2023-04-23 22:07:01
Earth Day celebrated last week reminds us once once more of the urgent need to change course to protect the environment and ultimately humanity from the negative consequences of climate change. The sixth assessment report of the Intergovernmental Panel on Climate Change (IPCC), recently published by the United Nations, also warns that the pace and scale of measures needed to combat climate change are not sufficient at present.
One of the most urgent problems to be solved is that of the transport sector. Transport is currently responsible for 26% of CO2 emissions in Europe and, while other sectors have succeeded in reducing CO2 emissions, emissions have increased by 7% in the transport sector compared to 1990. Investments Targeted solutions are urgently needed to transform existing infrastructure to enable rapid decarbonisation, the shift to electric mobility being a prime example. Europe is on the right track in EV adoption compared to many other regions, but still needs to close significant gaps in terms of EV manufacturing, supply chains and technology. installation of charging stations.
Europe accounts for a third of the world’s electric vehicle fleet and is home to a fifth of charging stations. In the third quarter of 2022, European sales of electric vehicles accounted for 11.9% of total car sales in the EU, compared to just 2.4% three years ago. Industry estimates suggest that this share will rise to 29.9% by 2025 and reach 70.7% by 2030, with the aim of achieving the EU’s ultimate goal that all new car sales will be zero emissions by 2035. However, this expansion of Europe’s electric vehicle fleet marks a significant divergence between electric vehicle sales and the installation of electric vehicle charging infrastructure on the continent.
In our opinion, the following points must be taken into account:
- The number of electric vehicles in circulation per charging station – The 2014 Alternative Fuels Infrastructure Directive (AFID) regulates the deployment of public electric vehicle supply facilities and recommends EU member states to reach 10 electric vehicles per public charger by 2020. With the exception of the Netherlands, Italy and Greece, all major EU countries have not yet reached this figure.
- Current expansion measures must take future demand into account – Despite accounting for less than a tenth of the total electric vehicle fleet in the EU, the Netherlands has almost a third of the charging station infrastructure. In this country, the infrastructure of charging stations is being built in anticipation of the growth in the use of electric vehicles.
- Advantages of fast charging stations – Spain and Portugal have managed to increase their average consumption of KW per electric vehicle significantly compared to the EU average by guaranteeing a greater number of fast charging stations, which can serve a greater number of electric vehicles than slow charging stations.
Meeting the EU’s sectoral target for reducing greenhouse gas emissions by the end of the decade will first require 42.8 million electric vehicles to be on the road in the EU d ‘by 2030. Secondly, the weekly installation rate of public charging stations for electric vehicles in the EU must increase from around 1,000 in 2021 to more than 20,000 by 2030. This would imply an average installation of 5,600 to 14,000 charge points per week between 2021 and 2030. As it stands, the weekly charge point installation rate is around one-sixth slower than the conservative ACEA scenario, which projects the installation of charging points by 2030.
To achieve these objectives, the necessary investments will have to be divided between charging infrastructure, the modernization of electricity distribution systems and transformers for e-mobility purposes and the increase of energy production capacity. renewable. While investment models have matured and governments have provided support in the latter two areas, funding for the charging infrastructure itself has not kept pace.
The lack of capital to meet the significant need for charging stations is partly explained by the absence of government support to guide infrastructure investors, by the fact that the sector is akin to a “Wild West” with players of all shapes and sizes pursuing different strategies and by the fact that few charging stations have the infrastructure characteristics that investors find attractive from a portfolio allocation point of view, namely the guarantee of long-term, low-volatility defensive returns.
Initiatives to mobilize private capital are urgently needed. Although more and more capital is flowing into charging infrastructure, it is far from sufficient to achieve the required level of expansion and advance the necessary transformation on Europe’s roads at the desired pace.
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