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Will Sheetz Be the Tipping Point for EVs?

Potential deal with Tesla could set the stage for wider charging network

ALTOONA, Pa. -- The convenience-store industry has shown middling interest in electric vehicles (EVs), with a handful of chains installing charging stations. But with the mass-market Tesla Model 3 poised to ship in 2017, at least one chain is positioning itself for a potentially big ramp up.

As reported in a McLane/CSP Daily News Flash, Sheetz Inc., Altoona, Pa., is in talks with Tesla to install the EV manufacturer’s Supercharger stations at some of its sites, according to The Washington Post.

“We’ve had discussions with them about putting their chargers in our stores,” Michael Lorenz, executive vice president of petroleum supply, told the newspaper. “We haven’t done anything yet, but we’re continuing those discussions.” Lorenz would not comment on how many of Sheetz’s more than 500 sites in six states would host the chargers.

The chain is no stranger to EV charging. It installed DC Fast Chargers at five sites in Pennsylvania in 2014 to develop a charging corridor between Harrisburg and Pittsburgh. The network has since expanded to eight sites in Pennsylvania and North Carolina. Sheetz joins other c-store chains such as Royal Farms, Ricker’s and Spinx that also have installed chargers.

Tesla would not comment on its discussions with Sheetz; however, in a statement to the Post, it said it was partnering with gas stations, restaurants and hotels to expand its Supercharger network. It has installed more than 600 Supercharger stations with nearly 4,000 chargers across the country to provide free, exclusive charging for its luxury-class Model S and Model X SUV. These chargers also could service the Model 3, although likely at an additional cost for drivers.

The EV manufacturer is attempting to address the issue of range anxiety, or EV drivers’ fear of being stranded with a drained battery on a long trip and nowhere to charge up.

For the convenience-store industry, EVs have been a bit of a conundrum. The fastest full charge available through current charging technology—a DC Fast Charger—takes about 30 minutes, which is much longer than the average c-store visit, which clocks in at less than 3 minutes. To address this gap, chains such as Sheetz have emphasized their foodservice offers. The retailer also has incorporated seating areas in all of its stores that feature the charging stations.

EVs represent less than one-half of a percent of new car sales, and have seen headwinds from low gasoline prices; however, their market share is expected to expand. A recent study by Wood Mackenzie projected a 20% drop in gasoline demand by 2035 assuming mass-market, longer-range EVs such as the Model 3 take off with consumers and fuel-efficiency standards continue to ramp up.

“Those kiosks that just sell gallons and smokes are going to have to change,” John Eichberger, executive director of The Fuels Institute, told the paper. “They’re going to lose gallons. Plain and simple, no way around it.”

To prepare for an EV future, gas stations could install the electrical infrastructure to support chargers as they build new sites or are in the process of installing new fueling equipment. And retailers who want to get into charging today can partner with EV manufacturers such as Nissan or charging networks, which will often cover most or all of the upfront cost of installing chargers. But analysts warn that this subsidy model may not last much longer.

Sacramento 49er Travel Plaza in Sacramento, Calif., recently agreed to host a charging station from NRG EVgo, a provider of DC Fast Charging stations. There was virtually no cost to do so, said president Tristen Griffith.

“We want to sell gas and diesel, but our future is electric vehicles, and trucks are going to be driverless,” Griffith told the Post. “Times are changing, and we need to keep up with that change as well, if we want to be smart and stay ahead of the game.”

 

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