PODCAST: How the race to build EV infrastructure is picking up speed

Have you noticed that more and more electric vehicles are zipping all over the place? They're silently gliding through the streets like spaceships from the future. I've got to admit, it's got me all charged up. But there’s still a problem with EVs. The charging network that powers these vehicles, it needs to catch up.

Adam Happel: This year, there's forecasted to be about a million EVs sold and delivered in the United States alone. That 1 million is somewhere between 5 and 6% of total vehicles sold today. By 2025, it's supposed to be that 20% of all new cars will be EVs.

I am Adam Happel, VP and head of growth here at EVgo.

We are one of the original, kind of OGs. We were founded in 2010, but we essentially own, operate and deploy DC fast charging stations for EV drivers.

James Cook: Today we're going to join Adam Happel, with EVgo, along with Josephine Tucker, who works with me at JLL. We're going to talk about this surging demand for electric vehicle charging stations throughout the United States. What are the pain points and what is the promise?

This is building places, where we look at the world of real estate through the eyes of the experts that study it every day. My name is James Cook and I research real estate for JLL.

Josephine Tucker: Josephine Tucker and I'm the head of clean energy and infrastructure advisory at JLL.

What's insane to me about that growth trajectory is just how wrong we got it.

If you go back and look at some of the analysis that was published even a year ago, but let's say, you know, five years ago, the prediction was 1 to 2% of vehicles will be EVs by 2030. Maybe we'll get to 5%.

We're at 5% now. The numbers you just gave are much bigger than that. So, it's like we need the infrastructure to catch up because this growth is happening a lot faster than anticipated.

Adam Happel: Just to meet the demand of the vehicles coming on board, I've seen estimates saying we'll need about 300,000 fast chargers in the United States alone. Today we have about 30,000 deployed across the U S. So, we need to essentially 10X the number of available stations across the US in the next six years, or so. So that's a lot of work.

James Cook: So, we're going to need so many more charging stations than we have. Are they going to be in the same kinds of places we get gas today?

Adam Happel: The answer to that is yes. When I look at EVgo’s network, we have over 900 locations today. We are predominantly an urban charging network. So, we're in 60 major metropolitan areas across 30 states. We have a lot of stations at supermarkets, at stores and shopping centers where people will go spend 30, 40 minutes doing their shopping, can plug in, come out, top off their vehicle, have basically a full charge on one of our fast-charging stations. That's really important.

There's a program part of the bipartisan infrastructure law, the National Electric Vehicle Infrastructure Program, and it's essentially building or creating incentives to build many more charging corridors.

As you're on a road trip, you're stopping, call it 200-something miles into your trip that might be 400 miles long, you can stop halfway through, charge up your vehicle and get to your final destination. A lot of money is coming through that program today to help deploy that.

Josephine Tucker: All this funding is suddenly going to help the business case and subsidize charging where it isn't today and there aren't enough necessarily EVs today to justify the business case. But we got to get those. It's like the chicken or egg problem, right? You got to get the chargers there so that people can actually buy an EV and feel comfortable that they're going to be able to charge and they won't have that range anxiety issue We're actually working with the Georgia Department of Transportation on their NEVI program.

So, of the $7.5 billion dollars that were dedicated from the federal government to go into this space, Georgia's cut was $140 million and we are now working with them to try to figure out where the best locations around the state. We looked at evacuation corridors, like rural tourism destinations, all the different use cases that a state D.O. T. Needs to be thinking about in order to make sure they've got the requisite infrastructure for the EV demand that we were just talking about before.

James Cook: So, the NEVI program, once those dollars are spent and we've got all these new charging stations. Is that going to be enough to meet the demand or do you think we're going to quickly outpace that as well?

Josephine Tucker: I'm curious what your reaction is to that, Adam. I think yes.

Adam Happel: Yeah, I agree. Creating this level of incentive, via the program is, is really important for getting us jumpstarted. And the great part about the NEVI program, where we've actually been working through NEVI applications and partnering with General Motors and Pilot Flying J, and we've been quite successful in that as well, particularly in Ohio, in getting awarded a number of those funds to build these corridors is that once that kicks off this kind of virtuous circle starts.

So, as people get more comfortable going on their road trips, more comfortable owning and using an EV as their primary vehicle, because they can stop because they see the construction work going on, more and more vehicles are going to be bought. And the really interesting thing, and it's kind of mimicking what I saw in solar, like, 10 years ago. Back then, the most likely indicator of someone going solar, is if their neighbor got solar installed. And I see the exact same thing happening today in electric vehicles. Like, the most likely indicator of someone buying electric vehicles, like, one of their friends bought an electric vehicle and said, ‘this is the best hands down vehicle I've ever driven.’

I'm very privileged and lucky that I have a Rivian, got it while I worked there, and I have told anyone who will listen to me about how amazing this vehicle is. I consider myself a car guy and this is hands down the best driving experience I've ever had.

I should be working on commission at this point for them because I think I've sold probably five or six new Rivians just in my neighborhood by giving people test drives and things like that. So, I think that's what's going to happen, we’ve going to have this virtuous circle as people get more and more comfortable driving an electric vehicle as their primary car because there is more infrastructure out there for charging, because you can feel comfortable going and doing those things and it just keeps building and building and building from there.

James Cook: I love it. Since we are a future of the built environment podcast, let's talk a little bit about commercial real estate, so what are the barriers?

Josephine Tucker: Power. I think in the beginning it was a bit of an afterthought. I think now there's been enough challenge in the industry and enough noise that like those who are kind of in it, get it. But I've got stories of clients that ordered like fleet, you know, ordered electric vehicles, light duty, commercial vehicles, and have no place to charge them, because they just thought, ‘oh, you just buy one of these things, you plug it in. How hard can it be?’ And the truth is, is that, , maybe one charger, like an at home charger is fairly uncomplicated, but when you start talking about like commercial deployment, having several fast chargers in a parking structure, for example, cause we see that a lot, grocery stores, mixed use, whatever it's all over, actually, the power requirements are a little bit higher than you'd expect. And so, if you don't have enough excess electricity capacity for that particular location, you've got to go and then apply for it, for the utility to bring that power to site. And that can take one to two years. In most cases, it's taking up to two years. So, you really have to get your plan in order, but way in advance of when you think you're going to need it. And so, it's just, I think it's kind of having this, spiraling effect of, okay, now, we've delayed our plans for getting the EV charging infrastructure in place and now we're getting a little bit antsy and then, oh crap, there's a two-year kind of wait line. So yeah, I'd say that's the number one issue.

James Cook: Wow. Are there any kinds of places that already have more power?

Josephine Tucker: Oh, definitely. Any sort of larger development, like if you were to go to a Walmart or a hotel or something like a mixed-use development where there's a bunch of different businesses like a mall or an airport, there's a lot of activity already on site. They've been planning for this, so they probably have some excess capacity. But it's when you look at maybe a smaller hotel and all of a sudden, they want to put 10 chargers in like those are the kind of like tipping points, right?

Or another great example would be we're working with a school district right now who's electrifying their bus fleet. And most of their bus depots have very minimal power on site because it's just a small office and like a little sort of machine garage, right? So, they don't have the kind of power required to electrify 20 or a hundred buses.

James Cook: I imagine a lot of what's going on right now is driven both by the public and private sector kind of together, one trying to help the other. Is there sort of a standard kind of public private partnership that's emerging?

Josephine Tucker: I think that the model has been evolving quite a bit, actually, and to the power challenge we were just talking about before, I think that has actually lended itself to what we would call sort of a progressive P3 model where you're layering on the requirements and bringing the right stakeholders to the table, to the deal, at the right time. And I raised this because in the school example that I gave before, this started out as an EV charging program that we were running on behalf of the client, looking for the right developers to come and bring their charging infrastructure to these bus depots. But very quickly because the power capacity issues that the gap was so stark in every location, we all of a sudden started to have to think about maybe having distributed generation or some kind of like on site energy, right? So solar on site, maybe with some backup generation or battery storage to just try to close that gap. Still working with the utilities but trying to find a way to make that project go faster.

So, in those instances, now you've got EV charging infrastructure, you’ve got on site renewable energy and maybe even potential for something like a micro grid or a technology that would allow you to balance energy supply and demand and kind of make use of the patterns of which those buses are charging or deployed.

It's really interesting having all those different technology elements actually lends itself to more of a progressive P3 approach where you can just bring different types of developers into that ecosystem at the right time and make sure that they're trading off cost benefits and risk in the ways that kind of suit their individual needs.

Adam Happel: I love hearing about the micro grids. Like, I feel like we could talk about that for days. But one thing I did want to hit on also is there are a lot of utilities out there that are thinking through this challenge, as well and they know that the power requirements are always something that gets a little sticky.

So, there are a lot of programs out there that utilities have. Typically, they're called a make ready program where they'll essentially fund the hardware upgrades that you need, whether it's a transformer or paying for trenching things like that all the way up to the site host location, so that it isn't a burden on either the owner of the real estate or the company that is helping manage the property or the brand itself that is there or the charge point operators, such as ourselves, because the utilities want more electric vehicle charging infrastructure out there, so they've created these really great make ready programs that oftentimes we and others will partner with the utilities too. So really exciting things that have come out of sort of those public private partnerships where different stakeholders have identified where they can help smooth the process out.

James Cook: That's fantastic. So, Josephine thinking about, you know, like the property owner, somebody owns commercial property, or maybe they own, I don't know, office building, shopping center, what, kinds of different models are being used?

Josephine Tucker: You know, it really depends location by location. It really depends on how dense of an urban environment are we talking about? How many people probably have EVs today in that city or in that place? And then for that specific business, what is the sort of profile, like what's happening at that business, right?

Like we talk about a shopping center, as an example. You think about like a hospital or a cinema, or there's so many different types of business models that are being utilized in real estate. And so, the charging infrastructure needs are going to be really case-by-case dependent on what's happening at that real estate location. And that then informs the business model that makes the most sense. For example, if you're like a CVS, you've got most of your customers coming in for like 20 to 45 minutes and you've got between 20 and 50 parking spaces at that particular location. You got to do the math on what kind of charger do we need? You probably want a fast charger because you want something that's going to give them enough of a top up in that window of 20 to 45 minutes. You don't want a slow charger that's going to take six hours because then that just doesn't meet the customer's needs. But then how many do you choose? Do you have two, do you have four? And all of that math to inform how many spaces are required is then what will inform the business model that makes the most sense because maybe you want to own and operate it yourself. Some of our clients do, especially on the government side, there's cybersecurity issues. There's just concerns about infrastructure ownership. And so we've seen that, but then we've also seen cases where it's a distraction from their core business, so they want somebody else to completely come in and provide that turnkey solution, which is you're basically outsourcing the EV charging needs a provider like EVgo or others would come in and say: You know, these are the spaces, this is the infrastructure, we're going to install it, we're going to maintain it, and then you just, work out a lease arrangement essentially.

James Cook: Okay. So, Adam, let me ask you this then, let's say you're looking to place a new EV charging station. How do you pick the right spot?

Adam Happel: Yeah, that's it's a really important question because a lot of our site hosts have a portfolio or multiple locations, and our job is across that portfolio looking at what is the utilization or utilization potential for those sites? And that can include things like, what is the density of electric vehicles and registrations in the area? What are the paths of travel and convening sites because there are C stores or grocery stores or other shopping and amenities there. So, we're really looking into those types of calculations as, as we choose the best sites to go and head and deploy our charging hardware or charging locations. And then the final piece, of course, was that power that we're talking about from the utility.

So, are those power requirements able to be met? And can we basically do construction, deploy our hardware, and get it up and running as fast as possible so that that onslaught of EV charging and people who want to charge their vehicles up, that demand is satisfied.

James Cook: So, let's imagine, you know, the people that are born this year, right? They're going to get their driver's license in 16 years, right? So, when they are getting their learner's permit, how fast are you going to be able to charge a car? How prevalent, you know, envision the future for me.

Adam Happel: So, the coolest thing I think that's happening now, someone much younger than me had said this to me a few years ago. They lived in the city, didn't own a car and they said, ‘I don't think I will ever own a car that is not an electric vehicle.’ And that's kind of happening right now, as you think about, you know, younger generation coming up, buying their 1st car, getting their 1st car, I think, in 16 years from now absolutely pretty much all of the vehicles on the road, hopefully new cars sold, will be electric. In my mind, it won't even be a conversation of is it an ICE (Internal Combust Engine) car or an EV? And along with that, I mean, 16 years is a long time from now, I think that we're going to be seeing that exponential growth in sort of the public infrastructure as well as home charging.

But home charging doesn't cover all of your needs because there's people in multifamily homes that are renters that are kind of looking for other options. So, as this industry evolves, we're going to be looking at a lot of other places that people charge, where their vehicles have the dwell time, where they're going to sit. But that's really the convenience of an as well, is that it sits and it charges while you're doing something else, while you're sitting in your home, while you're shopping, while you're eating, while you're dining.

The speeds will get faster and faster. I am not a physicist. There's probably some sort of physics problem that needs to be solved, but we're getting to the point where we’re going from 20% to an 80% charge on some vehicles, a Lucid, a Hyundai takes 20 minutes, right? So, we're kind of already reaching those charging speeds that are very, very convenient for everything from your road trip to just stopping and charging when you need to.

The cool thing is if you're stopping for an hour, you don't necessarily need to hit those top, you know, 300- and 400-KW charging speeds today. If you find 100- or 200-KW charger, you're actually good if you're going to stop for an hour, because the worst thing that happens is you complete your charge and then you have to go out and move your car halfway through your shopping experience, things like that.

So, when I think 16 years out from now man, I don't know. There's probably a lot of cool things that will happen, but I think the coolest thing that's going to happen is that pretty much everyone's going to be driving an EV by then.

Josephine Tucker: I love it. It's so interesting to think about that. Fifty years ago, there were like one or two EV models on the market, and they were definitely hybrid, and not that many people own them. Today, we've got more than 100 different models.

That was not the case even 10 years ago. It's just, it's changed so fast. I think Adam's spot on. The convenience of an EV is that you can do two things at once. And that's the challenge with fossil fuel vehicles today. It has to be a dedicated trip and you have to be there filling up your gas tank. You can instead run into CVS or be at a hotel or camping or there's so many different options.

So, I think it's really exciting. And for sure. I would say 16 years from now, we're probably going to see not just EVs everywhere, but also I'd say autonomous vehicles are going to be a lot further advanced at that point. And so, if you think about vehicles, they'll be parking themselves. You won't even have to worry about it. You'll just let it drop you off and it'll go find the best parallel spot in the neighborhood.

James Cook: Well, I can't wait for somebody to do the parallel parking for me cause I am not the best. You can talk to my wife about that. Uh, Anyway, Adam, Josephine, thank you so much for joining me.

Adam Happel: James, thanks so much. And the JL team, thank you for having me on.