Big winner in Biden’s EV charging revolution: Gas stations

By David Ferris | 04/04/2024 06:25 AM EDT

An exclusive data analysis for E&E News shows EV infrastructure law money may be boosting traditional sellers of fossil fuels.

Photo collage of a truck at a gas pump on one side and EV car at a charging station on the other with money raining down between them

POLITICO illustration/Photos by iStock

This story was updated at 9:18 a.m. EDT.

When Americans steer their electric vehicles off the highway and into shiny new charging stations — many paid for with federal tax dollars — they’re likely to find them in a curiously familiar place: the gas station.

More than half of the charging stations being built so far from the 2021 bipartisan infrastructure law are rising at truck stops and gasoline stations, according to data exclusively provided to E&E News by EVAdoption, an EV data consultancy. In essence, the law’s $7.5 billion pot for charging is reinforcing the very fossil-fuel infrastructure that the EV era would seem to consign to oblivion.


That raises the prospect that money intended to cut emissions could throw a lifeline to companies that traditionally have raised them. Even so, many experts say the two industries are a natural fit.

“I’ve always kind of assumed that the combination of fueling station and convenience stop would dominate,” said Loren McDonald, the founder of EVAdoption. “They’re safe. They’re well lit. They have bathrooms on site. They have restaurants and stores. They check a lot of the boxes.”

After initially resisting EVs and their charging needs, fueling centers are now using their lobbying strength and financial might to win federal dollars they say are a necessary cushion to survive an expensive gas-to-EV transition.

“Now is when you really start seeing [gas stations] in a big way in the funding programs, really taking center stage,” said Lori Clark, who oversees EV strategy at the North Central Texas Council of Governments, a regional planning organization.

The clamor for charging cash crosses blue and red state lines. The EVAdoption data shows that infrastructure law awards are set to transform gas stations in states that former President Donald Trump won in 2020, including Texas, Ohio and Utah, as well as states President Joe Biden won, such as Rhode Island and New Mexico.

Service stations have an upper hand in this first wave of subsidies because they occupy the very real estate where the federal government wants to build a charging backbone: at 50-mile intervals along the interstates and no more than a mile from highway exits.

But that’s not the only reason. Behind the scenes, service-station industry lobbyists have been working to tilt the rules to their advantage.

As a result, the biggest winners at the dawn of the EV-charging era are some of the biggest fossil-fuel sellers — familiar names like Pilot Flying J, Love’s Travel Stops, Sheetz, Circle K and Wawa — along with the retail division of oil major Shell.

The trend is finding little pushback. Even the Sierra Club — famous for its campaign to shut down coal-fired power plants — is cautiously welcoming the entry of gas stations into the EV economy.

“It’s not a bad thing we’re seeing the deployment of fast chargers at those locations,” said Joe Halso, a Sierra Club staff attorney who focuses on electric vehicles. “They are recognizing, whether they admit it or not, that electricity is the fuel of the future.”

Infrastructure law funding is funneled through the National Electric Vehicle Infrastructure program, or NEVI, administered by the Federal Highway Administration. Dollars don’t go directly into the pockets of gas station owners. Rather, the money is parceled out to states, where departments of transportation are responsible for building a statewide network and determining award recipients.

The money highlights a crucial difference between the EV and gasoline eras in terms of who owns the infrastructure.

At a gas station, the business owner and gas-pump operator are usually one and the same. That’s not so with charging stations. Instead, the charging provider — who owns and operates the equipment — often locates in the parking lot of another business called the site host.

As a result, the entity winning a federal award to build and operate the chargers — the bidder — is often distinct from the site where those chargers are located. Site hosts are not receiving NEVI funds but may benefit by linking up with charging companies that are.

As bidders, truck stops and gas station chains won $92.1 million, out of a total of $265 million awarded by the infrastructure law to date, according to the EVAdoption data. An additional $12.2 million was won by BP Pulse, the charging arm of British oil major BP.

The other award winners are mostly charging networks, led by Tesla, which got $23.4 million. Other entities that won smaller shares are real-estate developers, the electric automaker Rivian and a handful of electric utilities.

Gas and diesel sellers’ dominance is even greater when it comes to the site hosts — the places where the stations are actually built.

Gas stations and trucks stops together are hosts for almost 54 percent of NEVI-funded charging stalls. The largest chains dominate. For example, two of the nation’s biggest truck stop chains, Love’s and Pilot Flying J, are slated to host 39 charging plazas each.

Outside the fueling arena, state toll-road authorities, banks, hotels, casinos, malls and restaurants like Arby’s and Waffle House are expected to be site hosts.

States that have awarded NEVI funds to build chargers include Alaska, Colorado, Georgia, Hawaii, Indiana, Kansas, Kentucky, Maine, Michigan, New Hampshire, New Mexico, New York, Ohio, Oklahoma, Pennsylvania, Rhode Island, Tennessee, Texas, Utah and Virginia.

Convenience wins, rural towns lose

The surge in cash for gas stations is prompting some environmentalists to say the Biden administration is missing an opportunity to pursue another of its goals: stimulating rural economies.

Under the Biden administration’s Justice40 Initiative, states are required to place 40 percent of federally funded EV charging stations in census tracts where poverty is high and educational attainment is low.

But because the NEVI rules require proximity to the highway and sites that operate 24/7, they could lead to EV drivers not stopping and spending money in rural downtowns, which are sleepy at night and distant from turnoffs.

“I had some hopes about bringing some rural economic development and community benefits, but it’s not as obvious to me that those things are being pursued rigorously” by the administration, said Sam Houston, a vehicles analyst at the nonprofit Union of Concerned Scientists.

In an emailed statement to E&E News, the Federal Highway Administration emphasized that the initial goal of the program is to create a convenient highway network. It also mentioned that another part of infrastructure law funding, called the Charging and Fueling Infrastructure program, funds projects off the highway with a priority on building charging stations in rural areas.

“From my time working at the local level, I know that finding electric vehicle charging in a community is different from finding charging along highways,” Transportation Deputy Secretary Polly Trottenberg said in a January press release.

The extensive application processes that states have put in place to win the money may also be creating barriers to small-business owners, including mom-and-pop gas stations and convenience stores. Overwhelmingly, the gas stations that will host NEVI stations are regional or national chains.

For example, a property owner in southwestern Colorado said in comments to the state that the paperwork led him to quit the process. “The requirements to receive these funds were way beyond the sole [proprietors’] reach and way more complicated than it needed to be,” he wrote.

Fuelers flip

Until recently, the gas station industry and its lobbyists often ignored EVs and their charging needs. “Their attitude was one of general opposition,” said Halso, the Sierra Club attorney.

Few gas stations hosted chargers, and when it came to public subsidies, the industry’s goal was to make sure electric utilities — a potential source of competition — didn’t get them.

That changed with the $7.5 billion for charging, along with a swelling number of EVs on the road.

Over the last two years, NATSO, the main trade association for truck stops, has spent “a lot” of time working on NEVI, said David Fialkov, the association’s vice president of government affairs, raising his eyebrows for emphasis. “Meaningful time and political capital,” he added.

NATSO submitted comments to FHWA in early 2022, asking the agency to make service stations the cornerstone of NEVI, arguing that the things EV drivers need are what gasoline stations already have.

“Most fuel retailers are open 24 hours a day, seven days a week and provide restrooms, food and beverage options,” NATSO said in its comment. It also argued it has the incentive to overcome the glitches that have bedeviled charging stations and sapped the public’s confidence in charging infrastructure.

‘‘We are conscripted to make sure that the customer experience is pleasant,” said Fialkov. “You don’t see a lot of broken gas pumps, and the reason is that the guy who runs the station loses money when the pump isn’t working.”

Federal rules are silent on what amenities a charging station must have to receive funds. But some states have, intentionally or not, aided gas stations in their application processes by requiring the sort of offerings that gas stations possess, such as restrooms and food courts. In some states, extra points are awarded to applications providing those perks.

Once the federal government set its minimum rules, Fialkov said, NATSO turned its efforts to persuading state DOTs to require amenities. “‘We wanted more uniformity and direction so every state would do it in the same way,” Fialkov said.

'It's a rough case'

Although the major fueling chains are winning the funding race, many say that building an EV-charging business will be a challenge.

“It’s a rough case,” said Tim Langenkamp, a vice president at Pilot Flying J, which is aiming to install about 200 charging plazas at its stations by the end of this year, in collaboration with the automaker General Motors and charging provider EVgo.

“The NEVI support is an important way of making the economics … better,” he added.

A chief problem for funding recipients is one that might never occur to an EV driver: A bank of charging stalls can make an electricity bill rocket through the roof.

Gasoline fluctuates a lot in price, but gas stations manage that by changing what they charge customers per gallon. That construct collapses when the fuel is electricity.

The reason is that the price of electricity can get volatile when businesses use a lot of it. If many EV drivers plug in to high-powered bank of chargers at the same time, it can result in a financial penalty from the electric utility, which needs electricity usage to be stable. This penalty, called a demand charge, makes it difficult for gas stations to project if EV chargers will be moneymakers or money losers.

“Demand charges is high on the list of things that keep me up at night,” said Kim Okafor, the general manager of zero-emission solutions at Trillium Energy Solutions, the charging subsidiary of truck stop Love’s.

Winning the federal funds, Okafor said, is “tedious” and “time consuming.”

She said she brought on an engineer and a couple of project managers solely to manage NEVI grants. Of the states, she added, "they are not making it easy.”

What companies lose in terms of upfront costs and aggravation, they hope to make up from the pockets of EV drivers.

Sujay Sharma, the CEO of the American branch of BP Pulse, said that unlike gasoline customers, who typically linger five minutes or less, EV drivers stay on-site for 20 to 25 minutes, helping a company’s bottom line by buying food and drinks. “The EV consumer, their basket size tends to be higher,” he said.

The gas station’s presence on the future electric highway is one that EV drivers are just going to have to get used to, said McDonald of EVAdoption.

“For the people saying, 'My God, this money is going to the evil oil companies' — the way to think about it is that they are offering a solution,” he said. “There’s going to be lighting. There’s going to be windshield squeegees and water. There’s going to be drinks. There’s going to be food.”

“You’ve got to think of it as a place you refuel body, mind and car,” he said.

This story also appears in Climatewire.