Market Insight – What is in store for the Western Europe e-mobility industry?
The current state of e-mobility in Western Europe
Western Europe, including the Nordics, is the world’s second-biggest e-mobility market after China, with Germany and Norway currently leading the way in EV adoption. Electric vehicle sales have surged by 50% in 2019 alone, and sales of EVs are expected to reach 6.3 million by 2025 in the region.
However, clear disparities can be found between countries, usually depending on how involved and engaged a government is with the development of the industry. In the European Union (EU), only 12 countries offer incentives to stimulate EV sales, while over 75% of the 185,000 public charging points currently available in the region can be found in just five countries: the Netherlands, Germany, France, the UK and Norway.
How is this likely to change in the next decade?
The EU aims to become climate neutral by 2030 and the decisions taken in the next decade will be crucial if this target is to be achieved. As transport represents 27% of Europe’s greenhouse gases emissions, there is now a clear focus on accelerating the adoption of EVs.
2020 is expected to be a turning point for the EV industry, with sales of hybrid and fully-electric cars expected to grow by 35% by September, and estimated to be between 33 million EVs in the current policy scenario and 44 million in the climate-neutral one in 2030.
However, there was a clear chicken and egg problem for the EV industry during the last decade. Not enough people were buying EVs because of the lack of charging infrastructure, leading to delays in the deployment of large-scale charging networks as there weren’t enough drivers to justify the investment.
Providing charging infrastructure that grows alongside EV adoption is the key enabler for the growth of the EV industry. Fortunately, technology advances have managed to bring down the price of EVs, while improving the efficiency of EV charging infrastructure. Besides, legislation changes in response to the climate emergency will trigger more significant investment from governments across countries.
Driivz Insight: what is needed for exponential growth?
A recent study by Transport & Environment (T&E) demonstrated that a fifteen-fold increase in public charging points is needed to sustain the rise in EVs and help the EU meet its 2030 climate-neutral target. Concretely, the increase in public charging infrastructure should lead to 3 million public charge points being installed across the EU by 2030.
This exponential increase in charging points will have to go hand-in-hand with developments in EV charging and energy management software. In addition, as EV charging networks expand and gain in complexity, features such as roaming and vehicle-to-grid (V2G) communications will become essential.
Roaming will create more joined-up charging networks and will ensure seamless and reliable charging within and across countries for drivers.
With the futures of the energy and mobility industries being interlinked, V2G technology is in a good position to be the next major trend for the EV charging industry.
For adoption to fully take off, EVs need to be seen as more than simply a means of transport. As battery storage devices, they can be used to balance the grid, ultimately alleviating the cost of producing and distributing power.
Western Europe will remain one of the most promising markets for the future of the EV charging industry. It will lead the way over the next decade in terms of establishing a new ecosystem and partnerships between businesses and public organisations, as well as technology advancements.
One of the main challenges for Western Europe will be to alleviate disparities within countries if the EU wishes to reach its ambitious climate targets, and to guarantee a pan-European deployment of EVs and EV charging infrastructure.