Am I right to think it's practical start a commercial electric vehicle charging station?
August 17, 2011 2:03 AM Subscribe
I just bought an electric car -- Nissan Leaf -- and I am curious about what it'd take to start a commercial quick charging station in my area (Santa Monica, California). How do I best frame my thinking and analysis?
posted by haykinson to Work & Money (8 answers total) 2 users marked this as a favorite
Physically, a "DC fast charging station" is a box installed in the the ground next to a parking spot, which allows cars to park, plug in, and the drive away a half an hour later having replenished their battery.
Very naively, it seems like all one would need would be a) start-up funds to purchase and install a charging unit, b) a lease on some land for charging parking spots in a correctly-zoned area, b) time and money to secure appropriate permits for all this work. Dig a hole, plug in a box, profit.
Less naively, this seems like a serious business venture with serious risks and dubious potential returns. Land is expensive; hardware and installation is expensive. Permits are tough to get and are probably expensive. Electricity is very cheap, and thus you can't really charge a lot for it. It's hard to "make it up in volume" when there are fairly few electric cars, and everyone charging is bound to spend a good chunk of time using the spot. And of course capital expenditures go up if you want to have two or three charging slots. Finally, marketing costs time and money, even if there aren't other quick charge stations in the LA area.
Given just the financial aspects (high initial cap ex, high variable costs -- rent etc, low price point) which point to very slow returns over the long haul, this seems like it's only workable if there's serious government involvement in providing subsidies to offset this risk. I shudder at the thought of having to deal with government entities on a regular basis to make this happen.
So, help set me straight. Is it foolish to think that this can be a low-involvement project where a small group of investors can make a reasonable return over time by going low-fi and doing the minimum necessary to make a charging station work?
(As an aside: I am thinking about this from a principled position -- if small entrepreneurs don't start building infrastructure, it may never get built. So beyond wanting to build a successful business, I also want to help build a successful business ecosystem.)