Charging Utilization Rate: Is It Time to Standardize the Definition?

When a charge-point operator (CPO) states that they have a utilization rate of 21%, do you know what that actually means?

One of the challenges of new or maturing industries is that they often lack standardization on simple things such as terminology and metrics. I spent about 20 years in the digital marketing industry and helped define standard definitions around such commonplace marketing metrics as email marketing open and click-through rates.

What I and others in the industry found frustrating and confusing is that different marketing technology providers calculated these common industry metrics differently. Marketers could not accurately benchmark their performance against peers as companies in the industry often used different data in the denominator or numerator of these calculations.

We’ve reached this same point of inconsistency in the electric vehicle (EV) charging industry. From common terms like charging “station” and metrics such as “utilization” — you can never be certain of the meaning, unless these terms are specifically defined when used. While I’d like to think that “station” universally means the site/location and collection of chargers (analogous to a gas station), I still see and hear people in the industry and media use this term to mean an individual charging pedestal (analogous to a gas pump).

In this article, however, I will focus on the term “utilization.” At the recent EV Charging Summit (EVCS) and in response to some recent LinkedIn posts referencing utilization rates, I discovered that many people had to ask how the term was being defined. Or they criticized how it was being used as it didn’t align with their preferred definition.

Time-Based Utilization Rate

“Utilization” is not a term just used in the charging ecosystem, in fact it is a commonly-used term in many industries. The professional services industry, for example, uses the “utilization rate” metric to calculate how billable employees are:

Billable hours ÷ total hours x 100 = utilization rate

For example, if one employee submits 32 hours of billable time for their 40-hour week, their utilization would be 80%. Example calculation: 32 ÷ 40 x 100 = 80.

In the charging industry, the core value of “utilization” is to understand how a charging station or individual stall/port is performing from a usage perspective, which is then foundational to revenue, profit, and ROI calculations and models. There are at least three ways I’ve heard people in the industry talk about utilization: time, energy throughput, and session volume.

I argue that the only one of these that can actually be defined as a metric “rate,” is a time-based calculation. When calculating a metric that can be benchmarked across an industry — whether a click-through rate or utilization rate — it requires a definitive denominator. In professional services, for example, that might be a 40-hour week. But even if a firm were to use a lower or higher number of hours, the rate (hours worked divided by hours in the work week) would be normalized through the percentage calculation.

With time-based charging utilization, the standardized denominator is the number of hours a charging station is open to EV drivers. For most stations that is going to be 24 hours or 1,440 minutes, but many stations have limited hours of operation and may only be open for say 18 hours. Additionally, some stations are open longer or shorter hours on weekends. But even with a different number of hours, as in the work week for professional services employees, the resulting rate calculation (percent utilized) is normalized and can be benchmarked across internal or competitive charging stations.

Bill Ferro, Paren CTO, feels even more strongly about time-based utilization arguing that this rate is fundamentally about measuring the user experience. In the case of an EV driver, utilization starts when they pull into a stall and ends when they leave. From the CPO perspective, you can only generate new revenue from electricity when a stall becomes available to the next driver. At Paren, we can’t track when a car simply inhabits a stall, but we do track the session time starting from initial attempt to charge, to the completion of the session.

Prime-Time Utilization

A potential variation of the time-based utilization rate is what I call “Prime-Time Utilization.” For most fast-charging stations, a majority or about 80% of charging sessions will typically occur from early morning such as 6 am until early evening, such as 8 pm. The value of this metric would help CPOs understand how well a station is performing during the key and most utilized hours of the day.

The downside of such a metric is that the “prime-time” hours can vary by location type of a charging station, and the industry would have to agree on the hours that constitute “prime time.” But I do believe it can have value to CPOs on an internal basis. One value of a prime-time metric is helping CPOs understand when a station has reached its day-time growth limit.

There are now many fast-charging stations in urban areas, for example, with 50% plus utilization rates, but which might be north of 80% during key hours. For CPOs with these types of stations, a high prime-time utilization rate points to the need to focus marketing and pricing strategies on overnight hours to further grow revenue. Of course, TOU rates or higher prices overall could increase revenue, but might also affect utilization and negate the gain from a higher per kWh pricing approach.

The Problem With Throughput-Based Utilization

When it comes to using the throughput (kWh)-based utilization metric, however, it becomes difficult or perhaps impossible to have a denominator that can be used to benchmark across your portfolio or against competitors. There are simply too many variables, including:

• Power-level of the charging hardware
• Whether a charging unit is throttled or not
• If power is shared across a charging unit or multiple chargers at the station
• Maximum charging rate of the EV
• Charging curve of the EV
• Charging state of the battery
• Whether the battery has been pre-conditioned or not
• Mix of EVs
• Amp capacity of the charging cable
• Weather (cold or heat) can affect the charging throughput of the EV
• Free charging credits — some automakers offer free charging that might be capped at time (e.g., 30 minutes) or kWh volume, which would impact how long individual drivers might plug in and hence the amount of kWh throughput.

The point of having a standardized charging industry metric is that it can be used as a benchmark across companies, stations, and geographic markets. Time can always be benchmarked as adjusting the hours or minutes open per day, produces an apples-to-apples utilization percentage.

The same cannot be said for a kWh throughput-based metric. There are simply too many variables as outlined above. This, however, does not mean a kWh throughput metric is less important or relevant — it is in fact a key internal metric at charge-point operators. Since the vast majority of CPOs charge EV drivers by the kWh dispensed, tracking throughput over time and across ports/stalls and stations in your portfolio is the key determinant of total revenue and growth.

As you can see in the table below from EVgo’s Q4 2024 investor presentation, the company tracks and reports throughput per stall, utilization, charge rate, and average revenue per kWh. Tracking average throughput at the stall level as EVgo does, makes perfect sense as an internal benchmark — but the team at Paren believes that attempting to calculate a kWh throughput-based utilization rate and use as an industry benchmark doesn’t make sense due to the huge number of variables that would go into the denominator of the calculation.

Session-Based Utilization

A third potential utilization rate calculation would be based on session volume. The calculation:

Number of sessions per daily open time period ÷ by total potential charging sessions X 100 = Session Utilization Rate.

The problem with a session-based approach is that the number of potential sessions in a daily period can vary based on most of the variables outlined above for the throughput approach. An urban fast-charging station might see a lot of EV drivers adding range for their commute and only charge in the sweet spot of their EV’s charging curve, charging on average for say 20 minutes. Whereas drivers on a road trip might charge to 100% and enjoy a 45-minute lunch or dinner while their EV charges. With the former there would be a theoretical 72 potential charging sessions in a 24-hour period, while with the latter a theoretical average of 32 potential sessions. But these are theoretical and averages, which would change daily based on the mix of EVs and EV driver behaviors.

Similar to the throughput, we believe that session volume utilization metric provides value to CPOs on an internal portfolio basis to help understand changes in the number of vehicles that are able to charge throughout the day. For convenience stores, travel centers, and restaurants hosting charging stations the session volume metric can be helpful in understanding the number of potential in-store transactions possible during open hours. For these hosts, where margins are greater on food and beverage inside the store or restaurant, more sessions that are shorter but with a higher percentage spending money inside the store might be a goal.

Failed Charging Sessions: To Include or Not?

One of the nuanced, but important, questions in the definition of the utilization metric is whether or not to include failed sessions in the calculation? As a member of the ChargeX Consortium, Bill Ferro raised this question during meetings and found the group had good arguments for both sides. Bill found that many in the virtual room had no opinion, but having no opinion is not an option.

At Paren, we take a “customer-centric” view of utilization and include failed charging sessions in our calculation of the utilization rate. A failed session may be caused by payment issues, equipment damage, or vehicle issues. Regardless, our focus is on customer throughput, and as such, failure times should be included in the numerator as that charging stall is "in use" and not accessible to other vehicles.

Stations, Stalls or Ports?

A final question is around whether the above metrics should be based on station, stall or port? Internally at CPOs any or all of these approaches might make sense based on how your company tracks KPIs. But from an industry benchmark perspective, we at Paren argue that utilization should be calculated at the station level.

As a CPO, whether a charging station has 2 or 24 stalls, what matters is the total utilization and revenue from the site — not per individual chargers or stalls. (In a future article we will actually show that stall utilization can vary widely at charging stations, but that is more of a diagnostic metric than a performance KPI).

A caveat to the above, however, is that meaningful benchmark comparisons need to be across stations with similar characteristics. These attributes can include:

• Number of ports/stalls
• Power level of the chargers
• Location type (e.g., highway corridor versus urban stations)
• Amenities (e.g., co-located with popular restaurants versus a public library)

What do you think? Share your thoughts here on charging utilization rates and if the industry should work together on a standardized metric definition.

By Loren McDonald, Chief Analyst

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