Top 5 Things to Consider When Planning an EV Charging Network: #3 Business Plans, Financial Planning, Funding, and Incentives

Location, equipment, and technology. You have the basics figured out, but how are you going to fund your site expenses?

In this third installment of our Top Five Things To Consider When Planning an Electric Vehicle (EV) Charging Network series, we will discuss the key elements needed to fund your EV charging station or network. This includes business plans, financial planning, funding, and incentives. Without these elements, you cannot properly assess how much you are able to invest in your charging network.

Business Plans and Financial Planning

As you consider factors like location, equipment, and technology, it is important that you consider your own financial limitations, capabilities, and resources, as well as profit potential, return on investment, total cost of ownership considerations, and expenses related to equipment, maintenance, personnel, etc.

To develop a business plan, reach out to organizations that can help you determine your equipment needs, costs, and benefits. As mentioned in the previous installment, Equipment and Technology, CALSTART’s membership organization offers a plethora of companies that can assist with this. From identifying budgetary constraints to charging usage in your preferred location market, many of these companies can work with you to help identify your limitations and where you have room to invest, whether that be through the equipment you use, amenities at your charging location, or even advertising campaigns to boost visibility once the station is up and running.

Again, whether you are already well-versed in planning for business constraints and needs or you’re completely new to this process, make sure you’re not stretching yourself too thin.

Before finalizing any business plans, identify the following elements:

• Total budget
• Target consumer segment
• Projected usage of your charging station given its proximity to nearby shopping complexes, major corridors, or residential areas
• Operational and maintenance costs
• Amenities you plan to offer at the station
• Desire and/or ability to promote your station after project completion (i.e., advertising, partnership events, desire to join a network of like-minded EV charging companies)
• Applicable regulatory requirements and compliance-related costs
• Any other costs you may incur.

When calculating your costs, you should also consider calculating your station’s utilization rates. Using a third-party service provider or your own internal resources, determine whether the forecasted utilization of your EV chargers will make sense financially, considering how much time and effort you put into investing into technology, equipment, amenities, etc. Anticipating utilization trends can also inform your anticipated electricity costs based on your utility’s available rates, including any EV rates or time-of-use rates. By determining your projected utilization, you can plan ahead and avoid unnecessary financial losses once your station is running.

Your business plan can include timing factors. If electrical capacity is constrained in the near term, you may be able to phase in your build by including stub-outs for future expansion.

Similarly, you should continue to assess station utilization even after the station has opened. By assessing periodically, you can identify whether you may need to:

• Expand, in the case of high utilization rates;
• Cut back on offerings to save costs, in the case of low utilization rates; or
• Make moves to draw in more customers, in the case of low utilization rates.

Again, we encourage you to seek a third-party provider to forecast and assess your utilization rates if you do not already have internal personnel to do so.

As you prepare your site, we also encourage you to work with a third-party provider or your own internal personnel to complete a site design. This will help ensure that you stick to the regulations that apply to your charging location.

Funding and Incentives

While developing your business plan, it is also important to find out how you can maximize your funding opportunities. Investing in location, equipment, technology, personnel, and amenities can cause financial stress if you overextend your budget. Thankfully, this is where incentives can come into play.

There are several programs associated with and administered by CALSTART that you can explore when trying to plan your EV charging site.

In the last wave of funding, CALSTART announced that $56.5 million was available for EV charging infrastructure through the Communities in Charge Project, funded by the California Energy Commission (CEC). This limited funding applied to Level 1 and 2 chargers located at or near residential buildings in California. to eligible project sites across California.

CALSTART also previously awarded grants with funding from the CEC through its EnergIIZE Fast Track lane to incentivize the installation of charging and hydrogen refueling infrastructure for zero-emission commercial medium-duty and heavy-duty vehicles in 2025.

Given that these funding opportunities are limited, it’s important to stay up to date on what is available, which applications are still open, and when these funding cycles close. Consider following CALSTART on our social media accounts or subscribing to our Compass newsletter, which includes new funding opportunity notices each month. To subscribe, fill out the form here.

As we mentioned before, you must also have a clear understanding of your target consumer segment and the charger types you need to purchase before pursuing these incentives. You may choose to meet with an equipment provider to get expert insight into what chargers you need to fit your customers’ needs and vehicle types and whether their equipment is on the program’s eligible equipment lists. By having a finalized idea of the exact equipment you need to purchase, you can proceed with funding applications much more smoothly. Along with equipment, you’ll need to consider networking requirements and select a network service provider that meets your business needs and the data collection and regulatory requirements of your funding programs. You will also have to consider having your construction and site designs, permits, and site verifications ready for your application, depending on specific requirements. These factors will be explored more in our Regulations blog.

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Now that you’ve learned about business plans, financial planning, funding, and incentives, what’s next? commissioning, maintenance, and using your market network. Stay tuned for more.

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