ALTOONA, Pa. -- This year has been a constant drumbeat of news about electric vehicles (EVs), including Tesla’s coming semitrailer and mass-market Model 3 releases, plans by legacy automakers such as General Motors and Ford to move toward electrified fleets, and efforts by several countries to transition away from the internal combustion engine.
For a fuel retailer like Sheetz Inc., Altoona, Pa., whose more than 560 stores are known for selling large volumes of gasoline and diesel, each piece of EV news is like a new piece of a riddle. The questions the chain hopes to answer: Is there an opportunity for retail in EV charging? And how long before the demand for EVs becomes truly significant?
“You don’t know exactly what the future will be, but you have some good ideas what the possibilities are,” Michael Lorenz, executive vice president of petroleum supply for Sheetz, told CSP Fuels. “You’re trying to give yourself as much flexibility and optionality as you can to position yourself to take advantage of what the future ends up being.”
Read on for how Sheetz is attempting to position itself for a possible electrified future ...
Early EV efforts
Sheetz first began testing EV chargers a few years ago, installing DC Fast Chargers at five sites in Pennsylvania as part of a charging corridor between Harrisburg and Pittsburgh, Pa.
“The reason we did that was just experimental,” said Lorenz. “We felt there was not going to be huge demand, and clearly we were not going to make money off it. But we wanted to learn more about chargers. ... We learned an awful lot. We learned that they’re a real pain in the neck.”
Specifically, it is critical to keep the charging stations operational 100% of the time. If they do break down, it can be a major inconvenience to EV drivers, who for long-distance trips must carefully plan their routes to take advantage of today’s fledgling national charging infrastructure.
“If it’s not operating, they can be in a really tough situation if they’re very low on charge and depending on that charger operating so they can be on their way,” said Lorenz.
Sheetz meets Tesla
This upkeep issue is what made Sheetz’s partnership with Tesla so favorable. Tesla is building out a network of Supercharger charging sites for its customers across the United States, and has partnered with several c-store chains, including Sheetz, Royal Farms, Wawa and QuickChek, to host them on their lots. Tesla owns and maintains the Supercharger locations and works with its customers directly if there are any operational issues.
Sheetz first began partnering with Tesla in 2016 and today hosts 11 Tesla Supercharger stations, each with six to eight chargers. They include Sheetz stores in North Huntingdon, Breezewood, DuBois, Falls Creek and Wexford, Pa.; Cambridge, Ohio; La Vale, Md.; and Morgantown, Weston, Beckley and Martinsburg, W.Va.
“They’re trying to build out a network of where they need sites,” said Lorenz of Tesla’s site selection process. “They basically overlaid [customers’] charging demands, what they feel the needs were vs. where the stores are. They felt these sites would be good for them.”
Sheetz continues to learn about the habits and needs of EV drivers. “To say we’re in a learning process is an understatement,” said Lorenz. However, it has learned that Tesla drivers are a passionate group. For example, one Tesla customer had driven down from Canada and was waiting for the Breezewood Sheetz Supercharger location to officially open as he made his way down to Florida.
“There’s definitely a Tesla community,” said Lorenz, “and they seem to do good job reporting when new sites are open.” They also reportedly compete to see who can be the first to charge up at a new Supercharger location.
Lorenz described Tesla as a very efficient and professional group that prefers to control all aspects of the Superchargers—from their maintenance and operation to even public relations and communications. “If you’re going to partner with someone, you want to make sure they’re a reputable and reliable company like Tesla,” he said. “We don’t have virtually anything to do, which is also a plus.”
The c-store opportunity
Some question whether c-stores with their quick in-and-out shopping occasion are a good match for the 20 to 30 minutes it takes for a Level 3 DC fast charger to charge up an EV battery to about 80% capacity.
Lorenz believes there is a business case to be made, especially when comparing the 5-minute-or-less dwell time of a gasoline or diesel customer to the longer visit of an EV driver. “There’s someone on the lot for 20 minutes, so hopefully they come in to buy something in the store,” he said.
And the limited number of public EV charging stations makes Sheetz a preferred stop. “It’s got the potential to be a productive customer, but we don’t know yet,” Lorenz said.
Point of disruption
Sheetz is open to hosting more Tesla Supercharger locations and adding more charging stations of its own. “[EV charging is] a potentially disruptive force that could impact our model or even make our current business model obsolete down the road,” said Lorenz. “It’s important to understand what’s really going on.”
At this point, it is tough to tell if that point of disruption is five, 10, 20 or more years down the road, especially in the current low-price environment for gasoline and diesel. “But everything is going in the right direction,” said Lorenz, noting that the three major reasons people don’t buy EVs—cost, driving range and variety of options—are all improving.
“Everything will get better,” he said. “There’s a future there, but it’s hard to say actually when it becomes significant.”