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Biden wants to build a national EV charging system under $2 trillion infrastructure plan, but it won’t be easy

  • Charging stations for electric vehicles will be part of a $2 trillion infrastructure bill being pushed by the Biden administration.
  • It's going to take more than government support to successfully expand EV infrastructure.
  • AlixPartners estimates $300 billion will be needed to build out a global charging network to accommodate the expected growth of EVs by 2030, including $50 billion in the U.S. alone.

In this article

President Joe Biden speaks as he meets with Senators from both parties in the White House on Feb. 11, 2021.Doug Mills-Pool/Getty Images

President Joe Biden is prioritizing a national EV charging network under his $2 trillion infrastructure bill, promising to have at least 500,000 of the devices installed across the U.S. by 2030.

The Biden administration is rolling out Wednesday a $174 billion plan to spur the development and adoption of electric vehicles that includes money to retool factories and boost domestic supply of materials, tax incentives for EV buyers, and grant and incentive programs for charging infrastructure.

But it's going to take more than government support to successfully expand EV infrastructure. There aren't enough EV drivers to make it a viable business yet, and building a network of chargers is far more complex than it sounds. It takes a mix of private-public partnerships that can involve local municipalities, businesses and utility companies as well as automakers and an emerging group of EV charging companies. It's not as simple as having a gas station at every corner.

"As electric vehicles become more primary vehicles for people, certainly it's not like we're going to replace the gas station with the charging station and that's it," said Mark Wakefield, a managing director and global co-leader of the automotive and industrial practice at AlixPartners.

$300 billion

AlixPartners estimates $300 billion will be needed to build out a global charging network to accommodate the expected growth of EVs by 2030, including $50 billion in the U.S. alone. Costs for EV chargers vary based on the "level" of charger. The higher the level, the quicker the charge and the more expensive it is to install.

Charge Point EV stationsSource: Charge Point

"It is a big pill to swallow for anybody," Wakefield said. "These are really, really expensive, especially these fast chargers" that some automakers are promising will take as little as 10 minutes to charge upcoming EVs about 80%. That compares with lower-level chargers, including home outlets, that take several hours. Level three chargers cost $120,00 to $260,000 installed on average, according to AlixPartners. "These are not cheap."

But demand for the networks isn't quite there yet. Plug-in vehicles, which include EVs and hybrid electric vehicles with traditional engines, only accounted for about 2% of the more than 17 million new vehicles sold domestically in 2019, according to the Energy Department. But many believe now is the beginning of the end of gasoline vehicles.

"It's no longer a matter of if, and it's no longer a matter of when, it's now the question is how fast? Because we know that the automakers have put the money into the retooling," said Jonathan Levy, chief commercial officer of EV charging company EVgo.

While automakers like General Motors and Volkswagen are heavily investing in improving performance and lowering prices of EVs to catch up to Tesla, they're far less interested in building, owning and operating their own charging networks. The profit margins and amount of effort involved to maintain them just doesn't make sense. Tesla, an early leader in the industry, built its own charging network out of necessity and, in part, to help sell its cars.

Mainstream adoption

Most automakers are partnering with third-party companies to provide charging stations. Their strategy, combined with enthusiasm from Wall Street for EVs, has driven investor demand for charging companies such as ChargePoint and EVgo. ChargePoint went public through a reverse merger with a special purpose acquisition company, or SPAC, in March. EVgo plans to do the same in the second quarter.

There are about 41,400 EV charging stations in the U.S., according to the Department of Energy. Fewer than 5,000 are fast chargers. That compares with more than 136,400 gas stations, according to GasBuddy.

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