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How Electric Vehicle Charging Stations Met Taco Bell Parking Lots – Franchise Times

Raul Lepe of Taco Bell operator Diversified Restaurant Group says installing electric vehicle charging stations in restaurant parking lots could drive customer traffic.
Tosh Dutt
Restaurant operators don’t pay anything upfront to install ChargeNet stations, the company says.

Assistant Editor
With more than 230 Taco Bell restaurants mainly concentrated in California, Diversified Restaurant Group wanted to find a way to help offset high wages without negatively impacting the customer experience. After looking into solar energy options, DRG learned about ChargeNet Stations, a software start-up that installs electric vehicle fast chargers into restaurant parking lots, in addition to solar panels that power on-site battery storage.
Raul Lepe, DRG’s senior vice president of strategy and operations, said they were attracted to the idea for multiple reasons, including the alignment with Taco Bell’s sustainability push and the opportunity to save on operational costs.
“This could really be a top-line driver as well,” Lepe said during a Franchise Times webinar in August, theorizing that it could attract new customers to Taco Bell who would grab some grub while waiting for their car to power up.
Utilizing fast-charging technology from its partnership with Tritium, ChargeNet claims to offer drivers a 10-minute charge for less than $20 that will last them more than 200 miles. The chargers are white-labeled for QSR franchises, and ChargeNet will provide a seamless transition from the charging interface to the food ordering interface via an app soon to be released.
Raul Lepe of Taco Bell operator Diversified Restaurant Group says installing electric vehicle charging stations in restaurant parking lots could drive customer traffic.
“This was certainly something that was very new and different, especially in the QSR space, and we’d like to consider ourselves pioneers in that way,” Lepe said, pointing to DRG’s unique Taco Bell locations on the strip in Las Vegas and on the beach in Pacifica, California, where bloggers stop to grab a taco and post pictures while driving along the Pacific Coast Highway.
“We have really tried to create a really different experience than most people would expect at a Taco Bell, and so this goes along with that,” he added.
DRG partnered with ChargeNet to eventually install charging hubs at nearly 155 of their Taco Bells in California, with six charging stations per restaurant, which means more than 900 total EV chargers. The grand opening of the first charging hub at DRG’s Taco Bell in south San Francisco was in October, though the site was technically operational in September, according to ChargeNet Chief Revenue Officer Sharmila Ravula.
The first customer to stop by the site hooked up his Tesla and went into Taco Bell for lunch, “so this is exactly what we were trying to see in how we could improve traffic for QSRs,” Ravula said. “Luckily, the first customer turned out to be a good showcase of that.”
It’s worth noting this isn’t the first EV charging station at a Taco Bell. Electrify America has a charging site at a Taco Bell in Ellensburg, Washington.
While integrating an electric vehicle charging hub would typically take a sizeable investment for a franchisee, ChargeNet covers the bill—using $6.2 million in funding raised in part from the California Energy Commission’s California Electric Vehicle Infrastructure Project and the California Public Utilities Commission’s Self-Generation Incentive Program.
Tosh Dutt
Investing in the future
“Unless someone like you cares a whole awful lot, nothing is going to get better,” reads a famous quote in “The Lorax” by Dr. Seuss. The line also makes an appearance on ChargeNet co-founder and CEO Tosh Dutt’s LinkedIn page.
By 2040, ChargeNet projects there will be 64 million electric vehicles driving around the U.S., but the country has only built 4 percent of the charging stations needed to charge them all. There are even fewer fast chargers and a lack of clean infrastructure to support it, ChargeNet claims on its website.
While that may seem like a daunting issue, Dutt noted there are incentive programs to support the transition to electric vehicles. The Inflation Reduction Act of 2022 included a Clean Vehicle Credit, a tax credit of up to $7,500 for certain electric vehicles, with the aim of pushing automakers to produce more affordable EV options.
“The reason why quick-service restaurants are so important to this is because over a third of the U.S. population goes and gets their food there every day,” Dutt said. “You’ve got to put this infrastructure where they’re going to be.”
Restaurant operators don’t pay anything upfront to install ChargeNet stations, the company says.
Dutt has driven an electric vehicle for the past eight years, and noted his frustration with the lack of customer service while charging his car. Like being forced to wait at the gas station to fill up with fuel, waiting in a line to charge can deter EV drivers, which is another reason why Dutt is targeting QSR parking lots.
Operators don’t need to make further utility service upgrades, aside from one additional meter to support the chargers. And while paying nothing upfront, operators will take home a portion of the revenue generated from the chargers and benefit from bringing in EV drivers as customers.
But that doesn’t mean the process is without challenges. With an educational background in industrial engineering, Lepe said he takes a detailed approach to ensuring the charging hubs are placed in optimal locations at DRG sites, from mapping online first to scoping out every site. Lepe is also working with ChargeNet on the research front to make sure construction isn’t violating Americans with Disabilities Act requirements.
“Where’s the best place to put the solar structure? Because you want it to not impede the visibility of the building, but you also want to make sure you’re getting the production you need,” Lepe said.
And to avoid alienating existing customers who may not be hopping on the EV trend yet, Lepe also makes sure the chargers don’t dominate all prime parking locations. “It’s trying to find that right balance where you’re catering to both,” he said, especially while EVs are still in the early stages of adoption.
“Ultimately, they’re going to be ChargeNet customers too, but I think for the most part, the customers are thinking of this as, ‘this is a Taco Bell,’” Lepe added. “And so we want to make sure we’re designing this in a way that really generates that experience that we want.”
Five more charging hubs should be online at DRG Taco Bells in the San Francisco Bay Area by the end of 2022, Ravula noted, while the rest are expected to be built over the next 18 to 24 months.
Assistant Editor
Intrigued by fascinating founder stories and quirky business ideas, Callie takes the lead on any executive moves and emerging brands in franchising, plus merger and acquisition news for our monthly Dealmakers e-newsletter.
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