Tuesday, August 21, 2012

The Business Case For Level 3 Charging Over Level 2 Charging

Today, Blink suddenly announces that it will immediately require $2.00 payment for every hour to use their Level 2 charging stations ($1.00 for members for the next year -- but certainly no longer free). I recognize that Level 2 charging station operators must try to create an economically viable model. But consider the reality: a Leaf driver can travel about 35 miles with a three-hour charge that costs $6.00 (at $2.00/hour charging), and is therefore now paying the equivalent of $6.00/gallon for gas.

I contend that this demonstrates that there is no functional business model for public Level 2 charging. EV drivers will avoid charging outside the home unless absolutely necessary. Worse, perhaps, is that the public may come to embrace mediocre PHEV's with limited all-electric range in order to ensure that they have less-expensive gas back-up. This is a failing proposition for everybody.

However, if a Leaf were to use a level 3 fast-charger, with a 30 minute charge it can travel about 50 miles. If that charge were to cost, say, $5.00, it would be the equivalent of about $3.50/gallon for gas, and it would likely be quite acceptable to the public. Moreover, the charging station operator, more in the manner of a gas station, could make $10 an hour (instead of $2 an hour), and would doubtless be far busier (while the cost of electricity would of course be greater, it is the regular use of the device that generates profit). Moreover, with commonly-available fast chargers, there would be the opportunity for apartment dwellers and street-parkers to use EVs.

Plug standardization issues will hopefully soon be fully resolved, and the price of fast chargers are rocketing down. It seems likely that Level 3 is poised to become the reality. As it should be. Level 2 was always a readily-available but mediocre technical feasibility in search of a business model.  

Of course, I also believe that Level 1 charging using a plain household outlet should be ubiquitous.  It costs next to nothing to put plain outlets in parking garages, at employer lots, in apartment buildings, and even on the street, because the only cost is simple conduit and the small hourly amount of electricity.  This kind of charging will satisfy most people who are parked for hours.  And with such small costs, it doesn't require a business case.

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