24 Centre for Economics and Business Research Having sufficient charging infrastructure is particularly important as currently many users believe that changepoints can be difficult to find, difficult to use and often may turn out to be unavailable for use or broken when a driver reaches them. This can be particularly disconcerting for disabled users. For instance, it is estimated that there could be around 10 million electric cars and vans that are regularly parked overnight on-street in the UK by 2050. There would be a likely requirement for them to have access to charge points to manage the impact on the UK’s electricity system. It is likely that the increased demand will see electricity usage increase as a result. To minimise such an impact on the required electricity production infrastructure, much charging would have to occur overnight and on low charging tariffs to consumers. The corollary is a need for ubiquitous, low cost, overnight on-street charging. But creating this will involve considerable costs. There is also a need to transform the network to make is sufficiently ‘smart’ and also bolster the network to achieve much higher rates of renewable energy. Without smart charging, CCC modelling suggests that peak demand in 2050 could be increased by 19-26GW (32 to 44% of current peak demand).37 The consensus within government is that flexibility provided by smart charging can reduce the investment needed in the new generation of storage and network infrastructure This will be essential to keep costs low. For instance, smart technology could allow the charging of vehicles at times of low demand such as overnight or on a windy day. When the grid signals low demand or high supply, it can be cheaper to draw power from the grid. Vehicle to grid charging technology could mean that stored energy from EV batteries is pumped back into the grid or buildings when needed. We provide an estimate of all of these additional required investment costs generated by the ban. Over the 2022-2050 period an impact of £98.5 billion is estimated. Infrastructure impacts (£Bn) Total Car Motorbike LGV HGV Investment Costs -98.5 n/a n/a n/a n/a Tax Revenue losses As time goes on, there will be a need to replace lost revenue from the £35bn of annual Fuel Duty and VAT currently generated, or to make commensurate public spending cuts.38 As the fleet mix transitions to be more predominantly made up of EV vehicles, these assessed losses in revenues from the ban will decline – over the 2022-2050 period an impact of £76.8 billion is estimated. Tax revenue impacts (£Bn) Total Car Motorbike LGV HGV Fuel Duty 59.5 35.9 0.7 17.6 5.3 VAT on fuel 17.3 10.6 0.2 5.0 1.5 37 FES2021 net zero compliant scenarios (Consumer Transformation, System Transformation and Leading the Way). https://www.nationalgrideso.com/future-energy/future-energy-scenarios/fes-2021 38 FairFuel UK - Link
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