EV charging infrastructure: discussing the road ahead

Increasing electric vehicle (EV) ownership depends on ensuring that enough charging points are available to service them. There's a ‘wall of capital’ available for investment in this and other Net Zero areas of the economy, such as electrification, and renewables, but global competition for this capital is fiercer at present. Investors are increasingly sensitive to government U-turns on funding programmes and retroactive policy changes.

The conversations at our recent roundtable highlighted several actions that the government should prioritise to keep the UK on track to meet its EV ambitions and retain our leadership position on Net-Zero .

Shifting government priorities risks slowing investment in Net Zero

Addressing the cost of living and reducing the government deficit has rightly become a priority for government over the past 12 months. There's a concern that this shift in government messaging will discourage private investment in EV charging and other Net Zero sectors in the UK. The perception across the market is that the government is reviewing Net Zero policies and that any programmes that impose a cost on government, industry, or consumers could be watered down or scrapped.

Although the government is retaining its commitment to end ICE vehicle sales by 2030, the messaging from ministers in recent months is increasingly negative regarding the shift to EVs and reducing vehicle emissions. Participants in the roundtable expressed concerns that the UK was at risk of losing its leadership role in Net Zero and decarbonisation at a critical moment, when warming temperatures are increasingly at the top of the public's concerns.

The group agreed the next government should show leadership on Net Zero and reaffirm its commitment to not just the 2050 target, but to the policies and frameworks needed to achieve it. For example, participants suggested government should set out trajectories or targets for total numbers of EVs on the road by 2030 and 2035, to send a signal to the market on the rate of investment needed.

Government funding is still crucial but must focus on market failures

The participants agreed government funding was still needed to tackle hard to reach areas and ensure equitable access to charging, eg, in rural areas, deprived areas, or areas where there's charging need but no viable investment case. Participants also recognised the availability of power and the cost of electrical connections as a consistent barrier in delivering EV charging, in particular rapid/ultra-rapid charging hubs.

Participants stressed that government funding needs to be carefully targeted at areas where the private sector cannot deliver on its own: for example, where the investment costs aren't commercially viable. It was suggested that the chargepoint operator (CPO) sector could provide suggestions to the new government on how it can target only the ‘gaps’ in the market and avoid the ‘clash of capital’ that was perceived in initiatives such as the digital fibre roll-out.

It was suggested that government could encourage private sector investment in EV charging indirectly by providing incentives to drivers or setting out ambitions for numbers of EVs on the road. Indeed, this may be required to help drivers transition to EVs after 2030.

Most participants agreed there was nothing fundamentally wrong with government policies or existing funding programmes for EV charging, but they agreed the government must carefully monitor the market during this critical transitional period and continue intervening in the right areas without unintentionally distorting the market.

A patchwork of planning and procurement approaches is still a challenge

Participants acknowledged the work being undertaken by councils and local authorities to develop procurement frameworks and launch tenders for delivery of EV charging in their jurisdictions. This was seen as crucial for the transition in that it directly brings forward large-scale investment in EV charging.

Several participants noted the challenge of engaging in these tenders due to the variation in contracts and tender approaches and the sometimes overly burdensome commercial terms: for example contract length, termination rights, and tariff controls. Concerns were raised that by making tenders difficult to participate in, or not commercially attractive to large-scale investors, authorities risked not attracting the best operators/investors.

Participants recognised the work by central government and industry groups to support local authorities in capacity building and by providing resources and materials to support tender development. However, there was also a consensus that more needs to be done at both central or local government level to build capacity and resourcing for EV charging delivery.

Some participants suggested local authorities could be set targets for EV charging delivery, to level out the level of ambition and avoid regional black spots. Participants also recognised the challenge this would present in terms of devolved responsibility for transport policy and planning, and on competing local authority budget priorities.

Standards and regulations are helpful, but must remain focused on the bigger prize

Participants acknowledged the work by the Office for Zero Emission Vehicles and the Department for Transport to develop regulatory standards for chargepoint design, safety and, most recently, consumer experience. The group agreed with the government’s focus on ensuring good outcomes for drivers and encouraging those making the switch to EVs.

The EV charging sector has come a long way in the last few years in terms of consumer experience, for example on reliability. The UK's charging network now has very high reliability levels and most chargepoint operators are installing state of the art equipment and software systems to ensure interoperability, safety, and ease of use. Participants encouraged government to consider these overall high standards and not to focus too prescriptively on whether a network was. For example, 98% available or 99% available.

In addition, the group emphasised the need to encourage innovation in the EVs and adjacent sectors, such as smart grids and consumer energy. The UK has historically been a leader in this area, yet once again concerns regarding shifting messaging on Net Zero and innovation funding programmes risk tarnishing this reputation.

Participants noted that the UK’s selling point to global investors in Net Zero should be a mature market, with the right regulatory frameworks and the innovative established companies. The government should consider opportunities to promote this reputation, particularly given the challenge of competing with increased subsidy support from governments in the US and Europe.

For more information, get in touch with Alasdair Grainger and Owen Tong.