As roadblocks are addressed, electric vehicle adoption charges ahead

Electric vehicles have been touted as the next big thing in transportation ever since GM introduced the EV1 in 1996 and Toyota unveiled the Prius the following year. Now, two decades later, “big thingness” for electric vehicles may finally be within reach, with sales showing impressive numbers. Nearly 200,000 were sold in the US in 2017—up 26 percent from the year before.

The feeling of having arrived at the future was a predominant one among attendees at this year’s National Grid Energy Solutions Summit, held in October at Gillette Stadium in Foxborough. This was the tenth year of the summit, where individual and business consumers can get information about high-efficiency energy technologies and developments from vendors, analysts, and businesses that are using those technologies.

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And who could blame them for being upbeat? The future of the future that’s finally here for EVs looks incredible: Bloomberg New Energy Finance expects worldwide EV sales to increase 1,000 percent over eight years, from 1.1 million worldwide in 2017, to 11 million in 2025. Here in the US, researcher Loren McDonald of EVAdoption expects an equally dramatic increase in sales but in even less time, predicting that number to be 1.25 million in 2022 (from about 200,000 last year).

Washington is stepping up too, requesting realistic plans to meet crucial energy goals. The 50×50 Commission on U.S. Transportation Sector Efficiency, for example, brought together diverse stakeholders to formulate policy ideas for reducing energy consumption 50 percent by 2050. The commission, which is co-chaired by Dean Seavers, president of National Grid US, and Scott Keogh, president of Audi of America, came out with its first recommendation report for policymakers this fall.

With a future that bright, someone has to wear shades

“I think the estimate of how long it takes us to get there may be a little different among the people [here at the summit] than among a group of average Americans [who are] not in the energy sector,” says Andrew Goldberg of Hannaford Supermarkets. Goldberg, who works on energy and utilities for the chain’s retail business, was a speaker at a panel on fleet and personal vehicle electrification.

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“I look at EVs just like any other evolving technology,” he says. Goldberg points out that not long ago you’d find a pay phone in any restaurant, hotel lobby, or airport, but now “it’s weird” to see a pay phone. He sees the same thing happening with gas stations. “Today, we don’t really notice that there are gas stations all over the place,” he says. “But in 50 years, my kids will say to their kids, ‘Oh, there’s a gas station, right? We used to use gas stations.’”

While EV sales in the US are increasing, many markets are doing far better. According to EV-Volumes, an EV sales database, from 2016 to 2017, EV sales increased in China by 73 percent, to 606,000 vehicles, and Europe was up 39 percent, to 308,000.

 

So why aren’t US consumers more charged up by EVs?

“Price, range, and charging” are the chief issues, says Brett Hauser, CEO of Greenlots, which provides software to manage and run EV infrastructure. Hauser, a keynote speaker at the summit, notes that the first two of these issues have been pretty much resolved.

“The price points on the vehicles are starting to come down significantly,” he says. “Starting next year, you’ll start to see available models in pretty much every segment of the market—high end, middle, and entry level.” Hauser notes that more SUVs, specifically, are coming to the market. With a wider model selection, “people are going to be able to find one that meets their lifestyle.”

Prices are decreasing in part because batteries continue to drop in cost. In 2010, EV battery prices were around $1,000 per kilowatt-hour (kWh), but by the end of last year they were down to $209/kWh, according to BNEF. Also, as car makers continue to increase EV manufacturing capacity, economies of scale will bring the price down further. And, while it doesn’t show in the sticker price, EVs—which have fewer moving parts than gas-powered vehicles—cost far less to operate: $485 per year vs. $1,117, according to a study published this year by the University of Michigan’s Transportation Research Institute.

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Perhaps more important to consumers than sticker price is the issue of how far an EV goes on a single charge. A study by the government’s National Renewable Energy Laboratory found 57 percent of consumers want an EV to go at least 375 miles in order to consider buying one. This, even though AAA reports the average American drives only 31.5 miles a day. The average range for an all-electric vehicle is now 100 miles and even the most pessimistic analysts expect that to continue to increase.  The EV with the best range is the Tesla Model S at 335 miles. But you don’t have to spend anywhere near the $94,000 that a Tesla costs to get range that’s well above average. The Chevy Bolt has a range of 238 miles while costing about $60,000 less.

All of which brings us to the issue of charging stations and public misperceptions.  

As Hannaford’s Andrew Goldberg points out, today no one thinks twice about whether they’ll be able to get gas for their car. That is definitely not the case with EV charging stations. As of 2017, Massachusetts had nearly 600 alternative fuel stations, most of which offer electric charging. In 2010, the state had only three, according to a Globe report. By comparison, as of 2014, there were 1,988 gas stations in the state, according to data tracked by the US Census Bureau.

“Unless our customers see charging stations as ubiquitous and universally available, there will be that hesitation to buy an EV,” says Rishi Sondhi, emerging products manager at National Grid. With recent approval from Massachusetts, the energy company is planning to deploy about 1,300 charging ports across the state over the next three years, helping close the gap between gas and charging stations. They will be installed everywhere from private businesses and multifamily homes to public parking garages and retail locations.

 

How businesses may save the day

Hannaford’s Goldberg thinks the charging station issue might be addressed in part by retailers installing them to attract customers. To find out if this works, the supermarket chain is running a pilot program at 10 of its stores in Maine and New York.

It all started when the manager of the store in Camden, Maine, reported that customers were plugging their cars into the store’s outdoor electric outlets and wanted to know if it was safe. After Goldberg got over his shock that the outlets were still working, he and his bosses decided this was something worth investigating.

The Camden store manager was not convinced a charging station would serve a purpose, Goldberg says. “A lot of store managers said, ‘I don’t have any customers with EVs, I don’t have any employees with an EV, we’re in a low socioeconomic area,’ or this or that. And then we put one in and suddenly, it’s being used all the time,” Goldberg notes. “It’s because the technology has allowed people to say, ‘I want to get from A to B and stopping here lets me do that.’”

At the Hannaford in Marlboro,  the charging station had 172 charging sessions over one three-month period. The average session was about 40 minutes and a lot of people spent that time getting their grocery shopping done. The price of the electricity for all that charging? $400. So for now, Hannaford sees it as a loss-leader and isn’t charging customers.

Hannaford hasn’t yet decided whether or not it will expand the program but Goldberg can imagine it catching on as more people buy EVs.

“This could become a minimum level of offering for stores,” he says. “At one point no one [in retail] ever talked about Wi Fi. Why would they think of that? What did it have to do with grocery shopping? But now it’s almost become a cost of entry [to doing business].” For now, charging stations give customers a reason to patronize one business, like Hannaford, over competitors. If an EV driver en route to picking up groceries or doing other errands needs to recharge, it’s a no brainer that he or she will choose the business with a charging station in its lot.

Charging stations can be an amenity for employees, too. National Grid developed an internal EV benefits program for its employees, hoping to lead by example and gain first-hand insight into common barriers and solutions to making the switch from gas to green, says Sondhi. The company found that employees do want EVs when the three main obstacles to purchase—lack of awareness, affordability, and accessibility—were addressed through an informational platform, financial incentives, and charging stations installed at 20 National Grid facilities.

Within six months’ time, about 200 employees had purchased EVs, including Sondhi. “It’s been five months without gas,” he says. “It’s liberating driving by the gas station knowing I will probably never stop there.”

National Grid makes it more cost-effective for businesses and multifamily properties to set up electric vehicle charging stations for customers, employees, and tenants. National Grid offers site assessments and covers up to 100 percent of electrical infrastructure and installation costs for approved projects. For additional details and a program application, contact evnationalgrid@nationalgrid.com.

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