INVESTING in electric vehicles by UK businesses is set to increase by almost 50% over the next two years, exceeding £12 billion, according to new research released yesterday.
Centrica Business Solutions surveyed UK firms about their electric vehicle investment intentions and found many are planning to significantly ramp-up spending on the electrification of their fleet.
Alan Barlow, Director UK & Ireland Distributed Energy, Centrica Business Solutions, commented on the findings: “There is clear recognition among UK businesses of the increasingly important operational role electric vehicles can play for them in meeting their decarbonisation goals.
“But concern is still widespread over how to finance this significant change, particularly for those with large petrol and diesel fleets.
“Vehicle charging is inevitably going to increase the amount of electricity businesses consume.
“It’s our view that onsite generation from solar panels, allied with battery storage and smart charging are the right option for many businesses to enable them to provide charging facilities without facing large increases to power costs and upgrades to their incoming supply.”
The data revealed that, in the two years since the Government announced a ban on the manufacture of petrol and diesel vehicles, businesses have spent an estimated £8.2 billion on electric vehicle adoption.
However, over the next two years, this level of investment is set to increase by almost half (46%) – to £12 billion – as firms accelerate the introduction of electric cars and vans into day-to-day operations.
UK businesses plan to spend an average of 4.5% of their annual turnover on electric vehicle adoption over the next two years according to the data, with over a quarter (27%) of respondents expecting at least a fifth of the vehicles within their fleet to be electric by 2022.
Of those businesses that had already begun electrifying their fleets, the key drivers cited were pressure caused by government emissions targets (37%), wanting to operate freely in ultra-low emissions zones (37%) and the lower maintenance costs of electric vehicles compared to petrol and diesel-fuelled vehicles (33%).
The survey also revealed that firms consider the cost of electric vehicle adoption to be the biggest drawback to the technology despite clear business appetite to buy into electric vehicles.
Vehicle costs was a chief concern for 44% of all businesses polled, and of greater concern than range anxiety (42%) or the increased energy costs caused by charging vehicles on company premises (37%).
The cost of staff training to operate electric vehicles was also viewed as a drawback to adoption.
Cost concerns also appear to have affected businesses’ view of how they thought the government could continue to support electric vehicle adoption.
Two thirds of respondents suggested tax subsidies (68%) and a continuation of grants for electric vehicles (68%) as the measures they would most like to see the Government take or extend.
This was significantly more than the 48% that thought further investment in public charging infrastructure should be the main priority.
Nearly half of the businesses (48%) in the Centrica Business Solutions’ survey said they planned to install on-site charging points over the next two years.
Yet, a significant proportion (28%) hadn’t yet invested in energy technology, such as solar panels, capable of generating the electricity needed for vehicle charging.
Centrica Business Solutions has launched a white paper examining why the momentum driving electric vehicle adoption has become unstoppable can be downloaded here.