Comment of the Week
Dissecting the Economics of EV Charging Stations
Marker readers — including early adopters — weigh in on the cost of going electric
In the past few months, no less than three EV charging companies — Volta, ChargePoint, and EVGo — have announced their plans to go public via SPAC and reach multibillion-dollar valuations in the process. Building a robust infrastructural network of charging stations will be necessary to support the increasing number of electric cars on the road. It’s been relatively affordable to “fill up” EVs when plugging in because charging companies currently supply electricity as a loss leader. “While establishing their market, these companies must more or less give away the electricity in order to get people to buy the vehicles and begin building charging brand loyalty,” writes Medium editor at large Steve LeVine, author of The Mobilist, a blog about the future of batteries, electric cars, and driverless vehicles. “It’s a version of the freemium model — cheap until you are hooked.”
Invoking the Hamburger Rule, a standard economics principle whereby a product’s price usually rises to the level of its closest rival, LeVine predicts the price of charging electric vehicles will inevitably go up — way up — as EVs become cheaper than gas-fueled cars, hit the…
