Gas Stations Will Adapt To Benefit From Electric Vehicles

Tesla

MAY 19 2018 BY EVANNEX 15

GAS STATIONS PIVOT TO ADDRESS THE THREAT FROM ELECTRIC VEHICLES

If you think Big Oil is oblivious to the threat that electric vehicles pose to industry profits, think again. BP has forecast that oil demand will peak in the 2030s as EVs enter the mainstream. The CEO of Royal Dutch Shell has said the next car he purchases will be an EV, and the CEO of Total says he’s already driving one. At the recent CERAWeek conference in Houston, an annual gathering of players in the oil and gas fields, one of the hottest tickets was a seminar on batteries.

Related: Check Out Shell’s EV Charging Stations

*This article comes to us courtesy of EVANNEX (which also makes aftermarket Tesla accessories). Authored by Charles Morris. The opinions expressed in these articles are not necessarily our own at InsideEVs.

Above: Electric vehicle chargers pose a direct threat (or opportunity) for gas stations (Image: Tesla Road Trip Europe)

While some in the oil and auto industries still have their heads firmly ensconced in the sand (or perhaps another, more malodorous metaphorical location), others, notably the leaders of Europe-based oil conglomerates, are taking concrete steps to prepare for a future with fewer gas-burning vehicles.

Ironically, one of those moves could be investing more in “downstream” operations such as retail gas stations. Betting that oil demand will continue to grow in developing countries for some time, even as it shrinks in the wealthy world, Shell plans to expand its global network of gas stations and convenience stores, mostly in China, India, Indonesia, Russia and Mexico.  According to BusinessDay, Shell and rivals such as BP see retail as a way to secure demand for the fuels they refine as overall global demand heads towards a peak.

Over the past couple of decades, the business of selling fuel to drivers has radically changed. In the US, the iconic “filling station,” where a rumpled mechanic was on hand to check your oil and fix a flat, and the culinary selection was limited to a Coke machine and bags of stale peanuts, has been replaced by a mini-supermarket, with twenty touchscreen-equipped gas pumps and 500 flavors of designer coffee.

Above: A look at how the new Shell Recharge option at gas stations compare with other charging solutions in the UK (Youtube: Shell)

Even as retail fuel outlets have evolved, their number has been declining for decades. A recent article in Sky News notes that since 1970, the number of stand-alone petrol stations in the UK has shrunk by 75%. In Japan, the number of EV charging points surpassed the number of gas stations in 2015.

One reason for the transformation of the retail gas business is that margins on selling fuel are razor-thin. Gas is increasingly seen as a loss leader to attract customers who will spend money on drinks and snacks. Of course, that’s exactly how EV charging is seen by many industry observers, so it makes perfect sense that some oil purveyors (again, mostly European brands so far) are installing chargers at their retail locations.

Last year, Shell began installing EV charging points at gas stations (“forecourts” to our British mates) in the Netherlands and the UK (in partnership with Dutch charging operator Allego), as well as in Norway and the Philippines. It has also acquired Dutch charging network operator NewMotion, which manages over 30,000 charging points in 25 European countries.

BP, the dominant petrol retailer in the UK, recently acquired a stake in FreeWire, a developer of mobile rapid charging systems. Motor Fuel Group, the UK’s second-largest independent operator of forecourts, also has plans to offer fast charging.

Above: BP showcases its vision for EV charging at its gas stations (Image: BP)

“Downstream is helping Shell to thrive during the global shift to a lower-carbon energy system,” says John Abbott, Shell’s Director of Downstream. “We are helping to deliver tomorrow’s products, services and technologies, from battery-electric vehicle charging to next-generation biofuels, LNG for transport to hydrogen.”

Why is Europe leading the way when it comes to charging at the gas station? Demographics may be one reason: in contrast to the US, where suburban drivers charge at home, many UK drivers (perhaps up to 80%, according to research by National Grid) live in flats with no assigned parking spaces and must park their cars on the street. This is also the case in China, and in dense urban areas around the world. If EVs are to become a viable option for all drivers, some solution to this dilemma must be found, and rapid charging at public locations could be an option.

The oil giants are also exploring some less practical strategies to meet the electric threat. Some planners at Shell seem to believe that consumers won’t feel the need to buy EVs if they can assuage their consciences by greenwashing away their carbon footprints. Canada’s Financial Post reports that Shell is starting a program that earmarks 2 cents per liter of gas towards planting trees. “This means that everybody who has a car can actually be carbon-free, said Chief Executive Ben van Beurden. “They don’t have to buy an electric car.”

Petroleum analyst Dan McTeague called this gimmick “redundant,” noting that most Canadians already pay a carbon tax that amounts to more than 2 cents per liter. “Beside the point” is another description that comes to mind. As regular readers of this column know, reducing carbon emissions is only one argument for buying an EV. The main reason electrics will replace fossil vehicles is the same reason that the oil-burners replaced horses: they represent newer technology and a superior product.

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Written by: Charles Morris

*Editor’s Note: EVANNEX, which also sells aftermarket gear for Teslas, has kindly allowed us to share some of its content with our readers, free of charge. Our thanks go out to EVANNEX. Check out the site here.

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15 Comments on "Gas Stations Will Adapt To Benefit From Electric Vehicles"

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I think itäs more the gas companies want in on the chargin markets to make money, and of course also some “look how green we are”. They are perhaps a bit more progressive than the Americans.

Yes, they are. Remember that “Americans” include all the brands across both the North and South Americas, not just the U.S.

A quick topup of your EV at a servo will take enough time fir a cup of coffee and a snack. This is where the future profits will be found.

No one cares whether electricity is newer (by some measures it isn’t). People are going to want whatever works better for them. For some that’s electricity, but if you can’t charge at home it likely isn’t.

Society does have an interest here, though. Both for carbon dioxide and for other air pollutants we prefer electricity. It’s up to the government to provide the incentives to induce the majority to switch. Think Norway.

Very good point Ambulator. EVs are a newer technology and a cheaper choice to fuel, but mainstream consumers demand convenience too.
I’m very interested to see how mainstream consumers who don’t have access to a plug at home will primary charge their EV. It seems either workplace charging or DCFCing are the two main options if they aren’t able to get a charger installed at their apartment. People who live in MUDs aren’t going to buy an EV until they know for a fact that they have convenient charging options they can reliably use, and I really question how many will primary use DCFC, considering the time it requires per week, let alone find an employer or get their current employer to install charging stations.

“No one cares whether electricity is newer”

Please explain the concept of “fashion”. Or the popularity of trucks among people that only use it to drive to work and back.

The contrary is actually true. Consumers can be very easily manipulated into wanting the latest, newest thing, even if it is WORSE than what they already have. It helps if the new thing has some concrete advantages, but it certainly isn’t necessary. And people are far less rational when it comes to buying decisions than most people think.

Basically mainstream consumer want something that’s going to meet their needs and be convenient.

If you live in a dwelling where there is no parking or access to charging then accessing these public facilities would mean almost exclusively level 3 charging. That would be as expensive as gasoline and probably not good for the long term battery health.

That’s another good point to make! Will apartment dwellers get an EV and primary charge it on DCFC at $0.40 per kWh?
EVgo is often at $0.20 per minute for members, which if charging at an average rate of 30 kW would equal $0.40 per kWh. $0.40 per kWh is roughly equivalent to $4.00 a gallon gas.

Even if charging is as expensive as gasoline, remember that EVs have much less maintenance and operating costs ( and less servicing time) than any gas car or even hybrids. The only items that will be replaced are tires, wiper blades, and cabin filters.

They’re not really called forecourts in the U.K., but that is indeed the part of the petrol station where the pumps are. You wouldn’t say to someone I’m just going to the forecourt you’d say going to the petrol station or going to get petrol or going to fill up the car.

Thanks, I’d hate to go there and make an even bigger fool of myself.

I will avoid charging at a gas station as much as humanly possible. Those wankers aren’t getting any more of my money.

That is exactly the wrong thing to do. You should be making a statement by using the chargers as much as possible to show that electricity is preferred over gas. Demonstrating demand is far more effective than just ignoring the problem… which actually makes you an enabler. What message does not using a charger send?

Shell is a Dutch company. Seems that they are way ahead and more progressive than all the oil companies in the U.S. and other nations. Maybe everyone that actually own an EV should contact their local Shell offices and ask for these charging stations, and show the U.S. brand why they are wrong.