The real point of risk in the electric car charger build out

NRG Energy's eVgo Network at a Best Buy

Will electric car charging stations be the case of ‘if you build it, he will come’? The folks at NRG Energy, and its¬†electric vehicle charging network project eVgo, certainly hope so — particularly when it comes to the fast DC chargers that it’s installing around malls and public areas in the Dallas, Texas area. Those DC chargers can charge an EV in 15 to 30 minutes, but are somewhat expensive (six figures), so can be the riskier part of investing in the electric car charging network says Arun Banskota, President of NRG Energy’s EV services and who oversees eVgo.
The eVgo project is selling electric car charging like cellphone minutes via a subscription service. The installation of a Level 2 slower-charging home charger (capable of adding about 25 miles of range per hour) is free for the customer and eVgo charges anywhere from $50 to $90 a month on fixed three-year contracts for the battery charging. The cheaper rates are for people who only want the Level 2 charging capability at their homes and the more expensive plans give access to the publicly located fast DC chargers.
While home chargers will likely be used enough by the customer to enable NRG to make back money on the installation, it’s the DC chargers that NRG needs to convince customers to sign up to use, and to use regularly. Banskota told me that the eVgo project plans to have 50 public chargers built out around the Dallas, Texas area, with 25 of those installed by the end of 2012.
To convince customers to sign up for the DC chargers, Banskota says NRG thought long and hard on where to build each individual station, and focuses on sites with:

  • 1). Visibility
  • 2). Easy on/off freeway access
  • 3). A solid security assessment
  • 4). An area with tested high retail engagement

Will the investment pay off for NRG? Baskota wouldn’t disclose how many users the project has so far. But he said that eVgo has a very high conversion rate when compared to any of the other electric car charging options. However, electric vehicles have seemed to roll out a bit slower than some companies and auto makers had expected, and the eVgo network can’t move any faster than the pace of adoption of electric cars.
Banskota told me that NRG Energy CEO David Crane selected him for the job of leading the charging network buildout, he thinks, partly because he¬† previously came from the startup world — he was the Vice President of project development for solar company OptiSolar, and he was in charge of helping build the solar project pipeline. EVgo is kindof like a boot-strapped, somewhat risky, startup inside power company NRG Energy.