Hidden Opportunity: Electric Vehicle Charging Stations in Diverse Markets to Combat Charging Deserts
This is part of a series exploring the foundation of Genius Guild’s investment thesis.
This March, the Biden-Harris administration opened applications for a new multi-billion-dollar program to fund Electric Vehicle (EV) charging across the country, requiring 50 percent of all new vehicle sales to be electric by 2030.
Access to charging facilities remains profoundly unequal in predominantly Black and Latino neighborhoods, creating communities with limited access to EV chargers (aka, “charging deserts”). A January 2023 Axios study that analyzed the 35 U.S. cities with the largest amount of electric vehicle sales found that majority-white areas are about 1.4 times more likely than majority-non-white ones to have a charger. And some areas have even worse statistics: in Philadelphia, majority-white areas are 3.9 times as likely to have a charging station; in Chicago, they’re 2.8 times as likely; and in New York, they’re 2.6 times as likely.
To reach this imperative, a massive investment in infrastructure to support those cars is needed, especially public and private charging stations located in marginalized communities. The 2021 federal infrastructure bill included $7.5 billion to support public charging stations. According to a 2022 McKinsey study, in order to reach the goal of half of all new vehicle sales being electric in the next 10 years, the U.S. would need 1.2 million public chargers and 28 million private ones.
The gap between the need for charging stations and the reality of how many are built and where they tend to be concentrated means that there is a massive investment opportunity in this area to serve underserved markets. A September 2022 Price Waterhouse Cooper analysis found that the number of charging points in the US is poised to grow from about 4 million today to an estimated 35 million in 2030. They predict that the electric vehicle supply equipment will be a $100 billion market by 2040, led by charge point operators, who build, operate, and maintain EV charging stations.
Investors are starting to take note of this emerging market. For example, in January 2023, Orange Charger, an EV charging infrastructure startup that has designed a charging station solution for low-and-moderate income communities in apartment buildings, closed a $2.5 million pre-seed funding round from early-stage investor Baukunst.
As we head into our Fund II, Genius Guild is expanding our investments in climate and green tech startups, especially those working on developing technologies that serve diverse markets. There’s a massive investment opportunity in this space, and we’re excited to capitalize on it.
