Pacific Equity Partners, one of Australia’s leading private equity firms, has paid $250 million to take a majority stake in Australian battery charging technology company EVSE, part of a plan to create a partnership with smart meter company Intellihub.
EVSE provides residential, commercial and fleet charging systems, and PEP plans to invest “significant capital” via its partly owned Intellihub to help it grow in Australia and New Zealand.
EVSE co-founder Brendan Wheeler says the initial $250 million will supercharge an expansion in both Australia and New Zealand, but also launch new operating models such as charging as a service.
Being able to provide charging as a service means that customers, such as fleet managers or companies that are dipping their toes into EVs, can pay a monthly fee for infrastructure that can scale, Wheeler tells TheDriven.
EVSE also takes responsibility for uptime, which across the company’s network is about 99.3 per cent.
Wheeler says companies are running into the problem that initially they don’t want to invest the hundreds of thousands of dollars required in a large charger, if they only have a handful of vehicles. But that means when it comes time to grow, the existing infrastructure can’t scale and they need to start again.
Levelling the playing field
EVSE recently told the AFR that in the last 12 months it has sold 5500 of its Ocular brand chargers and 2200 ports for its Exploran platform.
It has about a third of the Australian charging market.
Wheeler says Jetcharge is the main competitor, which is currently trying to raise a $70m Series C round to pay for growth.
“This [PEP investment] levels the playing field and brings forward and accelerates a lot of the plans we had,” he says.
“Things like the New Zealand expansion, it’s on the cards for early next year. Those sorts of things are not cheap to set up.”
To put EVSE’s market share in context, 80,446 new EVs were sold in Australia 2023 up to December, according to the Federal Chamber of Automotive Industries, or 7.3 per cent of all new car sales.
In New Zealand that number is 17,697, according to the website EVDB, or 17 per cent of new car sales.
In New Zealand, the previous Labour government had set a target for 30 per cent of the country’s light vehicle fleet to become electric by 2035, requiring a rapid and large scale roll out of smart and energy efficient charging infrastructure.
The new National government however plans to scrap the $7000 clean car rebate but has promised to expand the public charging network by 10,000 chargers by 2030.
EVSE’s presence in New Zealand has to date been in the commercial sector, with hardware and software solutions for customers such as Bunnings and for the bus transport network in Auckland.
Wheeler expects a slight dip in EV adoption in New Zealand because of the end of the rebate, but says the overall market direction is positive there.
“Anytime you remove a rebate there’s always a slight backward movement,” he says.
“The EV transition is already happening. EV rebates are to get things started… it should be done on its own merits rather than governments having to prop it up long term.”
Plan to match EV charging with bigger smart meter
PEP already owns 50 per cent of smart meter company Intellihub, which manages some 2.5 million devices and has already moved into the EV charging space.
Intellihub will the senior player in what is being called a “strategic partnership”, as it tries to build an everything-app that can allow EVs, pool pumps, solar panels and other electricity users to connect into its smart meter, rather than each having its own app.
This is one project for the future, however. Wheeler says initially the work will be in integrating the EVSE technology with Intellihub’s so they can talk to each other.
Intellihub CEO Wes Ballantine says the company is installing more than 40,000 smart meters across Australia and New Zealand each month.
“More and more we’re going beyond the meter, to support the better management of consumer energy devices like electric hot water, pools, solar and batteries – and EV charging,” he says.
In November, Intellihub installed the first of 50 power pole-mounted EV chargers in Sydney and the Hunter region in NSW, as part of a $2 million program subsidised by the Australian Renewable Energy Agency (ARENA).
The 22kW chargers remove the need for expensive roadworks and infrastructure upgrades and are to allow EV owners who don’t have a garage to charge their vehicles near their homes.
Extracted in full from: https://thedriven.io/2023/12/18/private-equity-giant-sinks-250m-into-australian-ev-charging-technology-company/