TOKHEIM QUANTIUM ALTERNATIVE FUEL DISPENSERS
Initially established as Start Italiana, an exclusive distributor of equipment produced by primary international companies for the measurement of liquid level and flow in 1993, the ProGauge brand evolved and is now considered to be one of the leading providers of automatic tank gauge solutions, including a variety of magnetostrictive tank probes (both wired and wireless), consoles, and related software to measure and monitor fuel tank levels including the increasingly popular 3D laser tank calibration service. Focusing on the fuel retail and industrial market, measuring the level and temperature ofliquids such as solvents, heavy oils etc., ProGauge products and services are now sold or distributed in 195 countries, worldwide.
Find a distributor
November 08, 2022
Powering Progress Through Electrification
The fuel retail and convenience industry is changing. With energy diversification and decarbonization at the forefront of this transformation, drivers can expect to see a very different fuel station than the one they know and use today.
This transformation should not be underestimated or overlooked as a “thing of the future”, as it will affect the entire fuel retail and convenience industry. Awareness of carbon footprints and our impact on the environment has been growing among consumers for some time, but now the industry has seen a real shift towards “greener choices”. This, alongside governments applying pressure on the transport industry to switch to zero emission vehicles and meet the EU’s climate neutrality objectives, means the primary focus is now on electric vehicles (EVs). 2021 saw a significant increase in the uptake of electric cars and vans in the EU-27¹. EV registrations for the year were close to 1,729,000 up from 1,061,000 in 2020 – that’s a 7.1% increase of total new car registrations in just 1 year. The uptake of electric vans also increased from 2.1% of total new registrations in 2020 to 3.1% in 2021. For fuel retailers, this means the traditional forecourt model is no longer sustainable or viable. In order to remain successful, they need to plan for this transition, finding ways to offer clean energy solutions alongside conventional fuels
With cars running on electricity alongside clean fuels such as hydrogen (H2), and compressed natural gas (CNG), becoming increasingly available, consumers now have more choices available to them and it’s these choices they want and expect to see when they pull up to a forecourt.
The EV Opportunity
EV markets are expanding quickly, with electric car sales accounting for 9% of the global new car market in 2021² – four times their market share in 2019. From this, it’s clear to see that EV will have a huge impact on the industry but realistically, it’s not going to happen overnight. It’s going to take time. The reason behind this? In most countries it takes more than 10 years to convert the population of existing cars from ICE engines to EV, and many countries still require significant investment in EV infrastructure and there needs to be sufficient power, via National Grid’s, to meet demand. But this doesn’t mean forecourts shouldn’t be prepared now, for what the future will bring.
Although there is a lot of work to be done regarding mainstream EV implementation and adoption, there are still large groups of EV drivers already on the road, particularly across Europe. These are groups that hold a lot of potential and present valuable opportunities for fuel retailers; however, they are not currently being adequately catered for. If these groups are not considered “essential” to support at fuel sites now, why would they look to refuel at those same locations in the future?
Globally, there is a gap in EV infrastructure. Today, most EV charging takes place either at residential or workplace level, with the majority of availability being public charging points; however, consumers will gradually expect the same services, simplicity, and autonomy for EVs as they do for internal combustion engines (ICEs). Currently there are not enough chargers in place to meet EV demand, for example, there are approx. 475,800 EVs in the UK but just 24,219 public chargers – meaning there are around 20 vehicles per charging point³. If a fuel site is seen to be an “early adopter” of clean fuels, offering EV charge points, this can change consumer perception – transforming sites from a standard fuel station into an environmentally conscious energy hub, one who cares about their customers sustainable choices – while enabling EV drivers to have the same experience while charging their EV , as they did previously with their ICE.
While early investment in EV charging infrastructure can be a scary thought for a fuel retailing business, EVs should be seen as an expansion of the overall retail offer, increasing choices for customers, while providing an opportunity for fuel sites to stand out from the competition. EV charging systems are a substantial investment, there’s no denying that, but by implementing charging points at fuel stations, site owners can capture a “growth market”, one that is only going to grow and develop as the industry moves towards decarbonization and the various zero emission objectives set by governments, globally. By making the necessary investments now, fuel retailers can ensure their sites are able to cater to the accelerating clean energy adoption, future-proofing their forecourts for the “EV wave” set to come.
The Benefits of EV for Fuel Retail Sites
Drivers already associate fuel station stop-offs as essential to keep them moving, adding EV chargers to the forecourt is a natural point of progression. Not only could an EV investment help fuel retailers capture new customers – getting their foot into the clean energy door before their competition – it could also help them engage with new customer groups. This means the wait time to recharge a vehicle can be captured and transformed into potential for revenue and loyalty acquisition and retention.
Convenience is king and time is money, which is why consumers want to make the most efficient use of their time while waiting at a location to re-charge. This makes their visits to forecourts more multi-purpose than “fuel and go”. Increased driver dwell time will see a change in consumer spending habits at the convenience store (c-store), moving from “grab and go” purchases to more “destination shopping”, suggesting they have more time to spend in the c-store to make well thought out purchases, rather than just grabbing and adding a snack while paying for their fuel purchase. This presents an opportunity for fuel site operators to utilize and expand their c-store offering to EV drivers. Not only can this increase revenue, but it can enhance the overall consumer experience, turning an average charging stop into a future recharging destination encouraging repeat custom and long-term loyalty.
Today, there are dedicated apps and websites highlighting where EV drivers can recharge, specifically within Europe. With 37,000 charging stations in the Netherlands⁴ alone, drivers can map their journey while stopping at specific charging points on route, selected based on other drivers evaluations as well as the individual forecourt offering. This gives fuel sites additional exposure, reaching international audiences, while putting their forecourt on the map (quite literally). It’s a chance for fuel retailers to be part of the EV revolution, officially marking their commitment to support sustainable energies.
Is EV Integration Right for my Fuel Retail Business?
Although EV chargers could be a wise investment for many fuel retailers, and it’s clear EV charging units have the potential to bring in additional revenue over time, it’s not always suitable for every forecourt – not right now anyway. There are several factors that can impact an EV investment decision:
• EV charging systems need to be located at a distance away from other petrol and diesel dispensers on the forecourt. This means any site looking to invest in EV must have the footprint to do so, accommodating parked vehicles for charging while maintaining enough space for regular “refuel and go” customers.
• EV adoption isn’t widespread. EV adoption is still in early, incremental stages and isn’t widespread enough to make installing and investing in EV chargers profitable everywhere. The profitability of EV charging remains largely geographically dependant.
• Fuel site owners will have to rethink their business model. EV charging marks a departure from established business models, which have been built on traditional gas and diesel sales bringing consumers to site for a quick refill and convenience shop. Fuel sites looking to invest will have to rethink their strategy and look to boost profit margins by means of offering other goods and services during EV charging dwell time.
There are several other factors that should also be considered prior to making an investment, these include: local regulations and guidelines, range of power outputs and government incentives to name a few. It’s important fuel site owners take everything into consideration and do their market research before making the decision to invest in EV; however, one thing is clear, the industry is moving towards clean fuels and it will happen sooner rather than later. 90%⁵ of drivers who made the switch to EV have no desire to revert back to a petrol or diesel car – which further supports the move towards an electrified future where the need for accessible charging stations is not a “nice to have”, it’s a must. As such, fuel retailers need to stay proactive and consider how they can stay one-step ahead when it comes to their forecourt offering – providing the fuel choices consumers want, both now and in the future, so they don’t get left behind.
As the world tries to balance the ever-growing global need for more energy alongside decarbonization to improve sustainability within the transport sector, is your fuel business ready to take on the new opportunities it brings?