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Monday, May 1, 2017

Why Tesla's Charging Network Should Become Everybody's

The fractured fast charging market: CHAdeMO, Tesla, SAE Combo (CCS) - image via chargedevs.com

Charging is an important part of the EV ownership experience. If you have a living situation that allows for it, charging up at home is very convenient. It only takes seconds to plug in and your car starts out each morning fully charged, ready to take on the day. When you're on a road trip, things are different. You have to use the public charging network to fill up and keep rolling. This could be charging overnight at a hotel or roadside fast charging.

Up to this point in time EVs have been less than 1% of new vehicle sales. This means that they have been purchased by the portion of the market that is the most enthusiast about the technology. These early adopters have generally been content (perhaps even excited) to hunt for charging stations and to mold their drives around the available infrastructure. As EVs move to mass adoption, this tolerance quickly fades; it will be important to have a vast, easy to use, reliable, fast-charge network.

When considering public EV charging network infrastructure, you must look at several factors (speed, reliability, availability, access, usability...). Looking at the three fast charge networks (CHAdeMO, CCS, and Tesla), considering all of these factors, in our previous post we concluded that (although there is room for improvement) Tesla is the only charging provider that is currently offering a robust positive charging experience. Tesla has well positioned charging sites; no membership sign-in, apps, or cards are required to initiate a session; there are multiple stations per location; the stations are fast and operational; and there is usually no waiting (at most locations).

Tesla has offered to allow other automakers to use their network. In 2015, Elon Musk said, “Our Supercharger network is not intended to be a walled garden. It’s intended to be available to other manufacturers if they’d like to use it. The only requirements are that the cars must be able to take the power output of our Superchargers, and then just pay whatever their proportion their usage is of the system.” This statement from Musk is aligned to Tesla's goal to accelerate the advent of electric transport (not just Tesla's cars).

To date, no automakers (that I am aware of) have taken Musk up on this offer. Should they? Below we'll explore what this partnership might look like.

Porsche's proposed 800-Volt fast charger

Proprietary Versus Standard(s)

Which fast charging type to choose?

If you were the head of a new EV program at a car company (such as one of the many new EV startups or a conventional car company getting into the EV market), you would have to determine which of the fast charging solutions you would choose for your upcoming line of EVs. The options are:
  1. Design your own proprietary solution
  2. Select the Japanese standard (CHAdeMO)
  3. Select the SAE standard (CCS)
  4. Partner with Tesla

Proprietary Solution

Option 1 has several drawbacks. It has a large capital requirement. You would need to build out a vast network in all regions where you sell vehicles. It's a multi-year effort. Porsche has stated that they have engineered an 800 Volt fast charging system. If Porsche were to deploy yet another network, this would further splinter the industry. Porsche has a great record of innovation, they would be better off working with one of the groups in options 2, 3, or 4 to improve charging for all. Considering the cost and effort, let's consider this a DOA option, listed only for completeness.

Standards Based Fast Charging (CHAdeMO/CCS)

Option 2 or 3 utilize existing public networks. This is what most non-Tesla automakers are selecting. Here it is important that you consider the experience that your owners will be subjected too. Simply selecting a CHAdeMO or CCS port for the car and then saying "fueling infrastructure is someone else's problem" is a poor option. The automakers must become involved with the charging standard organizations. This should include investments into the infrastructure network, in the charging provider companies (AeroVironment, ChargePoint, ABB,...), and perhaps even a seat on their board promoting reliability and a positive driver experience.

Automakers cannot simply put a fast-charge port on their cars and call it done. The charging networks that support these vehicles and their customers are an important part of the ownership experience.


As we covered here, CHAdeMO seems to be losing steam. If you are considering this option, CCS looks like the better long-term choice. However, there is one more option to consider first.

The Tesla Network

Option 4 is to partner with Tesla. Let's continue with our analogy that you are in charge of a car company's new EV program. Should you partner with Tesla or select CCS? Let's assume you've decided to partner with Tesla. For the rest of this article, we'll explore this option.

Justification: Why Automakers Should Take Up Tesla's Offer

Compared to CHAdeMO or CCS, Tesla's network is more complete, robust, and reliable. The network is better planned and positioned, there are multiple stations per site, and no membership card is needed. As an EV driver, it is a better experience.

Selecting Tesla would give your fledgling EV program an incredible jumpstart and your EV program an incredible innovation partner. This will keep your vehicle's charging technologies on the leading edge. Tesla has announced plans to vastly increase the charging rate of their network in 2017 with Supercharger V3. They also plan to install solar canopies and onsite energy storage. If you are hoping to attract environmentally conscious customers, these (soon to be solar powered) charging stations are a compelling story.

How Would A Partnership Work?

Since no automaker has yet taken Tesla up on this offer, we don't know exactly how it would work but Tesla has laid out some of the framework. Musk has stated that the contribution to the Supercharger network would need to be proportional to use of the network. So, if your company's cars make up 5% of the network's use, your company would need to pay Tesla for 5% of the network's operating cost.

Considering the recent changes Tesla has made for idling fees and limited free charging, I'm sure that Tesla would require similar fees for other automakers vehicles joining the network. These changes were not profit motivated, they were intended to improve network availability. Any car that is blocking a spot is a problem, regardless of the brand, so these rules would likely to apply to partner company vehicles too.

As a partner, fees above and beyond the Tesla minimums would be at your discretion. Tesla has said that they are not trying to make a profit from the charging network. However, other automakers would be free to try other models. The fees collected, if any, could be used to offset the payments for your company's portion of the network operating cost.

Additionally, if your company established charging stations and added them to the Tesla network, the Tesla owner attendance could additionally offset the use of your vehicles on the Tesla network. Having this as an option is nice. If the EV project at your company is small, the network use will also be small and the payments to support the network would be negligible. If, however, the fledgling EV program at your company flourishes, then establishing your own Tesla-compatible charging stations in high-use areas can offset the charging events by your cars at Tesla branded superchargers.

Competing?

If your car company is using Tesla Supercharger stations, would your vehicles be seen as competing with Tesla vehicles? Yes. If you are building a long range electric vehicle, then your car is competing with Tesla, whether or not you are using their network.

Partnering with Tesla on charging standards puts you on equal grounds in this arena. This means you will need to make compelling vehicle.

Overcrowding

There has been overcrowding at some Supercharger locations in California and Norway. Tesla is actively installing and expanding their network. More locations will only help if the network growth outpaces new vehicle sales. Tesla has a large number of Model 3 pre-orders. They plan to deliver a lot of cars in 2017 and 2018. Overcrowding is a risk. The changes Tesla has recently made to eliminate free supercharging and to add an idle fee are steps to ensure that the network is not abused and only used when it is needed. Additionally, doubling the network size in 2017 to alleviate congested areas. We'll see if these measures help.

The Choice Is Yours

Which "little monster" (as ChargePoint called them) will you choose? If you are a car buyer, this choice will impact where you can charge. If you are an automaker, this choice (among many others) can determine if your sales continue to grow, or if they flatline.