Supermarkets pick up the tab for your free miles, but the endeavour is profitable because most drivers spend in-store.
They say there ain’t no such thing as a free lunch, yet earlier today I topped up my electric car with free electricity at Tesco. I added a healthy 21-miles of range in around 45 minutes, paying nowt for the privilege.
Topping up with free electricity on a grocery shop is one of the perks of driving an electric car, but it got me thinking about who’s absorbing the cost of my free miles.
Is it the charge point installer? The energy supplier? The supermarket?
Who pays the electricity bill?
The answer, it turns out, is simple.
Supermarkets pick up the tab for electricity at free EV chargers, but at a reduced rate and billed based on maximum or ‘peak’ demand. The cost of energy is absorbed by the Agreed Supply Capacity with the energy supplier.
Here’s how it works:
Large supermarkets in profile classes 05-08 are billed on peak demand (also known as maximum demand) measured against the Agreed Supply Capacity (ASC), an agreed max demand of electricity with the supplier.
What this means in practice is the energy supplier takes the highest reading half-hourly (using data from a half-hourly meter) and multiplies the reading by the kWh rate. So, the supermarket is billed based on peak demand.
Another less common approach is shared billing, or shared cost, where the charge point installer (e.g. Pod Point) shoulders some of the cost of energy, which isn’t common because the installer has already shouldered the cost of installation.
Supermarkets with EV charge points often have cheaper electricity rates for EV chargers, with a separate kWh rate for this electricity. This is similar to the EV tariffs offered by the likes of Ovo Energy and Octopus Energy for homeowners.
So, there we have it. In short: the energy supplier always gets paid, and supermarkets pick up the tab for your free miles.
Who pays for supermarket charger installation?
The supplier (e.g. Pod Point) shoulders the cost of equipment supply and installation, and the supermarket leases the equipment on contract. By leasing chargers, the supplier still owns them and is responsible for maintaining them.
EV charging companies make money by retaining full capital in the leased equipment and the supermarket making monthly lease payments.
In other words, there are plenty of people in the supply chain getting paid.
If you enjoyed this article, you might also enjoy our article covering how much your electric bill goes up with an EV.