities that provide EV charging services, add-on demand charges from
    utilities, and burdensome regulation that, for example, would treat retailers
    that resell electricity as if they are utilities.

    David Fialkov, NATSO's executive vice president of government affairs, said
    competition from utility-owned chargers is a disincentive for retailers to
    invest in the infrastructure. "If a utility sets up a charger and gives away
    electricity at a depressed price, retailers are not going to make a $1 million
    investment in EV charging, even if the government is picking up 80% of the cost
    as it will with the Biden (infrastructure) bill," Fialkov said.

    Still more challenging, he added, are the ongoing costs of demand charges,
    which are additional fees utilities impose on commercial customers to maintain
    a constant supply of electricity, including during peak periods.

    Up-front government incentives that reduce the cost of installing charging
    equipment are "going to be critical in getting through the early years of the
    energy transition," said Tim Langenkamp, vice president and general counsel for
    Pilot. "But it's even more important to bring some common sense to rate
    structures across the U.S. in many jurisdictions."

    Perhaps the most compelling case for relief from demand charges came from Eva
    Rigamonti, RaceTrac's associate general counsel and executive director of
    public policy. She said the Southeast retailer has 582 locations spanning 67
    different utility jurisdictions, each with its own rate structure. RaceTrac
    looks for a return on investment over a seven-to-10-year period.

    "There is no way selling coffee and a sandwich will cover a demand charge for
    us," Rigamonti said. "A single DC fast charger pulls 150% more power than an
    entire store during peak time."

    She said that adding a fast-charger increases a site's electric bill an average
    of $1,600 more per month -- $1,500 for the demand charge and $100 for the
    energy.

    "Policymakers need to send a signal they want to support private enterprise
    (charging infrastructure). There needs to be a reason to put private capital at
    risk," Rigamonti said. She added that private entities should be prioritized
    for grants, and government-subsidized utilities should not be allowed to
    "double-dip" into taxpayers' money by obtaining grants to install chargers.

    Anne Smart is vice president of public policy for ChargePoint, a third-party
    charging network that is installing chargers at convenience-fuel sites and
    working with NATSO to prepare travel center operators for the energy
    transition. The federal government could fund up to 80% of the cost of
    installing chargers with the remainder provided by state governments and
    private enterprise, she said. More states are expected to provide additional
    money for EV charging projects, and Smart said she thinks 2022 will be a
    "big"year for ChargePoint.

    There should be plenty of opportunity for fuel retailers to enter the charging
    business, she said. While most of the vehicle charging is expected to take
    place at home or at work, these charging sites are not seen as a threat to
    retail EV chargers. "You also have to factor in the need to travel," said
    Smart. She said travel centers in particular offer the best locations,
    typically next to highway exits, with food, bathrooms, well-lit stations and
    other amenities.

    However, "the regulatory environment is definitely in a state of flux -- and it
    needs to be in order to make this a successful energy transition with as few
    dropped balls as possible," said Langenkamp.

    --Reporting by Donna Harris, dharris@opisnet.com; Editing by Michael Kelly,
    michael.kelly3@ihsmarkit.com




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