EV Chargers in Commercial Real Estate

EV Chargers

in Commercial Real Estate

By: Scott Baker, PE

“Every couple of years, we’ve heard that this will be the year for electric vehicles and chargers to take off,” said Glenn Kurtz, vice president of Strategic Initiatives with Legacy Parking. “I think we are finally at the precipice of something amazing when it comes to EV chargers.”

There were only 506 public EV chargers nationwide in 2010. The number of EV chargers has grown substantially to over 100,000 chargers in 2022. With the growth in electric vehicles, the need to provide charging infrastructure has risen considerably.

Current trends predict that electric vehicles (EV) will become standard over the next 15 years. Most major automotive manufacturers have stated goals to convert most or all new car models to electric by 2035. The EV market has grown substantially in the past decade. This can be seen most visibly in the number of chargers throughout the United States.

CHARGING TYPES AND EV TECHNOLOGIES

EV charging stations currently come in three levels.

A Level 1 charger is typically 120 volts fed from a standard wall outlet and is often referred to as a trickle charger. These chargers typically come with all EVs sold. The rate of charge is limited to 1.3 to 2.4 kW or 3-5 miles of EV range per hour charged. Level 1 chargers can take over 24 hours to completely charge an empty EV. Level 3 charging is the fastest, at 480 volts with most cars being able to be charged up to 80-percent in 20 – 40 minutes and 100-percent in 60 – 90 minutes.

Technology may find a way to reduce this time to a level similar to filling a gas tank as many researchers are working on this challenge.

There are a few novel ideas for solving current charger limitations. One idea that has gained traction in the Midwest involves roadways that charge vehicles through induction while electric vehicles drive on them. This is being tested in the Midwest, with Michigan’s Governor Gretchen Whitmer announcing construction of the first mile of wireless charging road in the U.S. in Detroit. If this solution works, it could reduce the battery size requirements and the need for as many charging stations but with likely costlier infrastructure and maintenance.

Another possibility involves the utilization of batteries in charging stations. These chargers would slowly fill connected batteries over time with a level 1 or 2 charger, then send a kW comparable to level 3 chargers to quickly fill EV batteries. This technology could reduce the infrastructure costs for fast charging, as older infrastructure could keep pace with charging needs without costly improvements.

When the first EVs hit the road, they had a more limited driving range leading to range anxiety and the worry about the ability to charge away from home. This issue has been reduced with many new EVs increasing their range to 250 miles per charge. For those vehicles, range anxiety for daily commutes has been all but erased. For vehicles with sub-100-mile ranges, charging station availability remains an issue.

HISTORY OF ELECTRIC VEHICLE ADOPTION AND SUPPORT

The mainstream automotive industry began its gradual shift to electric vehicles with the advent of the Toyota Prius in 2000. The Prius demonstrated how the addition of batteries and an electric drivetrain could improve the efficiency of internal combustion engine (ICE) powered vehicles in these Hybrid Electric Vehicles (HEV).

From there, the Nissan Leaf pushed its way in as the first massproduced fully electric vehicle in December of 2010.

EV adoption was bolstered by the introduction of the federal EV tax credit in the 2009 American Clean Energy and Security Act, as well as numerous state and local tax credits such as Sarasota County, Florida’s ChargeUP! Sarasota County program, or Delaware’s Electric Vehicle Charging Equipment Rebates.

On the federal level, the 2021 Bipartisan Infrastructure Law allocated $5 billion over five years for a national network of EV charging stations under the New Electric Vehicle Infrastructure (NEVI) Formula Program. ten-percent of funds are set-aside each year for grants to US states to help fill gaps in the network. States are required to submit an EV infrastructure deployment plan to gain access to a portion of the $615 million allocated for 2022. An additional $2.5 billion is available for communities and corridors through competitive grants. These grants will be awarded to innovative solutions for rural charging support, increasing EV charging access in disadvantaged communities, and other criteria.

CHARGERS IN COMMERCIAL PROPERTIES

With the continued growth of EV adoption, commercial real estate will need to address this challenge. There are challenges in understanding and identifying what consumers and tenants will demand versus the convenience of the offered amenity. Installing charging stations may not be a question of if, but when and how many. And the largest question of all still remains, how can tenants or customers be appropriately charged for this amenity? Several of these answers will change as the laws, auto industry, and consumers evolve over the next decade.

Cost and Installation of Charging Stations

Some of the hurdles to installing charging stations are the high cost of installation, the maintenance of the stations, and the potential increased energy cost. After moving forward with installation of charging stations on the property, the next decision is whether the property team or a third-party company should own and maintain these charging stations.

If you’re tracking energy consumption through ENERGY STAR benchmarking or ESG reporting, another cost to consider is adding a submeter to this system. This energy can be subtracted from the ENERGY STAR profile or be included as scope 3 emissions to help reflect the breakdown of emissions to better represent the property’s energy profile.

One metro-Atlanta engineer had the electric service for a group of new charging stations fed separately from the main building power, lowering the building’s peak demand. This decision kept the billing rates lower for the building, saving on energy costs while ensuring future capacity for EV charger growth.

Based on a few recent installations in the metro Atlanta area, the infrastructure cost can range from $6,000 to $10,000 per station. The installation time can vary based on infrastructure requirements but can be from two days to one week depending on complexity of install and number of stations.

The cost of charging stations themselves can vary between $4,000 and $10,000 per station and typically take only a few days to install. Everyone interviewed for this article said the installation process proceeded without issue.

Rebate Programs

Numerous local utility providers offer rebate programs for the installation of EV chargers, such as Georgia Power’s Make Ready program. This program covers the cost of EV charging infrastructure for passenger vehicles, transit buses, various delivery trucks, airport ground support equipment, and forklifts. Through the Make Ready program, Georgia Power supplies the conduit, wiring, and associated infrastructure for both the utility and customer side of an EV charger.

This program does not cover the cost of the charger itself; however, the installation of EV charging infrastructure and its associated costs are normally higher than the cost of an EV charger. Old construction benefits greatly from this, as installing infrastructure for EV chargers can be prohibitively expensive for commercial properties.

Charger Pricing

There are several options for the consumer pricing structure of EV charger stations. The best option from the end-user’s perspective is to have free charging available at commercial office buildings. This reduces their operational cost for their vehicle but comes at the expense of property owners. Some tenant companies may choose to pay for their own meters and provide that as an amenity to their employees.

Many property owners choose to install them and let a third-party metering company bear part of the installation cost and handle the consumer charging costs. This helps the property owner step away from the maintenance of the system and the individual transactions that come with paid charging stations.

This consumer-paid approach may cause frustration among users as pricing structures can be unclear. Make sure you understand local laws regarding the sale of electricity and how EV charging is affected by them. For example, EV charging stations in the state of Georgia charge customers according to charging time rather than energy used as properties cannot directly sell the electricity used at EV charging stations.

Building Occupancy Type

The need for EV charging stations varies greatly based on the building occupancy type. Understanding the consumer’s needs can help in the decision process for whether to add EV charging infrastructure and how many stations.

“Is there demand [from tenants]? Is this for sustainability goals or LEED certification? Do you need level 1, 2, or 3 chargers? Do you have sufficient infrastructure and power for these chargers? These can be costly questions, but they are integral in defining and budgeting for a project like this.”

“It always begins with identifying your objectives, and scope,” explains Kurtz. “What is the purpose of the install?”

Residential Chargers

For residential occupancy, EV charging becomes a necessity as EV adoption continues to grow. For most EV owners, charging at home becomes a huge convenience so that time “filling up” does not add to people’s daily schedules. For anyone in multi-family or hospitality industries, addressing this need will be integral with the rapidly increasing demand for EV support.

For these buildings, the availability of charging stations may become a factor in consumer’s decision process for picking apartments or hotels. Faced with the need to charge their car and the desire to remove any hassle from the equation, consumers will make decisions with this convenience in mind.

Retail Chargers

For retail, the length of time an occupant is in the space is far lower than residential or office, so those stations are typically an amenity for short-term charging to “top off the tank.” For these buildings, consumers will review the cost and convenience of charging stations to decide whether to use them.

If the spaces are more convenient and charging is free, the utilization of these spaces will increase dramatically. The relatively low cost of electricity may push retail owners to provide this as an amenity to entice customers to spend more time in their space and assume additional sales will outweigh the cost.

Chargers in Office Buildings

For office buildings, there is an opportunity for EV owners to have extended time to charge their vehicles. Many office workers have their vehicle parked up to 8 hours a day in a property’s lot, and this gives a lengthy and convenient charging opportunity. If these properties choose to provide free charging, most tenants would be able to cover all of their charging needs while at work.

In order to free up use of these stations, property owners could limit the time a user can charge for free, to ensure that more tenants may utilize this amenity while minimizing costs from additional station installations. Even a metered charger would be a convenient solution whose costs could be passed on to tenants instead of the end-user.

Installing Chargers

There are numerous benefits to installing EV chargers. There is the potential increase in leasing opportunities, a possible uptick in tenant satisfaction due to additional amenities, and ESG benefits for owner and tenant ESG reporting. With 78 different electric vehicle models in 2022 alone, EV adoption is rapidly growing, and an early adoption and implementation of charging infrastructure could put your property ahead of competition.

About the Author

Scott Baker oversees Energy Star Certifications, Energy Audits, Indoor Air Quality Assessments, Commissioning, Retro Commissioning, and LEED recertifications.

Scott has more than 20 years of experience in HVAC systems design, operations review, and commissioning. Scott has a Bachelor of Science in Mechanical Engineering Degree from the Georgia Institute of Technology.

Find: Services, Resources, Expertise, Providers, Partners, And More;

on CRE Insight Marketplace