Electric Vehicles (EVs) have been around for almost a decade, but a slew of recent technical innovations and compelling tax advantages mean they are growing in popularity beyond a hard core of ecophiles. Many of the major automotive manufacturers have already launched or are imminently planning to introduce mainstream EV propositions.
Initially, the limited and unpredictable range and long charge times meant that EVs appealed predominantly to urban commuters. However, the technology is rapidly evolving, resulting in extended ranges and accelerated charge times of around 20 minutes from empty that its developers claim will be game-changing.
As with any revolutionary model, there are some interesting challenges that could potentially create a significant barrier to commercial success. A seeming lack of a universal plug, echoing the familiar “VHS vs Betamax” or “Android vs iOS” battles, sees various incompatible conductive and inductive connectors finding favour among different manufacturers and regions. So if you’re planning to take your green wagon over to France and stock up on wine at the weekend, you may find your plug isn’t compatible with the charging posts on the other side of the channel when you come to juice up.
While it’s assumed that most consumers will recharge their vehicles at home, this isn’t always possible – if you live in a tenth floor flat, for example, or practical – if you’re planning to travel a distance that exceeds the range of your battery. It is imaginable that major employers could be incentivised to offer charging posts in staff car parks, which could boost environmental and corporate social responsibility credentials.
In the absence of a national public framework, however, a voluntarily co-ordinated approach to infrastructure is required to provide an adequate penetration of charging facilities. Energy retailers are not mandated to provide charging posts – analogous to the way petrol forecourts proliferated as the combustion engine cemented its popularity, charging points look set to play out a chicken-and-egg scenario of supply and demand. If energy providers aren’t proactive in establishing facilities, downstream providers such as the BPs and Essos of the world surely will.
To that end, Ecotricity has entered into an agreement with motorway services chain, Welcome Break Group, to roll out complimentary charging posts on its forecourts. The ostensibly loss-leading gesture of free-of-charge charging overcomes the main hurdles of accurate billing. Ad hoc credit card payments are subject to an assumed level of fraud, while restricting consumers to the charging points of their domestic energy provider would create needless duplication and complexity that would throttle growth in EV uptake. Ecotricity has also joined forces with Nissan in a “glovebox agreement” at the marketing level, which hints at the potential for further collaboration between energy providers and automotive manufacturers.
At SAP, we’re in the fortunate position of working with the likes of BMW and Jaguar Landrover, as well as utilities retailers, and we’re seeing first-hand how natural synergies are emerging between the automotive and energy sectors. Our event-based billing engine, already deployed in several use case scenarios, can enable convergent charging and potentially allow energy customers to pay for their power with a PIN code or magnetic swipe card.
EVs could also play a further, not insignificant role in the pursuit of making smarter use of energy. Consumers who have solar panels should effectively be able to run their cars for free. And thinking laterally, the heavy duty batteries used in EVs offer an interesting application as a storage medium for cheap domestic electricity, acquired overnight to alleviate strain on the grid, which could be drawn down by the consumer while the vehicle is not in use.
What’s clear is that while a lot of the chatter around EVs concerns the rapid evolution of the battery and motor technologies, innovations in charging infrastructure and billing offer potentially lucrative opportunities for differentiation among energy retailers and the automotive industry alike.