Deploying electric vehicle (EV) charging infrastructure involves more than just purchasing and installing equipment. The full cost of installing electric vehicle supply equipment (EVSE) includes the hardware, software, and construction that make up EV charging infrastructure, as well as additional costs not directly related to EVSE hardware and grid-tied installation. These non-equipment costs are collectively known as soft costs. Understanding the soft costs associated with installing EV charging is imperative to reducing the overall cost of EV infrastructure deployment.
Why Are EVSE Soft Costs Challenging?
Soft costs are highly variable, harder to estimate, and driven by time-sensitive processes. Some soft costs are associated with processes at the state and local jurisdiction, including permitting, siting, and zoning. Other soft costs are associated with energization, including incurred cost for utility load service requests/interconnections, inspections, and customer acquisitions. Any obstacle in these processes can increase project cost and delay the project's completion. As a result, soft costs often can account for a larger portion of the total installation price than direct costs.
Soft cost uncertainty and project delays can create a negative cycle. Unexpected infrastructure soft costs can cause total installation costs to exceed site developer budgets, potentially leading to delays and cancellations. Additionally, delays in infrastructure deployment may further lead to an increase in soft costs.
Roadblocks to Installing EVSE
Variability Across State and Local Jurisdictions
In the United States, there are more than 40,000 authorities having jurisdiction (AHJs), including local municipalities, and more than 3,000 utilities. EV charging development processes may vary significantly depending on the installation site AHJ and servicing utility. Areas where processes and requirements may vary across AHJs include zoning, electrical codes, building codes, and fire codes. These variations can lead to delays to permitting, siting, and energization timelines, leading to unexpected additional project costs.
Lack of Standardization in Terminology and Processes
There is a lack of standardization when it comes to defining what counts as a soft cost and the factors that influence soft costs. EV charging site developers often don’t know what their soft costs will be until they begin deployment procedures. Promoting an industry-wide understanding of soft costs and helping to develop consistent processes saves time and money for all stakeholders involved, helping reduce costs and timelines for EV charging infrastructure.
In addition, there is a lack of standardization around processes and not enough transparency in those processes, such as maximum timelines to process permitting or a load service request, which prevents stakeholders from planning and budgeting projects effectively. According to the International Renewable Energy Council's (IREC's) report, Paving the Way: Emerging Best Practices for Electric Vehicle Charger Interconnection, current Level 2 charger interconnection timelines, where power is already available, can range from 1 day to 6 months, mainly due to interconnection and permitting delays. DC fast chargers (DCFCs) can take even longer—from 6 months to more than 2 years.
EV charging energization timelines vary widely depending on factors such as site location, requested site capacity, charging levels, equipment availability, whether grid upgrades are required, inclusion of distributed energy resources (DERs), local government cooperation, and difficulties obtaining easements. Unclear or inefficient policies and practices at the state, local, and utility levels can also greatly impact energization timelines. Having clear permitting timeline limits and energization process timeline limits will provide greater transparency.
What Is the U.S. Department of Energy (DOE) Doing to Address Soft Costs?
Through both the Office of Energy Efficiency and Renewable Energy's Vehicle Technologies Office (VTO) and the Joint Office of Energy and Transportation (Joint Office), DOE is supporting AHJs, utilities, and industry to overcome the barriers, including both practices and procedures, that increase development soft costs and delay EV charging infrastructure deployment.
Project REWIRED provides over $2 million of federal funding to reduce the soft costs associated with EV charging installation energization in rural areas serviced by utility cooperatives (co-ops). Working with rural co-ops, the REWIRED effort addresses EV soft costs by developing standardized procedures, checklists, and templates for applications to accelerate the energization timelines for EVSE installations serviced by co-ops. The objective is to enhance processes designed to reduce EVSE interconnection soft costs and develop a load service request/interconnection roadmap for National Rural Electric Cooperative Association (NRECA) utility members to accelerate EV charging deployment and better meet customer needs. REWIRED is a cooperative agreement between NRECA Research and DOE's VTO.
The Charging Smart National Program awards communities for EV readiness and provides personalized, no-cost technical assistance to help AHJs set and achieve policies that facilitate the equitable expansion of EVs and EV charging infrastructure in their community. Through a designation (Bronze, Silver, or Gold) the Charging Smart program recognizes and awards local governments that take action to accelerate EV infrastructure deployment based on six major categories: Planning, Regulation, Utility Engagement, Education and Incentives, Government Operations, and Shared Mobility. Charging Smart is led by IREC and funded by DOE’s VTO.
The National Renewable Energy Laboratory (NREL) is leading an EVSE soft cost analysis project in collaboration with Lawrence Berkeley National Laboratory and Idaho National Laboratory, with funding from the Joint Office. The project will determine the current baseline for soft costs at AC Level 2 and DCFC sites in the United States, including both private and public installations. By identifying, benchmarking, and tracking relevant soft costs, the project will identify potential pathways to reduce soft costs for EVSE. The three national laboratories are engaging diverse stakeholders, such as electrical utility organizations, federal agencies, and EVSE installation businesses, to understand their perspectives; collect data on various EVSEs, expenditures, and timelines for buildouts; and conduct analysis to determine areas with the greatest potential impact to reduce EV infrastructure soft costs and accelerate EV charging installation timelines. Further details and findings from the Soft Costs Benchmarking effort may be found through NREL's 2024 EVSE Soft Costs Annual Merit Review.
The Innovative Queue Management Solutions (iQMS) for Clean Energy Interconnection and Energization program provides up to $11.2 million to distribution utilities to pilot innovative software solutions for managing renewable energy and EV charging interconnection and energization queues. By implementing effective, scalable solutions, the selected pilot projects will help streamline distribution utility processes and reduce interconnection and/or EVSE load service request queues. Best practices and lessons learned from these pilots will be shared through DOE's Interconnection Innovation e-Xchange (i2X) via webinars, blog posts, and in-person events.