Who Ultimately Pays for and Who Gains from the Electricity Network Upgrade for EVs?

The UK and Scottish Governments have set ambitious targets for the roll out of electric vehicles (EVs). The predicted rapid expansion in EV ownership over the next decade will shift demand away from vehicles fuelled with petrol and diesel and will require upgrades to the electricity network itself. This will carry significant costs that are ultimately paid by consumers both through their energy bills and the costs of other goods and services where electricity prices impact production costs. Large-scale investment can also be disruptive to the wider economy. On the other hand, the net outcome may be positive due to a broad set of economic benefits, including up to 3,000 new jobs associated with 20% EV penetration by 2030. The main driver may be strong UK supply chain activity driven by powering vehicles with electricity.

The research findings reported here highlight the need to broaden attention from technology and cost considerations associated with low carbon developments. Instead, there is a need to focus on the potential for an initiative like the EV roll-out to unlock, sustain and increase value in different parts of the economy as we transition to a low carbon future. Indeed, we may have been missing a key source of value in terms of how we have fuelled our vehicles in the past, and need to look beyond the manufacture of vehicles and batteries in considering opportunities for generating value in the wider economy system.