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          Government policy is critical to electric power shift

          It is the beginning of the end for the internal combustion engine as legislators across the globe clamp down on the sale of fossil fueled vehicles and electric vehicles present themselves as a viable alternative.  Provided the right legal and commercial conditions exist, there is the opportunity for a real power shift in the world of commercial transport.  

          Date: 03/10/2018

          Enthusiasm for the shift to electric vehicles is reflected in our survey of 250 business leaders asked about attitudes towards new transport technologies. Forty five percent of respondents in the UK and Europe think that electric vehicles have the potential to revolutionise the transport sector. A total of 76% of total respondents believed that electric road vehicles will become commonplace in commercial transport within ten years.  The UK market has seen a 30% increase in the registration of electric vans from 2012 to 2016 with the result that, in 2018, there are 155,000 electric vehicles in the UK.  These trends certainly suggest that the logistics market is moving away from fossil fuels at a brisk pace.  

          The market's ongoing conversion to electric is not solely due to market forces.  Continuing government subsidy and increasing state regulation of petrol and diesel vehicles also has an impact.  However, despite the growth in business investment in electric power, the transport industry still has concerns, with continued worries over range and battery longevity being ranked by survey respondents as the greatest barrier to the adoption of electric vehicles. This suggests that government intervention is still required and it may explain the uneven distribution of charging points across Europe with the UK lagging behind other northen European Countries. 

          Electric vehicle technology is both fragmented and lacking in variety.  Although the number of vehicle types available is increasing, the variety of vehicles is stunted in comparison to conventional vehicles.  This is in contrast to the wide variety of charging technologies and varying specifications.  One example is the proposed "Megacharger" from Tesla, which, it is claimed, will be able to provide up to 400 miles of range in just half an hour. In future, these chargers might be provided at a haulage vehicle's origin or destination point.  Improved charging technology such as this could allay the worries of hesitant industry adopters through increased point-to-point efficiency; the vehicles can be recharged during loading, unloading and breaks.  

          However, it seems that wholesale industry support for one single charging system over another competing technology has yet to evolve. The UK Government has recognised this and has stepped into the void with the new Automated and Electric Vehicles Act 2018 (the "2018 Act") – which empowers ministers to make regulations governing the performance of electric vehicle charging points.  Whether or not the UK Government will mandate the adoption of a "Megacharger" or some similar technology remains to be seen but standardising on an effective, high-speed charger should help accelerate the adoption of electric commercial vehicles. Effective dialogue between government and industry is therefore required in order to strike a balance between the standardisation of charging technology and the commercial need for fast charging capabilities.  

          State involvement to encourage uptake is showing no signs of stopping. This, combined with positive industry feedback seen in our survey, suggests that the drive towards affordable electric vehicles is well underway.  

          Battery powered electric vehicles may be supplemented by electrification of the road itself. We see state involvement as being key to the development of this technology with national and regional governments looking to facilitate, fund or procure test projects.  Trials have already begun. In 2015, the Highways Agency began an 18 month scheme to trial charging lanes. Vehicles were fitted with wireless technology so that electricity could be transferred from road to vehicle through induction.  While testing is underway, this technology is still expensive and ultimately difficult to implement, requiring extensive reworking of roads.  

          Conductive electric road technology is a more viable prospect - this technology envisages a physical link between the vehicle and the road itself.  Sweden has already seen trials of this conductive system utilising electrified Scania trucks.  The Swedish government has been cooperating with the private sector for some time to allow trucks to act as electric vehicles when on the electrified road and then continue to run as regular hybrid vehicles when not.  

          This technology does show promise and could have huge implications for the long distance haulage business with cost effectiveness being felt in the long term as hauliers replace their existing diesel fleet. However, as with other electric vehicles, the success will depend on the sector's ability to produce them affordably and to a commercially viable scale.  

          The drive in the electric vehicle market, whether battery powered or road-conductive based, is still very much driven by government incentives. This is likely to continue as the world adapts to electric transportation.  Where there is a will it can be done - just look to China where Shenzhen has managed to electrify 18,000 busses – compared to London's comparatively disappointing 200. 

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          Key areas of the report include:

          • AI at play: The benefits of using artificial intelligence in transport are clear, but can it live up to the hype?
          • Big data, big opportunities: The adoption of data analytics has grown exponentially, but concerns over security and privacy remain.
          • The Block-chain game changer: This nascent technology could change the face of commercial transport, but only once its full potential is unlocked.
          • Power Shift: With the advancement of electric vehicle fleets and the development of electric roads, is this the end for fossil fuels?

          Related people

          Martin Gallaher

          • Partner // Head of Public Sector (Scotland) // Head of Projects: Road, Rail and Aviation