When Charlie Jardine started EO Charging in 2015, the Brit wanted to be central to the next big wave — the shift from the internal combustion engine to the electric vehicle. And the 2019 Forbes 30-under-30 entrepreneur chose to create a business that could help steer the way into this futuristic world. 

In the early days, the company that makes charging stations and the software that runs them got started in a pig shed. After laboring for a year to build something marketable, Jardine went to door-to-door to sell the chargers to electricians because they knew how to install them at people’s homes — a cold start but one that warmed up quickly. Fast forward to 2022: EO Charging will have sold 60,000 chargers worldwide. It also expects to get listed on the NASDAQ NDAQ in the first quarter and to increase its full-time staff from 160 to 400 during the year. 

EO Charging’s business model targets fleets. And it doesn’t just make the chargers and develop the brains behind them. It also services them. Companies like Amazon, DHL, Uber UBER , and Tesco have contracts with the London-based EV charging company. Amazon is the company that has fueled EO’s growth: Amazon wants to electrify 100,000 vehicles by 2030, and it inked a three-year deal in March 2020 with EO to provide the hardware, software, and service. Already, EO has built and is servicing 5,000 charging stations for Amazon. 

“If you have parcels and they can’t be delivered, it is a problem,” Jardine told this writer in a video interview. “These big companies pay us. They pay us for uptime and for reliability. We do vans, trucks, and buses, which are charging at depots at midnight before they hit the road at 8 a.m.”

EO Charging sells fast-chargers — separate from those found at work or home that charge slower. The “Level 3” fast superchargers cost as much as $100,000 apiece. EO, for example, will get paid $5 million for installing 50 superchargers. Charging companies like EVgo and Electrify America often locate at gas stations and get paid each time consumers plugin. 

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“We get paid for what do we upfront,” says Jardine. “We are the leading charging provider to fleets in Europe. The market globally is enormous. There are opportunities to expand in Europe and Australia, New Zealand, Iceland, Israel, and the United States. But we need to capital to fuel this growth.”  

Go West Young Man

Indeed, EO is headed West to this country. It will initially focus on electrifying vans, trucks, and buses, having already secured a pilot demonstration project in California for a global logistics leader. To that end, EO aims to raise $150 million by going public in the first quarter of this year. It will do so through a SPAC instead of a traditional initial public offering.  

So, First Reserve Sustainable Growth Corp. has raised $222 million into this endeavor. This NASDAQ-listed company will serve as the the special acquisitions company or SPAC — the mechanism by which the additional funds are raised. Jardine and his father will own 50% of the company, and First Reserve will own 20%. EO now has a market valuation of $675 million. 

Why a SPAC? Speed to market. The U.S. battleground is expected to heat up — expedited by the passage of the infrastructure bill that will plow $7.5 billion into the EV segment. The company is already serving the biggest delivery companies. Jardine says EO is “just following its customers” — trying to establish business ties with them wherever they are located. To do so, it needs cash. 

“For a company our size, a SPAC is a quicker route to market,” he says. “An initial public offering can take two years. We are a technology company, and being on the NASDAQ is the right thing for our business. The U.S. is an exciting place — a country that wants to reduce its carbon footprint and electrify its transport sector.”

Electrification of the U.S. economy is critical for the country to reach its climate goals — a 50% cut in CO2 emissions by 2030 from 2005 levels. If electricity can replace gasoline usage for cars, trucks, and buses, that would go a long way.

Specifically, President Biden wants half all U.S.-sold vehicles to run on electricity by 2030. General Motors GM , Ford Motor Co. F , and Stellantis have said that they would comply. BMW, Honda, Hyundai, Nissan, Toyota, Volkswagen, and Volvo also applaud the endeavor. They all say that the federal government needs to make significant investments in the charging infrastructure to succeed. Others emphasize that the most important incentives are financial — giving tax breaks to buyers of EVs, a move that has worked in Norway where 75% of all new vehicles run on electricity.

Signs Point One Way

AlixPartners, a consulting firm, said that electric vehicles could rise from 2% of the global car market to 24% by 2030; EV sales in the United States will hit 17.2 million in 2022 — about 3% of the market. Bloomberg New Energy Finance predicts global sales of 30 million electric vehicles by 2030, with China making up half of those.

Electric vehicles are more efficient than the internal combustion engine, with a 30% efficiency rate. That means they are cleaner. 

Nevertheless, AlixPartners says there are myriad of challenges. For example, it still costs $8,000 to $11,000 more to build an electric vehicle than to make a traditional car that runs on an internal combustion engine. And it says that economies of scale may not tip the balance until 2030. Other concerns include supply-driven price increases and material shortages.

Fleet owners are motivated to use electricity-fueled vans and trucks to enhance their images. But EO is giving them the tools to reduce the cost of ownership. By looking at EO’s software applications, those operators can determine the cheapest time to recharge. They can then program those applications to fully charge their vehicles before their morning runs. 

However, those fleet operators could decide to forego the use of their vehicles and to use them, instead, to heat and cool their homes. Or they could make that battery power available to grid operators and get paid. If 200 vans, buses, and trucks are plugged into the grid during peak hours, that could also save the utility a lot of money and possibly avoid building new natural gas-fired peaking plants. 

“The nice thing about EV energy is that it is cheap at midnight,” says Jardine. “Owners will examine the time those vehicles need to leave the next day, the state of the battery when it plugs in, and how many miles the vehicle must travel. Then they will know how much energy to send to those vehicles, and ensure they are ready by morning at the lowest price.

“Our business model makes sense,” he adds. “We have public charging companies looking at fleets. They are looking at us and trying to pivot. But we are a pure-play company that is focused on charging and servicing fleets. Our brand defines us. We are the first-mover in Europe. Now we are headed to the United States. It’s a huge market, and we want to get a piece of it.”

The EV market is going straight-up — guided in considerable measure by the need to drastically reduce CO2 releases. And fleet owners are a driving force behind that trend. But the speed at which they move is determined by public policies, government incentives, and a reliable charging infrastructure. EO Charging has earned its name by making the transition smoother — a company that has gone through some rough patches but that will soon be publicly listed.

SEE ALSO:

Solar-Power EV Charging Stations

Arguments Against EVs Are Running on Empty

Automakers Ramp Up Charging Stations

Truckers Going Electric

Even the Oil-Producers See EVs Coming

Source: Forbes

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