The automaker must invest at least $2 billion in electric vehicle charging infrastructure over the next 10 years as part of a settlement with drivers and environmental regulators over its emissions cheating.
Critics have said the special court-required fund could give Volkswagen a leg up on other electric vehicle companies and urged U.S. EPA to rethink the deal.
But the automaker is on the verge of starting its project to blanket the country's major highways and cities with electric vehicle charging stations, said Wayne Killen, a top employee at the subsidiary Volkswagen created to manage the special fund, Electrify America LLC. His comments to state environmental officials yesterday marked the first public details about the plan.
EPA and California have yet to approve the automaker's plans for the money. That could happen as soon as this month in California, which has already sought public feedback on a state-specific plan. At EPA, top political appointees who bristled at President Obama's electric vehicle initiatives have yet to sign off on the plan.
Volkswagen is planning to install hundreds of high-powered stations that let drivers fully charge their car in a half-hour or less along the country's highways, Killen, the senior director of charging infrastructure planning and operations at Electrify America, told a meeting of the Environmental Council of the States. It will spend $200 million in California and $300 million in the rest of the country in the first of four 30-month investment cycles.
A portion of that will go to build around 290 charging station hubs along major highways in 39 states. The charging points will have 320 kilowatt-hours of power, more than double the power of Tesla Inc.'s high-powered outlets.
"The whole paradigm of electric cars will change with that speed of charging," Killen said, calling it a "challenge to Tesla." Elon Musk's electric car company already has around 400 high-powered charging stations for its customers around the country.
Build it where they'll come
Volkswagen has staked much of its comeback in the United States on electric vehicles, promising to introduce several new electric models — including sport utility vehicles — in a dozen states by 2020. Some lawmakers have raised concerns that the scandal-ridden car company would be making money off of its settlement, but EPA officials have said they wouldn't oppose that.
The main purpose of Volkswagen's investment will be to build charging stations where people are more likely to buy electric vehicles, Killen said yesterday.
Volkswagen has chosen to focus on 16 metropolitan areas, including five in California. Charging stations will be concentrated in public parking lots near restaurants or grocery stores. He did not reveal which 16 cities were chosen because EPA has not made the draft plan public yet.
State environmental officials reiterated concerns first raised in California that Volkswagen's plan did not provide charging stations to underserved communities with high air pollution.
"We can set up lots of chargers in these areas, but if people aren't owning and operating electric vehicles, they sit around and get broken," Killen said.
ChargePoint Inc., one of the largest charging companies in the country, has raised concerns that Volkswagen could squeeze out other startups in the industry with its massive investment. Other charging companies, including EVgo and other equipment suppliers, have called the Volkswagen cash a boon to the industry.
Killen said Volkswagen would fully own and operate the charging stations. In most cases, it is looking to utilities to provide the electricity and help build surrounding infrastructure.
"Having a reasonable business case is important," Killen said. "To date, there are no charging companies that are really making money. It's a tough nut to crack, especially at this stage of adoption."
He said Volkswagen's analysis found that even in the areas where it plans the most investment, the 16 big cities, its influx of cash would only address 10 to 20 percent of potential charging needs.
Following a call for ideas from states and other groups on its website, Electrify America received more than 500 proposals, he said. Camille von Kaenel/E&E News