Power to the People

Power to the People

Retailers are used to seeing customers pressed for time and intent on getting into and out of their stores as quickly as possible, even if it means breaking a sweat. But Jacy Everett envisions a time in the not-too-distant future when many customers will be quite happy to browse a while. To these customers, what’s in the parking lot might be almost as important as what’s on your shelves.

Everett, Director of Business Development for Aetna Corp., said retail stores that devote a small percentage of parking spaces to electric vehicle (EV) charging stations will have an edge over competitors as EVs become increasingly popular. In September, EV manufacturers hit a significant milestone when the number of EVs sold worldwide hit four million, according to Bloomberg News. The rate of adoption is accelerating quickly.

About one million EVs were sold during the six-month period that ended in August, and the International Energy Agency expects there to be 125 million EVs on the road by 2030. In May, a survey by the American Automobile Association found 20 percent of Americans planned to make an EV their next vehicle purchase, up from 15 percent in 2017.

The AAA survey found consumers’ two main concerns about EVs are “range anxiety” – the fear that they will run out of battery power on the road and be stranded – and a dearth of available charging stations. But with battery technology improving and charging infrastructure expanding, those issues are becoming less worrisome to consumers, especially millennials, who are more likely to be environmentally conscious.

“Today, electric vehicles have mainstream appeal,” said Greg Brannon, AAA’s Director Of Automotive Engineering. “While concern for the environment is still a major motivator, AAA found U.S. drivers are also attracted to the lower long-term costs and advanced technology features many of these vehicles offer.”

Level 1 charging stations, which typically take eight to 12 hours to charge a fully depleted battery, are common in homes. Level 3 stations, the most expensive option, are commonly referred to as DC fast-charging stations and can give most EVs an 80 percent charge in half an hour or less, making them ideal for placement on major corridors to facilitate long-distance traveling. For retailers, the sweet spot is right in the middle with Level 2 stations, which can charge a depleted battery in four to six hours.

“I think many people would be surprised at the number of electric vehicles already on the road and the number of charging stations out there,” said Everett, whose company recently began installing and maintaining charging stations for retail stores. “As the prices continue to come down and battery technology improves, you’re going to see a lot more people buying electric vehicles.”

Everett recommended retailers with ample parking space earmark 5 to 10 percent of their spaces to charging stations to prepare for widespread adoption of EVs. Retailers can structure this amenity as they see fit and can change it on the fly because most charging stations have a wireless connection to the Internet.

Some retailers might want to allow free, unlimited charging, while others might want to attach a small fee to the service. Others might want to make charging free for only the first hour or so to prevent abuse. Retailers can choose to provide free charging to employees as a workplace benefit or offer them a discounted rate.

Everett said one retailer discovered that a resident living nearby was using its charging station for long periods late at night, so the store made the charging station free to use only during store hours and began charging for it after closing time. He said in the near future, retailers will be able to link the charging stations to customer rewards cards to encourage use.

EV charging stations make sense for a wide variety of retailers but are especially attractive for stores where customers typically spend a good deal of time, such as big-box retailers, gyms, movie theaters, malls, grocery stores and restaurants.

“If you have charging stations at your location, people are going to find them, and that really gives that retailer an advantage,” Everett said. “The typical EV driver has a higher income than the average consumer, so if you want to attract these customers and you have a charging station and your competitor doesn’t, you can potentially influence that person to come to your site because you have that amenity.”

Electrify America, a subsidiary of Volkswagen Group of America, plans to invest $2 billion to create a nationwide network of charging stations by 2027, with $800 million devoted to locations in California, traditionally a leader in the environmental movement.

In April, the company announced plans to install DC fast-charging stations at more than 100 Walmart stores in 34 states by June 2019. Electrify America also has installed charging stations at retail locations for Target, Simon Property Group, Brixmor Property Group, Kimco Realty Corp. and DDR Corp. The company installs and maintains charging stations, with a minimum build of three parking spaces, at no cost to retailers through site-use agreements.

“The premise is to provide customers with convenient, well-lit charging stations at a wide range of retail locations,” said Brendan Jones, COO at Electrify America. “The number of EVs hitting the market is going to increase exponentially, and these EVs, which are coming from a wide variety of manufacturers, are going to have longer-range batteries and faster charge times.” 

By: Nick Fortuna

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Published: November 19, 2018