How to Start An EV Charging Stations Business?

EV charging can be a lucrative investment for your business, and charging fees can generate thousands in revenue per year, depending on your situation and type of business.

Similar to any new business venture, starting an electric vehicle charging station business comes with its own challenges and rewards. Further, as the EV market is in its nascent stages, partnering with EV charging companies and setting up charging stations gives a first-mover advantage to entrepreneurs. Plus, business owners will enjoy different perks and incentives for supporting the government's zero-emission initiative.

According to Statista, unit sales of electric vehicles are expected to reach 17.07 million US dollars in 2028. With the increasing adoption of electric vehicles globally pushes the need for setting up an electric car charging station and creating an easily accessible EV infrastructure.

Are you planning to start an EV charging station business? Then, this post is written to answer all your “how to” and “why” queries related to starting an electric car charging station business.

EV Charging Station Market Size

• The global electric vehicle charging station market is forecasted to reach $76.9 billion from 2023 to 2027.
• The International Energy Agency (IEA) published a report stating that China owned 52% of the world's slow chargers and 82% of the fast chargers.
• Experts predict that the electric vehicle (EV) market will be worth more than $350 billion by 2028, reaching a tipping point. 
• EV charging market is projected to reach nearly $120 billion by 2028.

Is EV Charging Stations Business Profitable?

Yes, EV charging stations business is quite profitable. Electric vehicle (EV) drivers are willing to pay for services such as rapid charging. The level of profitability depends upon various factors, including individual circumstances, geographical location, and the business model you choose.

Different Types of Charging Stations for Electric Vehicles

Electric vehicle chargers are available in a diverse array of styles. The pricing structure is primarily categorized into three levels: Level 1, Level 2, and Level 3.

Level 1 Electric Vehicle Charging Stations

A zero-emissions vehicle (ZEV) is a type of vehicle that produces no harmful emissions during operation. The power adapter for charging devices is a commonly used 120V AC plug. No setup or hardware is required for these chargers. Level 1 electric vehicle (EV) chargers are frequently utilized for residential purposes. 

Although Level 1 Electric Chargers are considered a cost-effective choice, it is important to note that they have a longer charging time than other options when fully recharging a vehicle's battery. Automobile owners frequently utilize this charger to recharge their vehicles during rest periods.

Level 1 electric vehicle (EV) chargers are available from reputable companies such as Alphaa EV, Charzer, and Kazam.

Level 2 Electric Vehicle Charging Station

Level 2 Electric Vehicles Chargers are available at public and private charging stations. The commercial charger utilizes a 208V AC plug, whereas the residential charger utilizes a 240V AC plug.

Depending on the specific model, the charging units can increase the vehicle's range by a variable amount, ranging from 10 to 60 miles per hour. The Level 2 Electric Vehicle Charger can fully charge a car battery in under two hours. 

These charging stations are suitable for commercial establishments seeking to offer efficient charging options to their customers and private residences requiring such facilities. 

ABB, Mass Tech, and Delta are some of the manufacturers of Level 2 EVSE.

Level 3 Electric Vehicle Chargers

A Level 3 DC Fast Charger equipped with a CCS2 or CHAdeMO connector can provide over 100 miles of additional range to your electric vehicle within 30-40 minutes. DC fast chargers, however, are commonly utilized in professional environments. 

The installation and maintenance of these direct current (DC) charging stations require robust and specialized equipment. It should be noted that Level 3 chargers are not universally compatible with all-electric vehicles. While DC Fast Chargers are generally compatible with a wide range of all-electric vehicles, it is important to note that certain plug-in hybrid EVs may not possess this specific charging capability. 

Some electric vehicles compatible with DC fast chargers and offer quick charging capabilities include the Mercedes EQC and the MG ZS EV.

Step by Step Approach To Start An EV Charging Station Business

The electric vehicle market is a relatively new segment with a promising future. Investing in EV charging station business comes with an added first-move advantage. If you are planning to start a charging station business, then here’s a step by step approach for you;

Market Research

Conducting market research includes understanding your target audience, existing EV infrastructure, competitor analysis, new business opportunities, and potential challenges. Finding answers to these basic questions enables you to move smart and swiftly set up EV charging business. 

• Who is your target market, their EV type, and their charging needs?
• Who are your competitors, and what location are they currently serving?
• What are the current and future charging technologies that can impact your business?
• What permits, certifications, and legal requirements for setting up an EV charging station?
• What are the potential risks associated with running an EV business? What are the ways to minimize these risk factors?

Find A Location

Next, you have to find the location to set up EV charging stations based on the above market research. Location with high footfall, easy accessibility, and near to the highway ensures that more EV owners visit your charging station. Here’s how you can find a perfect location for your EV charging station.

• Type and number of EVs in the nearby vicinity.
• Renting or price of space for EV charging stations.
• Legal obligations and state laws for setting up an EV station.
• Nearby businesses like restaurants, shops, hotels, shopping malls, etc.
• Future expansion and growth.
• Use tools like Google Maps, Apple Maps, LoopNet, etc., to find nearby competitor EV charging stations.

Revenue Model

As an EV charging station owner, there are multiple ways you can generate revenue. There are different types of revenue generation methods for EV charging stations. We have discussed them in detail in upcoming sections. You need to decide which revenue model perfectly aligns with your business idea, target goals, and budget.

Start On Your Own or Go for Franchise Option

Next step is an important one because as a business owner you need to decide whether to go for a franchise option or set up an EV charging station. Check all the available options, associated costs, and total investment.

Fulfill Legal Obligations

For setting up an EV charging station, you need to obtain certain licenses, NOC certificates, and approval from local bodies. These legal requirements vary from state to state and country to country. Make sure you have the right legal knowledge and understanding of all the approvals and certifications required.

Invest in Marketing

Once you have completed all the above-mentioned steps, it's time to invest in marketing your EV charging station. Partner with an EV charging app development company to build your digital presence and connect with the target audience. Use popular social media platforms like Facebook, Twitter, and Instagram to spread the word and connect with the target audience.

Wondering, why partner with an EV charging app development company and launch your own EV station app? Then, keep on reading to find the answer.

Why Invest in EV Charging Station App Development?

If you are thinking that setting up an EV charging station is enough to run a successful business, then you are missing out on a huge growth opportunity. Investing in EV charging station app development makes it easy for new and established EV charging stations to manage and streamline business operations. Here’s what investing in EV charging station app development brings to the table;

Strengthening EV User & Owner Relation

EV charging apps allow business owners a platform to connect with the electric vehicle owners nearby and allow them to locate, book and pay for charging sessions. With this EV charging station owners can strengthen their relationships and streamline the entire charging process.

Greater Monetization Opportunities

As a business owner, you must be looking to diversify your revenue generation stream, and the EV charging station app provides you with the same. Business owners can generate additional revenue from digital advertisements, loyalty programs, and other value-added services.

Data Analytics

EV charging station owners can leverage EV applications to collect valuable information and analyze data to gain a competitive edge. The valuable business insights assist in exploring new growth opportunities and provide vital information on utilizing the EV charging infrastructure.

Engage New EV Users

The EV charging station application offers an opportunity for business owners to market and engage new EV users. The growing number of EV users are looking for a station to charge their vehicles, and making EV stations digitally available assists in attracting more users.

Reasons to Start An Electric Car Charging Station Business

In a dilemma, whether to start an electric car charging station business is a profitable venture or not. Then, this section is a must-read for you. Here, we will discuss some prominent reasons to invest in an EV charging station business.

Rise in EV Demand

A recent survey suggested that more than 58% of Americans don’t invest in electric vehicles, fearing running out of power or a limited number of charging stations. However, things will not remain the same, as both the private sector players and governments worldwide are pushing the EV infrastructure. This presents a lucrative business opportunity for entrepreneurs and business owners to make a move and capture the growing EV market.

Avail Incentives and Rebates

The U.S. Department of Transportation is offering a tax credit of 30 percent of the cost of EV charging infrastructure installed before December 31, 2023. Additionally, the government pledged to offer $ 2 billion as incentives and rebates to help entrepreneurs and support the EV infrastructure.

Increase Footfall and Revenue

Installing an EV charging point at existing businesses such as restaurants, bars, workplaces, and gyms creates a win-win situation. EV owners can conveniently charge their vehicles and business owners can capitalize on this opportunity to cross-sell and increase their revenue. While business owners can see an increase in revenue, EV charging station owners can earn profit from charging.

Straightforward EV Setup Requirements

Starting an electric car charging station business is a simple process followed by straightforward regulations and paperwork. While basic requirements for commercial EV setup such as NOC from local bodies, permits from a municipality, fire department, and others are essential. Check with the state authorities where there are any additional regulatory requirements for setting up EV charging stations.

EV Franchise Options

With the increasing number of EV vehicles, there are several EV franchise options available in the market. Partnering allows entrepreneurs to get direct access to their expertise and complete hardware & software solutions. EV charging station franchise service providers like Energys offer a website tool that allows entrepreneurs to calculate the ROI with franchise options.

What Makes EV Charging Station A Profitable Business Venture? 

For every entrepreneur, before investing in a new business venture, it’s all about how they are going to generate money back from the business. With EV charging station businesses, things are pretty simple and straightforward for entrepreneurs. EV owners are likely to spend a minimum of 30 minutes to 6 hours at the EV charging station. While you are going to earn revenue from the electricity sales, there are other revenue generation opportunities that entrepreneurs can explore.

Let’s explore different revenue generation option an EV charging station business owner have;

Revenue From Electricity Sale

Revenue generation in EV charging stations is directly related to the sale of electric power to the owner of the electric vehicle owners. More charging points mean your EV charging station can cater to more EV owners and generate higher revenue.

Cross Selling Products

As you already know that an EV owner is likely to spend a decent amount of time charging their electric vehicle. As a business owner, you need to be smart and creative to take advantage of this spare time and try to sell products like drinks, snacks, car accessories, etc, to generate additional revenue.

Fast DC Chargers

As an EV charging station business owner, you can invest in fast DC charging technology to reduce the waiting line and serve more EV owners. This new-age charging technology reduces the electric vehicle charging time from 5-6 hours to 1-1.30 hours. With this, you can save EV owners' valuables, cater to a wider target audience, and generate more revenue with more electricity sales.

Charging Subscription

Most EV charging stations offer subscription models to offer more perks to electric vehicle owners. EV owners can buy a monthly or annual subscription to these EV charging stations and enjoy unlimited access and other perks. 

Advertisements

An EV owner is likely to spend more than 30 minutes on your EV charging station. This is a great opportunity for brands and businesses to display their ads and connect with their target audience. As a business owner, you can invest in big LED displays to attract more advertisers and 24*7 run video advertisements.

Conclusion

The electric vehicle market is evolving at a rapid pace and offers new business opportunities for entrepreneurs. Setting up an EV charging station keeping in mind the target audience's needs and upcoming future trends, is a profitable business idea.

So, why wait? Take the first mover advantage and start a charging station business. Connect with our experts to build an EV charging management software development to gain a technological edge over the competition and streamline business processes.

Discuss your project needs with our expert today!