9th August 2020
New announcements about the upcoming charging infrastructure projects comes almost daily, but today we saw something different.
A UK-listed investment company SEEIT (SDCL Energy Efficiency Income Trust plc) has emerged with a press release about its approach to the topic.
SEEIT has entered into an agreement with Electric Vehicle Network Limited (“EVN”) company to acquire an initial 112 fast-charging sites across the UK for a total consideration of up to £50 million (€55 million/$66 million). "rapid and ultra-fast" suggest various power levels as "rapid" was usually associated with 50 kW, while ultra-fast with 150+ kW. There are no details about the stations, but the average amount is £446,000 (€493,000/$586,000) per site.
The sites will be developed and completed by EVN within 12-18 months and then purchased by the SEEIT as a turnkey product. As we understand, having the chargers up and ready, SEEIT intends to offer them to Charge Point Operators, through 20-year, fixed price, CPI inflated contracts. Then comes the profits, at least that's the plan.
It sounds like a completely different way of thinking about the charging network - with chargers like a no-name commodity - but will it succeed? Or maybe it would be better to invest in an existing charging network?
"The EV charging sites will be developed and funded by EVN to the point at which they are contracted and construction ready, at which stage they will be acquired by SEEIT. The commitment of up to £50 million will be drawn down in tranches to fund the implementation of projects, with the first draw down of capital expected to take place later this year with the full balance of up to £50 million expected to be deployed over the next 12-18 months.
The construction period for each project is expected to be around 6 -12 weeks, at which point projects become operational and are expected to generate availability-based revenues.
Once operational, the EV charging sites will be contracted through 20-year, fixed price, CPI inflated Energy Service Agreements (‘’ESAs’’) to Charge Point Operators (‘’CPOs’’), which are typically investment grade utility companies. The EV Charging sites will also enter into long-term land-lease agreements with the site-owners, which are large, established forecourt or car park operators on the same basis. EVN, through its subsidiaries, will also manage the construction and operation of the assets, via asset management and maintenance contracts in accordance with the period and terms of the ESAs."
EVN is reportedly already thinking about the next stage of about 360 charging sites, which can be built for about £150 million (that's £395,000 per site, so cheaper - assuming similar specs) in the next 36 months.