An EV Explainer

The transport sector still accounts for a quarter of EU carbon emissions, mainly coming from road transport. Direct electrification is playing a leading role in decarbonising the sector with electric vehicles (EVs).

What is an electric vehicle?

As suggested by the name itself, electric vehicles is a mode of transport based on electric propulsion. These include light-duty vehicles – mainly cars and motorcycles – and heavy-duty vehicle – buses, trucks and vans.

Other off-road vehicles, such as ships, ferries can also be directly electrified although the majority of modes still run on fuels.

Yet, the vehicle is only a marginal part of the e-mobility ecosystem, which is populated by multiple actors from several sectors. Let’s explore who the main players are.  

What is the role of electric vehicles in our climate objectives?

Less than a month ago the European Commission had laid out its ambition for the 2040 climate targets. The Communication leave no doubt: the future of the transport sector is electric.

According to the Commission’s related Impact Assessment, in particular, the transport sector undergoes the strongest growth in final electricity consumption between 2021 and 2040, attributed to the large development of electric transport.

Transport emissions drop by 69-78% compared to 2015, primarily due to large-scale deployment of electric vehicles in road transport in all scenarios, along with a further switch from fossil fuels to e-fuels and advanced biofuels in maritime, aviation and road transport. Importantly, e-fuels are clearly pointed to aviation and maritime. The emission standards for cars and vans with the notorious internal combustion engine ban from 2035 onwards seems to be the main driver for electrification, and the same goes for heavy-duty vehicles (HDVs) where the newly adopted target of 90% emission reduction by 2040 is the key element.

In terms of sectoral breakdown, Eurelectric’s 2040 analysis shows: Overall, final electricity demand in the transport sector will increase over the period 2021 to 2040 by a factor of 8 with no major differences between scenarios. In absolute terms, final electricity demand in transport increases from 60 TWh in 2021 to 180 TWh in 2030 and 505-510 TWh in 2040, respectively. In absolute terms, final electricity demand triples by 2030 (from 60 TWh in 2021 to 180 TWh), and then almost triples again (505-510 TWh) by 2040.

The electrification in the transport sector increases from around 1% in 2015 to 19% in 2040 and 27-28% in 2050. This is 30% in 2040 and 60% in 2050 in Eurelectric’s RePowerEU scenario. Electrification is more dominant in the road transport sector. The share of BEVs increases to 57-58% in 2040 and 79-80% in 2050 in EU’s car stock. In terms of share of electricity in energy consumption of passenger cars, it is around 31-33 % by 2040 and 60-70% by 2050. In Eurelecrtric’s RePowerEU scenario, in 2040, there is around 30 % electrification and in 2050 there is 80 % electrification in passenger road transport sector. EU’s scenarios have given considerably higher importance to hydrogen (6-7 % in 2040 & 18-21 % in 2050), e-fuels* (10-18 % in 2040 & 23-25 % in 2050) and biofuels (21-23 % in 2040 & 22-23 % in 2050) in the transport sector.

How much will it cost?

In the transport sector, annual investment is expected to increase to about (euro) 870 billion but to remain broadly constant as a share of GDP, at around 4.2%.

Who are the main actors in the e-mobility ecosystem?  

 

The e-mobility system is an entirely different world form the one of internal combustion engines (ICE). It is an ecosystem that depends on widespread collaboration among multiple actors enabled by advanced digitalisation.

These include original equipment manufacturers (OEMs), charging point operators (CPO), e-mobility service providers, power transmission and distribution grid operators, utilities and most importantly the final consumer.

Let’s learn about their roles one by one.

Who are the original equipment manufacturers (OEMs)?

Original equipment manufacturers is a company whose goods are used as components in the products of another company, in this case automakers.

Who are charging point operators (CPO)?

As defined by Driivz, a Charge Point Operator (CPO) is “an e-mobility industry player that builds EV charging sites, installs hardware from a variety of electric vehicle supply equipment (EVSE) vendors, and ensures optimal ongoing EV charging operations. CPOs also provide and manage the charging network infrastructure, the backend EV charging and energy management software, and the communications between the backend system and the chargers.”

Who are e-mobility service providers?

As explained by EV Box: “E-mobility service providers (EMSPs) are concerned primarily with front-end service, connecting EV drivers with charge stations (and thus CPOs) whilst ensuring an accessible and rewarding customer experience. By engaging with an EMSP’s service – oftentimes through an app and subscription – customers gain access to a wide pool of charging stations under one plan, rather than many”.  

Who are EV service providers?

“An Electric Vehicle Service Provider (EVSP) delivers end-to-end EV charging, handling both charging station operations and the driver experience. The EVSP oversees the IT technology systems – including the EV charging and energy management system – required for, managing, controlling, and optimizing the EV charging operations and experience.

EVSPs offer EV charging services to address multiple charging behaviors: on the road public charging, residential charging, workplace, fleet depots, and more.” - Driivz

Who are distribution system operators (DSO)?

As detailed in our page, DSOs are distribution system operators in charge of managing our electricity infrastructure and ensuring security of supply. There are over today who make sure electricity is efficiently carried from Europe’s power lines directly to around 300 million European households and businesses.

European system operators manage around 10 millions kilometres of power lines and supply around 2800 TWh of electricity per year. DSOs are regulated companies, meaning that their activities and financial resources are overseen and regulated by National Regulatory Authorities to ensure the cost-efficient, reliable and secure development and operation of their networks.

Regulators, utilities and CPOs are working together on challenges, such as how to get a charger to a multi-unit dwelling so that every resident who needs to charge can do so, or how much power and infrastructure is needed to support the charging demands of eHDVs.

Automakers and utilities are putting in place educational programmes to address skill gaps. Utilities are also working with investors to build and finance new renewable energy capacity. Automakers are partnering with technology providers to support EV drivers in finding fast-charging stations much more easily, enhance EV driver security or develop new solutions, such as usage-based insurance products, that could reduce insurance premiums for the customer.

What is the role of utilities in the EV ecosystem?

The ability to charge EVs and the ability to control EV consumption for load management purposes — are fundamental to maintaining the pace of the transition. Utilities have in-house electric engineering acumen, deep knowledge of electrical load on local distribution and transmission lines, and existing commercial power-supply relationships. Together, these capabilities will help them to address complex EV charging needs.

Though utilities are lynchpins in accelerating EV adoption, success hinges on five imperatives:

1. Develop a clear vision and overarching strategy: Utilities must align with internal and external stakeholders on the role they will play in shaping the new energy future. EV initiatives must not be siloed within or across organisations.
2. Connect customers better, faster and more cheaply: As EV adoption scales, infrastructure connections must be made proactively, digitally and seamlessly to support consumers and fleets with their electrification and net-zero ambitions. Delays and unexpected costs for grid connections will impact charging infrastructure rollouts.
3. Engage with EV customers: Utilities must establish themselves as trusted advisers to customers, both before and after they buy an EV. From real-time decision-making tools on their websites, to incentivised V2X and managed-charging programmes, utilities can enable customers' EV transition in ways that support both the operational grid needs and the desired environmental, social and governance outcomes.
4. Build a robust ecosystem: Utilities must partner strategically with customers, automakers, CPOs, regulators and governments. They must collaborate with research organisations and with providers of data analytics and intelligent grid platforms. Strength and value will come from pooling knowledge and resolving challenges jointly as the energy and transportation industries converge.
5. Take advantage of funding now: Financial support is available to advance e-mobility and infrastructure rollout. Development and grant applications should be submitted now to pilot and scale programmes.

Supported by regulation and standards to support decarbonisation, the emobility transition is headed in the right direction. Now, as we shift the dial and the horizon becomes clearer, the conversation hones in on the details of what needs to happen, at grid level, to make the transition work functionally and equitably for all.

 Which policies are supporting EVs uptake in Europe?

The Renewable Energy Directive (RED) mandates real-time access to basic battery and EV information, including state of charge, state of health and capacity. Manufacturers must provide this information to battery owners, users and third parties, without discrimination or cost.

The Alternative Fuel for Infrastructure Regulation (AFIR) promotes a competitive and open market for EV charging. It mandates ad hoc charging at publicly accessible charging points without the need for a pre-existing membership or a contract with an infrastructure operator, as well as the provision of information for users on the availability and location of charging infrastructure.

The Energy Performance of Buildings Directive (EPBD) mandates pre-cabling and recharging points for EVs, to ensure that the ‘right to plug’ becomes a reality and that building owners, tenants, managers and third parties have access to their buildings’ system data for smart and bidirectional charging.

The European Sustainable Battery Regulation sets requirements for sustainability, safety and labelling of batteries as well as requirements for end-of-life management. It also sets targets for collection, recovery and recycling, with specific goals for different types of batteries. As detailed by the Commission, this regulation will ensure that, in the future, batteries have a low carbon footprint, use minimal harmful substances, need less raw materials from non-EU countries, and are collected, reused and recycled to a high degree in Europe. This will support the shift to a circular economy, increase security of supply for raw materials and energy, and enhance the EU’s strategic autonomy.

The Data Act provides high-level principles for data sharing across sectors. As these are high-level principles, the subsequent proposal on access to in-vehicle data needs to set out that manufacturers must enable easy and non-discriminatory access to all relevant battery data by the EV user.

The in-vehicle data act, whose proposal is expected from the Commission this year, will establish mandatory provisions to openly share the data generated by the electric vehicle which is today own by OEMs.

EVs run on power but their hidden fuel is data...

EVs data is kept in silos today as a valuable commodity for car manufacturers’ competitive advantage. This is hampering the efficiency of the entire e-mobility ecosystem. Opening access to data across e-mobility service providers, charging operators, EV makers, and grid operators, can optimise their services, cut costs, and improve EV users’ experience.

How to break this data lock?

Eurelectric together with EY will launch a joint report on how to accelerate EVs uptake in Europe with data interoperability at EVision 2024 on 6-7 March at Autoworld in Brussels. Stay tuned!