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Electric vehicles: utilities and automotives tipped to collaborate

We can expect to see energy suppliers collaborate more with automotive manufacturers and retailers to push solutions in response to the growing electric vehicle market, an expert has said.09 Nov 2018

Lauren Jones, an expert in smart energy contracts at Pinsent Masons, the law firm behind Out-Law.com, said energy companies and automotives can both gain from collaborating on products and services for the electric vehicle market.

"The electric vehicle market is set to grow significantly in the coming years as we move closer to 2040 – the date from which the government has said the sale of new petrol and diesel cars will be prohibited," Jones said. "Today, the market is still in its relative infancy but increasingly we are seeing both energy companies and car manufacturers and retailers looking into electric vehicle offerings. The expertise both utilities and automotives have can be brought together to deliver attractive products and services for consumers."

"Energy companies are well placed to deliver the technologies and tariffs to attract consumers to electric vehicles, while automotives have the expertise to meet consumer expectations over the design, manufacture and sale of vehicles. It makes sense for the businesses to work together and we expect to see new collaboration opportunities being explored in the market," she said. 

Jones was commenting after Scottish Power announced that it had linked up with car retailer Arnold Clark to deliver a 'green' "end-to-end package" for electric vehicle ownership.

In its statement, Scottish Power said the tie-up would allow car buyers at the retailer "to purchase or lease an EV of their choice, book a home charging point installation and sign up to an exclusive 100% renewable electricity tariff as part of the same package". Customers will also be able to utilise 'smart charging' of their electric vehicles through Scottish Power's app.

"This will ultimately allow vehicle charging to be remotely scheduled via a smart phone to start/stop charging at a time that suits day or night, allowing electric vehicle owners to take advantage of cheaper unit rates at off peak times," the company said.

Jones said that the Scottish Power deal shows what is possible, and highlighted Nissan's partnership with Ovo on an electric vehicle and battery storage solution for the home as a further example of the innovative thinking, collaboration and new business models being developed in the market.

A survey earlier this year by Smart Energy GB, which champions the roll out of smart meters in the UK on behalf of the government, revealed that more than third of UK drivers (34%) would be more interested in buying an electric vehicle if they had a smart meter, and 33% said they would be more likely to purchase an electric vehicle if they could program it to charge automatically at home when energy is cheapest.

Jones said that the UK government has set up the Electric Vehicle Homecharge Scheme (EVHS) to help incentivise the take-up of electric vehicles. The EVHS provides grant funding of up to 75% towards the cost of installing electric vehicle charge points at domestic properties across the UK. A similar Workplace Charging Scheme provides grants to businesses that install electric vehicle charging points at their premises.

Jones said that the UK government has also introduced new legislation which is aimed at delivering the infrastructure needed to support the widespread use of electric vehicles.

The Automated and Electric Vehicles Act 2018 enables further regulations to be introduced to require large fuel retailers or service station operators to provide, and make available for use at prescribed times, public electric vehicle charging points. The regulations could also further stipulate performance standards for those charging points and a duty on operators to fix faults and publish information about their charging points, such as their location and operating hours and what the available charging options are.

"The electric vehicle market is in a slight 'chicken and egg' situation at the moment," Jones said. "Many consumers have been reluctant to move to electric vehicles due to underlying concerns about the range of the vehicle batteries and the lack of available charging points, while local authorities and businesses have been cautious with their investment in public charging points due to the relatively low numbers of consumers who drive electric vehicles."

"The government's plans to ban the sale of new petrol and diesel cars by 2040 and the sister targets outlined in its 'road to zero' strategy to move towards 'ultra low' and ultimately 'zero emission' vehicles, together with the overarching climate change targets the government is working towards, necessitate change, however. The technologies and commercial solutions are available to revolutionise the energy and automotive sectors, and we anticipate that these factors will drive innovation and collaboration in the coming months and years," she said.