The electric vehicle (EV) revolution is accelerating, and the pathway to a fully functioning EV charging ecosystem has never been clearer. Convenience stores, with their widespread presence, have a unique opportunity to stand at the forefront of the transition to a sustainable and commercially compelling low-carbon economy. Here are some of the most exciting aspects we see for convenience stores right now.
The Rise of EVs
The demand for EVs keeps increasing. More than ten million electric vehicles were sold globally in 2023, according to the International Energy Agency (IEA), with the United States accounting for 1.14 million sales. This volume is predicted to rise steeply to 51 million units by 2035[1], influenced by regulations and evolving technology. Federal tax credits of up to $7,500[2] and state incentives are also helping to reduce prices. As more EVs take to the road, the need for chargers continues to grow. However, early EV adopters often report a shortage of functioning public fast chargers.
The Biden administration aims to have 500,000 public chargers online by 2030. Currently, there are 64,000 public chargers in the U.S., encompassing 174,000 plugs, mostly on the coasts and in urban areas, according to Department of Energy data[4]. This equates to about 19 EVs per public charging plug.
"As the EV market accelerates, it’s important not to be left behind. I have confidence that the most progressive of this group here today [at RTC24] will get into EV charging within the next two years."
— Eran Rozenfeld, Director, e-Mobility North America at Konect
Plan Now to Be Ready
In c-store retail, EV charging is a future no one can afford to ignore. Many retailers are still working to refine their business case. In some regions of the U.S. and the world, the demand has already arrived. In others, now is the time to plan for the customer of the future.
For c-store operators, electrification can be either a threat or an opportunity. Without adapting the current business model, Boston Consulting Group estimates that up to 80% of fuel retailing sites could be at risk by 2035.
We believe it’s an exciting opportunity to rethink fuel retail. Return on investment is broader than just selling EV charging, with new revenue streams from carbon credits, supplying energy back to the grid, upselling services, and monetizing the longer dwell times for charging by attracting customers in-store.
Taking Advantage of Incentives
The Federal Highway Administration’s National Electric Vehicle Infrastructure (NEVI) fund covers up to 80% of the costs for installing, operating, maintaining, and collecting data from charging stations. The goal is to establish Alternative Fuel Corridors along the nation’s major roadways, and convenience stores are strategically positioned to cater to this demand.
California, Colorado, and New York are leaders in EV infrastructure due to their robust public charging networks, state incentives, and proactive policies. These states have effectively built out incentives for EV development, electricity and grid optimization, and EV infrastructure deployment and registrations. This comprehensive approach has made them exemplary models in the EV space. It’s now down to other states to take the template from states like California, Colorado, and New York to roll out their incentives and transition plans.
"NEVI is a once-in-a-lifetime opportunity for c-store retailers to change and future proof their businesses."
— Brian Kuebert, Director, e-Mobility Global Product Management at Konect
Fuel Retailers’ Advantage in EV Growth
Lots of existing fuel retail convenience stores are perfectly positioned in strategic locations with sites at 50-mile intervals along highways, existing grid connections, amenities, and good footfall. A key driver of the convenience store's success is dominating geography across the U.S. There are more than 148,026 stores in locations within ten minutes of 90% of American households.
Further EV adoption is coming, and there is a huge need for the ‘convenience experience’ at EV charging facilities. Convenience stores can capitalize on the growing demand by offering various amenities that enhance the charging experience and drive additional revenue.
- Food & Beverages: Longer EV charging times could lead to an increase in-store purchases. KPMG predicts that non-fuel profit could grow from 50% to 80% by 2035 due to this trend. The trend is already underway – non-food sales accounted for 32.7% of c-store revenue but 61.4% of profit in 2023, according to the trade association NACS[5].
- Site Design: Convenience stores are typically well-lit, attended 24/7, and require minimal detours, making them attractive locations for EV charging stations. This is another reason that fuel retail convenience stores score well on two attention-grabbing topics of Safety and Accessibility.
- Seamless Infrastructure: Reliable and connected EV charging infrastructure is essential to ensure customer loyalty and increase dwell time, further enhancing the overall convenience experience.
- Beyond Selling EV charging: Exploring additional revenue streams linked to selling electricity, c-stores could generate income from carbon credits, installing a battery on-site and supplying energy back to the grid, upselling services, and monetizing the longer dwell times associated with EV charging.
Critical Factors for Profitability
Utilization is key to profitability, making the selection of the right sites crucial for optimizing return on investment (ROI). Ensuring maximum uptime and quick problem resolution is vital for maintaining high utilization rates. Roadside real estate is often ideally located—a McKinsey study found EV drivers were willing to pay 10% more to plug in close to the highway if it avoided a detour.
These advantages explain why more than 68% of the recipients of NEVI funding are fuel retailers, as they are strategically positioned to benefit from the growing EV market.
"The consumer is starting to recognize that the fueling space is where EV chargers belong."
— Adam Schwartz, Electric Vehicle Charging Program Manager at Kwik Trip
The Bottom Line
The integration of EV charging stations into fuel retail c-stores is not just a trend but a strategic move to future-proof businesses in a time of change. The move aligns with the evolving needs of consumers and the broader push for sustainability. As technology continues to advance and the adoption of electric vehicles grows, c-stores that embrace this change will be well-positioned to attract and retain customers, drive sales, and contribute to a brighter future.
Help at hand
Konect is a unique turnkey EV charging Ecosystem empowering fuel retailers to deploy reliable, profitable charging infrastructure without working with multiple suppliers. Our team will support your business at every stage of the process, providing:
- Konect Consulting: We’ll help you select the right locations, equipment, grants and financing options, including options such as on-site battery storage for energy management solutions, such as peak shaving and supplying energy back to the grid.
- Konect Ecosystem: Konect includes a suite of our own hardware and software solutions designed for easier integration and a familiar interface, reducing complexity and the need for additional training.
- Konect Support: Our team will operate the unit for you, including a white label charging app for customers, predictive diagnostics and repairs, and a large nationwide team of technicians to maximize uptime, profit and loyalty.
Find out how Konect could help you, or download our whitepaper on how to create an EV charging Ecosystem.
References
1. [IEA Global EV Data Explorer](https://www.iea.org/data-and-statistics/data-tools/global-ev-data-explorer)
2. https://www.epa.gov/regulations-emissions-vehicles-and-engines/regulations-greenhouse-gas-emissions-passenger-cars-and
3. [Boston Consulting Group: Service Stations Future](https://www.bcg.com/publications/2019/service-stations-future)
4. Biden-Harris Administration Celebrates Opening of Nation’s First NEVI-Funded EV Charging Stations in Ohio and New York | FHWA (dot.gov)
5. [NACS 2024 U.S. C-Store Sales](https://www.convenience.org/Media/Daily/2024/April/4/1-US-C-Store-Sales-Hit-860-Billion_Research)
6. [McKinsey Center for Future Mobility](https://www.mckinsey.com/features/mckinsey-center-for-future-mobility/our-insights/exploring-consumer-sentiment-on-electric-vehicle-charging)