Point 4 of the UK Government’s Ten Point Plan announced that the sale of new petrol and diesel cars and vans in the UK will be banned from 2030, ten years earlier than previously planned. Further, sale of hybrid cars and vans with a significant zero emissions capability (e.g. plug-in and full hybrids) will be banned from 2035. Therefore from 2035 onwards, all new cars sold in the UK will be 100% zero emissions.
The government has committed:
- Up to £1 billion to support the electrification of UK vehicles and their supply chains, announcing the first £500 million this Parliament. This will include developing “Gigafactories” in the UK to mass produce the batteries required;
- £1.3 billion to support the roll out of charging infrastructure. This will include installing rapid charge points on motorways and major roads, and more on-street charge points near homes and workplaces;
- £582 million to extend the Plug-in Car, Van, Taxi and Motorcycle grants to 2022-2023 to reduce their sticker price for consumers; and
- £20 million in freight trials to pioneer hydrogen and other zero emission lorries, to help determine a date for phasing out the sale of new diesel HGVs.
The Government has also appreciated that it will need to ensure the tax system encourages the uptake of EVs and that motoring tax schemes are adapted such that their revenue continues to adequately fund public services and infrastructure across the UK.
Cars and vans currently make up nearly a fifth of the UK’s emissions. This Point of the Plan is expected to achieve carbon savings of around 5 Mt CO2 e (metric tons of carbon dioxide equivalent) by 2032 and 300 Mt CO2 e by 2050. The Plan predicts this Point will generate around 40,000 new jobs by 2030, for example through the Gigafactories, each of which could employ up to 2,000 people in highly skilled jobs.
The Plan envisages an extensive network of charge points on motorways and major A roads with more than 2,500 high powered charge points by 2030. This number is expected to jump to a total of 6,000 by 2035, by which point there will be thousands more ultra-low and zero-emission cars and vans on UK roads.
Successful roll out and public acceptance of more electric vehicles will be dependent on their being able to access charging infrastructure. This is acknowledged by the Government in the Ten Point Plan (which rightly identifies a lack of on-street charging infrastructure near homes), as well as through the Competition and Markets Authority’s review of the EV charging sector announced in December. The review will focus on:
- developing a competitive sector, while also attracting private investment for growth; and
- ensuring the public using EV charging points are confident in the service provided.
We have prepared a blog on the CMA review which can be found here.
At present, the EV charging market is highly disaggregated and early adopters of EVs often face challenges finding the right chargers in the right places at the right time. Much of the existing UK charging infrastructure is ageing (thus not supporting the fast charging needs of modern EVs) and lacks compatibility and integration between different networks. For instance, it is common for EV drivers to have to carry a selection of different connectors, and pay for access to multiple charging networks.
Although the Government is keen to encourage investment in improving the UK’s charging network, rolling out thousands of fast charging points is not simple. Each significant new charging site requires a web of commercial agreements relating to property and rights of access, construction and power.
In addition, the back-end digital infrastructure required to manage the charging network will need significant investment in capacity and technology to support the envisaged level of growth. This infrastructure should also be future-proofed to support smart grid management and the ability for EVs and charging networks to effectively ‘talk to each other’. This is essential to support the power and network demands of a much greater proportion of EVs on the roads.
A Delivery Plan setting out key milestones to deliver the phase out dates, a Green Paper on the UK’s post EU emissions regulations and car and van phase out dates, and the launch of a consultation on the phase out date of new diesel HGVs are all expected to be published next year.
The CMA is due to report on the EV charging sector within 12 months, and its recommendations may result in further evolution in this key market.
The contents of this publication are for reference purposes only and may not be current as at the date of accessing this publication. They do not constitute legal advice and should not be relied upon as such. Specific legal advice about your specific circumstances should always be sought separately before taking any action based on this publication.
© Herbert Smith Freehills 2021