Rachel Koning Beals
Plans for a national electric-vehicle charging network were mostly repeated details from the Biden administration Wednesday, but the announcement still sent already elevated charging-company stocks higher.
The headlines also left Americans wondering how soon a complex network to rival traditional gas stations — one that analysts say will need state and city buy-in and private-sector help — will fully come online.
Biden proposed spending $174 billion to promote EVs and install 500,000 charging stations across the U.S. as part of a sweeping infrastructure announcement. Broadly, Biden wants Congress to approve $2 trillion to re-engineer America’s infrastructure and expects the nation’s corporations to pay for it.
ChargePoint Holdings Inc. /zigman2/quotes/214140886/composite CHPT +7.12% , which calls itself the world’s largest network of EV charging stations in North America and Europe, was up 17% Wednesday. ChargePoint went public through reverse mergers with a special-purpose acquisition company, or SPAC, in March. It is up 179% over the past year, though down 32% in the year to date.
EVgo was also drawing fresh attention; it plans to go public in the second quarter through a $2.6 billion SPAC and owns and operates more than 800 charging locations in 67 major markets across 34 states.
Another SPAC, Newborn Acquisition is merging with Nuvve, which wants to turn EVs into what are effectively portable generators, letting homes and appliances use stored EV battery-juice when the car is at home.
And Eaton Corp. /zigman2/quotes/205393239/composite ETN -0.44% , a diversified power management company, and Sweden-based ABB /zigman2/quotes/209404356/composite ABB +0.03% , which makes robotics and electrical equipment, among other companies that are expected to sell the equipment to the charging station operators factor in the same conversations. These stocks didn’t see the same upside move with the infrastructure announcement.
Most charging companies have yet to report an annual profit and are counting on widespread EV adoption to meet future financial forecasts. Analysts stressed the challenges in linking a national charging network across states and municipalities and incentivizing more homeowners to outfit their garages for a home charge. Costs for EV chargers vary based on the “level” of charger. The higher the level, the quicker the charge and the more expensive it is to install.
“Charging is the big challenge,” said Joe Wiesenfelder, executive editor at Cars.com, in an interview with MarketWatch earlier this year.
“People will want to charge at home, overnight, then unplug and drive. At-home charging doesn’t work in every home without modification. And once on the road and needing a charge, even fast-charging batteries aren’t as fast as the five minutes consumers are used to spending at a gas station,” he said.
Plug-in vehicles, which include EVs and hybrid electric vehicles with traditional engines, only accounted for about 2% of the more than 17 million new vehicles sold domestically in 2019, according to Energy Department data.