Vehicle Technology and Aviation Bill (First sitting)

Richard Burden Excerpts

Tuesday 14th March 2017 Public Bill Committees

[The Chair]

Many thanks to all of you. We have quite a lot of business to get through, so may I ask that both questions and answers be relatively brief and coherent? Perhaps “coherent” is going too far, but they should be brief and to the point.

[Richard Burden (Birmingham, Northfield) (Lab)]

Q Welcome. The Bill was originally being talked about colloquially as the modern transport Bill—a Bill to look at the challenges facing particularly, but not exclusively, road transport in the decades to come. Parts 1 and 2— those dealing with road transport—focus on two main issues: the insurance liability of automated vehicles and the provision of electric charging infrastructure by big retailers. Do you think those are the right things for the Bill to cover, and are there things that should be in the Bill that are not included?

[The Chair]

Who wants to go first? Not everyone has to answer each question, so please do not feel that the whole panel has to answer.

Steve Gooding: We are pleased to see the inclusion of the provisions relating to autonomous driving insurance, an issue that needs to be gripped. We are also pleased to see that the Government are taking steps to do something about the rather confusing world of recharging electric vehicles—no doubt we will talk about that later. The RAC Foundation would have liked to have seen provisions relating to the creation of the roads fund—a Government commitment that the Chancellor mentioned and that was included in the Budget papers but that is not currently coming into statute. We also support the direction of travel on speed awareness courses and bringing more scrutiny to an area where some of us suspect a bit of an industry has grown up around a bright idea in a way that might have gone slightly too far.

David Williams: From an insurance perspective, we are very pleased to see the Bill. It is essential to have clarity, at this early stage, about the compensation process and about who is going to be responsible in the first instance, so that insurers and motor manufacturers can design their systems, business models and processes ready for it; so we are very pleased. Without that clarity, there is a danger that the public will lack confidence with regards to compensation being available when an autonomous vehicle is involved in an accident. Also, with road transport being a truly global element of our lives, it is good that the UK Government have come up with something at an early stage that hopefully will influence certainly Europe and maybe the US as well.

Denis Naberezhnykh: From TRL’s perspective, we are very supportive of the Bill as it stands, in particular the focus on electric vehicle consumers and users—that is very welcome. Taking steps towards introducing smart charging and managed charging is also very appropriate and timely. Given the forward-looking nature of the Bill, we would like to have seen more consideration for future technologies with regards to charging and vehicles themselves.

David Wong: The SMMT supports the principles underpinning the Bill, and we welcome its provisions. In particular, we think this is the right time for the Government to further encourage the take-up of ultra low emissions vehicles and pave the way towards the deployment of autonomous vehicles. This relates to the insurance framework that is set out in the Bill.

What we would like to see more of in the Bill is greater clarity—perhaps going forward in secondary legislation—particularly on smart charging of electric vehicles. In the area of connected and autonomous vehicles, certainly something on infrastructure and connectivity would have been marvellous, particularly with regards to deployment of connected vehicles.

[Richard Burden]

Q Thank you. That is very useful.

The Government’s target is that all new vehicles on the road should be ultra low emission vehicles—zero-emissions, in fact—by 2050. How far do you think this Bill will contribute to that target? On current trends, we are a long way off that target at the moment. What do you think are the other barriers to the take-up of ultra low emission vehicles, or we could also say—more broadly—connected vehicles? There is quite a crossover between those two agendas. How do you think these other barriers can be best overcome?

David Wong: Let me first deal with ultra low emission vehicles and electric vehicles. The Bill is a step in the right direction. Whether or not the targets are achieved depends on the extent to which we can solve what we call the three As. The first A is range anxiety; the second A is infrastructure accessibility; and the third A is vehicle affordability. Insofar as what the Bill is trying to do, it is crucial to address infrastructure issues, to support research and development and to provide continuing support for consumer incentives to create an enabling environment that will see a greater take-up of electric vehicles. If you look at range anxiety, a lot of it is due to the fact that technology has not evolved today to a point at which the electric vehicle can travel as far on a single charge as can a petrol or diesel vehicle. With greater research and development and Government support—not least in terms of, for example, battery technology—that may be an area that should be addressed for the future.

As for consumer incentives, this is particularly crucial in helping to address some of the issues regarding affordability, which is the second A. The technology itself is still very much in its infancy relative to other technologies, so we need to see continued support from the Government, as well as Government and industry working together closely on this.

The third A relates to infrastructure accessibility. From what we can see, this is a pivotal part of this Bill, and this, again, is a step in the right direction. Accessibility to infrastructure has been a key issue. It is the perception of most motorists that it is already not as convenient for people to charge an electric vehicle, which would take at least 30 minutes using a 43 to 50 kW rapid charger unit, compared to filling up a petrol or diesel vehicle at a petrol forecourt. We need to make it far easier for motorists to charge the vehicles. One of the things we need to do is to address the issue of interoperability of charge points. We are pleased to see that there is a provision for this in the Bill. When we consider the infrastructure from the perspective of the standardisation of multiple connectors and sockets that are available out there, it makes it confusing for motorists. We must not assume that every electric vehicle owner is a tech geek. We want to make electric vehicles as appealing as possible to the mass public. Standardisation is therefore important in making it easy for the average motorist to understand the plethora of technologies available.

[The Chair]

Thank you, Mr Wong. Could I appeal to all witnesses to do two things? The first thing is to be as brief as possible, as we have a lot of business to get through in an hour. Secondly, Mr Williams led the way in demonstrating how one can speak loudly and clearly. It may be my age and decrepitude, but please could you speak as loudly and clearly as you can?

--- Later in debate ---

[Rob Marris]

Q No, it is not that. I am saying that one way of doing it is regulation over the power supply and to say that you have got to make these incentives available for midnight charging. Should that be regulatory, to bring it about, or do you think the market will do that?

Marcus Stewart: I think the market will do that. Suppliers would look at the cost to them of securing more energy and they would look at the opportunities to trade that off against their portfolios. The market should provide that.

[Richard Burden]

Q Mr Evans in an earlier answer described the purpose of the Bill being to take reserve powers to allow stepping in to stimulate the right kind of infrastructure where the market does not provide it already. May I press you a little more on what that is, and on whether the Bill is hitting the right target? The stress within the Bill is on the provision of charging infrastructure by what it describes as “large fuel retailers.”

A lot of the discussion we have had so far has been about the importance of having rapid availability of charging points, and sometimes smart charging points, in a much more dispersed area than what might be described as large fuel retailers—typically, the motorway service areas. Is the emphasis on that right? If it is not the right emphasis, do those powers need to be applied more broadly? If those reserved powers are applied more broadly, what safeguards need to be in the Bill to ensure that unreasonable regulatory requirements are not put on a whole dispersed range of potential electricity suppliers?

Robert Evans: That is a good point. The powers that we are looking at are primarily around the provision of information to the user, the ability to have smart charging should you need it, and the interoperability. Those sorts of questions are dealt with in the Bill and are key topic areas for the industry. On the question of where infrastructure is located, supermarkets are an interesting one. We have a situation in which not everybody has off-street parking. When one comes to a place such as London, it is not practical to put charging all down London streets. Supermarkets become an extremely practical, pragmatic place for charging to be accessible, along with retail shopping centres, in a crowded city such as London. The consideration of that, along with motorway service areas, which is about allowing people to travel distances across the UK, are two strategic priorities. That is not to say that there are not other areas. The Government have provided incentives for the deployment of infrastructure in other locations and have obviously taken a view that maybe the market can deliver in those locations.

Quentin Willson: However, technology does exist that would allow you to charge at a street lamp post, although admittedly that could be for slow charging at night. For people who do not have parking within their house and have to rely on the street, this facility could be available on every single lamp post in the UK.

[Andy McDonald]

The whole discussion has been predicated on the basis of saving the planet. What about reducing emissions? In the context of automated vehicles and vehicles generally, it is all about their obsolescence, not about sustainability. Given that we have talked about the updating of automated vehicles and the relationship of manufacturers with the end user throughout the duration, are we missing a trick here? Though there is nothing in the Bill that requires software updates, necessarily there will be that relationship.

Should we not be thinking about a new way of using automated and electric vehicles across the piece? Should we be having people owning vehicles, or should we be making the offer for that relationship to be maintained so that it is a sustainable product that can be revisited? At the moment there is going to be an obligation to keep in touch with these automated vehicles for their lifetime. We heard in earlier evidence that there will come a point where that is cut off. Are we talking about an opportunity for a whole new way of using the services provided by an independent, personal mode of transport?

Quentin Willson: This is the big cycle of change now, like televisions, aeroplanes and the internet. We will see car ownership decline and will be buying or leasing vehicles as a service, not a product. The long-term vision is that this is going to be based largely on electricity and some on fuel cell, and that we will be calling driverless vehicles on our phones to come and collect us. They will then drive to our destinations in what is known as a green wav; they will be hooked up and connected to junctions, to the road system and to traffic lights. These zero-emission, automated, self-driving cars will drive in platoons and, it is hoped, eliminate congestion and pollution. That is the superordinate goal, which perhaps is as near as 2040. But it will always be powered by electricity. The whole structure of who owns what is changing. As we are seeing with consumer habits now, they are buying cars on personal contract plans; they do not own things anymore. That is what the long-term future looks like.

--- Later in debate ---

[Richard Burden]

Q To try to get a more rapid pace of development towards meeting the 2050 target, we have talked about infrastructure as part of that mix and about tackling anxiety—Quentin referred to that—and trying to ensure that consumers are not scared about electric vehicles, which can be good to drive. The third element is, in a sense, disincentives to drive anything other than ultra low or zero emissions vehicles through beefing up the MOT test and whatever.

The other thing is the carrot that goes with that stick. What are the right consumer incentives that could be put in place to encourage the take-up of electric vehicles? Let us face it: at the moment, they are pricey, so many buyers—certainly private buyers—will not be able to afford an electric or other ultra low emissions vehicle. What do you think about the changes there have been in Government policy on that, where measures such as the plug-in car grant have come down rather than gone up?

Quentin Willson: On pricing, the general consensus is that an electric car is probably double the price of a conventional car. That is not broadly the case. What we are not doing enough is incentivising and telling people about used electric cars. Your seven-month-old Nissan LEAF, which started with a list price of £25,000 after the grant, is now available for £13,000. All these electric cars are coming off company fleets and going into the market, and consumers do not realise that that is a really effective way of getting an EV at a low price. If you buy a Nissan LEAF or a Renault ZOE for £6,000, which is possible, that investment is paid back within three years in terms of fuel, maintenance and road tax. It is a really compelling proposition.

[Richard Burden]

Q Is that not a double-edged one? For the market in new electric vehicles to take off, the fleet market will be important to that, and one thing that will be important to it is some certainty over residual values. Therefore, the low residual values at the moment, which might be an incentive to the private car buyer, are a disincentive to the big take-up of new EVs by fleets. Is that fair?

Quentin Willson: But if we have volume, the manufacturers’ prices will come down, and they are coming down. If you look at a Mitsubishi Outlander plug-in hybrid electric vehicle compared with a diesel hybrid one, they are the same price. Residuals on things like Teslas and Renault ZOEs are quite good. The market is levelling off, and we will find that prices and residual values start to firm up. Price guides and the motor industry still do not value electric cars properly. We will see a strengthening of residuals as demand increases and a lowering of prices as manufacturers get their volume and their supply up.

[Richard Burden]

Q Perhaps you could answer a question about the idea of Government action on consumer incentives. Is there more that could be done? What should be the targets?

Quentin Willson: There are simple things like free on-street parking everywhere in the UK for electric vehicles, use of bus lanes and some form of priority. The Americans have had huge success with priority lanes for electric vehicles. We need to think about the stuff that you cannot buy, the things that give people an advantage in city centres if they drive an ultra low emission or electric vehicle.

Robert Evans: The other alternative is low emission zones, and we could do that. London’s low emission zone, followed by an ultra low emission zone, is the direction of travel that a lot of cities would like to take. They want to do it in a staged format, working to national guidance as to what constitutes the standards you would set for access, so that a motorist travelling in the UK can know whether they can gain access to the low emission zone and the ultra low emission zone as they move from city to city. That is a particularly important activity. It is not covered in the scope of this Bill as such, but low and ultra low emission zones are one of the key ways of incentivising the right kind of behaviour. The second-hand market is incredibly important, and it makes those vehicles more accessible.

Company car taxation is a particular favourite that helps to drive electric vehicles into a market where others would not. The lightbulb has gone on with fleets. Previously, they would operate a diesel-only policy. “You never got sacked for buying IBM,” was the traditional term, then, “You never got sacked for buying diesel,” and that has now switched. They can see that the motor industry is not going to support that in the long term and that they need to make a change. They are now embracing what they can see is the future that they need to have in their fleet.

Quentin Willson: Any benefits in kind that the Treasury can keep going must be kept going if possible. The plug-in grant has been really significant.

[Tom Tugendhat]

Q Forgive me; in relation to the cycles that we are talking about in introducing new technology, as you correctly identified, Quentin, the way we are going is towards transport as a service rather than as an item. If that is so, then presumably automatic vehicles will, rather like those vacuum cleaners you get in homes, be able to drive themselves to a car park somewhere, charge themselves up during the downtime and come back out again, at which point we are talking about investing an enormous amount of public money into an infrastructure system that will, within 20 years—you were referring to 2040—be redundant. That is quite a short timescale for large-scale infrastructure investment to be redundant.

Quentin Willson: But that infrastructure investment will also be used for this new breed of autonomous cars, because they will all be plug-in. They will all be electric.