Sunday, 26 February 2017

The Amazing Electricity Trickery: Recharged

Four years ago, I wrote about the Government's push for electric and so-called "ultra low emission vehicles" (ULEVs). There has been some media coverage of ULEV/ EV subsidy and so I thought it worth having another look at the subject.

When I last wrote in 2013, there was a budget of £400m available through the Office of Low Emission Vehicles (OLEV) which was being used to provide grants towards private and commercial ULEVs which was due to end in 2015. Of course, this was under the previous Conservative/ Liberal Democrat coalition.

We still have OLEV and it has been tweeting some things recently. First, that the ULEV grant system is still alive and well. It has also been trailing the fact that one can obtain grants towards domestic and workplace charging points. Finally, it has been tweeting the news that the Government will be pushing to improve the availability of EV charging points (possibly through changes in the law) as part of the proposed "Vehicle Technology and Aviation Bill". On the latter, there will also be the introduction of an insurance regime to cover autonomous vehicles (AVs).

In short, the Government is putting its weight behind a future filled with electric (or at least low-emission) vehicles and autonomous operation. In many ways, this is no different to many other countries who are seeking to dump fossil-fueled vehicles such as the Dutch and Norwegians. The whole area is a multi-trillion market and one can see why the UK Government is pushing to be part of it, more so given the uncertainties around leaving the European Union.

On the one hand, we will probably be using motor-vehicles for the foreseeable future and so they may as well be electric. At the very least, the tail-pipe emissions problem in urban areas will be addressed, although there are still plenty of issues created by braking systems and the action of tyres on roads. On the other hand, this represents a push to maintain business as usual and in that I mean to continue with a car and lorry-based UK transport system and anyone using active or public transport be damned.

It was interesting to read concern raised about vehicle excise duty being changed from April this year which meant that many owners of "gas guzzlers" would be paying less VED, whereas those driving "cleaner" cars would pay more (zero-emission cars will still be exempt). Forgetting about the weird discrepancy, this is the Government realising that as cars get more efficient, VED revenues will fall. With fuel duty too, aside from the fuel tax escalator being removed, a switch to EV and ULEV vehicles is going to see revenue drop as well. I fully expect to see changes whereby EVs will attract VED and as for fueling EVs, it will be interesting to see what happens as they are really cheap to run. It will also be interesting to see what the traditional fossil fuel companies do in terms of production and divestment in the next decade as the current push must surely go against their traditional business model!

Of course, subsidy and tax are part of the same system used by Government to influence a particular market sector in response to their stated policies. Unfortunately, in the UK, it seems to be about trying to compete for the "business as usual" sector with nothing of any substance being made available for local active transport. In truth, this area of transport is almost always neglected - at least it has seemed this way to me over the last 20+ years in my industry.

On Twitter, some people questioned OLEV about the potential for subsidy/ grants for e-cycles;

OLEV were pretty clear and in truth, e-cycles are not part of their remit. Someone suggested that the grant system was similar to the "Cycle to Work" scheme, which is essentially a tax-efficient mechanism which allows an employer to "lease" a cycle to an employee and for the lease to be paid before tax. At the end of the "lease" the employee purchases the cycle from the employer at a market rate. If you are in work and your employer runs the scheme, then you can save money. Otherwise, it's no use to you. It's rather different to the ULEV grant scheme which is basically money off the vehicle when you purchase it and the dealer will sort out the paperwork for you; there isn't even an applicant form!

E-cycles can help with our urban pollution and congestion problems. They can give range and help to those who would otherwise struggle with a conventional cycle. They enable heavier loads to be moved for those important "last mile" freight journeys and indeed, can help with family transport in terms of e-cargo cycles. If the Government valued transport diversity then it would extend the ULEV scheme to subsidise e-cycles. Of course, it doesn't deal with the infrastructure issues which have been largely ignored. England is still waiting for meaningful funding under the Cycling and Walking Investment Strategy (CWIS) as are the devolved administrations.

There is also the current concern about people using finance schemes to buy new cars becoming the next sub-prime financial disaster. If you have Government policy set up to perpetuate car ownership through road building and enabling car use, then there will be many people needing cars who can't afford to buy one out right. If your town has expensive and unreliable public transport, if the roads are not safe to cycle on, or if you have to get around to multiple destinations (care workers visiting people at home for example), then life without a car will be difficult.

As ever, this goes back to Government priorities. I'm afraid that I am quite pessimistic these days. It seems that the push to maintain the current model attracts copious amounts funding, ministerial support and the allied industries rushing to get their collective hands on the subsidies (because that is where the cash is going) - hell, there are even design standards for motorways! 

When it comes to local active transport, every infrastructure project seems to be a fight. Funding is hand-to-mouth and we have inconsistent approaches to design because walking and cycling are always "matters for local authorities". Compare the UK with other countries which are seeing a low emission future; they are investing in local active transport and therefore seeing that there are different tools for different jobs. Of course, ULEVs are just a part of the story, but this is a story which, as far as I can see, won't have a happy ending.

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