A decade or so from now, will we reflect on how EVs came ahead of the machinery and infrastructure that were needed to make them work. To avoid a modern-day cart-before-horse scenario, we need to manage six essentials that are critical to securing the future of eMobility.
Failure to get these six essentials right, could result in missed net-zero targets or unresolved air quality issues. And, perhaps, wasted investment or an extended eMobility transition period.
Collectively, the ecosystem must unite around these six essentials, which were identified in conjunction with business leaders who contributed to our survey.
1. A resilient supply chain
Demand for EVs is accelerating, but rollout is being hampered by supply chain constraints.
The EV segment has been hard hit by the tide of inflation. And rising minerals prices threaten to slow, or even temporarily reverse, the long-term trend in falling battery costs, which are the most expensive component of EVs.
So, in the short term, the cost of building EVs is going up as demand for key materials increases and as supply remains challenged. Battery shortages, coupled with EV-to-ICE price inequity, present serious challenges to EV sales targets and climate goals.
Europe and the US, which are heavily dependent on imports of raw materials and batteries, primarily from China, are taking production into their own hands. They are moving quickly to manufacture their own EV components. Automakers are investing in the upstream battery market and along the battery value chain. Meanwhile, investment in gigafactories is designed to meet future local demand for batteries and reduce dependency on producing nations. It is a long-term commitment, but securing the supply chain is critical to the ongoing availability of affordable vehicles.
2. Clean and green power
EVs stand to become the biggest consumers of clean and green power, but currently just over 3% of the transport sector runs on renewable energy. Renewable production must increase to both decarbonize the grid and meet anticipated EV demand.
An accelerated transition to cleaner and lower-carbon generation will further improve local energy security and reduce costs to consumers. The US aims for electricity that’s 100% free of carbon pollution by 2035.13 The EU looks to remove hydrocarbons from its energy mix and proposes to increase its 2030 target for renewables from 40% to 45%.14 The key to achieving these targets includes faster permitting and the development of flexibility markets to manage supply intermittency.
3. Accessible charging infrastructure
EV adoption will stall without a public network of fast chargers for drivers who can’t charge at home or at work, as well as for long-distance drivers and those in need of a quick top-up.
To tally with accelerated adoption of EVs, for example, EY estimates that 2.8 million public and destination charge points, and 2.4 million private workplace chargers, will be needed in Europe by 2030. To get close, that means 670,000 new charge points must be installed every year — or 13,000 every week. In the US, over 400,000 public charge points are needed by 2025, with that number rising to over 1.1 million in 2030.
Fast and efficient rollout depends on the removal of regulatory barriers, improved access to land for infrastructure and faster passage via local authority permitting channels. Ultimately, however, utilities must deliver more timely grid connections. And infrastructure must be equitably distributed in the spaces and places where people live and work.