Short answer: Probably not.
CAPEX (capital expenditure) is a big deal in fuel. Due to being an industry with thin margins and complex equipment, ROI can be pretty slow even on core business applications (pumps, tanks, PoS), so if you are going to spend chunks of money you have to be able to answer three questions: what is the cost, what is the payback and will I need to invest further CAPEX later on?
The cost of EV equipment varies hugely, depending on what you buy, but there are other fees that need to be considered. In most cases you’ll need to get an additional source of electricity and for some models you’ll need to dig up the forecourt to install.
There is also opportunity cost. It takes at least 20 minutes to get an acceptable charge from a stop and a lot longer to fully charge. Sure, there are fast charging options, but these can be more expensive and not all EVs can use them. This could be a parking space for ten customers in the time that you are servicing one, and probably with one of your lowest margin items; electricity.
There is a flip side to this. Whilst someone taking up a parking space in your forecourt may just pop in for a bottle of water and leave, EV customers have more time to kill and this could result in buying high-margin items like hot food or coffee. If you have inside seating and a great hot food offering, this could increase your in-the-box sales. Plus you are bringing customers to your forecourt who could not shop there otherwise. The impact of this should be considered station-by-station.
The payback depends on which company you go with, whether you own the equipment and the deal you agree. Some companies- such as Instavolt lease the land from the forecourt and provide a commission for each kw sold. I think of this as the residential solar revolution - I can put my own solar panels on my house and maximise profits or someone else can do it and I can get a smaller fee for less work with a guaranteed payback in X years.
The other concern is the speed the technology is moving at vs the time it will take to pay back the investment. Unlike fuel, where the nozzle just needs to fit a hole in the car, EV is a bit more complex. If you can’t service your customers, you may end up having to buy new equipment or just give up altogether.
Finally, you have to consider demand. The UK, France, the US and Japan all had less than 3% of all car registrations as EV in 2019. It’s worth keeping an eye on this for your markets. You can see more on the IEA’s Global EV Outlook and Wikipedia has some great data too. The image below shows a state-by-state breakdown:
Short answer: Depends where you are, but in most places it’s pretty unlikely.
Full answer:Long term commitments can be political gold for governments. It’s easy to commit to something that will happen in 17 years time when there will be multiple leaders and multiple parties that can rip it out between now and then. If you keep spending commitments low during your term, it’s a pretty cheap way to win votes.
And that’s why any target put in place ten or more years in advance should be largely ignored unless there is a third party legal commitment (like overall EU emissions reductions for example).
Furthermore, there is less commitment globally than you’d expect. The below map is from 2019 showing in blue countries with an official action plan on EV (source: Future Fuel Strategies).
Don’t get me wrong, some governments are investing heavily in EV, especially on a state level in the US. California is investing $2.46 billion in EV infrastructure, but when you compare that to the UK (which has a bigger population than CA and twice as many registered cars on the road), somewhere in the range of £100m (a final number is difficult to find due to it’s insignificance) of taxpayer money is being spent. That’s 96% less. See what I mean?
This doesn’t mean that EV investment is low as private investment in the area is pretty significant. But that is to answer a different question. As the global economy is set to tank, the appetite for climate change initiatives will change. Which way is yet to be seen.
Short answer: Yes, even when you take into account the production footprint.
EVs, like their conventional counterparts, also partly run on hydrocarbons. This is because of both energy consuming production and the source of the electricity that powers the vehicle every day.
Most countries use a mix of different power sources, with renewable energy becoming more prominent over time. However, since the wind does not always blow and the sun does not always shine, there still is (and likely always will be) a need for other sources of energy. Nuclear has very low carbon emissions but a bad reputation, so coal, oil and gas still service approximately 60% of the global electricity demand. And since fossil fuel use is more prominent in the countries that produce the majority of lithium batteries, there is a considerable footprint to consider.
In terms of whether EV has environmental benefits your particular country or state (I get this doesn’t really make sense, since we all share the same planet), depends on the local energy mix.
Having said the above, it is estimated that an electric car can save an average of 1.5m grams of CO2 over a year (source: EDF Energy); the equivalent of four return flights between New York and Miami. So the answer is a pretty resounding yes. Fair enough!
4. What on earth is Hydrogen and how does it stack up vs EV?
Hydrogen fuel cell cars create chemical reactions between hydrogen and oxygen to create water and energy. Whilst they have exhaust pipes the only thing that comes out of them is water. You fill up a hydrogen car much in the same way you would fill up an unleaded or diesel car; at the pump.
So what are the pros and cons to the consumer vs EV:
Hydrogen cars win outright on both range and time to fill but the price makes them unobtainable for many buyers hoping to leave unleaded or diesel behind. In the US, hydrogen car sales decreased in 2019 by around 12%. According to Air Quality News (yes, there is an establishment dedicated purely to news on air quality) EV still only makes up around 0.5% of the global total, Hydrogen had only 7,500 car sales worldwide by the end of 2019. This cost makes it easy to see why.
The environmental impact is very dependent on electricity generation and since hydrogen is not available in its raw form, it's production is still pretty emission heavy.
When we think about how this relates to stations, you probably aren’t going to get as much business from Hydrogen as electric, but it will take up less room on your forecourt and offer a niche that your competitors may not be able to provide. I’d say it’s one to consider for the future, but if costs can come down and hydrogen cars manage to take off, this maintains the use of a station in the traditional sense and is probably better for the industry long-term.