Before pondering on “How much does EV charging station franchise cost?” Let’s understand what it is and how big this business is.
According to the US Department of Alternative Fuel Data Center, there are 51000 public EV charging stations in the country, with California leading with approximately 14,040 public charging stations and some 37,987 ports.
The global leader of EVs- Tesla has more than 400,000 superchargers across the globe, with 17000 of those in the USA. But you’ll be shocked to know the Tesla Charging Station Franchise Cost.
What Is An EV Charging Station?
Electric charging stations are a source of electricity for your electric vehicle and plug-in hybrids.
These stations are also called electric vehicle supply equipment (EVSE).
While some charging stations have smart features like smart metering and network connectivity, and some are just basic charging stations.
You can find these stations at municipal parking locations by electric utility companies or at retail shopping centers by private companies.
Types of EV Charging
The cost of setting up your own charging station depends on the electrification needs. There are 3 different types of EVSE providing different types of charging speeds.
LEVEL 1- STANDARD WALL OUTLET
- These chargers use 120 Volts (V)
- It’s standard for home charging.
- These are the slowest type of EV charging equipment.
- Best used for overnight charging and low-mileage daily driving
- This charging equipment offers about 5 miles of range for every hour of charging.
- It’s an excellent option for plug-in hybrid vehicles as they have small batteries.
LEVEL 2- 240- Volt Oulet- DRYER PLUG
- These charges use 240 Volts of power.
- It requires alternating- current (AC) plug and home or public charging equipment to be installed.
- These equipment are best for quick charging- they can get fully charged overnight in 8-10 hours.
- Often found in public areas like restaurants, shopping centers, rest areas, etc.
- These charging stations offer an average of 25 miles of range per hour.
DC FAST CHARGING
- These are the fastest electric car charging option.
- It provides 250 miles of range per hour, depending on the car and charging equipment.
- These fast chargers can charge up to 80% in 20 to 30 minutes.
- One drawback of these fast chargers is that they are not compatible with all vehicles.
- For instance, Tesla DC fast chargers will only work with Tesla vehicles.
Why Opening EV Charging Station Franchise Is A Good Investment?
Since we don’t have any planet B other than our planet Earth, the introduction of Ev’s has solved the environmental issues to some extent.
For instance, the Volvo XC40 EV is estimated to be 30% more environmentally friendly than its gas or electric hybrid equivalent.
However, from a business point of view, opening an EV charging station franchise also has some other benefits lined up.
1. Low-investment
The most significant advantage of opening an EV charging station franchise is its requirement of low investment.
These franchises typically require a low cost and a minimal amount of start-up capital.
2. Financial stability
The high demand and low supply of electric charging stations provide an excellent opportunity for investors to make a steady income in the long run.
3. Competitive edge
Owning an EV charging station will give you a competitive advantage as electric cars are in trend now, and the demand will be increasing more due to their features.
4. Eco-friendly
Electric vehicles are convenient and get charged quickly, allowing less carbon emissions.
EVs emit 75 miles per gallon on average. On the other hand, the traditional vehicle emits less than 25 miles per gallon.
How To Start An EV Charging Station Business?
Firstly, starting an EV charging station business doesn’t require you to get a license from the government, but you need to take permission from the Ministry of Energy.
The government also provides rebates and incentives to set up commercial EV charging station equipment machinery.
Factors Affecting The EV Charging Station Cost
With more and more people using electric vehicles, the demand to increase the charging station has also increased.
According to Grits, American President Joe Biden wants to build 500,000 electric vehicle charging stations making America filled with electric vehicles by 2023.
Despite so many opportunities and benefits, opening an EV charging station cost comes with challenges also.
Here are some significant challenges to consider before starting an EV charging station franchise:
1. Location
The location of your charging station is a key factor to consider before starting your own electric vehicle station.
Make sure you set up the station at readily accessible and in high-demand areas.
For instance, you can set up the EV charging station at high-traffic locations like shopping centers, airports, and highways.
This will increase the chances of high usage and revenue.
2. Infrastructure and installation cost
Be prepared to invest a significant amount of money in infrastructure and installation costs. This includes permits, the cost of equipment, and any necessary upgrades, which can cost $12000 to $15000.
According to the U.S. Department of Energy, on average, the cost of installing a level-2 charging station is around $3000, which varies depending on the location and number of charges at each site.
Similarly, the average charge to install DC chargers ranges between $18000 to $66000, depending upon the power of the charger and the number of charges at each site.
3. Research the competition and market saturation
Although the business of opening an electric vehicle charging station franchise has a lot of potentials, but the competition is also growing rapidly in the business.
This makes it extremely important to research the market in your location and ascertain if there is enough demand to make revenue.
4. Pricing and revenue model
Another important factor to consider is the pricing of your product. You must research the pricing models and revenue streams of the existing charging stations in your location.
While profit is the main objective of every business, but you also want to ensure that your pricing is competitive with other businesses.
A Step-By-Step Guide On Starting Your Own EV Charging Station Franchise
Starting an electric vehicle charging station is a great opportunity for investors looking to make a steady income in a growing industry.
Here is a step-by-step guide on the key factors to consider when starting your own EV charging station franchise.
Step 1- Pick a location
Choosing a location for your business is everything. You want to set up the charging station in an area that is convenient and is in a high-traffic area.
Make sure that the location is visible from the road, has a parking facility, and is easy in and easy out site.
Step 2- Research and Choose a Brand
The next thing to do is to research and choose a suitable brand that aligns with your values and business model.
Some points to consider when researching companies:
- Company’s reputation
- Charging technology type
- The level of support and training the franchisor provides
- The fees and royalties that are associated with the franchise
Step 3- Set up the Charging Station
Once you choose the location and brand, you want to work with, it’s time to build your electric vehicle charging station.
Make sure to follow the guidelines for the design and layout of your charging station.
Step 4- Market your charging station
Now, it’s time to start marketing your charging station. Here are a few steps to start with:
- Create your website or build social media presence.
- Collaborating with local businesses in your area to offer charging services to their customers.
- Offering promotions and discounts
- Running online ads to reach potential customers in the location.
Step 5- Generating Revenue
The next step is to start generating revenue through charging fees. Here are some prerequisites to consider:
- Track your expense and revenue
- The cost of electricity and charging equipment
- Franchisor’s royalty fees
- The Potential for expanding the business
The Future Of Electric Charging Stations
There’s no doubt that this industry has a bright future and is evolving rapidly. The increased charging speed was its first step towards innovation.
This industry has a lot of potential to earn revenue in the coming years.
If you are looking to open an EV charging station franchise, here are some key trends and innovations you should watch for:
Trend 1- Improved Software Management Systems
A key trend in this industry is powerful software management systems. These systems help franchise owners to manage their charging solutions effectively.
These systems provide real-time data and performance that will alert owners of potential maintenance issues.
These software management systems will help monitor building management, lighting, and security camera.
Trend 2- Improved Charging Speeds
This trend is the biggest innovation in the EV charging station industry. Earlier, charging an electric vehicle would take hours or even overnight.
But as the technology is evolving, the new charging speeds of electric vehicles have increased.
For example, DC chargers can charge up to 80% in 20 to 30 minutes.
So if you are thinking of investing in this industry, then investing in fash charging electric vehicle stations will be a profitable investment. This will give you a competitive advantage in your location.
Trend 3- Growing demand for EV charging stations
According to Twilio, there will be an increase in total number of publicly available chargers by 2025.
This demand is driven by an effort to reduce the harmful emissions from traditional vehicles and fight climate change.
How Much Does EV Charging Station Franchise Cost?
The price for setting up the EV charging station business depends on various factors like the number of charges, type of charges, and the possible electrical upgrades that might be important.
Commercial facilities choose Level 2 chargers or DC fast chargers as installing Level 1 chargers is the cheapest option, whereas Level 2 chargers are in the mid-price range, and DC fast chargers are the most expensive.
However, if you are installing the chargers at commercial stations, then level 1 chargers are not the best option, as they are designed for residential use only.
Generally, installing a level 2 charger will cost you around $1000 to $5000. While a level 3 charger or DC fast charger will cost you $30,000 to $80,000.
Here is a table giving an insight into the cost on the basis of charging time and charging type:
| Charge Time | Charger Type | Estimated Charger Cost | Amperage | Voltage |
| 4-8 hours | Level 2 | $700 – $2,000 | 48A | 200-240V AC |
| 2-5 hours | Level 2 | $1,800 – $5,000+ | 80A | 200-240V AC |
| 1-2 hours | Level 3 | $30,000 – $40,000+ | 100A | 480V+ DC |
| 30-60 min | Level 3 | $55,000 – $65,000+ | 200A | 480V+ DC |
| 15-30 min | Level 3 | $65,000 – $75,000+ | 250A | 480V+ DC |
Funding Options For EV Charging
Despite the government’s tax rebates and subsidiaries, there are many options you can opt to fund the EV charging station by partnering with the leader charge point operator or electric vehicle service provider.
Business or Landowner Funded
In this approach, you prepare the place and pay CPO or EVSP for hardware, installation, and connection costs. After paying, you are the owner of the equipment and keep all the profits.
Under this approach, you can also opt for being fully responsible for the operation of charging points. For this, you will require to use management and billing software.
Or you can also opt for paying a monthly fee for maintaining the equipment and back-office costs to the CPO or EVSP.
Hybrid (partially funded) model
Under this approach, you have to share the upfront capital costs and revenue from the operations. However, you are still responsible for preparing the site, and the agreement will depend upon the EV charging company’s evaluation of your business.
All the maintenance activities for the duration of the contract will be handled by the CPO or EVSP.
Fully Funded EV Charging
Under this approach, the CPO or EVSP company will fully fund the capital cost of the project if they approve your location.
The cost of site preparation and onsite electrical upgrades may or may not be included in this type of agreement.
Conclusion
No Joke! But this industry is rapidly growing, and with the higher demand and less supply investing in this business will be profitable.
However, how much does EV charging station franchise cost depends on many factors that you must consider before installing your charging station.
FAQs
Is owning an EV charging station franchise profitable?
Investing in an EV charging station is definitely a profitable investment due to its increasing demand. With everyone going crazy with environmental issues, many people are switching to using electric vehicles, and they’ll surely need charging stations too.
How many charging stations are there in the US in 2023?
There are about 130,000 public charging stations across the US. And the President of the country has an image to make “America Electric,” and investors can expect an increase in the industry.
Who owns the most charging stations?
Currently, the largest EV charging company is ChargePoint. It has around 158,000 chargers around the world.
Amit Gupta is an experienced expert in digital marketing and co-founder of DrFranchises. With more than 11 years of knowledge in franchise digital marketing, SEO, email marketing, and social media marketing, Amit has helped many brands achieve incredible success online. As a passionate entrepreneur and owner of 7 franchises, he continues to study franchise models, looking at costs, revenue, and profitability to guide brands toward profitable growth. When he’s not working on digital marketing, Amit enjoys spending time playing with his beloved dog.