Price cap means 20% rise for home EV charging
The latest news from the world of EVs
Hello and welcome back to The Fast Charge, a weekly British EV newsletter.
In today’s edition… bad lobbying, good lobbying, plus the energy support scheme and what it means.
More immediately, I’ve written a short note on the passing of the Queen last week.
As ever, if you have any thoughts or feedback, please do drop me a line at firstname.lastname@example.org or simply reply to this email.
HRH Queen Elizabeth II, 1926 - 2022
I don’t believe I can start today’s edition without mentioning the passing of Queen Elizabeth II. It is difficult to think of anyone else in the world who dedicated themselves so much to constant public service as she did.
The Queen’s death came on an already huge day for this country, as the government unveiled one of the largest economic interventions in decades, the energy support scheme. More on that in the news sections below.
The funeral of The Queen will be held next Monday 19 September – which will be a bank holiday. Until that time, you would be wise not to deliver any announcements that interrupt a nation in mourning.
It was the right decision of the organisers of World EV Day, which was meant to be last Friday, to postpone the activity until a more appropriate time.
The Queen leaves behind one hell of a legacy, and protecting the environment played a significant role in her life. At her Platinum Jubilee - which thankfully we were able to celebrate - it featured prominently in rich imagery across Buckingham Palace. At the event, Prince William delivered a speech saying the Queen had spent decades “making the case for taking better care of our world”. And she did.
Even as far back as 1989, The Queen said in her Christmas message the "future of all life on earth depends on how we behave towards one another and how we treat the plants and animals that share our world with us.”
She held dozens of patronages and had links to many environmental charities. Her love of the natural world was captured in a now iconic 2018 TV programme with Sir David Attenborough.
More recently at COP26 in Glasgow, her message to attendees was praised saying “time for words has now moved to the time for action.” She also spoke of the “source of great pride to me that the leading role my husband played in encouraging people to protect our fragile planet lives on through the work of our eldest son Charles and his eldest son William. I could not be more proud of them.”
The Queen was even once in this newsletter after attending the Edinburgh Climate Change Institute in 2021. When she arrived at the event in a plug-in hybrid Range Rover, she remarked “it’s an electric car” when greeting her welcoming party with that signature smile. We didn’t know it then, but what better times they were.
I’m certain the impact of the Queen will be felt for centuries to come and her son will continue as a strong ambassador for environmentalism. God Save The King!
Latest EV news…
ENERGY SCHEME: After announcing the long-expected energy price cap, the government yesterday shared a few more details on how it would work. In short, from 1 October 2022, the Default Tariff Price Cap will be frozen at £2,500 for the next two years – this is instead of rising to the dizzy £3,549 previously revealed by Ofgem. That’s a whopping saving for the average household, though do remember – because people overlook this in the news – that doesn’t mean you won’t be charged more than £2,500 a year, if you use lots of energy you’ll have to pay for it. Read more.
WATT RATE? The actual unit prices consumers will face in October will be set at 34p per kWh for electricity on domestic bills, with a standing charge of 46p, and it will be 10.3p per kWh for gas, with a standing charge of 28p, all inclusive of VAT. See useful explainer here.
WATT ABOUT EVs? With the average unit rate being 34p per kWh, it will remain cheaper to run an EV than an internal combustion engine on average. However, it will still mean a 20% increase above the current rate of 28p per kWh from 1 October. In real terms, if you are doing 4 miles per kWh, this equates to the price of 200 miles moving from £14 to £17 if charged at home. The two caveats here. Firstly, if you charge at home overnight on an off-peak tariff, it will continue to be vastly cheaper to recharge your EV even with the recent price rises. Secondly, those using the public network will continue to attract higher costs. Hopefully, this extra detail will put an end to some of the reporting happening over the weekend, namely that charging an EV is more expensive than a petrol car. Even the consumer group Which? now says it will be cheaper with an EV.
WATT ABOUT BUSINESS? One of the more elusive parts of the energy scheme, which is awaiting further clarification, is what support there is for business. Thus far, the government has said it will fix energy costs at the same price per kWh as households for six months. A review would then be expected within three months, but more details are promised soon. Read the factsheet.
WATT ABOUT NETWORKS? I think this will depend on the detail we’re expecting on business support, but my read of the situation is there could be scope for charging networks to utilise the Energy Markets Financing Scheme, if in distress. The joint Bank of England and Treasury scheme will provide short-term financial support to firms operating in UK wholesale electricity markets. The aim would be to ensure resilience in the market and hopefully keep prices down for consumers. I would encourage you to read the short note on GOV.UK, but it is likely going to be a last resort scheme and involve an assessment process for claims.
WATT NEXT? We need more detail from the government, though naturally during official mourning I would not expect a great deal. After the Queen’s funeral next Monday, it is expected the Chancellor, Kwasi Kwarteng, will hold a “fiscal event” on Thursday 22 September. Note that it’s not a budget, as there’s no report by the Office for Budget Responsibility, which provides independent forecasts and analysis of public finances. Expect a short statement about how the Truss government has taken swift action to protect people from soaring bills, plus an array of tax cuts such as, reversing the NICs rise, ditching the rise in corporation tax, and potentially cuts to VAT and business rates. Read more.
WATTS WRONG? Worryingly, Chris Skidmore MP – Chair of the Environment APPG – has been commissioned by Truss to conduct a review into “meeting our Net Zero commitments in the most economically-efficient way”. This has been seen by some as part of Truss’ supporters muscling in to cut away the green agenda. Skidmore explained: “I've been asked to report back by the end of 2022 so no there's time to lose. I will be saying more very shortly about the terms of reference and how people can get involved.” See the tweet.
GOOD LOBBY: Speaking of VAT cuts earlier, the FairCharge campaign led by Quentin Willson went to the Treasury last week to lobby officials for a reduction in VAT from 20% to 5% on public EV chargers. Willson wrote about his trip on LinkedIn including why it’s important. He concluded, “The UK has the talent and potential to lead the world in electrification. The Treasury must not be allowed to sabotage this bold ambition by hiding behind an outdated piece of VAT legislation written 20 years before electric cars were even on sale.”
BAD LOBBY: On the flip side, an interesting story yesterday about how large housebuilders privately lobbied the government to ditch rules requiring EV chargers to be installed in every new home in England. The documents, which were seen by The Guardian’s Jasper Jolly, revealed concerns by the builders that the new policy – which was ultimately enacted by the Johnson administration last year – would cost too much, leave homeowners with old technology and risk electric shocks to drivers. The campaign group Transport & Environment said on the documents: “It’s absurd that housebuilders attempted to hold back progress and slow down the drive to net zero. In the future, all cars will be electric, and futureproofing new homes with charging infrastructure is an obvious step to take.” Read more.
OPEN VACANCY: The EV Association for England is hunting for a Marketing and Membership Officer. The advert went live a week ago and the successful candidate will “support the building of EVA’s membership growth strategy, owning digital email and social media marketing channels, helping to build brand awareness, whilst driving customer acquisition & retention as part of the overall marketing strategy”. The salary is £24k and would suit a first or second job seeker. Details here and do forward on. Team EVA England is great.
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SUPER FAST: An interesting battery development. StoreDot, the Israel-based start-up developing extreme fast charging batteries for EVs, has started shipping EV cell samples of its ‘100 miles in 5 minutes’ technology to automotive partners and potential customers. This includes Daimler, VinFast, Volvo, Polestar, and Ola Electric. On the announcement, StoreDot’s Chief Business Officer said: “We confidently continue with our strategic goal of providing 100 miles of range with just 3 minutes in 2028, and in 2 minutes of charging within a decade.” The company says it’s on target for mass production of its technology by 2024. Read more.
NEW PARTNER: Amazon-backed electric vehicle maker Rivian has forged a deal with Mercedes-Benz to make electric vans in Europe. Apparently, the two companies plan to build a facility at an existing Mercedes factory in central or eastern Europe to manufacture two new electric vans, one for each brand. This reminds me of that old Twix advert, where the fingers were made separately. Production will begin after 2025. As an FYI, Rivian remains in talks with the UK government to build a factory near Bristol. Read more.
LIQUID STATE: An interesting article in the FT suggests solid-state batteries, which will help improve range, safety and charging times for EVs, are further away than we all thought. According to Hiroaki Koda, who heads a joint battery venture between Toyota and Panasonic, the liquid-based lithium-ion battery will continue to dominate for the next 10 years. The reason being is that the technology is still developing, and the current liquid versions are improving. Read more.
NEW NAME: Interesting news from Americaland, the EV charging company Electrify America has created a new speed class for their rapid chargers. Whereas previously chargers delivering 150kW or more were called ‘ultra-fast’ chargers – similar to us in the UK – they will now designate those with speeds above 350kW ‘hyper-fast’. This is based on user research to make it less confusing, allegedly. Read more.
VAN FEATURE: As a forewarning, I’m planning an in-depth look at the commercial vehicle sector in a couple of weeks. The context is, looking at the data, sales of electric vans still stray vastly behind personal cars. Even the government is worried it’s off target, hence them having left a grant scheme in place. And it’s not like the options aren’t here, plenty of e-vans are available. But there are lots of challenges for businesses and fleet managers going electric, not least the initial outlay costs and concerns about chargepoint availability. So, if you’re reading thinking you’ve got something to say on this, please do get in touch.
VAN LIFE: Speaking of vans, last week Ford revealed details of its E-Transit due for release in 2023. It looks brilliant and I absolutely loved one of the press images Ford shared to highlight the E-Transit’s interior (below).
This image is to show off the van’s tilting steering wheel that can double as a desk, or lunch station. And, obviously, if you own a van your lunch is going to be a fast food burger with a large drink of pop. All that’s missing from this caricature is a copy of The Sun open on the dash!
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