Competition analysis of the EU-27 & UK recharging market
The number of public recharging points has been steadily increasing, from about 90,000 in 2016 to over 450,000 in 2022. However, the growth of EV recharging deployment (31% CAGR) has not kept pace with EV adoption growth (50% CAGR), leading to an imbalance between EVs and available rechargers. There is substantial variation in performance across Member States, classified as “nascent,” “in-development,” or “developed” based on EV penetration and adequacy of recharging infrastructure.
Industry value chain and key stakeholders
The key stakeholders in the public EV recharging ecosystem are Charge Point Operators (CPOs) and eMobility Service Providers (eMSPs). CPOs manage the physical infrastructure, while eMSPs handle digital end-customer services. Different business models have emerged, including pure-plays, expanding incumbents, and state-owned suppliers.
Operators can offer comprehensive services or specialize in specific recharging segments. The convergence of CPO and eMSP models enables improved consumer experience and direct relationships with EV drivers. The industry also involves EV manufacturers, energy providers, and regulatory bodies.
Regulatory and public support overview
The European Union has established regulations, such as the Alternative Fuels Infrastructure Directive (AFID) and subsequent packages, to foster the interoperability and growth of EV recharging networks. National and local strategies also play a role as the sector matures, focusing on consumer needs, target achievements, and sector-specific regulations.
An update to the AFID, called the Alternative Fuels Infrastructure Regulation (AFIR), aims to create an interoperable recharging network and promote the growth of the EV industry in the EU.
Overall, regulations are becoming more favorable to competition, the rollout of recharging points follows EV adoption, and there is a transition from monopolistic/oligopolistic structures to more competitive ones in the CPO concentration.
Assessment of potential competition concerns across the EU27 + the UK
Competition concerns in the EV recharging market are categorized into exploitative conduct, unilateral conduct, exclusionary conduct, coordinated conduct, and considerations around public funding.
Exploitative conduct may occur due to local market power, leading to price discrimination and higher access fees in less competitive areas.
Unilateral conduct concerns revolve around market “tipping” and potential first-mover advantages, although regulation and entry opportunities mitigate such concerns. Exclusionary conduct arises from vertical integration between CPOs, eMSPs, energy suppliers, and local authorities, with integration into energy suppliers and local authorities being areas of potential concern.
Coordinated conduct focuses on horizontal agreements between CPOs, CPOs granting access to eMSPs, and agreements with roaming platforms.
Public funding considerations revolve around ensuring fair competition and avoiding distortions caused by state aid or subsidies.
Address competition concerns, promote a competitive market
Regulatory authorities and competition agencies in the EU27 + UK should actively monitor and enforce competition rules. They should ensure non-discriminatory access to recharging infrastructure, promote interoperability among different networks, and monitor the behavior of dominant players to prevent abuse of market power.
Promoting competition can be achieved through measures such as facilitating market entry, encouraging new business models and innovative solutions, promoting open access to data, and fostering cooperation among stakeholders. Regulatory frameworks should be flexible enough to accommodate technological advancements and changing market dynamics while maintaining a level playing field for all participants.
Conclusion
To achieve Net Zero goals, a smooth transition to EVs is crucial, requiring a dense and accessible recharging network. Healthy competition among various ecosystem players is vital for supporting this transition.
Competition is expected to drive innovation, lower prices, attract private investment, and improve service quality. The EV sector is generally progressing well, although there is heterogeneity across the region in terms of development. While some competition concerns may arise as the sector evolves, the current state shows no major issues. Higher concentration levels are often observed in early-phase and expanding markets.
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