26/05/2021

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Future of Energy

Electric vehicles (EVs) will be cheaper to produce than petrol equivalents by 2027, according to analysis released in May by Bloomberg New Energy Finance (NEF). Once pricing parity is achieved, uptake is expected to dramatically accelerate, especially among businesses looking at ways to reduce overall emissions.

Indeed, forecasting by UK Power Networks, as part of its 2021 Distribution Future Energy Scenarios report, predicts a 3000% increase in EVs, with 4.5 million on UK roads by 2030.

"We've already seen big increases in sales of new fully electric vehicles over the past year, with more selling in 2020 than all previous years combined," says Ian Barnard, Commercial Analyst at E.ON Drive UK1. "The removal of the 'benefit in kind' taxation for company EVs introduced in April 2020 certainly contributed to this (compared to 20-40% tax on petrol/diesel company cars). And this year at just 1%, that incentive is likely to again support more corporate EV purchases."

Certainly, ever-increasing numbers of organisations are committing to switch their fleets to EVs and/or invest in on-site EV charging as part of wider net zero strategies (see box below).

Working within capacity
Along with the cost of EVs, the charging infrastructure that enables EVs is an important investment for businesses. The government’s Workplace Charging Scheme offers up to £14,000 of support. But when it comes to installation, working within existing site electricity capacity restrictions, using smart charging and even tapping into vehicle to grid (V2G) opportunities are all key considerations.

"When we work with any customer, we look at dynamic load management as part of their charging infrastructure, to ensure the site can accommodate the additional energy demand within its existing capacity in the 'smartest' way," explains Shenaz Ahmed, Project Manager in the E.ON Drive UK team.

"Often, a business rarely hits peak capacity more than once a month, and sometimes only a few times year. For example, during really hot or cold periods when air-conditioning or heating equipment is working at full power. But with a dynamic load management system, we can make sure we continuously work within authorised site capacity and manage 'smart' charging requirements as part of this."

The smartest way to charge
Smart charging will then automatically draw on power to 'refuel' vehicle batteries at the most cost-effective time or tariff. For example, late at night once domestic demand drops.

V2G is another consideration for commercial fleets where a large number of EVs are parked on-site when not in use. "As well as charging at the lowest-cost times, you can also factor in generating revenue by discharging any stored power from your vehicle batteries back to grid, or even to power your own building, during periods of peak grid demand," explains Shenaz.

"Using an algorithm, charging and any discharging can be managed around peak periods – usually between 4pm and 10pm – ensuring that vehicles are always fully charged for when they are needed, e.g. by 8am the following morning."

For V2G, car choice is as important as charging infrastructure, as not all models have V2G capability. "Nissan currently leads the way with its Leaf car and ENV200 van, but other manufacturers are catching up," explains Shenaz. "So if V2G may be important to your business, it's worth exploring how the vehicle types you require can support this."

On-the-road refuelling
As well as on-site charging, public charging availability is another key concern for many businesses. "For companies wanting to transition fleets to EVs, the ability to charge while out on the road is, of course, a major consideration," says Ian. "For example, if you have engineers out travelling long distances to visit customers all day, you don’t want them to struggle to 'refuel'.

"Public infrastructure is certainly improving. Tesla currently leads the way, with its network of high-speed public chargers. This probably explains why the Tesla Model 3 was the fourth best-selling car in the 'new-plate' month of March 2021 (out of all cars – not just EVs). But the availability of commercial chargers is also growing. There were nearly 23,000 public EV chargers in the UK as of 21 April 2 with an additional 2,015 installed in Q1, including 379 rapids. It has been widely reported that charging stations now outnumber petrol stations by more than two to one."

 

    The UK firms leading the EV revolution - Thousands of UK companies are already making the transition to EV fleets or offering charging facilities at their sites. Here are just a few recent examples.
  • Amazon has committed to switching to a 100,000-strong all-electric fleet by 2030, and has already installed 800 chargers across its UK sites
  • John Lewis and Waitrose have pledged to integrate 1,300 EVs into their delivery fleets by the end of 2021, and phase out all diesel and petrol vehicles by 2030
  • Both KFC and McDonald’s are planning to install rapid EV chargers at hundreds of their UK restaurants, and Premier Inn is set to offer 300 across its hotels in the biggest EV charger roll out in the UK hospitality sector
  • Water company Severn Trent has committed to converting its transport fleet to electric by 2030
  • Tesco has announced plans to decarbonise its fleet within the next eight years, including switching to electric home delivery vans, plus installing 2,400 charging points for customers across 600 stores
  • Dixons Carphone Warehouse plans to switch its commercial fleet to electric by 2030
  • DPD currently operates the largest EV delivery fleet in the UK, with 700 EVs on the road in 2020, and is working to further electrify as suitable vehicles come to market.


1npower Business Solution, part of the E.ON group
2 https://www.gov.uk/government/statistics/electric-vehicle-charging-device-statistics-april-2021/electric-vehicle-charging-device-statistics-april-2021

 

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