Federal Loan Guarantees Will Promote Nationwide EV Charging Facilities

The federal government and several major car companies are partnering to expand EV charging stations across the country. For its part, the government is making $4.5 billion in loan guarantees available to promote the project. Ford, General Motors, Nissan, and Tesla will participate as well. The expansion is designed to help ease “range anxiety” among drivers who operate cars with plugs.


EV Charging Station

The goal is to make “coast-to-coast, nationwide zero emissions travel” a reality by 2020. State, county, and local governments will be encouraged to buy electric cars for their fleets, lowering procurement costs while expanding the market for the cars. Charging infrastructure has been “one of the obstacles” to widespread adoption of electric cars, said Lynn Orr, undersecretary for science and energy at the Energy Department. She notes that drivers routinely check fuel levels while getting to and from work. “The kinds of things we’re talking about today make it possible to provide the same kind of service for electric vehicles.”

Electric utilities like Berkshire Hathaway Energy Co., Consolidated Edison Inc., Duke Energy Corp. and Southern California Edison Co. are also involved. SCE is already working on a customer financed pilot project that will install 1,500 charging stations in southern California.

Electric cars have been the victim of a “chicken or egg” situation since the first modern EVs went on sale almost a decade ago. They needed electric chargers along highways and at work in order to drive far from the comfort of their charging equipment at home. On the other hand, if batteries were more powerful and the cars had more range, drivers would not be so dependent on public charging equipment.

The government and many companies have been staring at each other, waiting for the other to do the heavy lifting. In the early days of the automobile, gas stations could make a profit by selling gasoline to motorists. No such business case exists for electric car chargers, primarily because of the time needed to complete the charging process. It takes five minutes or less to fill the tank of a conventional car. It can take an hour or more to do the same for electric cars.

Grumps Karl Brauer, an analyst with Kelley Blue Book, longer range electric cars will probably do more to boost sales than building charging stations.  “It takes 20 minutes to charge, even with a Tesla fast charger,” Brauer said. “It takes hours on a regular charger. Range anxiety is still a big issue.”

The whole electric car movement took a step back last week when NHTSA, EPA, and CARB jointly agreed to relax the guidelines for average fuel economy by 2025. They said that the auto industry can meet those new targets by simply continuing to improve the efficiency of the internal combustion engine — no hybrids, plug-in hybrids, or electric cars needed. If that’s the case, why fund electric charging facilities at all?

Perhaps the answer is because it’s the right thing to do. Any pressure the government may be willing to take off automakers is being more than made up for by the efforts of Tesla Motors to sell electric cars to the masses. 400,000 reservations for its Model 3 are ample testimony to the fact that cars with plugs are the future, no matter how hard some are straining to hang on to the past.

Source: Bloomberg  Photo credit: Foter

Steve Hanley

Closely following the transition from internal combustion to electricity. Whether it's cars, trucks, ships, or airplanes, sustainability is the key. Please follow me on Google + and Twitter.