The UK Government’s decision to ban the sale of all petrol, diesel and hybrid cars by 2035 is a welcome stride towards achieving ‘net zero’ emissions by 2050. And it has also inspired a surge in the development and production of Electric Vehicles (EV). However, questions still remain regarding the current suitability and potential evolution of the charging infrastructure to support this rapidly expanding area of the automotive industry.
The property industry has a key role to play in safeguarding the rollout of these charging facilities, but the market can be confusing with a lack of transparency or regulation for developers to rely upon.
The majority of current EV owners live in the main urban centres but numbers are set to increase rapidly throughout the UK. While the current charging infrastructure can support existing levels of EVs, experts agree that matching growing demand will require urgent and adequate development.
Home or work charging is sufficient for more urban or peri-urban areas but the need for ultra-fast networks and chargers outside of urban centres, where travel times tend to be longer, will be essential.
Most forecourt operators are now building out-charging points as standard across their portfolios, however, there is a lack of visibility, which is hampering public awareness.
The UK currently does not have an overall installation plan and location services such as ZAP MAP are only able to identify sites that have already been installed and are operating.
The inability to calculate the types of charger or the number required are set to hinder full scale infrastructure rollouts until the data can become more accurate.
EV and charging infrastructure companies are now looking to adopt a more strategic approach to analyse large amounts of usage data in a bid to pinpoint optimal locations and to standardise the technical specification.
This ‘chicken and egg’ scenario requires a degree of fluidity from developers that must be supported by policy makers to facilitate the projected expansion. Simplifying regulation and the licencing process would help to reduce overall cost and remove uncertainty for potential investors.
Alongside the traditional professional and residential markets, there is massive potential in sectors of the property industry such as tourism, retail or leisure. Here EV charging points can enhance an existing amenity and be a further draw for potential customers. The market standard fast and rapid chargers can take anywhere from 25 minutes to five hours to complete a full charge, leaving EV owners ample time to enjoy on-site services or facilities.
For real estate owners or developers looking to partner with an EV charging operator, it is vital that landlords do their research before committing. The majority of current models for financing and operating charging points tend to follow the same path as the mobile phone mast or photovoltaic (PV) sectors. Owners lease space to an operator, who shoulders the costs of the infrastructure, grid connection and installation for an annual rent. This can of course be varied to incorporate rents based on profit or income but, as with the phone mast and PV sectors, income can vary greatly depending on location and demand, therefore these types of lease are rare.
Landlords also have the option of purchasing and installing the infrastructure themselves to maximise income, however, issues with type, number and power can be a serious concern. There are additional risks around grid capacity or overload, not to mention financial burdens.
When installing units into existing properties it is vital that due care is given to recouping the associated costs as well as the ongoing liability for the electricity itself. In cases where landlords have chosen to partner with an EV charging operator, the upfront investment can be recovered from the users directly. This may have unforeseen effects on future disposal options, for example security of tenure, so it should be managed appropriately.
If undertaking the installation privately, landlords need to be mindful of some key points, depending on whether the property is multi- or single-let.
For multi-let properties, care should be given to the Service Charge, ensuring that the relevant charges for installation, maintenance, repair and electricity are all recoverable from the tenants. Additionally, the landlord will need to ensure that the existing leases reserve sufficient rights to vary, close or reduce the parking facilities to incorporate the charging infrastructure.
Special attention on single-let properties should be given to the tenant’s ongoing repairing and insuring obligations as well as specific reinstatement and yield up requirements at the end of lease.
Looking ahead, it’s imperative to add more regulation and transparency to the process so we can encourage investment across the property industry. The EV sector is not a fad and ensuring we have a solid foundation in place on which to roll out the required infrastructure will be vital.