The United States issued a new policy for electric vehicle charging piles to stir up the industrial pattern

On February 15th, after eight months of debate, the US government formally released the much-anticipated final rules for America's network of charging points for electric vehicles.

The administration hopes the new rules will spur a major shift in the US industry by giving consumers unfettered access to a growing national network of electric vehicle charging stations, including Tesla's superchargers.

The charging post must be made in the United States

The charging network is a central part of President Joe Biden's administration's climate change plan to make half of all new cars sold in the United States electric by 2030. Advocates have said the small number of charging points on U.S. roads has hindered the adoption of electric vehicles and diminished their positive impact on the environment.

In response, Biden has pledged to build 500,000 electric vehicle charging points in the United States by 2030, with $7.5 billion in federal funding to support it. There are currently more than 3 million electric vehicles and more than 130,000 public charging points in the United States, according to the White House.

The newly issued rules require that if companies want to use $7.5 billion worth of federal money to build a network of charging posts, they must be made in the United States and use the nation's main charging connector standard, known as the Combined charging System, Instead of using multiple apps or accounts to charge, drivers can use a single recognition method on all chargers. In addition, all charging posts need to work 97 percent of the time.

Steel is needed to make some of the most critical components of electric vehicle charging piles, including the internal structural frame, heating and cooling fans, and power transformers. Chargers with cabinets require even more steel, which in some cases can cost as much as 50 percent of the total cost of the charger. Just before the new rules were released, manufacturers warned that a premature emphasis on quotas for locally produced components would slow the expansion of charging networks.

Under a bipartisan infrastructure bill passed in 2021, federal infrastructure projects such as electric car charging posts must source at least 55 percent of their building materials domestically, including steel, and must be made in the United States. However, the US Department of Transportation has asked for "lenient treatment" of EV charging stations, proposing that starting in July at least 25 per cent of the total cost of charging points come from US-made components, then rising to 55 per cent by January 1, 2024.

Instead of adopting the two-step proposal, the new rules issued on Feb. 15 decided to implement the 55 percent cost requirement starting in July 2024, while charging piles must be assembled in U.S. factories and any steel charging pile casings must be manufactured in the U.S. effective immediately.

In comments to the DOT, states and businesses warned that global demand for electric vehicle charging piles was straining supply chains, making it difficult if not impossible to meet U.S. manufacturing standards and speed up construction of new ones.

Some rejoice and some worry

For this policy, some people are happy and some people are worried.

First, for American electric car consumers, the new rules will, in theory, be enormously convenient. Colleen Quinn, director of the National EV Charging Initiative, said consumers who drive electric vehicles "can now be certain that they can charge their vehicle reliably and easily, and have the potential to know in advance how much it will cost". Currently, there are many complaints about the poor service of the toll system.

For EV charging companies such as Electrify America, ChargePoint and EVGo, federal funding could help accelerate the deployment of charging points. Charging stations require trained electricians to install and maintain them, potentially creating more high-paying jobs.

Moreover, for automakers, the introduction of more charging stations will boost the adoption of electric vehicles in the U.S., which could boost sales for traditional automakers like Ford, General Motors and Volkswagen, as well as startups like Rivian and Lucid.

In addition, service areas are likely to see an influx of investment as companies set up charging stations along heavily trafficked routes. It's also a positive for BP (BP) and Hertz (HTZ), which are expanding their charging services at gas stations and rental locations, respectively. Service area operators such as privately held Pilot Co and TravelCenters of America could also benefit.

Of course, the new rules will also bring some challenges to some enterprises. While charging companies have received financial support in their expansion efforts, only a handful of them indicated to the Biden administration before the rules were released on Feb. 15 that they could meet the "buy American-made parts" standard within the proposed time frame.

And some analysts say the requirement for local components would hurt overseas suppliers, though the Biden administration also wants to force overseas suppliers to open factories in the United States.

Enterprise response

In the coming weeks, the first tranche of federal money will be released to states, and companies such as Tesla, EVgo and ChargePoint Holdings will have to compete for the money from state governments. Some companies are already responding, according to the administration.

One of the most closely watched moves is that of Tesla, the leading electric car maker. The White House said Tesla will open its supercharging network in the U.S. to other electric vehicles, opening 3,500 new and existing supercharging posts along highways and 4,000 low-speed ones near hotels and restaurants to non-Tesla customers by the end of next year.

The new rules will allow Tesla to keep its unique connector, but must add a permanently connected CCS connector or adapter to charge CCS compliant vehicles. Tesla told the DOT that the plan was "aggressive" and "could result in an insufficient number of compliant charging stations available given the speed and scale of deployment," according to the records.

"As we build our EV charging network, we must make sure as many charging points serve as many drivers as possible," Biden tweeted. To that end, Mr Musk will open up a large part of Tesla's charging network to all drivers. It's a big deal, it's far-reaching." Musk responded to Biden on Twitter, saying: "Thank you, Tesla is excited to support other electric vehicles through our network of superchargers."

Analysts believe this could help turn Tesla charging stations into shared "gas stations" for the electric car era. But the opening up of Tesla's charging network also has the potential to undercut its products' competitive advantage, because for now, Tesla has the largest network of high-speed superchargers in the United States, which Tesla owners have exclusive access to.

On the same day the new rules were released, Australian company Tritium announced it would add more than 250 jobs at its Tennessee charging post manufacturing plant. Germany's Siemens recently announced its second U.S. manufacturing facility for charging devices in Texas, while South Korea's SK Signet will open a manufacturing facility in Texas, the White House said.

In addition, welding giant Lincoln Electric announced a new line of fast chargers, while Blink Charging will expand its charger manufacturing plant in Maryland with plans to build another facility this year.