Leasing vs. Buying EV Charging Stations
Worldwide, electric vehicles are growing in popularity. This growth is far slower in the United States, likely due to a lack of charging stations. But, thanks to the combination of increasing tax incentives for charging stations and vehicles — and President Joe Biden’s proposal to add 500,000 charging stations nationwide — this trend may reverse sharply. The International Energy Agency expects the number of charging stations to grow between 800,000 and 1.7 million by the end of the decade, which should result in a substantial uptick of electric vehicle purchases.
Businesses and property owners who are considering investing in installing electric vehicle charging stations on their properties have a lot to look forward to. These stations have the ability to produce revenue for businesses and increase the popularity of electric vehicles, providing both an ethical and a financial incentive for businesses. Whatever their reason, prospective owners may be past the stage of knowing they want to install charging stations, and are now trying to figure out the best way to do so. For these people, one of the main questions is whether to lease charging stations, or buy them outright. Here are the factors to consider when making that choice.
Up-Front Costs and Ease of Use
While the exact procedures and costs of buying vs. leasing charging stations will vary from provider to provider, a general rule stands: leasing is usually simpler and cheaper up-front, while buying may be cost-effective in the long-run. Which provider you want to use and how many stations you’re hoping to install will determine the exact figures. That said, note that some EV charging station providers advocate passing the monthly costs of a lease off to tenants or users of your property. While this is an option, it could also be off-putting to your customers. This option may be outweighed, financially, by the tax incentives offered by purchasing units.
Control
Leasing an electric vehicle charging station has another potential downside: you have less control over the unit. Under some lease agreements, there may be things you can’t do with the unit in question. Sometimes, you must rely on the provider for maintenance, which can be a problem if their maintenance crews are not reliable.
On the flip side, many providers will also provide protections for the units, meaning you won’t be liable for maintenance, should the unit require it. After all, they have a vested interest in ensuring you keep the unit, and would like you to remain a happy customer with them.
Tax Credits
The biggest and most definite difference between leasing and owning an EV charging station are the tax incentives. The majority of tax credits and incentives for businesses and residents interested in installing EV charging stations prioritize or are available solely to those who own the charging stations. The 30C tax credit, for example, which provides up to $1,000 for residential installations and a whopping $30,000 for commercial installations, only applies to station owners. And this isn’t the only one.
Each state has its own bevy of tax incentives and laws regarding the installation of EV charging stations. New York State, for example, offers a solid handful of incentives that can offset all or most of the costs of installing EV charging stations for owners. California has so many that they practically need a directory to help you find all the options available. While not all of these apply only to owners, most do. And even those that don’t may be easier to navigate for owners than lessees.
If you’re wondering which option is best for you, it’s smart to look up the laws in your state and county to see which ones are available to you. Or connect with EV Connect to explore your options.
The Choice Is Yours
For those interested in installing EV charging stations on their property, the question of whether you should buy or lease comes down to your priorities. What’s more important to you between long-term costs, short-term affordability, control and simplicity?
Many of these tax incentives will require an application process that, at times, will be tedious and difficult. So, if your priority is simplicity or short-term affordability, leasing an EV charging station may be your best option. But for those looking for long-term gain, sustainability and more control over their business, the wisest option is to buy the charging station outright and seek out rebates and tax incentives to cover the costs.
C.J. Wilson is a freelance writer, novelist and game writer based in Brooklyn, New York. When he’s not obsessing over the environment, he can be found obsessing over storytelling, music, writing books, playing games, hiking or learning something new and unusual. You can contact him on his website, here.
Sources:
Pew Research Center - Today’s electric vehicle market: Slow growth in U.S., faster in China, Europe
The Environmental Center - 4 things you need to know about the EV Charging Tax Credit
New York State - Charging Station Programs
Drive Clean California - Incentive Search