Tipping point for Electric Vehicles (EVs)? Implications for business
In the last few months, there have been a number of events that indicate the rollout of EV charging infrastructure in the UK will start gathering further momentum.
The government has a longstanding ambition for 100% of new vehicle sales to be electric by 2040, in order to reach its goal of zero net emissions by 2050. In May, a new report issued by the UK advisory Committee on Climate Change said that if the UK is to reach its 2050 goal, it must consider moving its current target on EV sales forward by up to a decade to 2040. Whether the target moves or not, there is certainly an acceptance of how important the move to EV mobility is to the Government’s ambitions.
There have also been some big moves in local government, not least in London. In June, London Mayor Sadiq Khan unveiled an updated EV infrastructure delivery plan that aims to put as many as 50,000 charging points in the city by 2025 as London looks to become a zero emission transport city by 2030. This would support more than 300k EVs in the city in 2025 compared to around 20k in London today.
Some of the customer concerns around EVs are also starting to be tackled. For example, the new Nissan Leaf, launched in June, has a range of 239 miles from a single charge. The Leaf has sold 400,000 units globally since 2010 and with this upgrade to a range (from around 150 miles previously), it can be expected to attract a new segment of consumers. There are many new models expected from all the major automotive manufacturers over the next 12 months that will make an EV a realistic proposition to most drivers. The increases in range and the greater choice, allied to an increasing charging network, will drive the market forward in the months and years ahead.
What does it mean for business?
In terms of implications for businesses, there are some key considerations. In the workplace, employers need to be ready to cater for a growing number of employees with EVs. There may just be a few at present, possibly hybrids at the moment, and this is going to increase quickly. Employers will want to consider how many charging points they want to install and how quickly, and with smart charging there are features where employees can be informed via an app when a charge has finished and to move a car, and let the next employee know it is time to charge. Features like this could limit the amount of investment required in the short term.
In terms of fleets, many businesses are starting to look at electrification, believing that it can reduce costs in the longer term, and it is more viable now that vehicle ranges are improving. The type of fleet will influence what is the right EV charging solution. For example, for a fleet of vans that are predominantly at employees’ homes overnight, a set of home chargers would be required. If the vans are left at the workplace overnight 7kw chargers are likely to be adequate as they can fully charge in non-working hours. For scenarios where vehicles are constantly in and out of a site, a faster charging solution, possibly a DC charger, would be a more viable solution as it will give more charge more quickly.
In the retail environment (e.g. hotels, supermarkets and pubs), there are some very distinct approaches that can be taken. Retailers could treat EV charging as an additional benefit for customers with free charging, possibly to differentiate from competitors and drive further footfall, or treat as a revenue stream and charge customers for using the charging facilities. Many strategies and approaches are likely to develop in this space, and charging point companies are also targeting this space where they will put in the chargers for free and either share charging revenues with the business or pay rent.
In all scenarios above, site capacity is an important factor to consider. If more capacity is required, conversations with the distribution network operators will be required and it can be time consuming and costly. In the short term, there are approaches that could avoid these additional charges. For example, most smart charging solutions come with power management software that can limit the amount of supply to the charging points in order to avoid exceeding maximum demand, should all chargers be being used at the same time. Consideration should also be given to the location of the charging points on a site as this can greatly influence the cost of the work.
If you want to know more about Total Gas & Power’s EV charging offering please visit https://www.gas-power.total.co.uk/EV-charging.
James Turner, Head of Propositions in the commercial team at Total Gas & Power gives insight into the fast evolving revolution in the Electric Vehicle market and the infrastructure required to support it.