Charging companies raise $14 billion since 2022 as EV infrastructure expands

The urgent need for zero-emission commercial vehicles

With road transport emissions reaching a record 6,3 gigatons of CO2 in 2023, commercial vehicles are set to become the largest source of emissions in the sector by 2040. The demand for cleaner alternatives, especially in heavy-duty trucks and other commercial vehicles, has sparked rapid growth in the zero-emission vehicle market.

In the first half of 2024 alone, global sales of zero-emission trucks reached 38.000 units. China is leading this charge, accounting for more than 80% of those sales, while Europe is seeing steady adoption, though the U.S. market remains relatively smaller. The shift to electric trucks is uneven across regions, and expanding charging infrastructure is seen as key to accelerating adoption.

The critical role of charging infrastructure

Charging infrastructure remains one of the biggest factors in the widespread adoption of electric vehicles, particularly for commercial fleets. BNEF’s report reveals that nearly 600.000 new public charging stations were installed globally in the first half of 2024, bringing the total to around 4,5 million. China continues to dominate this space, hosting 70% of the world’s chargers, with strong growth also seen in Europe, where the number of ultra-fast chargers has multiplied sevenfold since 2021.

The U.S., while slower to develop its charging infrastructure, is beginning to catch up. Federal programs, including the National Electric Vehicle Infrastructure (NEVI) initiative, are pouring billions of dollars into charging infrastructure, with specific efforts to create truck charging corridors along key freight routes. This investment is crucial, particularly for heavy-duty vehicles, which require more advanced charging solutions than standard passenger cars.

$14 billion raised by charging companies since 2022

Since the beginning of 2022, EV charging companies have collectively secured close to $14 billion in funding, with more than $3 billion raised in just the first half of 2024. This capital has been gathered through various channels, including acquisitions, venture capital, and private equity investments. The U.S. and U.K. have been at the forefront of these deals, with both countries leading in the number of transactions.

One notable example is California-based Terawatt, which raised $1 billion in 2022 to build truck charging stations along major U.S. freight corridors. Similarly, WattEV, another California-based charging station developer, secured funding in 2023 to expand its electric truck leasing and charging services. These investments reflect the growing confidence in the long-term viability of the EV charging sector and its crucial role in the electrification of transportation.

Addressing the challenges of charging infrastructure

Despite the influx of funding and the growing number of charging stations, challenges remain. Heavy-duty commercial vehicles, such as trucks, require high-power chargers that are more expensive and complicated to install than those needed for passenger vehicles. Additionally, there are significant geographic gaps in charging infrastructure, particularly in rural areas and developing economies.

The BNEF report highlights innovative solutions emerging to address these issues. In China, for instance, battery swapping is gaining momentum as a way to reduce downtime for commercial vehicles. Instead of waiting for a battery to charge, trucks can swap out a depleted battery for a fully charged one in a matter of minutes. This approach, supported by over 600 battery-swapping stations in China, is a testament to the creative solutions being deployed to meet the needs of electric commercial vehicles.

As battery prices continue to fall and vehicle ranges improve, electric trucks are becoming more financially competitive with diesel trucks. BNEF projects that electric trucks could achieve total cost of ownership (TCO) parity with diesel vehicles by the end of the decade, particularly for short- and medium-haul routes, further driving demand for charging infrastructure.

Policy support is driving electrification

Government policies remain essential to the expansion of charging infrastructure and the adoption of zero-emission vehicles. In Europe, strict emissions regulations are pushing manufacturers to increase the production of electric trucks, while the European Union is expanding its public charging network through initiatives like the Alternative Fuels Infrastructure Regulation.

In the U.S., state-level policies have played a key role in driving ZEV adoption, particularly in California. California’s sales mandates for zero-emission trucks require that 5% to 9% of medium- and heavy-duty truck sales in 2024 be zero-emission. These mandates are creating significant demand for charging stations, as fleets prepare to comply with the new regulations.

The road ahead: A promising future for EV charging infrastructure

The nearly $14 billion raised by charging companies since 2022 marks a critical turning point in the global shift toward zero-emission transportation. As countries set ambitious targets to reduce carbon emissions, the need for widespread, reliable charging infrastructure will only grow. While scaling up this infrastructure remains a challenge, especially in regions where adoption has lagged, innovative approaches and strong government support are accelerating progress.

With advancements in battery technology and increasing investment in the EV charging sector, the future looks bright for zero-emission commercial vehicles. As infrastructure continues to expand and costs fall, the EV industry is on track to make significant strides in reducing global carbon emissions and meeting net-zero goals in the coming years. The momentum is building, and the electric future for transportation is closer than ever.

Source: BloombergNEF