The 2023 U.S. Distributed Energy Resource report shows that the U.S. EV charger market has the potential to reach almost $68 billion per year. However, behind-the-meter capacity is likely to grow by 3.7 times from 2022 to 2027. The electric vehicle charging infrastructure is the main driving force behind the growth of the U.S. energy market.
Moreover, the resources that are present in this report are EV chargers, distributed storage, solar and fuel-based generators, and residential and non-residential demand flexibility.
According to Wood Mackenzie, Distributed Energy Resources are the ones that fulfill the following requirements:
- The location of the resource should be on the customer’s premises.
- A resource must control the customer’s household electricity load.
- The primary purpose of DERs should be energy management. However, flexibility in customer energy demand is not the part of DERs.
- Non-CHP generators have a voltage restriction of 69 kV, which includes all EV chargers connected to the grid station.
According to the report analysis, the installation of 262 GW of DER capacity will take place from 2023 to 2027. Meanwhile, 272 GW of utility-scale installations is also expected during this time period.
For the first time, the EV charger market will surpass the distributed solar resource. The market is likely to add an energy capacity of approximately 3.5 percent by 2027, reaching a potential of $20 billion. Residential charging capacity holds the majority of the EV charger market. However, this share is likely to decrease due to the development in the infrastructure of buses and trucks.
Factors that can Impact the Growth of EV Charger Market:
Factors driving the growth in the EV charger market are federal incentives. Moreover, the Inflation Reduction Act tax credits, along with the National Electric Vehicle Infrastructure Grant program, will likely incentivize the EV charger market. However, the main driving force behind the growth of the EV market is the grid instability for home and business owners. Due to these insecurities, the fuel-based market is likely to grow by 240%, and the storage market will grow by 460% till 2027.
Another main reason behind the growth of the EV charger market is NEM 3.0. This new net metering policy will initially cause a contraction of approximately 38% in the market. But after 2024, the storage market will take a hike. Distributed solar will still represent 46% of DER capacity despite the price decline of 13% over the course of the next five years.
In conclusion, the capacity of EV charger market is likely to double by 2027. There are quite a few hurdles to accomplish this goal. But due to government incentive policies and grid insecurities, the market will see significant growth.