Finance and Accounting
Assuring revenue from EV (Electric Vehicle) charging points
The clamour for renewable energy and sustainable solutions is going to create a huge disruption in the power sector. Electric mobility has picked up steam in the last few years. After a century of transportation fuelled by petrochemicals, electric vehicles (EV) are now the new kid on the block. EV usage is growing, and it’s now common to see EVs on the road. Using electricity for transportation is now a reality.
The accelerated usage of EVs means that public charging infrastructure is now a requirement. Mass-scale EV charging has several challenges. Consumers are conventionally used to fuelling up at gas stations, and charging needs to be conveniently accessible, and fast, to ensure that electric vehicles are adopted. Physical access to charging stations aside, EVs and the fuelling infrastructure need to be connected, so that automobile maintenance engineers can get hold of real-time analytics and diagnostics.
Power utility companies are poised for a strategic shift to enable technology-driven models for EV charging. Power companies need to ensure that they provide safe and efficient solutions as well as infrastructure to build a sustainable future.
Challenges for power companies
Power companies face commercial losses due to incorrect meter readings and billing, meter tampering, and theft by direct hooking. While scaling up with new digitised service offerings, power companies need to also manage bad debt, improve credits and collections process, and manage risk better to become more profitable. With the EV charger market projected to grow into a multi-billion-dollar industry, power companies can provide smart and scalable solutions and grab a slice of the pie.
EV charging presents new business models which utilities can adopt to grow new revenue streams. However, the power sector must circumvent a few challenges thrown up by EV charging. While grid capacity may not be of significant concern, the commonplace use of EVs would demand more of the grid, and there may be peak usage pressure. Thus, traditional grids pose a problem. The power grid needs to be both smart and flexible to be able to handle disproportionate demands for charging of EVs. Improving customer experience is another key challenge. Consumers need to be engaged with low-cost plans, rebates, and rewards for EV charging.
How power companies can gain traction from EV charging
The adoption of electric vehicles is dependent on the wide-spread availability of the charging infrastructure. EV charging can be offered by players across industries: OEMs, big tech, EV operators and on. EV charging faces several challenges such as local and government regulations, expensive updates to grids, shortage of skilled resources, scaling up of production capacity for fast-charging hardware, and prohibitive costs for setting up charging infrastructure. Even with upgraded infrastructure, consumer acceptance is key to the success of EV charging-based business models
Power companies have a significant role to play by providing distribution networks, grid upgrades, and substation improvements. All of this requires huge capital investment. Digitisation and technological agility will enable utility companies to reconsider traditional business models and come up with new streams of revenue.*
Power companies can exploit their large customer base and offer bundles for EV charging. EV charging services can be offered to customers as a seamless experience in terms of the services and the billing. Flexible pricing, and pricing based on time of use (peak /non-peak hours) may help to distribute load and incentivise usage during off-peak periods. If power companies offer specialised rates for EV charging, users may be incentivised to take advantage of such plans. High-density communities such as high-rises will require very different charging plans as compared to, say, charging infrastructure for low-income groups.
They can also work with ride-sharing companies, and public transit systems to provide specialised charging infrastructure, and suitable rates. While the public, fast charging market is at present fragmented with multiple players, it is anticipated to grow exponentially, and ultimately become seamless and convenient to use. This will require predictive maintenance of charging stations, and platforms that enable real-time analytics and diagnostics.
Plug-and-play charging solutions will require intensive collaboration between various stakeholders – power companies, government, charging providers, real-estate developers and automotive manufacturers, to name a few. From the perspective of the power sector, digitisation would help companies predict the load for EV charging, optimise costs both for the company and the consumer, and improve performance and efficiency.
*For organizations on the digital transformation journey, agility is key in responding to a rapidly changing technology and business landscape. Now more than ever, it is crucial to deliver and exceed on organizational expectations with a robust digital mindset backed by innovation. Enabling businesses to sense, learn, respond, and evolve like a living organism, will be imperative for business excellence going forward. A comprehensive, yet modular suite of services is doing exactly that. Equipping organizations with intuitive decision-making automatically at scale, actionable insights based on real-time solutions, anytime/anywhere experience, and in-depth data visibility across functions leading to hyper-productivity, Live Enterprise is building connected organizations that are innovating collaboratively for the future.
