EV Strategy: (ECC Committee Report)

Baroness Young of Old Scone Excerpts

Wednesday 16th October 2024 Lords Chamber

[Baroness Young of Old Scone (Lab)]

My Lords, I declare an interest as chair of the Labour Climate and Environment Forum. I too am very honoured to have served on this inquiry. I am always amazed by the skill of the noble Baroness, Lady Parminter, in chairing what was a motley crew and her skill this afternoon in being able to name in exquisite detail all the schools we worked with, with no notes whatever. Doesn’t it just make you spit?

Sales of new battery electric vehicles are up—I do not think we should be excessively gloomy. They went up considerably in 2023, but of course that was happening mainly in fleets, and private new car demand for electric vehicles declined substantially during that same year.

I want to deal with four of the issues that have been raised already by noble Lords but perhaps focus on aspects that have not yet been covered. The whole charging infrastructure is the first. There are now 70,000 public charging points and 850,000 domestic and workplace points, and that is still substantial growth. Some 80% of current electric vehicle owners have their own off-street parking, so we must make sure that we do not end up with a situation of haves and have-nots. Equalising tax on charging is really important.

The mixed signals that we got from the previous Government about whether it was going to be a 2030 or 2035 phase-out date did not help the charge point operators—it undermined their prospects of investment. We need to make sure that the clarity around the date of the phase-out—which was in the manifesto, as the right reverend Prelate the Bishop of Oxford mentioned—is honoured and sustained, so that everybody is very clear about the trajectory to which we are working.

There are considerable incentives in place at the moment for charge point installation—such as the rapid charging fund and LEVI, which is a local authority scheme—but they have not accelerated charge point rollout to quite the rate that we wanted. For example, the LEVI rules keep changing, making it very difficult for folk to deal with. There are a number of laggard local authorities that have done nothing since the scheme was opened, and that needs to be subject to government action. Local authorities are key in making charge points available for people who have not got access to driveway parking, and collaboration between charge point operators and local authorities is fundamental. The LEVI scheme and some of the initiatives put in place by the last Government to make it successful need to be continued and looked at, to make sure that they have not been lost sight of in the transition.

The Government have been consulting on-street charging. It would be good to know from the Minister when the results of that consultation are likely to emerge and what is going to happen as a result of them. There is a view that there is a need for Section 50 licences to allow on-street charging to happen, but these are quite expensive and very slow. Why not grant permits to deliver on-street charging in the way that utilities have standing permits to operate the works necessary to keep them moving?

As the noble Lord, Lord Birt, indicated, the rapid charging fund is dragging. It is only a pilot scheme so far. When it is rolled out in full, it needs to include the provision that was in the pilot of having HGVs included. It would be good to hear from the Minister when the full scheme will be introduced.

There is a cross-pavement charging grant, but the guidance on how that will operate has not yet been published. As a result, the money that was set aside for it has literally not been utilised. Can the Minister say what plans the Government have to take forward the cross-pavement charging grant? To be frank, I think that it is not a good idea. I would be much more in favour of looking at how we can ensure that, within communities, there are sufficient accessible charging points, so that people can be assured that they will find one within a decent walking distance of their house, rather than having the prospect of intrusion into pavements by works sponsored by a grant to individuals.

The second point I want to cover is that of upfront costs. The vast majority of people who are buying electric vehicles at the moment are buying them through workplace or other leasing schemes, so I am not as downcast as some previous speakers have been. The second-hand market, which is a really important part of the vehicle market, is struggling. That is partly because of a lack of clarity about depreciation as a result of uncertainty around battery health. I would be grateful if the Minister could tell us what is happening with the support scheme for battery assurance certificates. It has been consulted upon; when will it come about? Could the Minister also tell us how the fairly substantial investment that the Government have put into battery development and initiatives such as solid-state batteries is going?

Commercial fleet operators are key, and the upfront costs of trucks are still very expensive—by a factor of three, compared with diesel. The current government grant schemes are pretty small, so perhaps we need a combination of increased grants and tax incentives, as well as tax disincentives. Disincentivising tax on diesel trucks will help create the market for electric vehicles in the commercial sector.

I turn to one of the bees in my bonnet that the committee discussed: marketing and communications. The reality is that the climate change challenge is one of the biggest that the world has ever faced, yet we do not have a government-co-ordinated marketing scheme for electric vehicles to persuade the public that some of their concerns and fears are being met and are not as huge as they think they are, using modern marketing techniques, social media and all those sorts of things. Under the previous Government, we frequently had Ministers in front of the committee who told us that that was an example of the nanny state and that the Government did not do that.

The reality is that there needs to be a concerted campaign against what is a big disinformation campaign. If you read local and national newspaper reports on electric vehicles, you would think that they are the Antichrist and liable to eat babies if left unattended. Range anxiety is said to cause stress, but range anxiety is rapidly becoming a non-entity. There are groundless fears about spontaneously combusting batteries, and of battery life and resale value. All those fears are not justified by the evidence but the tabloids, and other far more reputable newspapers, continue to peddle them like billy-o. The time has come for the Government to recognise that it is important to take forward a concerted campaign with modern marketing techniques and good information reliably provided to the public, and that this must not be left on some government website for the public to have to seek out. That is long overdue.

I will finish with the ZEV mandate. I do not agree with the noble Lord, Lord Woodley, who is not in his place, that the timescale should be adjusted, although I agree with him that some of the market incentives need to be geared up. We must not forget that it is important to bring in electric vehicles at a greater rate not only for climate change but for the manufacturers themselves. Increasingly, the world is looking for electric vehicles, rather than diesel and petrol. If we are to keep our place at all as an exporter of UK vehicles, we need to make sure that we can meet that requirement and do not see a diminution in the pace of moving our manufacturing capability towards electric vehicles.

I hope that the Minister will be able to give us strong assurances that the Government are not spooked by the manufacturers’ push-back at the mandate, and that there will be a strong campaign for the promotion of electric vehicles and a tweaking of the grants, taxes and other mechanisms, as noble Lords have spoken about today. We do not want to break stride. We need to find ways of addressing the hiccups and bumps in the road that mean that the manufacturers are feeling uncomfortable. We need to meet their legitimate concerns, but not by changing that date.

The mandate is one of the biggest tools in the toolbox. Electric vehicle sales are going up, especially in the lease market. We are seeing heavily discounted prices, which are good for the customer as well as for the climate. If you look at the exact calculations for the 2024 target, which with proper adjustments is about 18.5%, you will see that we are on target to meet it, and therefore should not be panicking now. So let us keep up the pace, drive down the carbon and the costs, drive more feedstock into the second-hand market, and make a real contribution to the huge challenge that is climate change.

No doubt the noble Lord, Lord Lilley, would have hysterics at any suggestion of taxation benefits or subsidy. But the reality is that we are rapidly seeing a closure of the upfront cost between electric and petrol vehicles, and that is as long as the subsidy needs to persist—we are not talking about it being in place for a very long time. We are talking about these sorts of subsidies being time limited by the point when electric vehicles can hold their own in that market.

I also thank the noble Lord, Lord Lilley, for his strenuous efforts on the committee to keep us honest. Many of his points were absolutely admirable, but I think the point at which I parted company from him was this: he does not believe that the costs of not doing this are higher than the costs of doing it, and that climate change down stream has huge costs that are now dreaded by the reinsurance and insurance market, the banking sector and every sensible business. Of course, if you do not believe that, a cost now is a bogeyman, and a cost in 20 or 30 years that you do not believe in is not worth thinking about. It was fun.