Written evidence from Richard Amunugama Mykos Technologies Ltd (ELV0034)

1              Introduction

1.1              Overview of Mykos Technologies Ltd

2              Summary

3              REsponses

Government Approaches

EV Market and Acquiring an EV

Experience of using an EV

End of life disposal of EVs

National and regional issues

International perspectives

4              End Notes

1         Introduction

1.1       Overview of Mykos Technologies Ltd

Mykos are a technology development and investments group.

We provide product innovators and creators with the support that they need to take an idea from concept to successful production.

We provide high-quality technical due diligence to de-risk financial investment.

Our company undertakes research and analysis to build the foundations for the growth of an idea into a business. We provide the tools to chart success through product and strategy development. We deliver and manage the processes needed to plan and execute a company’s goals.

2         Summary

Mykos is delighted to respond to this key consultation at a critical point in the transition to electric vehicles (EVs).

Our contribution is based on decades of experience in the automotive industry, together with a deep understanding of current technologies and those in development in the short, medium and long-term. This is combined with an understanding of the new business relationships and ecosystems being created as the transition to zero emissions vehicles is combined with a shift to decarbonising the power generation industry and the technical challenges which must also be met in accomplishing this.

Evidence submitted is a combination of information referenced from existing research and subjective opinions based on a wide knowledge of the industry landscape.

Comments have only been made where we feel that we have sufficient knowledge to provide justification for our position if further consultation is requested.

• The direction of battery technology development and customer demand is towards ultra-fast public charging to serve populations living in urban areas and to minimise the requirement for substantial behavioural change and associated reluctance to switch to a battery electric vehicle (BEV)
• There is a risk of investing heavily in low-speed public charging which may become a redundant stranded asset, unpopular with consumers
• There is an opportunity to combine charging with grid storage technology that will both reduce the requirement for immediate grid infrastructure upgrades and fully utilise renewable energy generation capacity
• Low volume and specialist vehicle manufacturers are under pressure due to the lack of availability of battery systems and the very high cost of certification of trying to develop their own products

Detailed comments are given in the following section to questions: 1, 2, 4, 5, 12, 18, 21, 24, 29, 31, 32 and 33. These are the areas where we feel we can add most value to the committee’s work. We have not responded to all of the questions, and sections set out in the call for evidence.

References are hyperlinked and repeated in full in the End Notes.

3         REsponses

Government Approaches

1. What are the main obstacles to the achievement of the Government’s 2030 and 2035 phase-out dates? Are the phaseout dates realistic and achievable? If not, what steps should the Government take to make the phase-out dates achievable?

The most significant obstacle to the 2035 phaseout date is the availability of public charging infrastructure and the “range anxiety” and “charge anxiety” that this creates in the public. The five worst things about the EV experience from a survey of existing drivers are: 1. Limited range when travelling 2. The need to plan for where to charge when away from home 3. Unreliable public charging 4. Lack of ultra-rapid (e.g. 20 mins to 80%) public charging stations 5. Long recharging time (The EVXperience Report – Zenith[i]). Note that these are early adopters and relatively enthusiastic about the technology. There will be more resistance with the broader public in changing their behaviour.

Ultra-fast charger availability will allay this anxiety, especially if they are as widely distributed and visible as current petrol stations or take their place over time. However, charging availability must stay ahead of electric vehicle sales to minimise negative experiences.

This can be achieved with faster grid infrastructure connections to charging stations and the increased deployment of distributed energy storage systems for vehicle charging.

2. Do the 2030 and 2035 phase-out dates serve their purpose to incentivise the development of an EV market in the UK? To what extent are car makers focusing on one date or the other? What are the impacts of the deadlines on the ability of the UK supply chain to benefit and how could the Government seek to further support the development of the UK EV industry? Would the introduction of a plan with key dates and timescales support the development of the EV industry in the UK?

Fossil fuel only vehicles are already a minority of UK car sales at 45.6% (ACEA[ii]). This trend will continue due to the fuel efficiency benefits associated with hybrid drive trains, regardless of other factors. This trend has also been driven on the part of vehicle manufacturers by progressively stricter emissions legislation. Hence the 2030 date banning fossil fuel only vehicle sales is at best accelerating an existing trend. However, it should be noted that The real-world fuel consumption and CO2 emissions of PHEVs in Europe is on average three to five times higher than the official WLTP type-approval values (ICCT REAL-WORLD USAGE OF PLUG-IN HYBRID VEHICLES IN EUROPE: A 2022 UPDATE[iii]) so may not deliver the expected real benefits to CO2 and pollution reduction.

The 2035 phaseout of all fossil fuel sales, synchronized with the same requirement in the EU has provided a focus for all vehicle manufacturers to invest at the scale necessary to achieve this target. As with all large investments, raising doubts as to the UK commitments to these dates will lead to delayed or diverted spending in the face of significant US and EU investment in the sector (The White House - Joint Statement by President Biden and President von der Leyen[iv]).

Specialist and low-volume vehicle manufacturers generated £5.44bn in revenue pre-Covid with an £861m annual R&D spend (SMMT Low Volume and Specialist Vehicle Report 2021[v]). Direct feedback to Mykos Technologies indicates that the transition to zero emissions puts them in a difficult position. As large volume manufacturers use their purchasing power to set up the supply chains required, smaller companies do not have access to off-the-shelf battery and electric drive systems and the associated software control expertise that is currently ubiquitous with existing engines. Economic access to battery, power and management systems are the most significant barrier to smaller companies being able to serve existing, and in many cases critical, market needs.

This is primarily driven by exceptionally high, cost barriers to certification that run into the millions for a battery pack alone.

Consideration should be given to mandating and/or incentivising all large-volume vehicle manufacturers or the companies that supply their cells, make available reasonably priced battery packs with the associated engineering support. Another option is to offer financial help to niche vehicle companies with certification testing, particularly as reciprocal agreements with the EU expire and will require additional certification in the future.

3. What specific national policies, regulations or initiatives have been successful, or have hindered, EV adoption to date? Are these policies or initiatives fit for purpose?
4. Given that the Government should apply a behavioural lens to policy—which involves people making changes to their everyday lives, such as what they purchase and use—is there a role for clearer communication of the case for EVs from the Government? If so, who should take the lead on delivering that?

As reference in point (1) the ideal scenario is to minimize the behavioural change required in peoples’ everyday lives by increasing the availability of ultra-fast charging in familiar locations (such as petrol stations). If it is possibly to “fill” an EV in a similar time to an existing liquid fuelled vehicle, then life continues “as normal”. Such a focus also maintains the current economic model of forecourts where much of their profit is made as a convenience store (McKinsey & Company - Fuel retail in the age of new mobility[vi]) but requires significant investment. This aligns with the direction of travel of battery technology with CATL announcing a battery chemistry capable of charging 250 miles in 10 minutes. (MIT Technology Review[vii]). A new pattern of mainly charging overnight or at the office at low speeds (for those with access) and adding “enough” at ultra-fast public chargers would also be relatively easier to understand.

5. What is your view on the accuracy of the information in the public domain relating to EVs and their usage?

Many people working in the automotive industry, and particularly those involved in electrification have noted a clear shift in “anti-EV” news stories from certain sectors of the media since the beginning of 2023 reminiscent of campaigns questioning the dangers of tobacco and climate change. The tone is that of constant raising of doubt and raising of anxiety. This has been noted by the motoring journalist Quentin Willson and Jack Cousens, head of roads policy for the AA amongst many others (CarDealer Magazine[viii]). Repetition makes a fact seem more true, regardless of whether it is or not (BBC Future[ix]).

Good quality information is available but not as visible in the popular media as it once was nor published as regularly as negative or misleading items.

6. What are the overall environmental benefits that would result from achieving the 2030 and 2035 targets?
7. What are the likely costs that will be faced by consumers as a result of the Government’s phase-out dates for non-zero emissions vehicles? Are there policies or initiatives that the Government could use to specifically target barriers arising from unpredictable costs to the consumer, for example significant fluctuations in the cost of electricity, changes to road taxes, or the introduction of low emission zones?

EV Market and Acquiring an EV

These questions relate to the UK EV market and uptake of EVs by UK consumers.

8. What are the main routes for acquiring an EV? Which aspects of these routes are working well, and which aspects could be improved?
9. What are the main consumer barriers to acquiring an EV, either through purchasing, leasing, or other routes?
10. How is the Government helping to ensure that EVs are affordable and accessible for consumers, and are these approaches fit for purpose?
11. Do you think the range of EVs on offer in the UK is sufficient to meet market needs? Which segments are under-served and why? Why is the UK market not seeing low cost EVs, particularly in comparison to China?
12. What is the future role of L-segment and personal light electric vehicles, and how will that impact car ownership and usage? What is inhibiting their uptake?

The cost of small M-segment vehicles driven in-part by the safety requirements to achieve full Euro NCAP safety targets have increased significantly along with size and weight. These will consequently require larger battery packs to achieve acceptable performance levels, making affordable small cars harder to obtain.

L-segment vehicles make far more efficient use of resources, generate half the greenhouse gas emissions and could substitute upto 50% of BEV passenger car trips (MDPI Potentials of Light Electric Vehicles for Climate Protection by Substituting Passenger Car Trips[x]).

Although there are some specialist applications including last mile delivery, the L- segment is currently largely invisible to the general public. However, the Citroen Ami[xi] indicates interest from the wider automotive sector, which has the potential to raise the profile of these vehicles. More conventional designs, such as the Ligier Myli[xii], could see this sector becoming more popular for urban use. Car clubs could be particularly enlivened with this option. This will require a clear understanding by the public that they are for relatively low-speed urban use only. It will also require regulatory stability for manufacturers to allow for long-term investment in the sector.

The lower voltage power systems associated with L-segment vehicles also make for a safer and more economic servicing regime.

The currently low volumes and low profit-margins associated with the L-segment have not attracted the interest of large-scale manufacturers. The different engineering requirements and manufacturing processes also mean that they are not as obviously aligned with existing automotive sector as it currently exists. There is far more in common with the manufacturing processes of e-scooter, e-bike and e-motorbikes.

13. What is your assessment of the current second-hand EV market? How is the second-hand EV market projected to develop between now and the phase out dates?
14. What is the relationship between EV leasing and the second-hand market and how do they interrelate?
15. What barriers are there to achieving a sufficient supply of second-hand EVs, mindful that second-hand vehicles makeup a high proportion of all vehicles purchased?
16. What is the value and role of alternative transport models such as car clubs and micro mobility vehicles in the Government achieving the 2030 phase out date, and how should the Government consider their roles and opportunities for use in transport decarbonisation?
17. Are consumers charged higher rates of insurance for an EV when compared to an internal combustion engine (ICE) vehicle, and if so, are these higher rates justified? Can the Government do anything to mitigate this?

Experience of using an EV

18. What are the main challenges that UK consumers face in their use of EVs?

Limited public charger access driving too large a behaviour change, particularly for those without private off-street parking. Anxiety not only for long journeys, but also at the beginning and end of each day around the availability of charging will impact negatively on the ownership experience.

19. What are the main benefits that UK consumers could realise from using an EV?
20. How prepared are car dealerships, service networks, repairs and maintenance organisations, breakdown services and aftermarket suppliers to meet the growing EV uptake?

Whilst Franchised networks for sales and service will be well prepared, independent garages for both sales and service will not.

Servicing high voltage systems requires specialist fire suppression equipment and safety protocols.

There is also projected to be a shortfall of 4,500 appropriately qualified technicians by 2029, increasing to 16,000 by 2032 (Institute of the Motor Industry, Electric Evolution - Examining the Triumphs, Trials and Roadblocks[xiii])

21. How does the charging infrastructure for EVs need to develop to meet the 2030 target? Does the UK need to adopt a single charging standard (e.g., the Combined Charging System (CCS)) or is there room in the market for multiple charger types?

A single charging standard would be helpful. One less thing for users to worry about.  A simple charging and payment experience, exactly as paying for fuel now, would also make the transition far smoother. 87% of survey participants would welcome the ability to use one smartphone app across all public charge point networks and 67% strongly preferred and 18% somewhat preferred to use a contactless credit or debit card (EVA England Improving Drivers' Confidence in Public EV Charging[xiv]).

22. The Government recently published the draft legislation of “Public Charge Point Regulations 2023”. What assessment have you made of the draft legislation text, and what contribution will it make in ensuring the charging experience is standardized and reliable for consumers?
23. What assessment do you make of the requirements set out in the draft legislation of “Public Charge Point Regulations 2023” for charge point operators to make data free and publicly available, and how may this improve the EV charging experience for consumers?
24. In terms of charging infrastructure, are there unique barriers facing consumers in areas of low affluence and/or multi-occupancy buildings, such as shared housing or high-rise flats? Do you consider public EV charging points to be accessible and equitable compared to home-charging points?  What can be done to improve accessibility and equitability?

There is a lack of access to off street parking in urban and lower income areas (Nationwide Vehicle Contracts The UK’s off-street parking index[xv]).

On-street slow charging leads to a fear of making “parking wars” worse whereas rapid charging hubs (analogous to today’s petrol stations) are a popular option (Catapult Energy Systems Electric Vehicles: What will persuade the 30% of households without off-street parking to adopt electric vehicles?[xvi])

As stated previously, the lack of home charging access and access to charging leads to the reason 33% of OFGEM survey (Consumer survey EVs summary 251021[xvii]) respondents are reluctant to purchase an EV, with a further 25% also citing the speed of charging.

Embracing current technology trends towards ultra-fast charging outlined in (1) and (4) will help to improve accessibility and equitability.

25. Is there a financial benefit to the consumer of choosing an EV over an ICE vehicle? Are there further benefits, aside from financial, that a consumer may gain from EV use?

End of life disposal of EVs

26. What options are there for consumers for end-of-life management of batteries and EVs, and what impact does this have on consumer attitudes towards buying an EV?
27. What are the current regulations and responsibilities of disposal and recycling for EVs, and how effective are they? How much of the battery can be recycled from a technical standpoint, and how much of that is economically feasible?
28. Is there a risk that the residual value of EVs may be lower than the value of the EV as a source of recoverable critical minerals, and how might this effect the flow of EVs into the second-hand market?

National and regional issues

29. What are the challenges or concerns around grid capacity in relation to significantly increased EV adoption?

Grid connectivity delays and costs are well publicised. This will be more substantial if ultra fast charging is installed to make use of available vehicle technology.

Is there confidence rather than aspiration that increased power generation will be in place to meet demand? Will the grid storage capacity be in place to fully utilise the renewable generation potential?

30. What is the role of distribution network operators in ensuring EV infrastructure can be rolled out sufficiently to meet 2030 target?
31. What are the requirements, challenges or opportunities for the development of public charge point delivery across the UK?  How will the development of EV charging infrastructure in the UK interact with existing planning regulations?

There is an opportunity to combine distributed storage with vehicle charging to simultaneously resolve the issue of requiring substantial grid upgrades and being able to make full use of renewable generation capacity. This could also bring resilience to rural areas that may be cut-off in extreme weather conditions. This is based on Mykos Technologies’ own research work.

32. What are the issues facing rural residents, urban residents, and sub-urban residents and how do they differ?

Urban residents are particularly affected by the lack of off-street charging availability which drives an un-met demand for public charging. In high-density areas, the ability to rapidly recharge vehicles at a limited number of locations will improve public uptake and cannot be viably substituted by other means (24).

Rural residents may lack the grid infrastructure that will realise the ultra-fast charging potential in new vehicle technologies. This could have a negative affect on access to visitors to these areas if such charging infrastructure is not readily available.

33. What role do you see local authorities playing in delivering the 2030 phase out target, particularly in relation to planning regulations, charge points and working with District Network Operators? How can government best support local authorities in their roles?

There is a danger of local authorities in investing in unpopular, low speed, on-street charging (24) that could lead to negative social outcomes and ultimately become unpopular stranded assets.

They may be better served by enabling the infrastructure to convert existing petrol station forecourts to convert to ultra-fast charging stations and develop existing industrial and brownfield sites to either public or fleet charging facilities. Otherwise, there is a danger that such sites in urban areas will be sold for residential development, further exacerbating the problem.

International perspectives

34. What are the successful approaches to the rollout and uptake of EVs in other countries, and what can the UK learn from these cases?

4         End Notes