Mobility in the world is changing, and needs to change radically, to secure the future of our planet. Electric vehicles (EVs) and the decarbonisation of transport have an important role to play in this. That said, this alone is not a total solution and a wider, more global perspective is required.
It is a complex subject and one of extreme importance that needs individuals, businesses of all sizes and governments to work together to achieve change.
Alexander Dlouhy and Edward Barratt from international law firm Osborne Clarke are experts in this space. Alexander heads up the decarbonisation practice at Osborne Clarke in Germany. He advises companies and investors on energy and infrastructure projects and transactions, energy storage and infrastructure for mobility and the associated business models.
Edward is a commercial lawyer specialising in rail, public transport and new mobility solutions. He works with investors, asset owners, public authorities and operators to design and implement solutions for transport and mobility businesses. Edward heads Osborne Clarke’s decarbonisation of transport practice and regularly advises on electric vehicles and the structuring and delivery of transport and mobility solutions. .
We caught up with Alexander and Edward to celebrate World EV Day to talk about electric vehicles in the context of new mobility solutions, the importance of effective regulation and how businesses can make a successful transformation to e-mobility.
EDs: How important is it to understand mobility patterns and how do these need to change for a more sustainable future?
Understanding mobility patterns is important to be able to assess which means of transport are currently used, when, how and by whom. In order to achieve the decarbonisation of transport, significant changes in the transport sector are necessary. These new concepts must also meet the current expectations and mobility patterns of the users, otherwise the users will be reluctant to adopt them.
EDs: How important are electric vehicles within all of this, especially in urban environments?
The current transport system has a high environmental impact. Greenhouse gas emissions in this sector have hardly decreased since 1990. A crucial part of achieving the objective of sustainable transport is the further development and adoption of e-mobility and, thus, sustainable mobility. This is especially important in large cities, where noise and fine dust pollution from cars with combustion engines is particularly high.
While electric cars produce reduced emissions and pollutants during driving, the effects of particulate emission from brakes and tyre wear are still significant. Excessive car use (even when EVs) may also not be conducive to the creation of better urban spaces. So while electric vehicles have an important role in reducing greenhouse gas emissions they need to be part of a holistic solution involving better public transport and enhanced travel choices for users.
EDs: What do you think will help with the mass adoption of electric vehicles?
A variety of issues need to be addressed. Establishing a comprehensive charging infrastructure is crucial. Also, technical improvements to enable higher charging speeds and reducing the degradation of batteries will be needed. Furthermore, e-mobility needs to become more climate-friendly. For example, improvements are needed to make available green electricity and circular economy mechanism for the batteries.
In order to achieve the goal of more electric mobility, a consistent regulatory approach and viable funding measures for electric vehicles need to be in place.
The long-term user proposition for electric vehicles is fast becoming more attractive although the current spike in electricity prices is a challenge. The development of integrated mobility solutions should support the mass adoption of electric vehicles and help transform how we travel.
Public authorities have key roles to play in defining the landscape within which this change takes place and developing regulation which supports sustainable change in a way that is attractive to users and the public in general.
EDs: What significant regulatory measures would you highlight as supporting the transition to electric mobility?
In 2016, the German government decided on a purchase premium for electric cars, in which the German government and the manufacturers participate. Up to 6,000 euros are granted for electric or fuel cell vehicles and up to 4,500 euros for a rechargeable hybrid electric car.
In addition, further tax incentives for electric vehicles came into effect at the beginning of 2020, for example, through special tax write-offs for electric vehicles and cargo bikes, a reduced tax base for the taxation of electric company cars or the tax exemption for charging private cars at the employer’s facilities. In addition, the erection of charging infrastructure was subsidised.
Across Europe, gas reduction quota (GHG) quota could also lead companies to provide more charging point infrastructure. For example, under German law, electricity taken from the grid by final consumers for the use in electric vehicles can be credited against the GHG quota obligations of those fossil fuel distributors. Operators of charging infrastructure can commercialise the use of electricity in electric vehicles as part of the so-called GHG quota trading regime.
EDs: Can this help to incentivise companies to go electric?
In Germany, these measures definitely helped to promote electric vehicles. The number of electric vehicles on the streets increases constantly. Growing demand has led to a wait of up to 9 months for a new vehicle. Also, the used car market is picking up speed. The subsidies for charging stations are always used up within a short time.
EDs: How has Germany ensured that there are sufficient charging points for electric cars to support demand?
The construction of and provision with the preparatory cable infrastructure and charging infrastructure for electromobility in buildings is regulated by the German Building Electromobility Infrastructure Act (GEIG). This act implements the according provisions in the EU Building Directive.
It requires that new buildings or in the event of major renovations also existing buildings ducting infrastructure, namely conduits for electric cables, has to be installed – depending on the number of parking spaces of the building. Existing non-residential buildings with more than 20 parking spaces need to be equipped with at least one charging point until 1 January 2025.
Furthermore, tenants have a civil law claim against their landlord to consent to the installation of charging infrastructure, provided that these measures are not unreasonable for the landlord.
EDs: What can be done to reduce consumers’ reluctance to switch to e-mobility?
An important step is to make the charging of electric vehicles easier and more widely available. An interface is needed that can be used to call up charging stations and their occupancy status and other conditions (e.g., showing defective charging stations). According requirements are existing in Germany, for example.
Another example: In Germany, it will become mandatory to enable the users of charging points (erected in the future) to pay by credit card since credit cards are perceived as the standard payment mechanism.
EDs: Do we need to look at a new model that involves several forms of electric mobility in urban areas rather than just replacing ICE vehicles with EVs?
A new type of mobility concept must be multifaceted in order to meet the different needs of users. Urban public transport should not only be limited to underground, tram and busses but should also encompass shared cab services and bicycles, including e-bikes. This should be complemented by car sharing offers and public transport hubs allowing an easy switch from private to public transport means.
As a matter of course, public transport systems need to be based on fuels that are greenhouse gas emissions neutral. Thus, public transport must be based on electric or other alternative fuel buses, trams and underground.
EDs: How can mobility as a service (MaaS) help?
MaaS is an approach to supplement transport in individual vehicles with a wide range of different mobility services tailored to demand. It encompasses, among other things, a user-centric approach to public transport, car sharing, bike sharing and ride hailing services.
The aim of MaaS is to offer users means of travel that are optimally adapted to their needs, thus reducing transport inefficiency and the need to own vehicles. This has the potential to reduce greenhouse gas emissions, the need for parking spaces in public areas and the overall volume of traffic.
EDs: One of the big questions, especially in busy city centres, is how we ultimately reduce the number of vehicles on our roads?
In order to achieve the climate protection goals, transport must be significantly transformed. The priority should be to avoid the need to travel in the first place. Less traffic would also lead to less traffic congestion with the according negative effects on the environment.
This should be complemented with a shift to more environmentally friendly modes of transport, increased energy efficiency of the modes of transport and the use of greenhouse gas neutral fuels and green electricity. This means not (only) a reduction in the number of cars but in particular the use of electric cars and car-sharing.
It also means a continued, enhanced role for public transport, made more attractive to users through making rail and bus use part of a mobility ecosystem. Technology is underpinning radical shifts in the way we travel, and with the right blend of regulation and incentives, can unlock transformative change.
EDs: How can individual businesses ensure a successful transition to e-mobility?
From a legal perspective, core elements to get right in any transition to a new e-mobility platform include understanding the options for procurement of any new fleet of vehicles required how this can be financed and, where assets are acquired on a leased basis, howrisks and responsibilities are allocated between customer and supplier.
We also need to look at whether infrastructure upgrades are required and the process for undertaking these, who pays and whether subsidy support is available. Plus, how to manage engagement with electricity suppliers and network providers and other third party suppliers.
This may include assessing how much risk can effectively be transferred to the external provider or be more efficiently managed by the customer and how employees and other stakeholders are managed. This includes how the shift to new forms of vehicle usage can be managed within existing employment and benefits arrangements.
For many businesses, the shift to e-mobility will represent a key transformation project with a significant number of legal components, each of which will need to be assessed and efficiently managed to deliver a successful outcome.
EDs: What are the current trends in electric mobility?
We are currently seeing a run on sites for charging infrastructure at attractive publicly accessible locations, such as shopping centres, with providers installing revenue generating charging infrastructure on leasehold sites.
It is also worthy to note that owners of commercial and residential rental spaces are becoming active as enablers or even providers of charging infrastructure in the buildings – also looking at new possibilities to commercialise parking spaces.
The electrification of fleets is becoming more and more of a business model for service providers acting as providers of charging infrastructure, maintenance and billing services, etc.
EDs: How important is it that both public and private companies come together to achieve a more sustainable future?
In order to achieve a fast and comprehensive transport transformation, it is essential that public and private companies work together efficiently. Only then will it be possible for all modes of transport to meet the climate targets.
This is particularly the case for EVs at the macro level in terms of standardisation, as well as in the development of effective mobility solutions relying on shared use of public space, such as with mobility hubs.
EDs: How important is vehicle to grid (V2G) technology?
Vehicle-to-grid refers to the temporary storage of electricity in the battery of an electric vehicle, which is fed back into the energy system of homes, districts or even the public grid -when needed.
V2G technology has the potential to be an important part of the solution to the climate challenge as it assists in balancing generation and consumption. For V2G and grid balancing to operate to its potential, smart grids and new regulations for controllable consumption devices are required.
So far only a few charging stations or vehicles have the necessary technology. A number of legal and regulatory issues also require addressing before V2G can be used more widely.
EDs: Can this type of electricity sharing reduce greenhouse gases?
V2G technology could help to reduce greenhouse gas emissions by setting an incentive or even enabling the further expansion of renewable energies. A high percentage of renewable electricity generation (namely solar and wind power) is volatile.
V2G technology could serve as an important component to store excess electricity and feed electricity into the grid if the demand exceeds generation. V2G technology has the potential to support the stabilisation of the grid and serve as a buffer between generation and demand.