Four Major Trends in the eMobility Industry in 2022
Despite supply constraints and COVID-19, there are now almost 20 million passenger EVs on the road, 1.3 million commercial EVs, including buses, delivery vans and trucks, and over 280 million electric mopeds, scooters, motorcycles and three-wheelers. (Electric Vehicle Outlook 2022, BloombergNEF)
1. Governments increase their influence on the e-Mobility industry
Around the world, governments at all levels are taking a “carrot and stick” approach to accelerating the transition from ICE vehicles to EVs and the infrastructure required to support them.
The “carrot” typically takes the form of incentives such as subsidies and tax credits. The German government offers grants up to €9,000 plus tax reductions for fully electric passenger vehicles, €40,000 for small to medium-sized electric trucks and up to €500,000 for heavy-duty trucks. The US federal government offers up to $7,500 in tax credits for qualifying plug-in electric vehicles (PEVs), and California announced a $3.9 billion package that includes funds to put 1,000 zero-emission cars, 1,000 school buses and 1,000 public transit buses on the roads.
Governments also use the “stick” of policies and regulations that can only be met by adopting EVs. The European Commission has announced a package of policies intended to reduce greenhouse gas emissions that requires a 55% reduction in the average CO2 emissions of new cars by 2030 and 100% by 2035. New regulatory targets in the European Union and the United States now aim for an EV share of at least 50 percent by 2030, and several countries have announced accelerated timelines for ICE sales bans in 2030 or 2035. In the US, California intends to end the sale of ICE passenger cars in 2035.
2. Bolstered by government funding, private companies drive growth in the EV charging infrastructure
Lack of charging infrastructure is a top barrier to EV adoption, especially in the US and the UK. Even though most EVs are charged at home or work, roll-out of public charging is critical to supporting EV growth. And even with government funding, private enterprise will be the mainstay in making this happen — and there’s ample room for opportunity.
In 2021, there were more than 1.8 million publicly accessible chargers globally, the majority of which are in the EU, UK or China. To meet future demand, EU regulations call for a ratio of 1 public charger per 10 EVs and will require member countries to install charging points every 60 kilometers on public highways.
In the US, there are 46,000 public charging stations and 120,000 charging points to serve 1.3 million EVs on the road. That sounds good, but the chargers are distributed very unevenly across the country, with most in California. President Biden’s infrastructure plan (still pending legislative approval as of this writing) calls for spending $7.5 billion on a network of 500,000 charging stations, and California is offering up to $70,000 in rebates and up to $40,000 cash per fast charger installed at new sites.
3. Electrification of fleets
Electrification of fleets (buses and light, semi and heavy commercial vehicles) continues to expand. The explosion of home deliveries during the pandemic helped boost plans for electrifying fleets of “mid-class” trucks and vans over the next two years. Already the major players – Amazon, FedEx, UPS, and DHL – have electric vans on the street with orders in for more.
These last-mile vehicles are particularly well suited to electrification because they serve predictable routes and travel fewer than 50 miles a day, well within current battery range. Early adopters of EV fleets have already realized 20-25% cost savings from greater efficiency, more affordable “fueling” and reduced maintenance.
School and public transit buses have similar profiles, putting them high on government priority lists for electrification. Along with last-mile vehicles, buses can be charged overnight so they are ready to go in the morning. But that will require building smart EV charging depots that can manage charging and manage energy consumption, for example staggering charging and balancing loads to avoid overloading the local grid.
Electrification of heavy freight trucks (HFTs) is a longer term endeavor. The effort will require developing high-capacity batteries and the charging infrastructure to support them, both at depots and along the highway. Efforts involving both the CHAdeMo association and CharIN are underway to develop standards for megachargers (above 1 MW), with other industry players working on harmonizing standards globally to facilitate HFT roll-out.
4. Integration of renewables and battery storage with EV charging infrastructure advances
Sources of clean and renewable energy from solar and wind are increasingly being integrated into the grid by utilities around the world. Utilities are also allocating green energy to eMobility service providers to charge electric vehicles, further reducing the impact of hydrocarbon-based energy sources on the world.
As the rate of EV adoption increases, public charging networks, fleet operators and campuses will need to meet demands for energy without incurring high demand charges or putting undue demands on the power grid. Smart energy management that balances the allocation of power between chargers is one alternative.
Integrating onsite renewable energy generation, typically from solar panels, into the charge point’s power supply can supplement the energy drawn from the grid. Another approach is integrating battery storage systems into charging stations. EVgo, the largest fast charging network in the US, is an early adopter of using batteries and smart energy management to provide a stable EV charging service. Power is fed into the batteries from the grid during low demand/low cost times or from onsite renewables, then released to charge EVs during peak times. It’s the same principle as vehicle-to-grid (V2G) charging, where batteries – in this case, in the EVs themselves – store power during off times and feed it to the grid during peak demand.
These are a few of the trends that are already gaining traction across the industry as key players such as charge point operators (CPO), eMobility service providers, utilities, and governments work together to advance the adoption of electric vehicles. The benefits will be realized by the public and the environment as the industry grows.