This spring, the Competition Authority released an extensive analysis of how the public electric vehicle (EV) charging infrastructure market functions in Estonia. Although the report states its goal is to identify obstacles to effective and fair market competition, the overall takeaway leaves an unexpectedly disheartening impression: that buying an electric vehicle might not be all that sensible right now.

Certainly, drawing that conclusion was not the aim of the Competition Authority's report. However, when news coverage about the report says that market competition is limited, that the development of the charging network is insufficient and that even the limited visible progress is focused only on densely populated areas, the average person is left with one unavoidable impression: the time isn't ripe to buy an EV.

The report also assessed the number of public charging stations for light vehicles in Estonia, their variety and geographic distribution. It notes that the charging infrastructure is continually evolving and that, by the time the analysis was published, market participants had already added new charging points and new players had entered the market. As of May 31, 2024 — when the Competition Authority had just completed data collection for the report — there were 592 public charging stations located on 384 different properties across Estonia. Nearly 55 percent of these were in Harju County and 14 percent in Tartu County.

Now, ten months later, that snapshot is hopelessly outdated. It no longer provides consumers with an accurate picture of how dynamic the development of charging infrastructure is or how quickly changes are happening. The situation isn't helped by the report's reference to a European Commission overview, which states that Estonia has too few EVs and a very low number of public charging points compared to other countries, placing it among the laggards.

Yes, those are cold facts reflecting a specific moment in time — but spreading such a message doesn't exactly instill confidence among consumers at a crossroads: whether to commit to an electric vehicle today or go through one more cycle with an internal combustion engine car. That decision has a very real impact on whether Estonia can meet its climate goals at the desired pace.

As a developer of charging infrastructure, we can say that 2024 was one of the most pivotal periods in the development of Estonia's public charging network. While consumers may not yet see the results of this progress, we will witness explosive growth in the charging infrastructure this very year.

In fact, the rate of network expansion has been steadily increasing in previous years as well. In 2020, Estonia had about 200 public chargers; today, that number exceeds 600. Since fast chargers usually have two connectors, those 600 chargers can serve over a thousand vehicles simultaneously.

Forecasts show that this number will multiply in the coming years, and every new market entrant accelerates that growth. Alongside state-affiliated Enefit Volt, companies like Elektrum, Alexela, Circle K, Eleport, Ignitis and many smaller players — altogether no fewer than fuel retailers — have been actively expanding charging parks. The major operators signed substantial contracts primarily in the second half of 2024, after the report's data collection phase had already concluded.

So what's the real issue here? For Elektrum and other charging operators, making these investments pay off requires that more and more people choose EVs over gasoline or diesel cars. That's not just a business premise for infrastructure developers — it's directly tied to Europe's environmental goals and is a shared responsibility. It's a duty for ministries, local governments, infrastructure developers, car dealers and all state institutions alike.

To encourage more consumers to opt for electric vehicles, we need to send positive and reassuring signals that EV charging infrastructure is already accessible throughout Estonia — and will become even more so in the future. Elektrum's ongoing projects alone will increase our number of charging parks sevenfold by 2027, with more than two-thirds of those chargers located in sparsely populated areas. So, in my view, the report's claim that the charging infrastructure is overly focused on urban areas is simply not accurate.

Lossmaking charging stations

Building a charging station in a sparsely populated area does not significantly differ in cost from building one in a densely populated area. The cost of equipment, connection fees and construction services is comparable, but expected usage rates and payback periods vary greatly.

For example, we know that some portion of the more than 200 charging points we plan to install near Coop stores over the next two years will never be profitable from an investment standpoint. These locations often only see visitors seasonally during the summer, with very few year-round residents.

When making investment decisions for these locations, we've calculated that usage at more popular sites will help offset the losses incurred in less frequented ones. We're also clearly relying on the hope that having a sufficiently accessible charging infrastructure will ultimately give consumers the confidence they need — along with a push — for strong growth in electric vehicle adoption in the coming years.

We're making these rural-area investments with a long-term perspective, hoping that all stakeholders will begin to commit seriously to promoting wider EV adoption. For instance, local governments could significantly accelerate the development of EV charging infrastructure in rural regions through their own investments.

So far, only the city of Tartu has procured a small number of EV chargers, and Tallinn has announced plans for a tender involving 100 chargers in the coming year. Expanding charging infrastructure to smaller towns and settlements should, going forward, become an inseparable part of every county's environmental development strategy.

Harmful market restrictions

The Competition Authority's report also criticizes some market participants for engaging in anti-competitive practices, such as exclusive agreements with property owners that prevent competitors from accessing key charging locations. While it's understandable from a human perspective that some infrastructure developers want to protect their positions — so the already thin soup doesn't get even thinner — such agreements are undoubtedly toxic.

Still, if the development of charging services becomes financially unsustainable for anyone but the largest operators, that doesn't benefit consumers in any way. The best remedy remains the continued and rapid growth of the number of electric vehicles.

Currently, there are nearly 9,000 registered electric vehicles in Estonia. The more optimistic forecasts suggest that by 2030, Estonia could have 100,000 EVs on the road; more conservative projections put that number at 50,000. At the current pace of growth, even the lower estimates are starting to look unrealistic.

At the beginning of 2024, a simple calculation showed that, based on national targets, the number of electric vehicles in Estonia should reach 18,000 by spring 2025. This means the rate of EV adoption should have been 2.5 to 3 times faster than it is today.

Buyers uncertain

The sluggish growth in the number of electric vehicles stems from a lack of confidence among everyday drivers. Many are hesitant to make the investment. Buyers are experiencing "charging anxiety" — a fear that charging won't be convenient enough along their route or that there won't be enough chargers available, leaving them stranded with a dead battery. For many, there's also "technology anxiety" or the question of why buy now, when newer and better EV technology might be just around the corner?

Recent developments in the electric vehicle market haven't helped inspire confidence either. Volvo recently announced it was abandoning its goal to switch entirely to electric vehicles by 2030 and Tesla has unexpectedly found itself embroiled in a political crisis.

Consumers are also grappling with "price anxiety." While manufacturers have started to lower EV prices, for most buyers a new electric car is still too expensive an investment. The growing availability of more affordable Chinese EVs may help ease some of that anxiety, but even here, there are open questions. Is that really the direction Europe's car market wants to go in — considering both its climate goals and the need to protect its domestic auto industry? In the automotive world, brand loyalty can take nearly a decade to solidify.

Growth to slow

One thing is certain: within a year or two, Estonia's charging infrastructure will have expanded explosively and no driver will realistically need to worry about being stranded on the road. But what happens next? Elektrilevi's decision last year to increase grid connection (ampere) fees by nearly 50 percent sends a clear message: the burden of developing new charging stations rests squarely on the shoulders of private investors.

A simple calculation proves the point. Installing a 150-kilowatt fast charger typically requires purchasing an additional 250 amperes of grid capacity at the property. This means that — on top of all other costs involved in building a charging park — the connection fee alone amounts to around €83,000, accounting for more than 60 percent of the total installation cost. For a 300-kilowatt ultra-fast charger, the connection cost doubles, making up as much as 70 percent of the total cost.

Even under the previous, lower ampere fees, it took an average of ten years to recoup the investment in a fast charger located in a high-traffic area. In many sparsely populated regions, building a charging station is already an unprofitable venture. Going forward, with these new connection fees, it would be a commercially poor decision to develop charging infrastructure in such areas.

As a result, future expansion of the EV charging network will likely be driven primarily by property developers, with infrastructure providers offering slow or semi-fast charging services on their premises. Companies planning to update their vehicle fleets should also consider at least a partial transition to electric vehicles. If every company replaced just 10-20 percent of its fleet with EVs, it would give a tremendous boost to the growth of the electric vehicle market.

In short, the EV charging market is ready for a leap. At this stage, no stakeholder should be wasting energy lamenting the current state of affairs. The market needs expert oversight and supportive measures. Ensuring market transparency is important, but we should also collectively focus on delivering more encouraging messages to consumers — messages that affirm the future is promising, and that this promise is being realized across all of Estonia.

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