Electric vehicle infrastructure and zero emission technologies
The opportunity for UK business
Two years ago, there were just 1 million electric vehicles on the roads in the world. Roll forward to 2030, and the prediction is that this number will be in the region of 200 – 300 million (source: JP Morgan).
Many of the largest and most significant car manufacturers globally are now embracing electric vehicles. VW, for example, is introducing a new vehicle in 2019 – this new vehicle will be approximately the size of a Golf on the outside, but with the internal capacity of a Passat.
The new reality is that because electric cars require few mechanical parts, they rarely require servicing, and the cost of the energy is a third or a quarter of the cost of running a car with petrol and diesel. So, the total cost of ownership of an electric vehicle over five years is already less than the cost of the equivalent petrol or diesel-powered vehicle. The cost of the vehicle is no longer a barrier to growth in the market. Instead, the real question is how long batteries will really last, and where and how they can be charged.
The electric vehicle market is developing – fast
There are several reasons for this:
1. Vehicle technology. Electric vehicles are simply becoming better than their counterparts with internal combustion engines. They are quiet, accelerate better, cost less to drive, have no emissions, and are now cost-competitive.
2. Carbon emission targets. The UK government, along with most of Europe, is strongly pushing a low emissions agenda, and looking to improve air quality and limit climate change.
3. Infrastructure technology. The creation by Parking Energy (other providers will follow) of ‘open source’ charging infrastructures, with the cabling built into new buildings and car parks, allowing people to purchase charging units, and to simply plug and go.
4. Reducing ‘charge point anxiety’. Increased visibility of charging points across the country, supported by the UK government’s aspiration that buildings and parking bays will soon be ‘EV ready’. This is leading to a gradual reduction in concerns around battery capacity and the availability of accessible charging points.
5. Mobility as a Service (MaaS). There is a gradual shift in mentality, especially with the millennial generation living in urban areas, who no longer aspire to own a car, but would be happy to rent one. This is a big driver for people who want to get from one place to another in the easiest possible way, but don’t want the cost or responsibility of car ownership.
UK innovators, FiveAI, are working hard to capitalise on opportunities in the MaaS space. Founder Stan Boland has a vision to create “Urban travel that’s safe for everyone without costing the earth”. They offer safe and convenient demand-responsive shared mobility services for European city-dwellers so attractive that no-one feels they need to own a car.
Founded in 2015, FiveAI are growing fast. With offices in Cambridge and Bristol, they recently received funding from Kindred Capital and are planning their next stage of growth.
In the UK market, the arrival of ‘plug-n-play’ infrastructures that allow the installation of a charging point to a pre-installed network within minutes, creates an opportunity for new players to enter the market, offering a range of charging point ‘boxes’ with different levels of functionality.
Charging boxes are essentially small computers, with a processor and internet connection. This also opens up new markets for apps and services that allow people to control how and when they charge their vehicles, to take advantage of off-peak tariffs.
The UK is taking the lead in zero emission vehicle technology
In September 2018, Birmingham will host the world’s first zero emission vehicles summit as a key part of the government’s Industrial Strategy. The summit will bring together policy makers, industry experts, and opinion formers from around the globe to tackle carbon emissions and to find ways to improve air quality.
This is great news for those UK businesses innovating in the world of low-carbon emissions, and particularly in creating the infrastructure for electric vehicles.
Through its modern Industrial Strategy and Automotive Sector Deal, the UK government is committed to making transport technology cleaner and greener. Its mission is to put the UK at the forefront of the design and manufacturing of zero emission vehicles, making all new cars and vans effectively emission-free by 2040.
Transport Secretary Chris Grayling said, “The government is committed to meeting our climate change targets and cleaning up our air, and to help achieve that we are investing £1.5 billion in ultra-low emission vehicles by 2021.”
It’s no accident that the summit will be held in the Midlands. According to Business Secretary Greg Clark, “The Midlands has a rich automotive heritage and the growth of high-tech manufacturing across the region continues to drive investment into the region, produce highly skilled jobs and boost economic growth – making it an ideal place to lead the world in zero emission vehicles.”
The news of the summit was announced on May 24th – the same day as ministers confirmed the continuation of the Plug-in Car Grant and Van Grant, committing further towards the UK’s climate and clean air targets.
Find out how EV innovators Parking Energy have funded their finance journey, and read their tips for business growth in this disruptive sector.
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