The Electrification of UK Mobility
30 Jul 2019

The UK set a series of five yearly carbon budgets, which currently run to 2032, to help track and proactively manage their 2050 emissions targets. Having already met the first and second carbon budgets and being on course to meet the third (2018-22), the UK is currently on a trajectory falling short of the fourth carbon budget and thereafter. These carbon budgets, coupled with the government amending the 2050 target from an 80% reduction from 1990 greenhouse gas levels to “net zero”, sees the UK increasingly look to the roll out of electric vehicles (EVs) to help towards achieving these ambitious objectives. 

The overarching public opinion of EVs is that the movement couldn’t happen sooner as they see diesel and petrol cars to be one of the biggest contributors to greenhouse gases. These ‘old’ cars are often synonymous with conversations surrounding human-influenced climate change so substituting them for shiny, new EVs seems the logical and simple option. With increased uptake of EVs, associated costs are beginning to reduce. Green Alliance expect EVs to be cost competitive with petrol and diesel cars by 2022 with the present running costs of EVs already lower. Upfront cost parity is mainly driven by the expectancy that battery costs will drop below £100/KWh.

However with the projected uptake of electric vehicles, Bloomberg New Energy Finance (BNEF) expects EVs to add roughly 3,950 TWh of new electricity demand globally by 2050, accounting for 9% of the world’s electricity demand. BNEF’s view is also that the UK will be considerably above these averages with EVs accounting for up to as much of 24% of the total electricity demand by 2050. Taking this into consideration, the UK faces an interesting challenge to meet this new demand using a sustainable and renewable approach. With moving beyond the fossil fuel era towards a low -carbon economy, the difficult act of balancing intermittent generation becomes just as important as ensuring we can add enough renewable generation to meet increasing EV-driven demand. With the UK government reducing renewable levies and schemes, especially for small-scale generation, new build renewable generation is facing an uphill battle to meet potential changing and increasing UK demand.

What does this mean for your electricity supply contract? The race to have the best coverage of the UK is well and truly on for EV charging companies. As with any widespread product or service roll out, someone must foot the bill. EVs and their chargers can currently receive certain subsidies but none of these are charged through electricity suppliers. There is potential that this will change, and the government will introduce new subsidies, through energy suppliers, to incentivise investment into EVs and the change from conventional cars to EVs.

However, the impact of EVs could be wider spread than this with other non-commodity charges having to adapt to manage a change to capacity requirements and demand profiles. Distribution Network Operators (DNO’s) currently have their red band charges set at mostly 4-7pm, Monday to Friday but with EVs, it’s unlikely that users will choose to charge their EVs during this time as they’ll most likely be commuting home or finishing work between these times. It’s more likely that you’ll see EVs treated in a similar way to mobile phones whereby most of the charging takes place overnight to ensure charge time isn’t a worry and the EV is ready for use the following day. This would lead to the UK having a ‘flatter’ demand load between day and night. This could lead to DNO’s updating charges to smear their cost to serve into other time bands to ensure they recover the necessary costs. 

Brook Green Supply currently supplies several I&C EV charging networks within the UK. By providing a clear and concise structure for new EV meter connections, proactively managing aggregate demand and producing simple, reliable bills for our EV clients, we’ve allowed them to focus on their business objectives. By offering bespoke contracts with dynamic, time of use pricing and contracts to support the fluctuating EV charging point demand, we are at the forefront of the I&C EV revolution. This is just one way we are meeting our aim to provide solutions to the rapidly changing face of the UK energy market. To hear more, get in touch today to discuss your I&C EV charging needs with Luke from our Solutions Team on 020 7870 4950.
 

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