Quebec company secures $136-million to boost its EV charging network

This article was written by Kate Helmore and was published in the Globe & Mail on June 12, 2024.

A Quebec-based EV charger company has secured $136-million in long-term capital to deploy a 15-minute charger and expand a high-tech network across Canada and the U.S.

Export Development Canada lead the Series E equity financing for FLO EV Charging Solutions alongside Business Development Bank of Canada, Caisse de dépôt et placement du Québec and private investors including MacKinnon, Bennett & Company.

FLO will use the funding to advance the rollout of new products, including an ultrafast charger that can charge most new EVs to 80 per cent in 15 minutes. They’re also releasing a residential charger.

“FLO has 15 years of delivering reliability,” president and chief executive Louis Tremblay said. “Investors saw this opportunity to invest in a market share that is growing.”

Charging infrastructure needs to expand for Canada to reach its 2035 goals of zero-emission vehicle sales. There is one charging station for every 20 vehicles. The global average is 10, according to a January report released by Mobility Futures and Pollution Probe.

This is affecting EV sales – 72 per cent of consumers cited a lack of charging stations as a top concern, a March survey by Autotrader Canada said. And, for those hoping to capitalize on this shortage, the market has opened up. In May, Elon Musk fired Telsa’s entire charging infrastructure staff.

FLO, established in 2009, charges 1.5 million cars a month at more than 85,000 stations that span across North America. Utilization was up 48 per cent last year, while energy transferred across the network grew 64 per cent.

FLO has two major revenue streams. It is a charging manufacturer and sells hardware to gas stations, grocery stores, convenience stores and developers.

Customers include Canadian Tire and the City of Toronto.

It is also a vertically integrated business that is developing a network of charging ports owned and operated by FLO. Last week, FLO and grocery store Metro announced a partnership to install at least 500 fastcharging ports at more than 130 stores across Quebec and Ontario.

The other key to success is reliability. Research by Berkeley found that one-quarter of 678 chargers in California’s Bay Area did not work. To combat this, all new FLO chargers will come equipped with a sensor that immediately notifies staff if broken. The ultrafast charger has more than 400. As such, FLO chargers work 98 per cent of the time, Mr. Tremblay said.

Other advancements are focused on ease of use, for example FLO’s mobile app, which maps available charging stations and offers route planning. The company also recently signed a deal with General Motors to synchronize new vehicles with chargers so payment will happen automatically.

“Eventually it will become much easier to charge than it is to fill up gas,” Mr. Tremblay said.

FLO is betting that a vast network of reliable, available and fast charging stations will boost EV sales, which have slowed compared with recent years.

However, whether these charging stations will return the investment is another question.

Consumers need a dense network of reliable charging stations to consider buying an electric vehicle, said Jeff Turner, director of clean mobility at Dunsky Energy and Climate. This demand will remain constant over the long term. According to research by Dunsky, infrastructure needs would represent a total investment of approximately $20billion over the next three decades. And Mr. Turner agrees with FLO: maintenance and reliability are key.

However, the majority of charging happens at home, in the driveway overnight. This is both cheaper and easier for drivers. But it’s not good news for those hoping to make profit on public charging stations.

“Imagine asking a gas station what they would do if all of a sudden 90 per cent of the fuel we needed we could get from a home fuelling station,” Mr. Turner said.

He said that those living in apartments will require public charging stations and can anchor their stations within cities with this housing.

Mr. Tremblay recognizes that the majority of charging happens at home. But FLO is betting that its diverse product offering, which includes selling residential chargers, will provide a profitable pathway forward.

“What the EV driver wants is to be able to travel everywhere.”

FLO, established in 2009, charges 1.5 million cars a month at more than 85,000 stations that span across North America. Utilization was up 48 per cent last year, while energy transferred across the network grew 64 per cent.