At the end of October, Ministers and Director-Generals of Energy and Mobility from the Pentalateral Region (Belgium, the Netherlands, Luxembourg, France and Germany), CEOs and experts came together to understand how electro-mobility can accelerate the energy transition. Reducing vehicle emissions is one thing, but a vast number of “batteries on wheels” can also enable rapid grid expansion. IRENA were one of the experts, and their analysis says smart charging can reduce distribution grid investments needed for the uptake of EVs by between 40% to 90%. However, before we get to the vast numbers we need the infrastructure and the policies, explain Dolf Gielen and Francisco Boshell of IRENA and Guy Lentz, Coordinator for EU and International Energy Policies for Luxembourg. Their review of the conference covers a very wide range of issues, from charging infrastructure (public and private), planning permission, cross-border compatibility, pricing that works for both businesses and consumers, battery recycling, to the prospects for slow-charging and fewer cars. Pentalateral manufacturers like Volkswagen and Renault are already investing billions, so the policy makers need to start getting ahead of the game.
The Pentalateral Energy Forum consists of the Benelux (Belgium, the Netherlands, Luxembourg), France and Germany. In more recent years Austria and Switzerland have joined the discussion. The Forum has been for the last 15 years a blueprint and a flagship in electricity market integration and successfully worked in closer cooperation in the transformation of the regional power sector. This year, under the Luxembourg Presidency of the Benelux Union, the work has expanded to the transport sector with a focus on electromobility.
The Presidency organised a Ministerial Meeting in cooperation with the Benelux secretariat and the International Renewable Energy Agency (IRENA) on 21-22 October. Ministers and Director-Generals of Energy and Mobility from the Pentalateral Region, CEOs and experts discussed strategies how to accelerate the energy transition through electro-mobility. HE Claude Turmes, Minister for Energy and Spatial Planning of Luxembourg, chaired the conference. “This Conference was unique in interconnecting for the first time two different dimensions in a high-level regional policy discussion. On the one hand we had the spatial dimension, to use the regional cooperation to accelerate the development of electro-mobility. On the other hand, we brought the cross-industry sectorial dimension, to collect the perspective from car manufacturers, electricity sector and infrastructure development actors (charging points) on their respective challenges and work with a harmonised and common-goal based approached for the Pentalateral Region”, HE Turmes said.
Within this context, four sessions focused on the rollout of electromobility, the charging infrastructure, the electromobility-renewable power nexus and the enabling policy frameworks.
EV sales are growing
A first aspect that was discussed is the market growth. The Pentalateral region is a global leader in electromobility with 730,000 electric vehicles in operation (plug-in hybrids and full battery electric vehicles). This represents around 12% of the global electric vehicle fleet. A growth is foreseen to 4-5 million vehicles by 2025. In 2019, on average 2.8% of sales in the Pentalateral Region are electric vehicles, a share that has grown from year to year over the last decade. Rapid growth is foreseen in the coming decades.
More ambitious targets
Countries in the region such as France and the Netherlands have ambitious objectives to phase out Internal Combustion Engines sales by 2030-2040. Luxembourg is aiming to grow from less than 1% to 40% EV fleet share by 2030. One has to see in the coming years if all these ambitious goals are met. It’s already certain that Germany will miss its target of 1 million EV in 2020. An interesting case is Switzerland where consensus building, and dialogue has been applied instead of target setting, with good results. Wallonia was the only region present without deployment targets.
The Conference highlighted how appropriate policy measures on electro-mobility may have a quick impact on the markets. In April 2019 the European Parliament and the Council adopted the Regulation (EU) 2019/631 which sets the ‘CO2 emission performance standards’ for new passenger cars and new light commercial vehicles in the EU after 2020. From 2021, the EU fleet-wide average emission target for new cars will be 95g CO2/km. Such a CO2 limit makes the case for electric-vehicles as the only available option at present to comply with this limit, but electricity fuelling those cars must be renewable. Therefore, deployment of electric vehicles must go hand in hand with a faster penetration of renewable power in the electricity mix.
Consumer concern: price, range, battery recycling
As a result of this policy, European car manufacturers such as Volkswagen and Renault have made massive investments towards commercialisation of new electric vehicle models, which are more affordable and with increased autonomy. The focus is to tackle two of the main concerns from consumers around electromobility, the cost of EVs in comparison to conventional cars and the driving range anxiety. An additional concern from car owners mentioned during the discussions is the impact of battery manufacturing and disposal. It was noted that there are approaches to manufacture and disposal, including second-life and recycling, of batteries in a sustainable manner; but there is an urgent need for a regulatory package at European level on best practices for battery management.
Buses, vans, trucks
Buses and trucks were discussed during the event as well, with a clear electrification strategy for city buses and delivery vans but divided opinions regarding the prospects for electric long hall trucks. But some producers were confident this is the way ahead in combination with massive 2MW charging stations.
Public charging stations
A second aspect is the new charging infrastructure requirement for such transition. Today 75-80% of all charging operations take place at home or at the office. A lot of effort will be needed to complement this with a public charging infrastructure. Today the region has 123,000 public charging stations and the ratio of cars to charging stations is around 8:1. If this ratio is maintained, around a million public charging stations will be needed.
Today 22-50 kW charging dominates for public stations but the trend is clearly toward fast charging (50-150 kW) or even ultra-fast charging (>150 kW). It’s clear many decision makers foresee a similar system to today’s petrol charging stations as the way ahead, while charging point operators (CPOs) are looking for new business models to make the economic case for slow-charging in public urban locations, as shopping malls or public parking lots.
This debate on the type and location of charging points is a centre of focus from public and private sector alike, as decisions on investments have to be made soon and at large scale. Planning procedures for installing public charging points are often complex and require several months. That’s not consistent with a massive rollout in the coming five years.
Addressing the consumer charging needs is of paramount importance as well. Charging electric vehicles must be an easy, transparent and seamless experience for e-car owners travelling across whole of Europe. Today’s public charging infrastructure emerged as a main cause of consumer anxiety. Inadequate information regarding nearby charging stations, gaps in charging station coverage and especially incompatible and incomprehensible payment systems emerged as a main concern. This is clearly an area where governments need to act as the greater good clashes with the benefits for charging service providers.
Home, office charging. Or fewer cars
Regarding home and office charging systems, issuing permits for tenants is a major obstacle. Especially in cities where many cars are parked on the road, charging can be an issue for further expansion. A right to install charging points near your home or office has been introduced in several places but this is not enough for a full-scale transition. Some questions were raised regarding the future need for cars. Autonomous driving vehicles and better integration of transportation modes through shared information systems may reduce the need for car ownership, notably in cities.
Smart charging enables rapid grid expansion
A third aspect that was discussed is the integration of electromobility and the energy sector transition, the so-called smart charging. A recent report from IRENA illustrates how an uncontrolled charging of electric vehicles may exacerbate the stress on distribution grids, resulting in large investments to reinforce local grids. Mr Dolf Gielen, Director of the IRENA Innovation and Technology Centre, explained at the Conference that “our analysis shows how smart-charging approaches, which is adapting charging cycles via dynamic pricing and digital technologies, can reduce distribution grid investments needed to the uptake of electric vehicles between 40% to 90%.”
In the discussions, companies explained their demonstration projects but the attention on the policy side is so far limited. This may rapidly become an issue. “While incentives for smart charging infrastructure are in place, for example in France, the actual deployment depends on market incentives and ‘smartness’ needs to be better defined to really reap the benefits of the ‘batteries on wheels’. The potential is vast: by 2025 the car battery electricity storage capacity on the road may equal more than a third of the hourly nameplate generation capacity in the region”, Mr Gielen said.
“Route do soleil”: Netherlands to southern France
In terms of cooperation areas, what emerged is the opportunity of compatible charging infrastructure along major routes through multiple countries, for example a “route do soleil” from the Netherlands to southern France.
The discussion allows us to draw some general conclusions for the Pentalateral Region, the Benelux and IRENA and its member states:
- The transportation revolution is ongoing and electromobility will play a key role
- There is an important role for governments to facilitate the necessary charging infrastructure and enable smart charging
- It’s important to work with neighbouring countries to ensure the compatibility of efforts
- Solving charging market issues is nowadays a higher priority than range anxiety
- The consumer needs must be at the centre of the deployment plans for charging infrastructure, making the e-car driving experience comfortable and seamless across the whole Europe.
- More efforts are needed to ensure an infrastructure that is smart charging ready, and it needs to be defined better
- The Pentalateral Region, with its policy and industrial leadership, can move forward at a faster pace than the rest of Europe, paving the way for the next phase of the transport and energy transformation.
- IRENA has a role to play in sharing best practices among countries and continue to advise on the key aspects to be anticipated by decision makers for a successful rollout of electro-mobility in conjunction with their renewable energy plans. IRENA stands ready to work with its members to tackles these challenges. The next edition of the Innovation Landscape report will focus on end use sectors including electromobility.
Guy Lentz is the Co-ordinator for EU and International Energy Policies for Luxembourg