And welcome to the EBITDA Second Quarter 2021 Earnings Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce Ted Brooks Thank you.
You may begin. Hi, everyone, and welcome to EVgo's Q2 2021 Earnings Call. My name is Ted Brooks, and I head up Investor Relations at the company. Today's call is being webcast and can be accessed from the Investors section of our website at investors. Evigo.com.
The call will be archived and available there, and the company's results, A presentation and a transcript of today's proceedings will be available at the Events and Presentations section of the Investors page after the conclusion of today's call. Joining me on today's call are Kathy Zoilik, EVGo's CEO Olga Shavankova, for the Q2 of 2021 followed by a Q and A session. During the call, management will be making Forward looking statements regarding the 2021 fiscal year and our outlook for expected growth and investment initiatives. These forward looking statements involve risks and uncertainties, many of which are beyond our control and could cause actual results to differ materially from our Thank you, sir. Thank you, sir.
Thank you, sir. Thank you, sir. Our first question comes from the line of These forward looking statements apply as of today, and we undertake no obligation to update these statements after the call. For a more detailed description of factors that could cause actual results to differ, please refer to our Form 8 ks filed with the SEC today and posted to the Investors section of our website. Also, please note that certain financial measures we use on this call are of a non GAAP basis.
And for historical periods, we provide the reconciliations of these non GAAP financial measures to GAAP financial measures. With that, I will turn the call over to Kathy Zuri, eVego's CEO. Kathy?
Thanks, Ted. I'd like to welcome everyone Today's Q2 of 2021 results call. Whether you're a current shareholder or just interested in learning more about EVgo's business And our role in the growing electrified transportation sector, we've got a lot to share with you today. This is the first time EVgo is reporting results And sharing our outlook since we commenced trading in EVgo on NASDAQ on July 2 after completing our business combination with Climate Change Real Impact Solutions or CRIS. I know I speak for the entire team at EVgo when I say how pleased we are to be here And how excited we are to be able to discuss the growth and new developments at EVgo.
During the Q2 of 2021, we achieved growth across All of EVgo's segments, we deepened relationships with our core partners and we cultivated business with new ones. The backdrop for EVgo success and exciting growth trajectory is a rapidly transforming transportation sector As the electric vehicle industry continues to experience unprecedented growth and a supportive policy backdrop both in Washington and at the state level in the U. S. And indeed, around the globe. EV sales were brisk in the first half of the year with over 200,000 EVs sold in the U.
S. Through June, About 1 third or 70,000 of which we estimate were non Tesla vehicles, reflecting increasing adoption and additional vehicle options available to drivers. EV sales in the U. S. For the full year are expected to continue to accelerate, driven by long term industry growth fundamentals.
1st, OEM commitments. Globally, the auto industry has reached a crucial tipping point in its for the electrification of the transportation sector. This is translating to meaningful financial support with an estimated $330,000,000,000 of investment In bringing EVs to market over the next 5 years. The second significant tailwind is favorable regulatory dynamics. President Biden has announced an executive order aimed at making half of all new vehicles sold in 2030 0 emission vehicles.
Additionally, policymakers are working hard in Washington on proposals that will provide 1,000,000,000 of dollars to support charging infrastructure and consumer purchases of EVs. And 3rd, shifting consumer preferences. According to a Harris poll conducted in July, 48% of So they would consider purchasing an electric vehicle today and that figure is up from 37% in just April of this year and up from around 20% in 2017. Related to the strength of the EV market, EVgo added approximately 35,000 new customer accounts during the Q2 And more than 53,000 new customer accounts year to date. EVGo's customer account number now exceeds 275,000.
Further, driven by the factors of a reopening economy, the March of EV adoption in both the retail and fleet segments And new take or pay arrangements with some of our fleet customers, EVgo realized kilowatt hour network throughput growth of 48% sequentially and At 125% versus the prior year quarter. During the Q2 of 2021, EVgo commissioned 104 new charging stalls, representing an approximate doubling of our Q1 of 2021. Operating in 68 metro areas and in 35 states, EVgo's total fast charging stall count at the end of the second quarter was 15 48. EVgo continues to execute on its robust stall build out plan, identifying locations that will deliver our targeted financial return. Today, we have more than 2,000 charging stalls in what we refer to as the active engineering and construction or active E and C pipeline, Representing strong visibility into further stall growth.
Roughly 85% of the active E and C pipeline We're located within the top 20 U. S. Metropolitan markets. A majority are part of the GM EVgo partnership To deploy 2,750 fast charging stalls by 2025, by definition, stalls are added to our active E and C pipeline Only after undergoing a rigorous evaluation process, at which point we have a high confidence in station completion and EVgo begins investing capital into those projects. Upstream at Active E and C is a pipeline of literally tens of thousands of prospective stations locations that EVgo has identified across the U.
S. To meet the needs of the rapidly expanding EV market, we're working closely with others in the charging ecosystem, retail and municipal flight hosts, Electric utilities, local government permitting authorities and OEM and state government funding partners to create a charger deployment flywheel That positions the industry to rapidly advance from station concept to energization. While it takes EVgo just 4 to 8 weeks to actually construct a fast charging station, the typical all in timeline of end to end station deployment To help compress project development timelines, EVgo kicked off an initiative in April called Connect the Watch, in which we are providing a forum stakeholders like site hosts and utilities to share best practices on charger deployments across their jurisdictions. Collectively, we're aiming to achieve Ideas to energization timelines that are more efficient and hence meaningfully shorter, possibly removing months or even quarters from the timeline once that flywheel is really spinning. EVgo's market leadership and public fast charging for the retail market has given rise expanded work with both existing and new partners as the base of EV applications extends across new segments of the transportation sector.
Our recent development I'd like to highlight here is the mid July announcement that EVgo was chosen by GM to serve as a preferred charging provider For its Altium Charge 360 fleet service, GM is, in its own words, expanding its LTM Charge 360 solution to fleet customers in an effort to make it easier for fleets to switch from internal combustion to all electric offerings. Well, Like GM, we believe that fleet adoption of electric vehicles is crucial for reducing transportation carbon emissions. And hence, EVGo is a suite of solutions for the emerging fleet segments that are tailored to meet individual fleet customer needs. EVgo is proud to be partnered with GM OnFleets and proud to deepen and broaden our GM relationship beyond expansion of the public retail network I just described. The strength of the GM EVO partnership is founded on a shared philosophical and commercial commitment to electrification of transportation And 0 emission vehicle.
As another example of market expansion in the fleet, EVgo is now contracted with 2 leading autonomous vehicle companies to provide each with dedicated fast charging sites away from their This is important for several key reasons. 1st, dedicated charging depots will allow those autonomous vehicle companies quickly charge and recirculate vehicles in the cities where they are commencing operations. Similar to the use profiles of the rideshare vehicles EVgo has served for years, self driving vehicles are utilized in very high mileage situations, often more than 7 times the vehicle miles traveled per annum in 2nd, EVGo's momentum in serving autonomous vehicle companies illustrates the value we see And being a first mover and trusted partner to those companies who, like us, are unlocking new norms of operating 21st century electrified transportation. Similar to the dynamic that benefited the EVgo network with the addition of rideshare, We expect autonomous vehicle activity to turbocharge throughput growth on EVgo's network given AV's higher mileage patterns compared to everyday drivers. The third reason that the business with these autonomous vehicle companies is important is that the contract structure includes take or pay arrangements that provide for revenue minimums to EVgo in exchange for a guarantee of exclusive charging access, increasing those of certainty And reducing risk for both parties as the self driving market continues to expand, a true win win.
And finally, I'd note that the sector is just getting moving. Autonomous vehicle fleets are starting off in dense urban areas with supportive regulatory backdrops. The industry's high rate of growth is forecasted to continue more broadly once certain critical technological and consumer thresholds are reached. So in July, EVGo also announced a deal to acquire eMobility software company, Ricargo, for $25,000,000 I would like to highlight several key aspects of this acquisition that we're most excited about. First, the purchase reflects a highly strategic And logical extension of the efforts already well underway at EVgo to create value added software and data driven ancillary services.
Riccargo's robust software offerings, unmatched customer reach and product development pipeline are well aligned with EVgo's vision and growth. 2nd, Riccardo is a well established platform that serves as the go to for so many drivers in the industry. Ricargo was founded in 2009 and will be known to most of you through its PlugShare offering. Globally, PlugShare has 1,600,000 users and 3,300,000 app downloads with coverage of more than 61,000 level 2 and Mass charging stations in North America alone. Users share crowdsource reviews, photos and data, helping the communal insights that helps drivers optimize their experience and charging network operators to improve their services.
The third thing we're really excited about with Riccardo is pay with PlugShare. This proprietary application developed by Riccardo Allows for seamless payments across multiple charging networks to expedite and improve the charging experience for EV drivers. EBITDA will be moving quickly to adopt pay with Clubshare on our network and will encourage other charging networks to do the same. We are keenly aware of the important role the PlugShare platform plays within the EV ecosystem and are committed to maintaining data remains unbiased and secure. We will also be enhancing platform features and improving transparency for all parties, Including, for example, publishing the plug score algorithm to charging network companies.
EVgo is steadfastly committed to enabling the EV sector and the integrity of a platform such as PlugShare is essential to those efforts. The final development I'd like to share relates to EVgo's technical leadership. We built the EVgo Innovation Lab and advanced technical laboratory to test, validate and certify charging equipment for safety, performance and user experience. Doing this successfully requires rigorous testing of Standards for safety, efficiency, performance and user interfaces and interactions. We test for and then ensure seamless interoperability between chargers and the EVs themselves, including models in operation now and those in preproduction.
The EVgo Innovation Lab enables the entire industry to anticipate and remediate technical challenges inherent to young fast moving sectors And it positions EV Go to lead the industry in specifications for the next generation of charging equipment and software. We provide this valuable information to EV, OEMs and charger manufacturers for free and then we work together with all parties to address these issues Before they impact customers. In summary, EVgo's mission to speed the adoption of electric vehicles through the investment in charging infrastructure Progressing at an accelerating pace. EVgo's build, own, operate business model has equipped us with the experience and insight to be a market leader and to be a provider of first resort to the rapidly expanding EV market. While retaining a relentless focus on financial discipline as we invest We're able to offer new and emerging EV segments charging solutions that meet their particular needs.
These include DCFC Or level 2 or a combination of charger types. They include use of the EVgo public network, dedicated depots or both. They include EVgo owned assets, charging as a service or white label services. We've also cracked the code on keeping the most expansive fast Charging network in the U. S.
Operating at 98 percent uptime, a key element of the customer experience and retention. We've built the Envigo Innovation Lab, which has become a trusted go to resource for automakers to test their new EV model on different types of chargers. We've pioneered a best in class Power sharing and power routing configuration for our fast chargers. We've integrated proprietary software functionality that can drive margin And delight EV drivers via reservations, driver coupons, loyalty rewards and behind parking garage pay gates. We've been a reliable partner for state and local funding agencies, delivering on our commitments to deploy chargers and offer electric for all.
And thus, we've earned the trust of industry participants across the board. I'm proud to be at the helm of such a company and working alongside a truly world class leadership team. EVgo will continue to offer the growing base of EV drivers and sellers convenient and reliable charging infrastructure where they want it and when they want All while making an outsized contribution to addressing climate change. With that, I'll turn it over to Olga to go through some of the particulars in the quarter and our outlook.
Thanks, Kathy. 1st and foremost, I would like to highlight that upon the completion of the business combination was Chris, on July 1, EVGO received net cash of $573,000,000 which will enable us To fund our strategic plan going forward. As Kathy noted earlier, we're pleased to report solid results for the Q2 of 2021, including strong growth in customer accounts, Network throughput and revenue. Please let me take you through some of these numbers and discuss How they support our outlook for 2021. As Kathy mentioned, we saw 48% Quarter over quarter growth in kilowatt hour network throughput during the Q2 of 2021 126% growth year over year.
Retail and fleet both benefited From a continued reopening of the economy and strong EV sales. Network throughput was ahead of our forecast for the Q2 and the first half of the year, and we remain on track to achieve Our full year 2021 network throughput target of 24 gigawatt hours. Revenue exhibited similar growth trends. Essentially, we saw a 16% increase in revenues. With these 2, we remain on track to achieve our $20,000,000 revenue target For full year 2021, adjusted gross loss, which does not only include energy usage fees, But also fixed costs such as operational and maintenance expenses, call center or site leases Was negative $61,000 for the quarter, equating to a margin of negative The year driven by improved energy costs per kilowatt hour due to better leveraging of demand charges.
IZIGO dedicates considerable resources internally to making our operations more efficient While continually striving to reduce costs, one of the bigger components of our cost base is energy related expenses. By working with our utility partners to improve rate design To better match the EV charging use case, for instance, by limiting or eliminating demand charges, We're able to improve our energy costs. EVGO was able to shift our California stations away From tariffs with demand charges across 3 major California utility territories, 2 of them In the last 18 months, general and administrative expenses increased to $12,200,000 in the Q2 of 2021 compared to $11,000,000 In the Q1 of 2021
$6,800,000
in the Q2 of 2020. The increase is in line with EZIGO's expectations and primarily driven by the company's ongoing growth investments. Adjusted EBITDA for the Q2 of 2021 was negative $11,000,000 compared to Negative $9,800,000 in the Q1 of 2021. Cash flow from operations for the first half of twenty 21 was negative $1,400,000 which is $14,400,000 higher Then during the comparative period in 2020, driven mostly by OEM partner contract prepayment of $20,000,000 in the Q1 of 2021. CapEx was $23,300,000 In the first half of twenty twenty one as compared to $7,700,000 in the same period last As we continue to accelerate and execute on our store build plan.
Let me take a moment here to emphasize the flexibility of our business model from a financial perspective. Out of the $573,000,000 we have raised, the vast majority or north of $400,000,000 We'll be invested in building charter stalls, and we have a full discretion Over the pace of that capital deployment, we can accelerate charges deployments if the market ramps more quickly. We can also conserve capital if market development is, for some reason, delayed. Remember, Station investment is discrete. Most are under $1,000,000 CapEx and have lead times of months, not ears.
Also, as Kathy mentioned previously, we acquire rigorous underwriting criteria This combination of factors affords EVGO with enormous flexibility In order to help The investment community fully appreciate our business model and the robustness Of EVgo's process for green lighting projects, I would like to walk everyone through the unit economics of a typical charging station. As I just mentioned, every single project developed by EVGO undergoes A rigorous underwriting process and is evaluated against preset financial criteria. The model for every single project includes 3 key elements. 1st, CapEx. This includes the cost of constructing a site as well as any investment offsets, such as CapEx incentives from partner contributions, public agencies and utilities.
2nd, operating costs. This primarily includes the cost of energy at the location, but also encompasses non energy costs, Such as the rent and maintenance for the sites, which, as a reminder, all sit in cost of goods sold on our income statement. And third, revenue. This includes site specific revenue forecasts based On a detailed utilization model. So let us dig more into each of those elements.
1st, on CapEx. On average, the charging station is comprised of 4 to 6 stalls, which means it can charge 4 to 6 vehicles simultaneously. CapEx per stall is roughly $110,000 which includes both equipment And third party labor, bringing all in installed costs to somewhere between $400,000 700 $1,000 These figures are obviously affected by site layouts and equipment. As for investment offsets, if we build a stall in partnership with an OEM, for instance, General Motors, Our capital outlay may be reduced by up to 1 third. In addition, if there are state, local For utility incentives, the initial CapEx may be offset by anywhere from 5% to 10% to over 50%.
To make this point again, all of these inputs are known and included in our model When we decide whether to go ahead with the project. On the operating cost side, Our stalls are subject to commercial and industrial utility tariffs, which vary greatly across geographies And sometimes are subject to demand charges in addition to the volumetric cost per kilowatt hour of energy sold. As it stands today, our energy costs range from as little as $0.10 per kilowatt hour To as much as $0.50 and even higher in certain cases. We work actively And we think effectively with utilities and their regulators to continue reducing these costs. Non energy Costs are more stable and tend to center around $6,000 to $7,000 per stall per year.
These costs include rent, property taxes, maintenance, warranties, 3rd party software, call center and other network related costs. And again, as a reminder, all sit in Turning to the revenue side. In order to forecast station throughput or utilization, we employ Identify the best site locations and geographies. We do this in 2 steps. Step number 1, We determine starting 4 year 1 utilization using our proprietary machine learning model, which enables EasyGo to forecast utilization down to every Census block group in the United States with a high degree of accuracy.
Step 2, we develop a lifetime station throughput curve Using a proprietary market build out trajectory, which relies on EVgo experience and market data On EV sales, average vehicle miles traveled, vehicle efficiency and other factors. Charge rate is an important element in projecting a station's kilowatt hour throughput. An individual EV's charge rate is the rate at which its battery can take power from the charging network And is entirely driven by its particular battery characteristics. On our network, We see average charge rates close to the mid-thirty kilowatt hours per hour range. New vehicle models being introduced over the next several years will have higher charge rates and expect to more than double to roughly 80 kilowatt hours per hour.
These improved batteries Mean that YGGO should be able to dispense more kilowatt hours over an equivalent time period. Private public policy initiatives also enhance our operating revenue forecast as carbon reduction standards, Federal level benefits and state programs offer ways to reduce costs and increase revenues. The low carbon fuel standard in California, for instance, has contributed approximately $0.20 to $0.24 of additional revenue per kilowatt hour dispensed in recent periods And similar programs are being contemplated in other states as we speak. Our forecasts only include the policies which are currently in place. If any other programs We hope this helps you understand EVIGO's unit level economics better.
Finally, I would like to turn quickly to our 2021 full year guidance. We reiterate our financial and operational forecasts communicated earlier this year, including total revenue Of $20,000,000 network throughput of approximately 24 gigawatt hours And adjusted EBITDA of negative $58,000,000 With respect to operational guidance, We expect to provide our year end stall count expectations at the Q3 call in November. As Kathy noted earlier, while a large number of EVGO projects have reached the active engineering And construction pipeline stage where we have high confidence in project completion, there is Still a fair amount of volatility to these time lines, especially around permitting and inspection. We expect to have much clear visibility on this in a few months. Our midterm and long term deployment goals We are closely monitoring recent COVID-nineteen developments, Outbreaks linked to the Delta variant and any potential impact on customer activity, supply chain, raw material costs and the overall macroeconomic situation.
In general, we are pleased with our Q2 of 2021 results and how our to date performance positions EVGo for the future within this High growth marketplace. We're seeing growth in existing and new relationships. We are Spending our product depth and the depth of talent on the EZIGO team, and we are executing With that, I would like to stop there And open up the lines for
questions. Thank you. We will now be conducting a question and answer Our first questions come from the line of James West with Evercore. Please proceed with your questions.
Hey, good morning, Kathy, Olga. Good morning, Dan. So the first question for me is around kind of behavior of EV drivers.
Now that you've made this acquisition, you've got even more
data than you Now that you've made this acquisition, you've got even more data than you already had. And I know you guys had impressive amount of data already. But I think the biggest Key to success for especially your business model is this change in behavior to where I as an EV owner am topping off or charging at places where I go, Not charging to go somewhere, I guess, if that makes sense to you guys. Are you seeing evidence or have you seen evidence of this behavioral change That we expect can start to happen or are we still maybe too early days with penetration?
You know, James, actually we are what we see on our network is that the average charging session People are spending about $8.20 So what that tells us is that they're not just going all the way down to 0 on the battery and waiting and then filling At the end, they are convenience charging. And one of the reasons and their convenience charging at EVgo because we are in places where they're going to be anyway. So One of the reasons that you see our strategy is going to retail centers is because we don't feel like charging needs to be a separate special destination. You should be able to charge while you shop or Charge while you go to the gym or charge while you're watching your son play softball. And that's very much a part of our business strategy.
I'd also remind you that 30% of Americans don't have access to home charging. Now EVGo's main business model does not Assume that we're going to take any market share for people that do have access to home charging. If you got a level 2 charger in your garage and it's convenient, you're going to Charge most of the time there at home, and that's fine. But what we see is with the broadening sort of choice of Options for purchasing EVs and price points that are actually improving for many different sorts of Either buyers or lessors of EVs that many of the demographics are changing so that those folks who don't necessarily have access to home charging also need to charge conveniently away from home. So look, we're already seeing that.
We're pretty confident that we're on the right path here. And as I mentioned in the opening remarks, In our asset engineering construction pipeline, we're in the top metro areas in the U. S. So we're going to be where people want to charge.
Right. Got it. Okay. That's good to hear. And then perhaps, Kathy, on the policy side, the we have an infrastructure bill that's now passed.
We've got a reconciliation package that we're seeing some of the information from understanding that no one's going to get preferential treatment here on EV charging, but maybe you have some Context with which you could share, how you think this will play out with the Biden administration Clearly, understanding the chicken and the egg problem and wanting to drive EV adoption via charging networks and how EVgo could fit into that?
Yes. We're pretty excited about this. I mean, the federal That we're seeing emerging from Washington right now are a big accelerant. And then they're incredibly important. I mean, the UN climate change report of a couple of days ago Was a wake up call for everybody that hadn't already woken up.
And so we're now needing to move very, very quickly to actually To accelerate climate solutions across all sectors and obviously transportation is a big one. So again, look at the conversations that we have Both with the administration and on Capitol Hill, it suggests that this is going to the support for EVs is going to be in the Through the infrastructure bill, it's going to be on the charging part of it. And through reconciliation, we're going to see more incentives for drivers to purchase EVs And for some other tax credits for the charging infrastructure pieces. So there is a potpourri, if you will, of incentives to accelerate this. On the charging side, they're probably going to be is it going to be a combination of support for fast charging and level 2?
There's going to be a combination of support for Urban and distributed and there will be some emphasis on making sure that some of that infrastructure money goes into disadvantaged communities. And EVgo is like we've got experience in all of that and we're really, really looking forward to participating in it. And look, I can tell you as somebody who administered over $30,000,000,000 of infrastructure money during the Obama administration that there will be probably this will be done via Grants that are competitively secured, much of the money will flow to states. And again, the indications here that they will flow Through the State Departments of Transportation and EVgo and our experience to date in accessing much of the state funding that Come through the Volkswagen Dieselgate Sediment, we're very well positioned to be able to compete for and secure and then deliver on those commitments.
Got it. Got it. If I guess one more in, Kathy. The I mean, that makes a lot of sense. I'm excited to see how this plays out.
You had the GM relationship. They've obviously figured out they both need to work on their supply chains for batteries and The end game of charging and have partnered with you and others. Are there other like minded OEMs, auto OEMs that you're Talking to that you perhaps could have similar type relationships with and announced in the coming quarters?
Well, what I can tell you is that we have a great relationship with GM. It just continues to strengthen and broaden them. We're really,
really excited to be partnering with them. We also have
an existing relationship with Nissan that's that's that's We also have an existing relationship with Nissan that's not dissimilar to GM, but it's a bit smaller in scale. And on the BD side with other OEMs, so there's not an OEM globally now that's not investing in EVs. And so those conversations are really, really active. I mean, what we're doing with General Motors to build 2,750 fast Chargers by 2025, it's big and it's important, but it's only a drop in the bucket. So we're looking forward, we're all ears for working with other OEMs to partner to get out Into more metropolitan areas to create that comfort amongst the driving public that wherever they go, there's going to be convenient reliable charging.
Got it. Thanks, Kathy.
Thank you, James.
Your Next question comes from the line of Craig Irwin with ROTH Capital Partners. Please proceed with your question.
Good morning and thanks for taking my questions. Kathy, the one thing that really hi. The one thing that really jumped out to me in your results was The network throughput, 6.1 gigawatt hours, 48% sequential growth. I was hoping maybe we could tease this apart a little bit. When we look at the miles driven data that just came out actually for the whole country, there's Something like 18% miles driven increase 1Q to 2Q.
And then you onboarded a very substantial number of new customers.
I think
Since your SPAC IPO announcement, the number is 55. I see you went roughly 19,000 to 34,600 1Q to 2Q. Can you maybe comment a little bit whether or not you're seeing Straight out EV growth, EV vehicle fleet growth drive this increase in usage. Or are we maybe seeing people charge at slightly better rates than the 5% of miles driven that You were thinking in the beginning. And are we seeing potential acceleration of people Coming over to the eGrow network as we get more visibility as a public company, I mean, just the presence in the media and the discussion of The financial opportunity, I think, jars a lot of attention, a lot of eyes.
I mean, can you maybe help me tease those different things apart?
Yeah. I'm going to toss this over
to Olga and then I'll round up if there's anything to add. Go ahead, Olga.
Sure. Thanks, Craig. So what we're seeing, There are 3 major factors driving that 48% in kilowatt throughput increase. 1 is the growth in our retail traffic. And the growth in our leisure traffic
is driven by 2 factors on its own. People are
coming back and vehicle miles traveled
are growing Exactly,
as you have mentioned. So people are coming out of lockdown, coming back to work and driving more. But also we get all of those customers who add Pretty much new traffic to our network everything today and the TV sales in first half of twenty twenty one were very strong. And You can see in our results, we added close to 50,000 new customers and their own drive and added to our network. So both factors contribute to retail.
The amount of the new storage and 75% we were estimated, we don't have any new data, which We'll demonstrate that at this very moment, the debt by investment has changed. And we have mentioned multiple times In various conversations and in various materials, we do think that 5% number will grow over time. We don't have any evidence to adjust in the last That number has changed, so we don't think that is a factor contributing to growth. The last factor contributing to growth Is an increase in our fleet traffic, and that is driven by 2 things here as well. 1 is A lot of fleet drivers, the rideshare drivers, they have more work to do now because economy is back and people are just doing things and moving Delivers are moving themselves between more locations.
So we see the increase of driving activity on our network. But also we have partnerships with autonomous vehicles, which Cathy has spoken in her remarks earlier about. And those that traffic, we see quite a bit of an increase on the take or pay contract, which contributes to that 48% growth as well. So it's pretty much Growth across our major segments and it's reopening in economy and it is new drivers Personnel network, beat retail drivers to beat fleet drivers.
Thank you for that. Thank you for that. So one of the things in their Fleets, right, is a very exciting area for the longer run, really drives the model for your company. Can you maybe update us on the experience with public fleets, What the operators are seeing and is it logical for us to assume that these lower operating costs Are incredibly something that will support expanding public fleets, rapidly expanding public fleets Just because of the relative opportunity for profitability versus an ICE vehicle. And then can you update us on medium and heavy duty?
How is this taking shape for EVgo? Do you see The opportunity for multiple fleet announcements over the next year or 2? Or is this something where we're seeding the market right now and Medium and heavy duty is something that's going to kick in
a little bit further out.
Yes. So look, you rightly note that the growth of the fleet Segment is important to Ebigot's business plan and business model. The first area, of course, where we were working Very closely with fleets was with rideshare and so we've got arrangements with both Uber and Lyft. And as Olga noted like Post lockdown, those
the Uber
and Lyft, the Rideshare segment is coming back. And as you know, both Uber list has made commitments to go 0 emission by 2,030. So they're going to increasingly being electrifying and enabling their drivers to drive EVs And that's going to accrue to EVgo's benefit, because we've got and they're going to be expanding those offerings to more cities across America. So Again, the particular timing is in Uber and Lyft Hands, but we'll keep you posted as we can on that. The second thing that we're already seeing that's really I think is the AV announcement that I talked about, like the fact that we've got 2 contracts with autonomous vehicle companies That are major players that are that come with take or pay arrangements, because those guys, if you're running an AV business, You need to know that when those autonomous vehicles are out on the road that they're going to be able to come back and they're going to be able to recharge back.
So that's super exciting. We have and again, the light duty delivery, there's a whole bunch of Activity that's underway and we look forward to being able to share that with you when those deals become inked. The medium and heavy duty as you've kind of alluded to, it's still a supply shortage in terms of the vehicles, Right. Like we're just like EVgo has been partnering with a truck company for a long time that they can get access to one truck. And so we've been working with them for a couple of years and they're planning for when they're going to get their next tranche of trucks.
They're just as just and that Should be coming, but you guys will have to talk to the supply side to the vehicle companies to get more insight into exactly when. What I can tell you is that on EV Go side is that we are In active conversations with all of those players because everybody sort of anticipating and seeing that the total cost of ownership Electric trucks, pencils,
as soon as you can
get the trucks. And so those charging solutions, again, we're happy to either Along the charging infrastructure for these folks and operate it for them or if they want to put the charging infrastructure on their balance sheet, then we can operate it for them. That's fine with us as well. There's no lather, rinse, repeat model there yet for the fleet segment, but it's a very, very I should say, very Active conversations with that market as it develops.
Understood. That makes a lot of sense. Thank you. So my last question, Yeah. I guess most of us already appreciate the opportunity of having sort of discretionary network build out, right?
You have the cash from the SPAC IPO, and you get to choose how quickly you're going to build the stations. The pipeline, the 2,000 charger stalls that you've discussed a couple of times, can you maybe help us understand how many of these 2,000 stalls Are already maybe fully permitted or late in the permitting process. How many of these could you move quickly On executing, if there was a very attractive subsidy or something that made that the right decision here?
So yes, we it varies wildly. I mean, the Active E and C pipeline means that we're investing capital and we've got literally got hundreds of those stalls are in front of local government authorities right now. So they can cut loose very, very fast. And so we can actually move really, really quickly once It's funny, as I was thinking about this about what we're seeing with either whether it's local government authorities utilities providing and permits and inspections and getting easements, it all reminds me, Craig, and I think you've been in this space a long time too, it reminds me of Solar 10 years ago, right? Like when I was Assistant Secretary of Energy during the Obama administration, I was literally investing 1,000,000,000 of dollars To commercialize clean energy technology, like in the forms of grants or tax rebates and the common refrain that we heard from Like the recipients of these grants or the solar businesses was the choke point, but pain point of permitting.
Oh my gosh. What the Department of Energy eventually did is like issued this sort of best practice set of guidelines that would be that was a checklist For the other players in the industry, like, look, this isn't that hard. Here's what you just need to do to get these rooftop solar projects moving. And that we'd like to think that that was quite helpful and it probably was. But the thing that was equally helpful was that the industry as an ecosystem got experience with And as that experience, to hold the timeframes compressed.
So I think if you translate that into where we are with Charging with EVs and electrification or transportation, we're in the early innings now. And all of these players in the ecosystem are just gaining experience. This is why EVgo invented this initiative created this initiative called Connect the WAT to help accelerate that and share best practices With local governments, with utilities, with site hosts, retail shopping centers that have never had to set aside a part of their parking lot for charging infrastructure, they're just learning how to do that. So all of that, our expectation is that it's going to start to pick up pace. I mean, interestingly, a couple of weeks ago, I did a ribbon cutting at Santa Monica, California, you think of that as ground 0 for all things environmental.
The first fast charging station That was open in Santa Monica with an EVgo station, 8 chargers a couple of weeks ago. It took us at EVgo 7 weeks to construct that, But it was in the planning stages for over 18 months prior to that. Now we're doing another one in Santa Monica right now that's not going to take that alone, Right, because they're now the city of Santa Monica now has experience. Everywhere we turn, we're seeing that with more experience, the time frame is compressed. So look, we've got just to get back to the macro sense of your question, we have agreements with major national retail chains That give us a line of sight to a possible literally tens of thousands of possible locations for fast charging stations, like literally, literally that many.
And so once the spot flywheel starts to spin, we're going to be able to like ramp up really, really quickly, again, should the projects pencil. And that is a fundamental thing for EVgo.
Thank you for that and congratulations for the strong quarter out of the gates.
Yes, we're really pleased. Thanks, Greg.
Your next question comes from the line of Gabe Daoud with Cowen and Company. Please proceed with your question.
Hey, good morning, everyone, and congrats on Getting the first print in the books and thanks for all the details so far. Olga, you mentioned supply chain on or in your prepared remarks, I was Progressing at this point and how are your suppliers, I guess, guiding you for the rest of the year? Should we expect continued Balonext? And just again, how does that impact your business moving throughout 2021?
Hi, Gabe. Sure. So what we haven't been affected by supply chain bottlenecks yet. We are getting Various signals from various suppliers and vendors of ours that might come later. And what we have done and we've been doing right From the beginning of the year, we are managing our risks and we're preemptively placing orders much earlier than we used to do In order to secure our supply.
So we have done it with charges, we have done it with various components, and we're constantly monitoring situation. What we have also done, We have identified a few critical components, for example, cables, and we started diversifying our vendor base and supply base To make sure that we have as far reach as possible. So we have from our perspective, we have done All precautions possible. We have pre ordered equipment through Q1 2022 pretty much. So we don't have it In our warehouses, but the supply has been secured, and we continue very closely with very degree of attention monitor the situation and react quickly to information.
Unfortunately, this is the world we live in where this situation changes day by day, And we are pretty clear eyed about it and ready to act quickly when we need to. But as of now, not since serious has Happened to our rest of the year supply, and it hasn't affected us to a high degree yet. It might, but hasn't happened yet.
Okay, awesome. Thanks, Olga. That's super helpful. And then maybe just sticking to or just going back to the financials For a second, if I look at 2Q capital of about $15,000,000 against 104 installs would imply, I guess, dollars 144,000 Per install. And I guess you could recognize there could be other numbers in that capital figure that could also be timing differences Between costs incurred and just kind of cash out the door.
But curious, is that fair? Is that the right way to look at it? Or Again, just kind of maybe worried about cost inflation impacting that install number per port.
Yes, that's a fair question. So first, we haven't noticed yet. Again, we are observing the same cost where we projected and quoted this number multiple times, including early in my remarks of average of $110,000 to First of all, the math you're doing is a very natural math where your mind is going. But unfortunately, that's probably not the right way to look at it Because time and time in effect is huge. You as Kathy mentioned, answering the previous question, it might take up to 18 months to Fully developed the station and despite the fact the construction only takes 7 weeks, you're prepaying the equipment, you're starting spending CapEx Much earlier than the station goes into operation.
So in that $23,300,000 number of CapEx in Q2, Tons of that is not related to those $104,000,000 charges we put in operations. It's a lot of charges which are going to go into operations Q3, Q4 And even Q1. So the timing here is really not a trend when you're trying to do that estimate. But again, As we're seeing and monitoring our costs, we haven't seen inflation affected for anything which we spent to date. But we will if we see that effect, We will update you next time we speak in Q3.
Great. That's super helpful. Makes a ton of sense. And then Just last one for me. This question comes up a lot amongst investors.
And just curious if you could share some thoughts around Tesla Potentially opening up its supercharger network and how that could impact your business and potentially take some flow, if you will, On a kilowatt hour basis from EVgo, is there any kind of level of risk embedded in your forecast from like the spec materials that Kind of that potentially counts for this or just how should we be thinking about this potential moving forward?
Look, Gabe, the macro driver here is there's going to be a gigantic growth in EVs, Right. I mean, B and S updated its forecast in the spring. I mean, it's just this is significant. So there we and what we needed as you ask drivers, what we needed more To satisfy that demand. So that's sort of the first point.
The second point is that EVgo and Tesla have a really good relationship. And as you know, EVgo is the only network that Tesla has sort of committed to have kind of a Tesla connector on our charger so that we can charge any car. And what we're seeing and we've now got I think 400 of those connectors out there. What we're seeing is about 10% of our new accounts Are from Tesla drivers. So we're actually got we've actually got the flow coming in our direction, which is fascinating.
The Practical implication we think of what if Tesla opens up its charging network to other Non Tesla vehicles, it's likely to happen in Europe first because of the engineering issues associated with the UCCS cables on the Teslas In Europe, they don't do that here. And so there's we'll all be watching what the tweet say about what Atezil is going to do. We're actually thinking that this is overall macro is that the charging network needs to expand and grow. So we're full steam ahead on our build plan and there's nothing particularly that this announcement does to affect our Forecast for market share, growth of throughput, etcetera.
Got it. Got it. Very clear. Thanks, Kathy. Thanks again, Olga.
Sure.
Thank you. Our next questions come from the line of John Lopez with Vertical Group. Please proceed with your question.
Hi, thanks very much. I appreciate you taking the questions. I had 2 quick ones. I guess they're probably mostly for Olga and the first one feels Done. So I apologize for it in advance.
But if throughput hours or if your gigawatt hours were up 49% sequentially, why was revenue up Jean, like what was the offset?
Sure. That's not a dumb question, John. That's the question I'll be asking as well. So the difference here comes mostly from our take or pay contracts. Take or pay contracts, by definition, they have a fixed revenue income And they come the revenue comes before the throughput comes.
So we see a wrap up of the throughput and we've seen it throughout the Q2 and we the contract That is the pain in the end of Q1 and that contributes to that difference. Another reason is we will see we have those membership revenues in our retail People are paying for the month $7.99 and then they're using it and we have certain breakage in it. We're seeing that with the growth of usage, we see less and less breakage, so that contributes so the Q1 has more breakage than Q2 on a relative basis, so that contributes to that as well. And the 3rd factor contributing to it, we ran certain promotions in April May to commemorate the end of pandemic as part of our marketing strategy, and we Gave people $5 off, and that contributed a little bit to kind of a lower kilowatt realized lower revenue per kilowatt In Q2, we haven't changed pricing or anything since pretty much 2019, but that short term promotion that was also contributing to us.
Got you. Thanks. That's really helpful, Olga. My second question is or just, I guess, clarifications, if you will, about The 2021 commentary. Excuse me.
So the first one is, obviously, recargo, I guess, was really not contemplated before. Is there any contribution that you expect from RECARGO in the financials for the second half of this calendar year?
So Ricardo is a therefore, it's a very small contribution. It's a tiny company, and they Haven't been successful in commercializing their great technologies. That's why we keep them at a very attractive valuation, and that's what We will be doing so for the remaining of 2021, again, very small contribution and that didn't materially change our guidance. So we decided not to update it.
Got you. And sorry, the other clarification there, I think I heard you say you guys are doing a cessation count target Excuse me, in a couple of months. But like if you're not sure on the station count, how can you be sure on the revenues?
That's a great question. Thanks, John. So let me explain what's truly driving our revenues. There are 2 main factors 1, it's a growth in DIO and the new customers we're getting when they purchase NAV and 2, And the ability of our network to accommodate the traffic, the growing traffic. Right now, our network has capacity to accommodate All the new traffic, which is coming in, and we do not see our that ability to be impaired In the short term, so we are absolutely prepared to take all the new traffic with the charges we have.
And that doesn't impact Our revenue doesn't impact our throughput. In the mid term and long term, we are committed to constructing more charges to accommodate that growing But in the short term, that doesn't really move the needle on us generating throughput in revenue because we do have capacity To take all the new customers off.
Got you. It's really helpful. And sorry, if I could just sneak one last one in. Obviously, Olga, I'm happy to hear your thoughts on this. I'm wondering if Kathy could chime in as well.
I want to come back to the Tesla dynamics a bit and maybe, Laren, Electrified, because in both these cases, I mean, I think Electrified now is planning to double. And I think they said they're going to exceed that initial $2,000,000,000 they're planning to spend and the Tesla dynamics are obviously new. So I guess my question for you here, Kathy, is just if you think about stations that you've specked out or sites That historically maybe looked attractive to you. Do any of those calculations change when you contemplate maybe a change in supply? Can you talk through those dynamics at all?
Yes. Well, so I think, John, as Olga outlined, we look at every single investment through the lens Kind of looking at 8 years, what's the utilization likely to be and we can take those decisions discreetly On an investment by investment basis. And that data is always quite up to date. Part of the algorithms like that's in our sort of Proprietary utilization tools is how many other chargers are nearby. So if for example, like 1 of our competitors or utility decided to build a whole lot in the particular area, we could immediately say, you know what, Let's actually a better use of that capital will be in this other place.
So this is the beauty of our business model is that we can kind of Pivot on a dime and only build where the projects pencil. So look, I'm really, really I've been in the clean energy space for a long time and I've been in the energy sector since I graduated from college. What I love about this Sort of placed in the energy ecosystem is the flexibility, the granularity of the individual investments that give us so much agility and being able to deliver value.
Our next question comes from the line of Stan Shepatner with Pickering Energy Partners. Please proceed with your questions.
Good morning. This is Philip James on for Stan Shepatner. Thanks for making time for our question. With respect to the Investment America Act, could you comment on how grants potentially reducing your effective CapEx per DC Charger could impact capital investment plans as well as return on capital and a path to positive free cash flow?
You bet. So the way this is likely to work is that there's going to be chunks of money that get distributed probably to the states At their local departments of transportation and then the rules that the kind of the rules and the guardrails around how that money gets Specifically allocated in those jurisdictions are probably going to be done at that level. And what we've seen If what we've seen through the Appendix D Volkswagen grants is any indicator of how the future might work, states are doing it differently. So some states like we've got Virginia, which pay which Covered 75% of the capital of rolling out in Virginia, with other either other jurisdictions where the state Decided to do 50% as others where they actually do a kind of a reverse auction possibility. So the answer is that there's no single answer But there will be some sort of anywhere, I'm guessing, from 20% to 80% CapEx coverage.
What we then do is we put that into our model and it makes It reduces the returns in those particular locations. So it's we haven't modeled that for any of our forward, any of the Prospective federal money, everything that we're building now is based on real grants that are available now. So what this This will provide some upside and or will allow us to get into markets that might not otherwise cancel without So for example, rural locations or quarters that are not really in our scheme and now because there aren't enough EVs Make them pencil without the grant. They'll allow us to spread our footprint more quickly and profitably.
Great. I appreciate the color. Thank you.
Pleasure.
Thank you. There are no further questions at this time. With that, that does conclude today's teleconference. We do appreciate