Automated and Electric Vehicles Bill (Second sitting)

Karl Turner Excerpts

Committee Debate: 2nd sitting: House of Commons
Tuesday 31st October 2017 Public Bill Committees

[The Chair]

Welcome to our afternoon session. We will now hear oral evidence from the Society of Motor Manufacturers and Traders, the RAC Foundation, the Petrol Retailers Association and the Institute of the Motor Industry. We have until 3 pm, when there may be votes. Would the witnesses please introduce themselves for the record?

Steve Nash: I am Steve Nash, chief executive of the Institute of the Motor Industry.

Brian Madderson: I am Brian Madderson, chairman of the Petrol Retailers Association, which is part of the Retail Motor Industry Federation.

Steve Gooding: I am Steve Gooding, director of the RAC Foundation.

David Wong: I am David Wong, senior technology and innovation manager of the Society of Motor Manufacturers and Traders.

[Karl Turner (Kingston upon Hull East) (Lab)]

Q 87 Thank you very much indeed for attending. The Minister suggested on Second Reading that the Bill would deliver a cost saving to people who are insured on automated and autonomous vehicles, because they will be safer. Do you think that that is correct? Will insurance be cheaper?

Steve Nash: I will kick off, if you like. Right now, electric vehicles can cost anything up to 50% more to insure than comparable vehicles that are not electric. There are couple of reasons for that. An element of that is the cost of the vehicle, but a large part of it is the relative lack of skilled people to work on them. The insurers, naturally, load the premium because they expect to pay a higher cost to get the vehicles repaired, but provided the right mechanisms are in place to ensure a competitive market to service and maintain those cars, there is no reason they should be more expensive. In fact, if you take it to its logical conclusion, with sufficient fully autonomous cars on the road, accidents should go down.

Steve Gooding: May I echo that? It is a question of penetration—the number of autonomous vehicles out there. In the transition, when there are still a lot of conventional vehicles, someone in a driverless car might be a lot safer but will still face the risk of someone colliding with them. In the early stages, because of the technology built into the vehicle, that might be quite an expensive accident, which might put premiums up. In the longer term, however, as Steve says, as we see greater penetration, a lot of the human error that is the cause of crashes on the roads today will be ironed out by the technology.

David Wong: On the basis that 94% of all crashes involving a fatality are put down to human error, and that the modelling we published two years ago suggests that connected and autonomous vehicles are expected to save 2,500 lives and contribute to the avoidance of 25,000 serious crashes between 2014 and 2030, we certainly hope that with autonomous vehicles, insurance premiums will go down.

[Karl Turner]

Q Thank you. Do you think that there is a necessity for licensing and accreditation for technicians? Should that be in the Bill?

Steve Nash: I feel very strongly that there should be, on a number of counts. First, we have electricity at work legislation that was put in place at a time when electric vehicles were virtually non-existent, although it does refer to electric vehicles—believe it or not, it actually tells people to talk to my organisation about them. But it is patently obvious that there is an inconsistency in regulating people who work on mains electricity, which is 240 V, while being happy for anybody to work on a vehicle that could be between 600 V and 1,000 V if we include commercial vehicles. To be really clear and specific, I am not talking about general licensing. I am talking about regulating people to work on the high voltage elements of these cars, not to change the tyres or to do the mundane stuff. These vehicles are wholly different to internal combustion engine vehicles. In the fullness of time, and it will not be that long, quite large numbers of them will start to come out of warranty and find their way into the open market. Right now, only 1% of those who work on the maintenance of vehicles in the whole country are actually qualified to work on the high voltage electrics and they pretty much all work for franchised dealers. Putting a regulation in place would open up the market to the wider industry and provide a standard that everybody could recognise.

[Karl Turner]

Q Why can you not just let the industry get on with it? Why does it need to be in the Bill?

Steve Nash: Because it will not happen. I have been in the industry for 40 years. We have a great deal of support for this from huge independents such as Halfords, from a lot of manufacturers and a great many independent garages. When we talk about the independent sector, it is an indeterminate number, roughly 40,000 businesses, we estimate, but we do not know exactly who is working on cars, because they do not belong to a body. It could be anyone; there is nothing to stop anybody setting themselves up to service and repair these things tomorrow. It will only be when somebody kills themselves—there have been incidents outside this country already of people being killed or seriously electrocuted working on these things. Don’t get me wrong, they are perfectly safe to ride in and operate, but once you get under the skin, if you do not know what you are doing, you are in just as much danger as you ever would be playing around with mains electricity without knowing what you are doing, except that it is potentially more fatal, because it is direct current and it will not throw you off, it will just keep electrocuting you.

It would definitely help the market, because manufacturers will do what they have to do to sell the cars and make sure that their own people are competent, but it will not automatically happen. It is a coin-operated business outside the main dealers. We have investigated what happened when Corgi or Gas Safe were put into place, similarly with the electricity at work legislation. Very quickly you would undoubtedly have had a lot of practitioners who should not have been doing what they were doing back in those days, but very quickly the industry raises to that level and it becomes a competitive market again and you do not get unreasonable costs introduced. We believe that is the right thing to do here. It establishes a common currency across the industry for knowing what competence means.

[Karl Turner]

With Sir Edward’s permission, does any other witness want to comment?

[The Chair]

It is not necessary for all the witnesses to answer all the questions. I am anxious as many colleagues as possible get in. I know the Minister is anxious for his voice to be heard, which we await with alacrity.

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[Edward Argar (Charnwood) (Con)]

Q This is probably more to Mr Madderson. You touched on mandating or not mandating particular solutions. Do you have any assessment, either anecdotal or based on research, from your members? The big retailers may well be able to adapt over time and have different types of fuel supply, charging points, conventional fuels and so on. What is your assessment of the ability to adapt of smaller local retailers of fuel, or your feeling about the impact?

Brian Madderson: They are all extremely interested in this new technology and we, in fact, are providing a route to market for many of the charging point suppliers. They come to our regional forums—Northern Ireland, Scotland, England and Wales—and they appear in our market review book, so there is a thirst for knowledge.

The real problem with the Bill as it is currently written is that in mandating motorway service areas and, indeed, large fuel retailers there is a key missing ingredient, and that is the carrot I referred to before. There is funding for charging points at home, on the street, in the workplace and in other public areas but there is no funding available for the fuel retailers who would like to embrace this technology in order to provide a diverse range of refuelling options for their customers. It is the big rump of the medium to small-sized filling stations right across the country that will find this more difficult, because the investment decision at the present time is not something that banks would support. There is almost no money to come back on a perceived return-on-investment basis. So they are the ones who will be holding back the growth of charging points right across the country—it is not just city-centric.

[Karl Turner]

Q To be honest, I think Mr Madderson has answered the question I was about to ask: what are the carrots? He said it was all stick and no carrot.

Brian Madderson: It does have to be some form of funding, because if you go to your bank and say that you want to put in a charging point that might cost you a lot of money, you will immediately be asked, “What do you see as the return on investment? I’ve got to get my interest back.” They have no idea at the moment, because the market is in such a state of flux. New systems are coming on. I heard of one relatively recently called ZapGo. I do not know whether it is a big runner, but it is looking at putting storage tanks into a traditional forecourt with charging posts, and being able to meter out the electricity on a basis that I am told Her Majesty’s Revenue and Customs would enjoy because you might be able to get fuel duty back on it. This is relatively new. There are all kinds of development in the marketplace, and I think it would be precipitous to ask them to invest 100% of the money now—they could not do it.

[Karl Turner]

Q Could I ask what the average cost is? Am I right to say £50,000?

Brian Madderson: It can be up to £50,000 per instalment. What has been happening is that certain companies have gone along and said, “Look, we will take over that cost but we want from you two parking bays for 30 years on a lease basis.” If you are thinking about 30 years, that is a very long time. It precludes you, as the owner of that freehold property, from perhaps expanding your shop or putting up a new car wash— indeed, from perhaps even selling the property to someone else. So most of them have opted away from that style of investment.

[Mr Hayes]

Q To jump back to your point, Brian—it is nice to see you again, by the way—you will know how supportive I am of small and medium-sized business of the kind you represent. Is it fair to say that the Bill begins a process of spreading the number of charging points by picking on and mandating those larger retailers, but that to get the coverage we all seek there will need to be other mechanisms, because in rural areas, for example, where many of you are based, there might be no large retailer conveniently situated? Can you see the Bill as a welcome start?

Brian Madderson: First, I do not agree at all with any form of mandating because this is interventionist by the Government in a market that is so new and in such a state of flux that there should not be mandating. This is a perfect example of where market conditions should encourage investors to invest in the product that is right for them at the time. Mandating may make them make a false decision, which would prove very costly and certainly not be beneficial for the consumer.

[Graham P. Jones (Hyndburn) (Lab)]

Q Obviously, you represent the motor manufacturers, and I am concerned about the shape and size of vehicles going forward and the adequacy of the legislation. My hon. Friend the Member for Kingston upon Hull here has, I think, a Twingo—do you have a Twingo?

[Karl Turner]

A Twizy.

[Graham P. Jones]

Twizy—that is it. I notice even on the continent, particularly in urban areas, we are getting smaller and smaller electric vehicles and cars driving around. Is the legislation adequate for the type and size of electric vehicle that might come on to the market? What changes do you see, for example? How will an automated vehicle work when you add a trailer to it or make some other changes to it? The shape, size and form of vehicles is probably going to change, as you are well aware, so will the legislation be adequate for those vehicles to be on the road when they are automated—of course, when they are operated by an individual manually, there is a human choice—and the automation is making choices?

Steve Gooding: I will start with a very short answer, as the Chairman seeks, which is no. But that is because this is a very immature market. We do not even have the vehicles in the marketplace yet. Having also driven a Twizy, which is great fun, I think the construction and use standards, based on a mechanical testing of roadworthiness, should be sufficient for most of the concerns you are voicing, but they are certainly not sufficient for guaranteeing the roadworthiness of the autonomous software systems; you are going to need something new for that.

When it comes to the size of the vehicle, again, their crash-worthiness, for example, needs to be tested in the circumstances in which the vehicle will be used. Maybe then there will need to be something in addition either to prevent or constrain what other purposes—whether it be towing a trailer, a caravan or whatever—are appropriate for that vehicle.

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[The Chair]

Q We will continue our session by hearing oral evidence from National Grid, the UK Electric Vehicle Supply Equipment Association and UK Power Networks. Will you please introduce yourselves and say where you are from?

Robert Evans: I am Robert Evans. I am chief executive officer of Cenex and chair of the UK Electric Vehicle Supply Equipment Association.

Suleman Alli: Good afternoon. My name is Suleman Alli. I am director of strategy for UK Power Networks. We distribute electricity to 8.2 million homes and businesses in the east of England, London and the south-east.

Marcus Stewart: Hello. My name is Marcus Stewart. I am head of energy insights for National Grid. We are responsible for the balancing of the electricity and gas networks, and for managing all the energy across the UK.

[Karl Turner]

Q On charging infrastructure, we have just heard evidence from the Petrol Retailers Association, which is very worried about being mandated to have charging points on the forecourts of its members. What is your prediction of what would happen if we did not mandate them to do that? If it was not required by law physically to invest and have them on their forecourts, would they bother?

Marcus Stewart: At the moment, the majority of people who own electric vehicles charge them at home, but there is a limit to how many houses have off-street parking. About 43% of properties do not have access to off-street parking, therefore other forms of charging facilities need to be available. They could be a mixture of charging types at destinations, workplaces, supermarkets, and so on.

From the evidence that we have gathered when we have talked to and interviewed people, key locations on the motorway and strategic network are seen as key enablers for the roll-out of electric vehicles and will help to remove some of the concerns around range anxiety which is seen as one of the main barriers to the take-up of electric vehicles at the moment. Charging and plus charging in particular at key locations across the country will facilitate the roll-out. If you do not have that, it is likely that the roll-out will be slower.

Suleman Alli: I support that. I would say that there is going to be a paradigm shift. It is a bit like when we used to get water from a well and we now get it from a tap in our home. In the same way, I do not think that petrol forecourts will be the only place where we will recharge our vehicles in the future. In our engagement with the marketplace, we are seeing major supermarkets looking at how they can offer fast charging to be a key differentiator for their customers. We are seeing hotels considering the same and local authorities looking to explore how on-street charging can be part of the solution. Based on the engagement we have done, I believe that it will be a much more diversified charging environment: it will not just be petrol forecourts.

Robert Evans: We have members who are very interested to install charge points at these locations. They see them as locations where there will be high utilisation rate and a good economic case for those charge points to be used. We are also talking here about an insurance policy—it is not a mandating per se. If the market does not deliver, the Act gives Government the ability to step in. It is not by definition a mandating until you pass additional legislation.

The members are very interested in installing in these locations, but they are other people’s land. Part of the issue here is the ability to encourage landowners to install charge points at their locations. In some cases it is a fuel supplier, in other cases it is one of the three main companies that operate motorway service areas. You have to recognise that there is a desire to install in those locations, but you cannot put your asset on someone else’s land.

[Sir Oliver Letwin]

Q I am delighted to hear what you say and absolutely agree with you. If the problem of range anxiety is addressed or partially addressed by fast charging at service stations and so on, we are still left with—I think you said—40% of homes that do not have off-street car parking. Have you done any assessment of the kinds of costs involved for the distribution network operators if over the period between now and 2040 there was a roll-out of universal charge points on the street in towns and cities—probably not all areas—where there is lawful parking?

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[The Chair]

Welcome. Would you like to introduce yourselves, please?

Stan Boland: I am Stan Boland. I am the CEO of a start-up company called FiveAI. We are building a driverless car system, which we hope to trial in London by the end of 2019.

Denis Naberezhnykh: My name is Denis Naberezhnykh. I am head of ultra low emission vehicles and energy at the Transport Research Laboratory. We work with industry and Government to help to introduce new technologies such as electric and automated vehicles.

[Karl Turner]

Q I have one really quick question on safety. What are the safety implications for blind pedestrians, runners and people of that nature?

Stan Boland: Safety is the start and finish of whether we can bring these cars on to the streets. A huge amount of attention will be focused on making these vehicles safe, in our case, for use in urban environments, where we will have all sorts of obstacles and agents with all sorts of different behaviours. That really centres on having systems that are able to perceive what is in the scene accurately in 360° and three dimensions and classify what those objects are.

This also talks to predicting what will happen next. We actually have to predict human behaviour, and we have to learn what those behaviours might be ahead of time. Our vehicles will certainly have to be state of the art for perception, but they will also have to be very good at predicting human behaviours. In the case where we identify an object and can tell, just like a human can, that this person, cyclist or whatever it turns out to be has a certain type of behaviour, we will have learnt those ahead of time, and if we are not sure, we will have to propagate that uncertainty through our software and slow down.

The behaviour of these vehicles will be slightly different to that of human drivers, but it will be possible to attain the levels of human safety, and in the long term surpass them, by applying technology. Our systems can pay attention in 360° all the time, and that makes it a bit different to human drivers.

[Clive Efford]

Q What will be the limit of the speed that your vehicles can travel at in an urban area?

Stan Boland: We are kind of hoping that we can operate at normal driving speeds. To be able to do that, it is important that we can predict behaviours. We cannot have a system that is collision-avoidance only, because that would result in frozen robots all over the city and would make congestion worse. What we humans do is anticipate human action. We actually run more than one world in our heads, and are constantly looking to see whether that world is turning into reality or some other world is going to happen. That allows us to merge on to full lanes of traffic, for instance. We cannot just have a system that is collision-avoidance only, because we would make traffic worse. The idea is that we are operating in normal streets with normal road signs at normal road speeds and obtaining and exceeding human levels of safety.