EV sales not keeping pace with Estonia's charging infrastructure development
Estonia's electric vehicle charging network has grown more than tenfold over the past four years, while sales of electric cars have not seen a similarly sharp rise.
Developers acknowledge that the business is likely to remain unprofitable in the near future. For investments to start paying off, there would need to be at least four to five times more electric vehicles on the road than there are today. Installing fast chargers is expensive work. The cost of a single charging station is typically around a couple hundred thousand euros, but can exceed €300,000.
"This is an extremely capital-intensive investment. By far the biggest expense when opening a charging station is connecting it to the power grid. It depends on how powerful the station is, but if we are talking about 150-kilowatt and more powerful ultra-fast chargers, the investment reaches at least a couple hundred thousand euros," explained Jaanus Riiner, head of transport electrification at Enefit.
In 2022, Estonia had 147 electric vehicle charging points. Now, three and a half years later, there are 2,165. There are 11,500 fully electric cars in the country, meaning Estonia has roughly five cars per public charger, though many users mainly charge their vehicles at home. Sales remain modest. In April, 115 new electric cars were sold, accounting for 6 percent of all new cars sold.
"We are closely monitoring the ratio between fully electric and plug-in vehicles and charging points. This is a long-term business plan. At the moment, neither Enefit nor, presumably, other charging operators are making a profit from this activity," Riiner said.
Enefit has opened 700 charging points in Estonia. Latvia's Elektrum has opened more than 300, with more on the way. This year, Elektrum will open 200 fast-charging points, and by the end of the decade it plans to add 1,000 new charging points.
"I can say that the investments are very large. We see the development of electric vehicle charging infrastructure as a business of the future, with a long payback period. Elektrum is one of the few companies — fewer than five — capable of making investments of this scale with such a long-term return horizon," said Agnes Makk, head of Elektrum Eesti.
Developers hope that investing in the charging network will also increase drivers' confidence in giving up internal combustion engine vehicles.
"Let's be honest, for us this will not reach the break-even point before 2035. Based on forecasts for electric vehicles in 2030 and 2035, we would like Estonia to have 50,000 fully electric vehicles by 2035," Riiner noted.
"It is difficult to predict when rapid growth will happen, but we have the financial buffer to wait for that moment," Makk said.
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Editor: Marcus Turovski, Mari Peegel
Source: AK
