By Timothy Gardner
WASHINGTON (Reuters) - The United States on Thursday offered EVgo a conditional loan guarantee of up to $1.05 billion to expand public electric vehicle-charging infrastructure across the country, some of which in marginalized urban communities.
If finalized, the loan guarantee from the Loan Programs Office (LPO) at the Department of Energy will support EVgo's (NASDAQ:EVGO) deployment of about 7,500 public stalls with high power chargers that can power two EVs simultaneously at nearly 1,100 stations.
The financing should help EVgo, which has a high cost of capital, compete with Tesla (NASDAQ:TSLA)'s network of chargers, Jigar Shah, the head of the LPO, told Reuters.
"The key is helping the company really achieve far higher customer service scores, (which) will mean that more people want to charge there, and it'll mean that they'll be able to pay back our loan faster," Shah said. EVgo, which is not yet profitable, currently has more than 3,500 fast charging stalls.
It was the first financial aid for an EV charger company from the LPO and comes from the office's innovative clean energy program, which has about another $70 billion of loan authority.
The EVgo chargers, meant to be built over five years, will complement a federal program created in 2021 that aims to put chargers every 50 miles (80 km) on highways, Shah said. That federal grant program has been criticized for slow progress.
More than 40% of the 350 kilowatt EVgo fast chargers, which are designed to charge all EVs, are planned to be built in disadvantaged communities where the company believes they will be used by car-share services and individual car owners alike.
"They're ideally suited to those individuals who don't have access to a private driveway," EVgo's CEO Badar Khan told Reuters. "It's a key aspect of our business, to provide access to clean air through transport electrification to those that don't have charging at home."
The announcement "is a meaningful mile-marker as the private sector sprints to build the infrastructure to meet consumer demand," said Ali Zaidi, the White House national climate advisor. "This partnership will help us continue to accelerate expansion from coast to coast."