The pace of change has accelerated in the electric vehicle (EV) charging industry. The EV charging market in 2025 will look very different compared to what it is today, says Virta’s CBO Elias Pöyry.
There are four key trends that will change the EV charging market in the coming years: Brands, end-to-end, energy management and open ecosystem. Let’s take a closer look at each of these trends and what they mean.
Brand is the king
Charging is a must-have service for EV drivers anywhere they travel. And people tend to do business with companies they trust. The same goes for EV charging: people will favor charging with brands they trust. It is no wonder that just about any consumer business – from shopping centers and restaurants to hotels and from energy companies to petrol stations – is considering to start to offer EV charging as a part of the overall customer experience.
What does every business owner or land and property owner want? They want their own brand to be related to EV charging. This goes well beyond adding the company’s logo sticker to the charging station. It means full brand experience – from loyalty programs onwards. It means that the core business is fully integrated into the charging experience. In addition, charging point owners of course want to collect end-user data, in order to be able to develop their core business.
We will see in the coming years that even small brands will take advance of the EV charging and fully integrate the EV charging into their existing services. One could say that out of these four EV charging trends, this “brand” trend is strongest one.
Avoid hidden costs
Second big trend is the integrated end-to-end digital value chain. It means that anyone who wants to manage the best user experience or the best value for charging networks must understand and manage the entire value chain, end-to-end: From the customer journey to the hardware journey and from maintenance to operations and to customer experience and so on.
This is because the EV charging business is not yet very profitable. This not due to the high cost of a platform or roaming operations, the real reason are the hidden costs. Let’s take invoicing as an example: One payment that comes into the company’s bank account is causing a cost of 29 euros in the organization. Company must go through all the procurement, clearing, verifying and accounting processes – and the list goes on.
This kind of hidden costs aggregate and multiply on top of each other. They in fact become the greatest cost of EV charging. Company can avoid these hidden costs only when they have an end-to-end visibility to the whole value chain. End user experience is also strongly related to the capability to handle the end to end value chain.
This need of cost efficiency is driving the market players to cooperate and collaborate even more in the future.
Take charge of your energy
Another important trend is energy management. Already we are seeing that more and more of purchasing decisions are based on the capability to handle energy. Why? Because it brings direct benefits in the form of saving costs - for example grid connection and installation costs.
The next phase will be the energy flexibility: EVs are the most cost-efficient batteries and energy storages in the energy system because they come with zero incremental costs. They also come with zero infra costs because the charging network is already there. They also run with zero maintenance and operations costs because the operation costs are already taken care of by the EV drivers and charging operators.
This trend is already in full motion. It does not need V2G technology, all the EV chargers can adapt to this and become active players in the energy flexibility markets.
Interoperability is a prerequisite for the mainstreaming of EVs
Roaming refers to an EV driver's ability to use various charging stations even if they're only a customer of one service provider. In practice, it means that electric car drivers can use charging stations with just one customer account.
Roaming is something we all want to do. EV drivers demand interoperability. There are two ways to organize roaming: one is centralized and the other is peer to peer. Unfortunately, in the centralized roaming markets there is now asymmetric competition between charging operators: There are charging operators that do not want to open their networks to others. They have separate EMP services, but they still want to have access to other players’ charging networks while keeping their EMP service separate.
This asymmetric world keeps the prices high. Operators protect their own networks since there is no fair playground, no common rules between players. If we cannot solve this problem, it will lead to peer to peer structures. And these kinds of bilateral agreements are of course more costly to operate than open, centralized roaming.
Now it is time for all the players to agree together how we can develop roaming and pricing structures that are reasonable for us and reasonable for partners and ensure level playing field between all the charging networks. The charging networks are the core part of charging not the EMPs who take advance of the investments that others have already made.
Germans have opened the conversation at the EU level on how to regulate roaming. There is a strong need to regulate the EV charging roaming in the form of pricing or contractual regulation, but not in the form of regulating the technology. Because choosing just one technology or one solution means that we would take a step backwards. There are several technologies already in the market and several new ones are being developed as we speak. It is essential to keep the roaming technology neutral.
Elias Pöyry was one of the speakers at the Interchange Network Conference 2020 held in Berlin in September 2020.
Read more about EV charging trends here.