With this week’s announcement in the U.K. that all new homes in the country will be required to have an EV charging point as part of the country’s EV revolution, it begs the question - should new EV uptake be mandated by the government? As countries around the globe strive for net-zero carbon emissions, largely supported by the movement away from fossil fuel-powered vehicles, will governments opt for the strict policy approach, will they rely on incentives and tax breaks, or will they simply leave it up to individual choice? This week, U.K. Prime Minister Boris Johnson announced that from 2022 new homes and commercial buildings will be required to install EV charging points, according to new legislation. This is the first example of the EV building regulation mandate in the world. The new regulations mean that around 145,000 EV charging points will be constructed in the U.K. every year, preparing the country for the phasing out of petrol and diesel vehicles.
In November last year, Johnson announced a ban on the sale of new fossil fuel-powered vehicles by 2030. This is part of the Prime Minister’s "green industrial revolution" aimed at tackling climate change and creating new jobs in the energy sector.
The government’s Net Zero Strategy hopes to attract $120 billion in private investment by 2030, as well as create 440,000 well-paid jobs in green industries. In support of the energy transition, the U.K. hopes that grants and tax cuts will bolster EV uptake. A $827 million fund has been established to provide electric car buyers with a grant of up to $3335 on the purchase of an EV under the $46,600 cap.
But is encouraging any type of automobile uptake, through the installation of EV charging stations in homes, regressive in a millennial era, where many youths are opting for public transport and car rental rather than ownership? While it is a step in the right direction to ensure enough EV charging points are accessible across the country as the uptake increases, Johnson does not appear to be addressing the call for better public transport links.
Friends of the Earth’s head of policy, Mike Childs, stated of the move, “New housing should also include secure bike storage and access to safe cycling routes and high-quality public transport to provide real alternatives to driving.” Related: Green Fintech Is A New Trend Investors Can’t Ignore
Others are more concerned about the idea of any type of EV mandate. Australia’s conservative Prime Minister Scott Morrison is staunchly against strict EV policy, opting for “choices, not mandates”. Following the COP26 climate change summit, the Australian government announced it would be investing $250 million in the construction in EV charging stations for heavy commercial vehicles, passenger cars and households. However, no timeline has been established for the ban on the sale of petrol and diesel vehicles. While the country expects EVs to make up 30% of all new car sales by 2030, the government has refused to give consumers incentives, such as tax breaks, for making the switch. Yet, others believe that mandates are precisely what’s needed to encourage EV uptake as well as support the long-term goal of net-zero carbon emissions within the coming decades, in line with COP26 pledges by several governments around the world. As oil prices continue to rise, now could be the perfect time to incentivize making the switch.
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There have been mixed responses in other parts of Europe. For example, Amsterdam’s ban on petrol and diesel cars and motorbikes by 2030 will see an outright ban on the driving of fossil fuel-powered vehicles in the city. While some praise the city council’s efforts to reduce pollution, which they deem “a silent killer”, others point out the financial restrictions to making the shift to EVs.
A spokesperson from the automotive industry’s lobby group, the Rai Association, believes the policy is regressive, with “many tens of thousands of families who have no money for an electric car will soon be left out in the cold. [Making] Amsterdam a city of the rich.”
There is uncertainty in other regions of the world on how best to achieve the automotive transition. In the U.S., earlier this year, President Biden asked automakers to agree to a voluntary pledge for at least 40 percent of their new vehicles sales in 2030 to be electric. In addition, Biden signed an executive order with the objective of making half of all new vehicles sold in 2030 electric. However, the United Auto Workers (UAW) union has opposed the introduction of any EV mandates in the U.S., worried that the adoption of such policies could threaten jobs in the sector.
The U.K. is one of the first countries to impose such strict EV-related mandates, setting the bar for other governments aiming for net-zero and the banning of petrol and diesel cars. Over the next year, it will become clear which countries agree to the mandate approach and which choose to use incentives and tax breaks for EV uptake as a lighter alternative to encourage the consumer transition.
By Felicity Bradstock for Oilprice.com
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