With a 14 million global sales projected by the end of 2023, the electric vehicle (EV) industry is poised to reach an inflection point for mainstream adoption. Much of this success is due to recent public and private investments into EV infrastructure. And as those investments begin to bear fruit, the coming decade’s EV charging infrastructure forecast looks more promising than ever. Here’s what the future holds—and why investors, entrepreneurs, and consumers should be excited about the years to come.
5 reasons why the EV charging infrastructure forecast looks bright
#1. Public infrastructure investments are beginning to materialize
Even as EV adoption rates start shifting from early adopters into the early majority of the mainstream market, there’s still a supply-and-demand dilemma regarding infrastructure. Businesses and consumers may want to choose an electric vehicle as their next purchase, but the current lack of available public charging stations is a significant hurdle for many.
But with recent edicts from world governments—such as the United States pledging that half of all new passenger cars and light trucks sold should be zero-emission vehicles by 2030—the broader existence of public EV utilities is more a question of when, not if. The United States recently approved $5 billion in investment to build EV charging networks nationwide. Canada similarly approved the Zero Emission Vehicle Infrastructure Program to do the same.
These investments address a crucial barrier to the mainstream adoption of electric vehicles, and it’s already beginning to pay off: 2023 will likely mark the first year EV sales reach 1 million in the US, with over half of the country’s drivers considering purchasing an EV as their next vehicle. And by 2030, the number of available EV charge points in the US will grow from around 4 million to 35 million. As development progresses, investment will continue to pour in, and adoption will continue to increase—making now a perfect time to enter the EV market.
#2. Enhanced charger compatibility will drive further adoption
While increasing EV charger access is an essential step toward improving EV infrastructure, it’s not the only challenge investors need to face. In the early EV days, manufacturers designed a variety of plug sizes and software protocols to facilitate charging for their vehicles.
But as adoption increases, compatibility becomes a massive pain point for ensuring drivers can charge their cars, no matter where they are. Consumers don’t have to worry about whether the nozzles at the gas station three states away will work—they shouldn’t have to worry about connections for their future EV, either.
Luckily, the wild west days of the early EV market appear to be drawing to a close. The formation of the North American Charging Standard—developed out of Tesla’s charging standards that the company opened up for use to manufacturers like GM, Ford, and Volvo—provides a unified plug-and-charging system for consumers. With the rise of universal EV charging stations through state and federal investment (which also take into account North American Combined Charging Standard plugs and Japanese CHAdeMO plugs), interoperability for plugs and charging protocols appears to be inevitable.
#3. Industrial advancements will make heavy-duty and long-distance EV use viable
Transitioning consumers to EV use is only part of the solution toward a greener future, especially as nearly one-third of all transport emissions come from freight trucks. Ensuring the transition of these commercial long-distance vehicles—as well as short-distance delivery trucks, corporate fleet vehicles, and heavy-duty machinery—will be crucial for receiving corporate buy-in to EV infrastructure.
Recent strides have shown that this transition is arriving rapidly. According to the International Energy Agency (IEA), battery electric trucks can now compete with conventional diesel vehicles on a total cost of ownership basis for various commercial applications. While most charging will occur “off-shift” (that is, at night or during downtime), the IEA reports “mid-shift” charging availability (that is, charging that occurs during transit or on breaks) is the most significant obstacle to full corporate adoption. Further investment in urban and regional EV infrastructure will help to mitigate most (if not all) of these pain points.
#4. Manufacturers are pushing to decarbonize EV battery development
While EVs produce significantly lower greenhouse gas emissions than gas-powered vehicles, they still produce some, especially during the EV manufacturing process. Making the batteries that power EVs form the bulk of those production emissions—anywhere between 40-60%.
However, as EV production ramps up, manufacturers are tackling this challenge head-on, hoping to reduce the carbon footprint of battery production by up to 75% within the next decade. These steps aim to make EVs a greener, more efficient—and more enticing—solution for global consumers.
#5. EV infrastructure will become a $100 billion market by 2040
Conventional vehicles rely on conveniently placed gas stations to provide fuel, and electric vehicles will also need a similar approach to keep running smoothly. The process may differ slightly, combining slower charging options in residential areas and commercial parking lots with faster mid-travel stations instead of traditional refueling businesses. However, like gas stations, these EV charging stations will still need to be managed and maintained by charge point operators (CPOs) to ensure continued operation. And this market is set to take off significantly in the near future.
As demand for electric vehicles grows, the need for privately owned EV charging station businesses will grow along with it. According to PriceWaterhouseCoopers, the EV infrastructure market is projected to grow to around $100 billion by 2040, with CPOs expected to take between 50-65% of the total market share. There is a massive opportunity for investors and entrepreneurs to begin building foundations now to reap the benefits as the market fully matures.
Building a charging business from scratch means matching the right hardware and software with the right business opportunities. ChargeLab’s robust EV charging software can help. ChargeLab provides centralized control of all aspects of your EV charging business, and it’s hardware-agnostic so that it will work with virtually any OCPP-compatible EV charger. Contact us today to get started on your own EV journey.