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The opportunities around electric vehicle charge points in the UK
About the report
Slowly but surely, electric vehicles (EVs) are gaining market share. In the UK, EV adoption could get to at least two million units (or five per cent of all vehicles) by the mid-2020s, if costs come down to internal combustion engine (ICE) vehicle levels, and battery ranges go up. Currently, the higher upfront costs, lower distance range and the relative scarcity of vehicle charging points are holding adoption back.
This report focuses on how the future of public EV charging will unfold. We consider likely uptake scenarios, the various segments in the charger market and steps being taken to accelerate uptake. We examine how AC charging will be complemented by faster DC options, and what we can learn from EV charging models in more mature markets.
How many chargers will be needed?
Many variables will impact the demand for chargers: how quickly EVs are adopted as mainstream transport, the type and availability of the various charging options on offer.
Charging will fall into four broad categories. Two private segments, where the infrastructure is only available to owners or designated users, are Residential, and Fleets. The public segments available to all are Around town, and En route.
We forecast that the UK will need around 28,000 public charge points by 2030, and to invest a further £1.6 billion in the infrastructure to meet the needs of an estimated seven million EVs in use by then.
To reach that estimate, we modelled three possible scenarios to 2030, ranging from two million to 10.5 million EVs in circulation. The public charging scenarios include a combination of lower-cost, parking-based segments and higher-speed and higher-cost segments.
How much power an EV battery can take from the charger, and how long it takes to fully charge is limited by current battery technologies. Alternating current (AC) is what is found in homes and businesses. It must be converted to direct current (DC) to charge the battery directly.
Residential and parking-based Around town charging will likely to remain slower and AC-based. Improvements in battery technologies and power ratings mean that DC-based segments will enable drivers to charge up in less than an hour. The Fleet and En route segments will use rapid and ultra-fast DC chargers at urban and motorway hubs for motorists on the go.
Even with improvements, a complete recharge of an EV will not be as fast as refuelling an ICE vehicle, so a blend of charging options will be required.
DC or not DC? That is the question
We anticipate DC charging to be the fastest-growing segment in the coming years. AC is slower, and because of its use in home and workplace charging (where 90 per cent of charging events take place) is the dominant technology and likely to remain so for the medium term.
The faster DC charging requires more power and substantially more investment in upgrading power grid networks. However, customers will need to be prepared to pay a premium to charge up in a much shorter amount of time.
Successful deployment will be a balance of slower charging at places where people tend to spend time, faster charging when they just want to power up and go, and offering the service at a customer-friendly price point.
The infrastructure value chain
The EV charging value chain is comprised of four main activity areas:
No single industry can provide an end-to-end service across all parts of the value chain, so integrated and collaborative work between players in many sectors is required.
Players looking to succeed in the EV charging market need to act fast, but then be prepared to wait. EV charging is not yet profitable, but this should change once a tipping point of two million EVs is reached.
Models seen elsewhere
Public charging infrastructure holds the key to EV uptake, but it is unprofitable in the early years of EV adoption. A number of business models have emerged that address the need for planning; finance; installation and management of the charging networks.
The three main models are:
The opportunities are vast and varied thanks to the different ways EV drivers can access charging. Companies looking to enter the space should get going now, and then be prepared to wait. The viability of business models will depend on a variety of factors. The most successful entrants will have deep pockets, or strong partnerships − ideally both.