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

Slowly but surely, electric cars and trucks are invading America’s highways. The White House is aiming for half of new vehicles sold in the United States to be electric vehicles by 2030, and auto giants like GM and Volvo want to go all-electric within a similar time frame. As utility companies race to increase the number of charging stations — a crucial step in the transition to electric vehicles — the future of the gas station is uncertain.

Today, gas stations are an integral part of American life, a place where drivers go daily or weekly to fill up and occasionally grab a snack. But the concept of fuel pump and convenience store has much less to offer the country’s small but growing number of electric vehicle owners.

While some gas stations have taken the plunge and installed charging ports next to their pumps, people tend to do the lion’s share of charging their electric vehicles at home. And since EV chargers can be installed in almost any place connected to the electrical grid – they are now available in office garages and rest areas, and will soon be in some Starbucks parking lots – the gas station is more more useless for some Americans. .

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

This is worrying news if you are in the gas station business. Boston Consulting Group analysts estimate that if electric vehicles take off, up to 80% of the fuel retail market could become unprofitable by 2035. If demand for gasoline disappears completely, many of the more than 100,000 stations across the country are at risk of going out of business. If they are unable to sell fuel, gas stations would struggle to make money, as people typically buy goods from their convenience stores while they are filling up.

So if these companies want to survive, they have to start reinventing themselves for a world beyond gas. This might be difficult to do, if not impossible. Installing EV chargers at existing gas stations can be quite expensive. Meanwhile, those locations could become redundant as automakers, charging station companies and the government race to build a whole new network of electric vehicle chargers.

Some are already imagining what a post-gas station future might look like. It can be as simple as electrified parking spaces placed in a city, or lead to futuristic roadside stops where people can hit the gym or stroll through a garden while their electric vehicles charge. One thing is certain, however: EVs are bound to change our built environment.

How to retrofit a service station for electric vehicles

Service stations currently serve as intermediaries between the fossil fuel industry and drivers. Oil companies need a place where they can easily dispense their product to customers, and drivers need a convenient and reliable place to fill up their gas tanks. And again, gas stations don’t just sell gasoline and diesel. They also make money by selling food, alcohol, cigarettes, and lottery tickets, among other things. Some service stations offer mechanic services; some have restaurants inside.

To adapt this business model for the age of electric vehicles, some gas stations are now installing Level 3 chargers, which can provide up to 20 miles of range per minute, alongside their older pumps and convenience stores. Some of these fast chargers make charging electric vehicles almost as fast as filling an old-fashioned gas tank, and they’re much faster than what people typically use at home. Several gas station owners who have or are installing Level 3 chargers told Recode their goal is to become “fuel independent” and appeal to EV drivers as well as those with gas-powered cars.

Charging an EV is often as easy 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 tough expense for a small business. The overall cost can be much higher, as installation often involves drilling asphalt and laying electrical cables, and sometimes service stations also need to purchase transformers to increase the overall electrical capacity of their sites. Chris Bambury, who operates multiple gas stations in California, told Recode that installing just four EV chargers at one of his sites would have cost about half a million dollars if government and utility programs hadn’t covered about 90% of the bill.

An even bigger challenge is that gas stations already face intense competition from other public EV chargers. Data collected 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 hostels, shopping malls, and government buildings than at gas stations and convenience stores. This is a limited picture of the country’s charging network, and it doesn’t include the large number of chargers built by private companies like Blink, Electrify America and Chargepoint. These companies also seem to prefer installing these chargers in places with grid-connected parking spaces, where EV drivers can find something to do while charging, such as going to the grocery store or a restaurant.

The fight for the future of charging

For a number of reasons, the government really wants to convince people that electric vehicles are just as easy to use – and can go just as far – as gasoline-powered vehicles, so they’re building a lot of charging stations in places practice. 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. This money will be divided among the states, and the hope is that eventually there will be chargers at least every 50 miles on the United States Interstate Highway System. Meanwhile, local and state governments are providing grants to businesses that install chargers on their premises.

Gas stations aren’t exactly enthusiastic about the government’s efforts to put EV chargers anywhere and everywhere. In Georgia, where several automakers want to build new manufacturing plants focused on electric vehicles, gas station trade groups are advocating for legislation that would limit the state electric authority’s potential role in charging electric vehicles. Nationally, lobby groups representing the gas station and convenience store industries have pushed back against a Congressional proposal to build EV chargers in public rest areas on the freeway because they say it would hurt the competitive capacity 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 household wall outlet, just like their laptop or phone, and it virtually eliminates the need for frequent refueling. These are usually cheaper level 1 chargers that take a few hours to fully charge a battery, which is perfectly acceptable for charging a vehicle overnight. And since the average electric vehicle can travel 260 miles on a single charge, most people only need to plug in their car once a day.

Electrify America is opening luxury charging hubs in California and New York, and concept renders show they could include lounges and solar 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% of new cars sold are now electric or hybrid. While gas stations have quickly installed charging ports, many EV drivers in Norway only visit them on a monthly basis.

The rise of electric vehicles could actually 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 awnings and event spaces that could eventually offer valet parking and curbside deliveries in California and New York City later this year. Automakers are also experimenting with the idea of ​​high-end charging stations. In California, Tesla has already opened a charging hub for its vehicles that includes 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 technologies obsolete. After all, the phasing out of horse travel also meant the demise of the carriage industry and the repurposing of stables. Today, 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 type of cars people drive, but also where they drive them.

This story was first published in the Recode newsletter. register here so as not to miss the next one!

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