In the wake of Barack Obama’s $2.4 billion stimulus dump on electric vehicle technology yesterday, the Wall Street Journal wonders why there wasn’t more money aimed at charging infrastructure.
The Journal frames the issue as a chicken and egg problem, arguing:
Demand for electric cars isn’t likely to take off unless there are convenient ways to recharge batteries. But utilities and service-station operators aren’t likely to spend money on such infrastructure until there are enough cars on the road to make the investment profitable.
While this is a common concern for electric cars, we don’t think it will actually manifest itself as a huge stumbling block.
First off, a decent chunk of this stimulus money, $99.8 million, went to funding charging infrastructure in a few states working with Nissan to roll out its electric car at the end of 2010. Those nine markets-Tennessee, Oregon, Sonoma County, California, San Diego, Phoenix, Tucson, Washington DC, Seattle, Raleigh–will be the test cases for Nissan, as it works out the kinks on its program.
Second, the government’s decision to dump cash into battery technology doesn’t mean it’s not considering looking out for charging infrastructure. Richard Lowenthal, CEO of charging station company, Coulomb Technologies, told us earlier this year that the stimulus package provides a 50% tax break on all charging stations.
If utilities want to install charging stations in preparation for a coming surge in electric cars, the stations are all half-off right now.
Third, this just isn’t a real problem, and we doubt it ever will be.
Despite some analysts declaring an “electric car bubble,” let’s remember there is only one electric car on the road today, the Tesla Roadster. Down the pipe we have Nissan and Coda developing pure electric cars that come out next year. Beyond that is Tesla’s Model S, which won’t be around until 2011-12.
There’s the Volt, which is a plug-in hybrid, as well as the Fisker Karma, also a plug-in hybrid. Because those cars can use gasoline when the charge is done, there isn’t a pressing need for charging stations for those cars. Plug them in at night, drive them, if the juice runs out, the gas takes over.
Coda is aiming for 20,000 units sold by 2011, Nissan hasn’t officially announced sales targets, but let’s say it’s way higher, 60,000. By the end of 2011, we’re looking at–very optimistically–over 80,000 pure electric cars on the road. Lowenthal says you need about two charging stations per car, one at home, one at work, or elsewhere. That means we need 160,000 stations installed around the country.
He thinks his company will be installing over 520 stations a month by the end of next year. If his projections are even off by half, the charging infrastructure should be in place. (Plus, he’s not the only charging company in the country.)
But, let’s say it’s not. Are the earliest adopters of electric cars really going to be turned off by a lack of charging stations? Is anyone going to own an electric car as their primary vehicle? Probably not for the first few years. It will be a commuter car, one that comes with accepted limitations.
As the cars catch on in the mainstream–or, if they catch on–then the charging stations will spring up naturally. If I own a strip mall, and I can offer a charging station to my customers, there’s no way I don’t do it. It’s a good way to draw in business. At minimum, the customer is stuck in my mall for 30 minutes, while the car juices up.
Should the government have dumped more money into charging stations? It’s arguable, as it’s a technology that’s ready today, would put people to work and create infrastructure, twin goals, that are important to the stimulus package.
But, it’s more important to spend money on the batteries to make these cars in the first place. Without the cars, there is absolutely no need for charging stations. Calling this is a chicken and egg problem is wrong.
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