14 AFTERMARKET MAY 2023 BUSINESS www.aftermarketonline.net Electric vehicle adoption is outperforming all expectations, and is now anticipated to represent over half of US vehicle sales by 2030. The key link to mass EV adoption is now software, not hardware or vehicles. Fortunately, software innovations are already providing solutions to many of the scaling challenges and will play a crucial role in EV adoption. From $1 billion in 2021, EV charging software is forecast to grow to $25 billion by 2030, making it one of the fastest growing software sectors in the market today and a huge opportunity for value creation for founders and venture capitalists. Key challenges in EV adoption that software can help solve Electric vehicles are set to revolutionise the industry. But a full transition to EVs requires overcoming several critical challenges. The first relates to infrastructure and interoperability. While the number of charging points is growing, it is still far away from being able to meet the demands of many EV drivers. EV drivers still must plan their journeys, especially longer ones, as charging networks are still inadequate, and range anxiety remains a major stumbling block for many willing consumers. As the EV market grows, it will strain the grid. According to some estimates, we will need 1.1 EV chargers for every EV car. This could increase peak electricity demand on local grids by 15-50%, requiring expensive upgrades to accommodate the increased demand. The interoperability of different EV charging systems remains a major issue – currently it causes problem of overnight charging for EV owners who lack off-street parking and journey planning. Having varying protocols meant there were different standards/levels of device management, transaction handling, security, smart charging functionalities. New protocols like the Open Charge Point Protocol (OCPP) and communication standards such as ISO 15118 are now in place but will need continuous co-development by all stakeholders, to increase compatibility between different charging stations and management systems. The second key challenge is equipment and maintenance cost. EV charging hardware remains expensive. The cost of a charging station varies significantly by type though generally, a Level 2 240-volt (the typical home charger – with capability for full charging around 6-8 hours) station costs up to $2,000 incl. installation costs, with level 3 charging stations intended for public and commercial networks costing typically between $10,000 and $40,000. In addition to hardware and installation costs, soft costs drive up operational costs. These soft costs include complex permitting processes, lagged communication between utilities and providers, and high maintenance cost if not serviced well (especially for outdoor chargers). The final challenge relates to the length of time and cost of e-fuelling. Refuelling a petrol car is straightforward; Charging an EV remains more complex. Some stations EVS: THE POWER OF SOFTWARE Software is now driving the worldwide Electric Vehicle charging market BY Julien Deconinck, Managing Director of DAI Magister
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