The Cost Of Level 3 Fast Chargers Is Declining

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The cost of batteries for electric cars has dropped sharply over the past 18 months. That’s good news for EV advocates. But Bloomberg reports this week that another critical part of the EV revolution is also getting cheaper — Level 3 charging equipment. Its latest survey studying the price of Level 3 chargers found the price of 300- to 400-kilowatt chargers averaged $58,100 in 2024, or $163 per kilowatt of power. That’s a 26% drop from when the survey was last completed two years ago.

That’s the good news. The even better news, Bloomberg says, is it expects prices to decline even further. The minimum cost of chargers in Europe and the US was 30% below the average price. In China, chargers were as much as 63% cheaper. Manufacturers can expect a sustained period of competition and a race to solve reliability issues that have bedeviled EV charging networks and left consumers confused as to how long a charge will really take. Tesla is one of the biggest Level 3 charger manufacturers and has installed over 65,000 Supercharger stalls in its network. Power electronics giants ABB and Siemens are also in the market, but have been outshone by smaller firms such as Finland’s Kempower and Italy’s Alpitronic in recent years.

Alpitronic is estimated to have shipped around 25,000 chargers in 2024, and CEO Philip Senoner told BNEF that revenue exceeded €1 billion for the year. That would make it one of the biggest charging manufacturers in the world. EV drivers are used to seeing Alpitronic chargers across Europe at major networks like EnBW, Fastned, and E.On. The company has also made inroads in the US, with Ionna and Mercedes charging. This will be an increasingly important market, and manufacturers will be keenly watching any attempts by the Trump administration to change the $7.5 billion federal charger grant fund. (If it hasn’t been killed by the time you read this, it soon will be.)

Kempower was a poster child for success in 2023 as its sales and share price rocketed. It’s hit a rough patch, however, as competition led to lower sales and put pressure on prices across the industry. Kempower’s revenues dropped around 30 percent  last year to roughly €200 million. The company’s share price has plunged 80% from its peak. It wasn’t the only company that found 2024 challenging. ABB highlighted weak performance and losses at its eMobility business during its last investor call. An initial public offering of the division mooted back in 2022 looks unlikely anytime soon. Siemens, however, announced it would carve out its eMobility division in September of last year.

The BNEF survey found Chinese companies are selling chargers at dramatic discounts to the average global price, and many are looking to expand in the US and Europe. This includes Phihong subsidiary Zerova, Autel, and Starcharge, all of which have set up manufacturing facilities in the US. Many manufacturers are also incorporating power modules, which are one of the most expensive components of the EV charger, from Chinese suppliers.

Level 3 Charging Ups And Downs

There was a flurry of activity in the US in the past two years. Tritium, an EV manufacturer from Australia, set up shop in the US two years ago to take advantage of the manufacturing incentives in the NEVI and IRA legislation. Tritium is a major supplier of the high-speed, direct-current fast chargers used to quickly recharge electric cars, vans, buses, and trucks at highway rest stops, fleet depots, and other sites, with 13,000 DC fast chargers sold in 47 countries. Despite its track record, in 2024, its US subsidiary declared insolvency.

Another company that has had an interesting experience with high-speed chargers is Ford. In late 2023, CEO Jim Farley notified all Ford dealers that they would need to install at least two Level 3 chargers in order to be qualified to sell electric cars from Ford. Some of the dealers screamed that those chargers would cost them a million dollars or more, a demonstrably false claim, but one that was enough to stir several dealers to sue the company. That spat has now settled down as the slowdown in EV sales growth has led Ford to rescind its EV charger mandate amid supposedly lower than expected EV sales volume.

What few have explored is the impact of demand charges on the cost of Level 3 chargers. Demand charges are imposed by utility companies to cover the costs of providing the electricity to power them. To arrive at a number, the utilities figure how much it will cost to provide the infrastructure — poles, wires, and transformers — necessary to ensure there will be enough electricity available to meet the highest expected use case. Whether that level is ever reached is irrelevant. In the case of those Ford dealers, the demand charges may have far exceeded the cost of the chargers themselves.

Price is not the only factor for prospective buyers of Level 3 chargers. Reliability, efficiency, and the ability to deliver consistent charging power all matter. A Kempower white paper suggested 25% of sessions fail on average, and that this number may be around 15% even for some of the best operators. EV charging software provider Monta’s CEO Casper Rasmussen highlighted error rates between 9% and 14% for the top AC and DC charger manufacturers it works with. Many issues can cause these errors, from failing hardware and charger cables, to communications between the vehicle and charger, to payment systems which can rely on malfunctioning authentication systems and internet access. Ensuring support for legacy hardware is one of the biggest challenges for charging manufacturers who would prefer to focus on shipping new product.

The industry is evolving fast, and its many stakeholders are coming together to solve issues. Charging operator EVgo said its “one and done” charger success rate had risen to 95% in its presentation of third quarter results. In addition to improving reliability, efficiency is important for the next generation of chargers. Electricity costs can far exceed hardware costs in the lifetime of a fast-charging hub. Ensuring the charge rate is clearly advertised to consumers is also important. Many EV drivers pull into a charger only to discover they’re getting much lower power than anticipated, and therefore have to wait much longer to charge. This can be due to vehicle and battery limitations, but power sharing across chargers is also common. This is a problem all of the industry will need to solve together if the EV revolution is to move forward as incentives and tax credits are removed under the current administration.