Battery electric vehicles and climate change
With significant variance in the capital costs required by site to install a network of ultra-rapid charging hubs, coupled with an equally variable, but uncorrelated, set of traffic flows for these sites, any national charging infrastructure build- out risks becoming a ‘postcode lottery’ (National Grid, 2019) if left to pure market forces without the levelling support of government funding (exhibit 5.4). Nation-wide regulations also need to be adopted to drive greater home installation of charge points: in the UK, for example, while many city and local authorities have requirements for new-build projects to provide active and passive charging infrastructure ( ‘ EV Charging Legislation for Developments in the UK ’ , 2019), no national policy yet exists. Charging infrastructure investment funds are being launched (Hirst, Dempsey, Bolton, & Hinson, 2020) to encourage new and existing companies to accelerate the roll-out of charging solutions, particularly those that make intelligent use of demands on the national network or even supply power back from connected vehicles at times of peak demand. Consumers are being provided with access to grants to pay for the cost of charge points at home (for example, a total of £500 in the UK). And task-forces are being created (Hirst et al., 2020) to pull together multiple players in energy and automotive sectors to ensure plans are in place to support the increased demand and distribution of electrical energy that BEV adoption will create. Finally, governments can intervene to stimulate consumer demand for BEVs. The simplest is through vehicle grants – sliding scale benefits that reduce upfront vehicle costs, each dependent on vehicle type and emission ratings. Governments, faced with pressures on the public purse, are nonetheless being criticized alike by environmentalists, consumers and the automotive industry for offering less financial support than they otherwise might, or indeed for reducing previous support before the BEV tipping point of consumer take up has been reached. In response to the UK’s 2018 reduction in vehicle grants for low emission vehicles, the Society of Motor Manufacturers and Traders argued ( ‘ Automotive industry calls for plug-in grant rethink as cuts put Government ambition at risk ’ , 2018) that ‘ we understand the pressure on the public purse but, given the importance of environmental goals, it’s astounding that just three months after publishing its ambitious vision for a zero emissions future, government has slashed the very incentive that offers our best chance of getting there. ’ Indeed, governments will have to prepare for the impact of BEVs on their own national coffers: as BEVs take off, so will governments’ ability to raise taxes through excise duty on traditional fuel fall, leading many to call for advanced planning for new forms of tax collection that nonetheless do not punitively damage electric vehicle owners (Inman, 2017). Nonetheless, through all the various complex considerations, it’s clear that across the full range of levers available to government, it is the more assertive interventions that pay dividends in driving adoption of new technologies. While electric technologies have been a possibility for the last two decades, it has only beenwith the combination of aggressive regulation on emissions, and government- encouraged R&D investment in battery technology, that OEMs have shifted their investment focus to driving BEV development and consumer penetration – mirrored by the accelerating release schedule of electric vehicles in the last five years. With enforced emission targets, and future bans of ICE vehicles on the horizon (and with this, loss of entire revenue streams), OEMs have shifted investment funds to new technology. Such shifts are so radical that many commentators see them as unparalleled in nature (Riley, 2019): Volkswagen has now committed £30 billion over the next five years to ensure that an electric or hybrid version exists for every vehicle in its line-up, cannibalizing, even as it does so, their existing ICE sales. But without government regulation and intervention, such shifts would have been inconceivable.
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