Organisations can reduce the financial impact of electric vehicle adoption by rethinking their sustainable energy strategy says John Hartley of Centrica Business Solutions.
According to our latest research, investment in electric vehicles (EVs) by UK businesses is set to increase by almost 50% over the next two years, exceeding £12 billion.
27% of the 200 large businesses we surveyed expected at least a fifth of their fleet vehicles to be electric by 2022. Over the next two years, business leaders said that average spend on EV adoption is expected to amount to 4.5% of annual turnover.
Despite the strong momentum towards EV, the survey showed that cost of adoption is the biggest drawback. Vehicle costs was a chief concern for 44% of all business polled, and of greater concern than range anxiety (42%) or the increased energy costs from charging vehicles on company premises (37%)
Businesses emphasised the importance of grant funding and tax incentives to encourage widespread fleet electrification.
Inevitably, organisations will significantly increase their total power consumption through EV charging, but it is possible to minimise the financial impact and further increase environmental performance by transforming their energy strategy.
EV adoption requires a new approach to strategic energy planning for businesses and public bodies. To avoid spiralling costs, it is essential to maintain visibility and control over increasing electricity usage.
Extra secure power demand
The need for more electricity to fulfil additional demand from charge points may require investment in new on-site infrastructure to increase electrical supply. This could include upgrades to the grid supply infrastructure, such as an enhanced connection, or the implementation of new on-site generation and storage solutions.
It is essential that the uninterrupted operation of the EV infrastructure is protected. Downtime will have a direct impact on business continuity. The risk, costs and business impacts of a power outage need to be fully assessed and appropriate actions taken to ensure resilience.
On-site energy solutions
Installing on-site generation solutions, such as renewables or combined heat and power (CHP) is a proven strategy for increasing on-site power availability, improving sustainability, lowering energy costs and reducing grid dependency
By combining these on-site generation assets with battery storage, resilience and flexibility is further improved. Organisations can ensure a constant power supply in the face of an increasingly volatile grid, rising energy demand and intermittent renewable generation.
Local energy generation and storage also provides an opportunity to earn revenue from power flexibility via lucrative supply optimisation programmes.
The potential of using energy stored within EVs to generate income from Vehicle-to-Grid (V2G) initiatives is even more exciting. As such, EV owners and fleet operators can charge their cars during off-peak demand periods, then sell any excess stored power when demand is high and financial incentives are most generous. This is a particularly attractive option for back-to-base fleets, where vehicles may be plugged in for longer periods.
Time for detailed preparation
Despite the potential benefits of moving to a distributed energy strategy to support the roll-out of EV charging infrastructure, our survey showed that organisations are under prepared.
Although almost half of the businesses surveyed said they planned to install on-site charging points in the next two years, a significant majority hadn’t invested in energy technology capable of generating the electricity needed for vehicle charging. Just 28% were using on-site energy production, such as solar panels.
There is an urgent need for organisations to develop a plan to meet the additional power requirements of providing on-site EV charging. Planning and implementing the complex EV infrastructure for at-work charging or back-to-base fleets requires specialist technical and regulatory expertise.
Without the right experience and resources available in-house, it’s likely that organisations will need to seek expert support to guide them through the complexity of EV enablement.. This involves integrating the many disparate elements of the project, including software, hardware and energy provision; planning control; regulation, installation; operation and maintenance, etc.
It is advisable to find a technology partner who has experience across the entire value chain and can take a joined up approach to project delivery.
The adoption of electric vehicles (EVs) is no longer a question for tomorrow. For many businesses and public sector organisations, the transition to electric vehicles is now a big opportunity to become cleaner, more sustainable and more efficient.
Further information: www.centricabusinesssolutions.com
Driving out fleet emissions
Electrification of transport is a key part of Centrica’s commitment to reducing its internal carbon footprint by 35% by 2025 and developing a develop a path to net zero by 2050.
As the owner of the third largest commercial fleet in the UK, the company has committed to electrify its 12,500-strong fleet of vehicles by 2030, having already racked up over one million electric miles over the last five years.
Employees are being encouraged to use low emission company cars and by the end of 2018, nearly 500 employees were driving electric and hybrid options. As a lead EV charge-point installer in the UK, Centrica has installed over 75 charge-points across its sites to support employees that choose low carbon transport for their commute.
These combined actions led to an 11% reduction in global fleet emissions and company cars in 2018, saving 4,763tCO2e.