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Cleaner vehicles and charging infrastructure

In decarbonising the transport sector, we need not only look at electric mobility, but also at transport policy. This is one of the main findings in the discussion paper ‘Cleaner Vehicles and Charging Infrastructure’, published by the World Bank Group. Without a sustainable transport policy, the e-mobility revolution will only lead to ‘cleaner congestion’.

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This policy cannot be one-size-fits-all. Different approaches should be formulated based on geography, level of development, type of (future) travel needs and sources of funding available to countries to support adoption efforts. 

An integrated approach between the transport and electricity sectors

In transitioning the vehicle fleet from ICE to EV and deploying the charging infrastructure, individual countries need to develop their own long-term sustainable EV ecosystem, based on their respective infrastructure condition. This requires governments to consider energy and mobility as part of the same whole, facilitating the transition toward EV’s, deployment of charging infrastructure and supporting the transition toward clean and smart electricity grids. To do this, they need to involve sectors such as energy and real estate from the outset.

Varying investment needs for e-mobility adoption 

The investments needed for transitioning to EV fleets depends on many factors, such as vehicle type, import costs and taxes, registration costs and extended warranty costs.The same goes for the cost of charging infrastructure deployment. This includes both the cost of the infrastructure and the necessary civil works. All these costs can vary widely between different countries and cities. Because of these incongruent circumstances, the roadmaps for government actions and policies should be adjusted to demand creation and supply management, especially in the case of public and shared transportation. To achieve this, the various sectors should plan and coordinate their efforts. The full ecosystem of stakeholders, including civil society organizations, private sector, utilities, and ministries of finance, should be mapped out to get a clear overview of cost structures.

Targeted monetary and non-monetary incentives

When shaping new policy, it is crucial to plan for the long-term in a sustainable fashion. Therefore, EV and charging infrastructure incentives should be not be designed and implemented as one-time policy. 

Source: Cleaner vehicles and charging infrastructure | World Bank Group

Differentiating user groups is important to determine the right incentives. Moreover, the adoption of EV’s should be targeted at vehicle types that are comparable in cost with ICEV’s or in modes that benefit the masses. This could mean that subsidies should be aimed at timebound cost-sharing options for public transport, shared fleets, and two- and three-wheelers.

In this, special attention should be placed on cost-sharing or subsidies for charging infrastructure in the early stages of e-mobility adoption. According to studies, supporting the deployment of charging infrastructure is a cost-effective method to facilitate e-mobility adoption. These subsidies should also be structured in a way to avoid installing charging infrastructure for sheer numbers, but rather for addressing customer charging needs.

De-risking the sector

To de-risk and thereby encourage investments from the private sector, governments need to develop and enforce standards in several areas. Some examples of this are: using innovative financing options like guarantees; establishing standards for interoperability between EV charging infrastructure and standardized payment models; developing local capacities related to EV’s, battery management and electric.

Financial models for public transport and fleet operations

These models range from public led, to private-led and from private partnership models to fleet operator led models. Deciding which public-private model to apply depends on the TCO differential and underlying conditions.

Scaling charging infrastructure investment needs 

Investment needs may scale disproportionately with the size of the EV fleet. To achieve sustainable large-scale deployment of EV charging infrastructure requires an understanding of the power ecosystem and how it would respond to the introduction of new charging infrastructure. Based on this, the needed investments can be identified, ranging from investments in the local power distribution to the high-power distribution network. 

Source: Cleaner vehicles and charging infrastructure | World Bank Group

Installing charging infrastructure comes with a host of complementary actions, including establishing regulations, ensuring availability and augmentation of the electric power grid.

Equity considerations

As mentioned, one-size-fits-all type incentives for the purchase of EVs or deployment of charging infrastructure might only reinforce existing inequalities in the transport sector. Charging infrastructure in particular should be deployed in a sustainable manner to optimise the use of EVs and make them accessible for all.

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Reported by World Bank Group

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