Written evidence submitted by Roadchef (EVS0003)

Executive summary

Roadchef is pleased to respond to the Public Accounts Committee’s inquiry into Public Chargepoints for Electric Vehicles (EVs). This is a timely inquiry, with EVs in the spotlight as we look towards critical industry milestones, such as the ZEV Mandate and the government’s ambition to reinstate the 2030 ban on the sale of new petrol and diesel cars.

Roadchef also welcomes the publication of this inquiry in response to the National Audit Office’s (NAO) report into how successful the government has been in identifying and mitigating the challenges that are obstructing a successful rollout of charging infrastructure, and whether the Department for Transport is delivering value for the public purse.

As one of the UK’s leading motorway service areas (MSA) operators, with 31 sites across the Strategic Road Network (SRN), Roadchef provides essential facilities, services and resting spots to ensure the road safety of all motorists, be that HGV or EV drivers, general motorists and passengers.

Roadchef welcomes more than 50 million customers a year. Our services are the backbone of business, leisure, and economic travel. As our customer base grows and consumer demands evolve with the transition to EVs, it is imperative that we support the delivery of a comprehensive charging network across the SRN, which is crucial to instilling greater confidence in motorists looking to make the switch.

Our submission to the inquiry focuses on three key issues:

1.                 Outlining the case for prioritising MSAs for electric vehicle charging.
2.                 The barriers facing the rollout of electric vehicle charging at MSAs.
3.                 Roadchef’s solutions to accelerate the rollout of electric vehicle charging at MSAs.

The most significant barrier that is preventing Roadchef from releasing more capital investment into the deployment of EV charging are the costs, availability and timescales associated with obtaining grid connections. Due to the isolated nature of MSAs, power upgrades tend to incur extremely high costs. This only becomes viable when there is a guaranteed return on investment (ROI) for the power capacity and infrastructure we install, generated by a high volume of customer demand. Alternatively, these upgrades become more commercially viable when there is fiscal support from government.

Roadchef is committed to working in partnership with the government to accelerate the rollout of ultra-rapid charging across our estate of MSAs. Through our owners, Macquarie Asset Management, we have recently announced investment in approximately 650 new ultra-rapid chargers that will be partly powered by 9 megawatts (MW) of new solar energy capacity installed on-site. We have ambitious plans to rollout even more charging, including bespoke facilities to kickstart the transition to eHGVs. However, this requires a long-term strategy to increase power provision across the SRN, enabling us to play our full role in the delivery of charging infrastructure.

1.                             The case for prioritising motorway service areas for electric vehicle charging

There is a strong consensus across government, industry and motorists that MSAs are a critical component of the public charging network. With on route charging forecast to account for 16% of all EV charging by 2050, an increase on the current rate of 5%[1], it is essential that MSAs can cater to this growing demand through an expansion in ultra-rapid charging. This precedent was acknowledged by the previous government, who set the target for at least six ultra-rapid chargepoints at MSAs in England by 2023, which was met by only 39% of sites for reasons outlined in the section below[2].

While the majority of EV drivers will rely on facilities at home, work, or on residential streets for their day-to-day charging needs, all motorists will need the assurance that they can swiftly recharge while undertaking longer journeys. MSAs are uniquely placed to provide these facilities, as they are conveniently located along the spine of the SRN, and drivers and passengers can take a break while waiting - the relatively short time on an ultra-rapid charger - for their vehicle to charge. Roadchef has highlighted for some time that an even distribution of chargepoints across all MSAs is critical to ensuring road safety, as the lack of available charging can force some motorists to travel unsafe distances to find facilities that are more suitable or discourage them from switching to an EV altogether.

In addition to delivering more infrastructure to support EVs, the decarbonisation of road haulage significantly increases the pressure on MSA operators to boost our electrical capacity. With approximately 80% of domestic freight currently moved by road[3] our sites are vital to maintaining the health and resilience of our supply chains. We are ready to embrace the transition to eHGVs through the provision of bespoke charging infrastructure. However, this must not impede on our ability to provide ultra-rapid charging for EVs, and we must work closely with government and the Distribution Network Operators (DNOs) to ensure accurate forecasting of power demand to support both requirements.

2.                             Barriers facing the rollout of electric vehicle charging at motorway service areas

Barriers facing grid connections

The significant challenges faced by MSA operators in obtaining grid connections is well documented. The recently published NAO report highlights the scale of this issue, showing that around only 10% of MSAs have sufficient power capacity needed to meet projected chargepoint demand to at least 2035[4]. Of the remainder, around 50% may need to increase their capacity by two to ten times, and some sites may need to increase their capacity even more.

The cost and timeline of increasing electrical capacity is site dependent and based on existing power availability, how quickly the DNOs can deliver a new connection and levels of passing traffic and turn-in rates. At the time of our response to the ‘Rapid Charging Fund: Scheme Design’ consultation (February 2024), we estimated that our commercial model could accommodate for between £100,000 and £300,000 per MW for the cost of securing a connection with usage across a 2-to-5-year period. When combined with the capital expenditure required to install charging infrastructure, these sums provide Roadchef with a reasonable degree of confidence and ROI over the assets’ lifetimes. However, there are regional differences and many sites across the country where the ROI is not justifiable due to the higher costs of securing power. Some of these sites we had earmarked to participate in the Rapid Charging Fund.

Challenges with government policy

While Roadchef supported the principles of the Rapid Charging Fund, there were a number of issues and complexities associated with the rollout, which has meant that to date, not a single MSA has benefited from the £950 million in funding. Despite the Rapid Charging Fund having first been announced in the Spring Budget 2020, under the previous government, only £70m – 7.4% - was due to be deployed as part of a pilot scheme, which opened in late 2023. Delays to the scheme were partially an outcome of frequent changes in leadership at the Department for Transport, in both the Secretary of State and Roads Minister portfolios, which resulted in a distinct lack of ownership.

The challenges associated with the design of the scheme were wide ranging. The application process was onerous, unreasonable commercial conditions were imposed, the timeline to complete was too brief, and there was a lack of flexibility for operators. While the objective of the scheme was to de-risk private investment, MSA operators would have borne high costs for upgrading electrical capacity before it was in use. Any changes to the scheme over the course of its rollout could have risked Roadchef losing some or all of its upfront investment, before guaranteeing a ROI from the chargepoint infrastructure.

Moreover, Roadchef has been anticipating a change in the direction of travel for EV chargepoint rollout under the new Labour government. Labour’s ‘Plan for the Automotive Sector’ published October 2023, committed to “release and redirect existing chargepoint funding” which includes “the unreleased £950m Rapid Charging Fund as soon as possible”. Given the issues raised above, Roadchef does not wholly object to diluting the fund to prioritise areas with insufficient charging coverage. However, it is imperative this funding is still invested into MSAs, given the precedent to deliver a reliable charging network across the SRN, which can only be achieved through an increase in electrical capacity.

3.                             Solutions to accelerate the rollout of electric vehicle infrastructure at Motorway Service Areas

Despite the obstacles raised in this submission, Roadchef maintains that meeting the charging needs to support the transition to electric vehicles is a national priority that must be seen as a collective opportunity rather than a challenge.

Roadchef is calling on the government to work with industry and the DNOs to adopt a long-term strategy that will oversee the rollout of public charging across the length and breadth of the country, including at MSAs. A reliable charging network will increase consumer confidence and accelerate the adoption of EVs, which is crucial for securing ROI for the infrastructure we deliver.

Roadchef has consistently advocated for the adoption of a mechanism similar to Ofgem’s Green Recovery Scheme. This scheme enabled DNOs to invest capital in shovel ready projects that were struggling to access funding and could be delivered within a 2-year period. A factor which contributed to the scheme’s success is the ability of a DNO to review an entire network to make investment decisions at strategic locations. Funding was made directly available to DNOs who had the oversight and knowledge to pick locations best suited for grid upgrades and EV charging provision. A similar mechanism could be brought forward, utilising the funding from the Rapid Charging Fund, to address the barriers facing MSAs quickly and build confidence in the public charging network.

A lot has changed since the launch of the Rapid Charging Fund and it is anticipated that the absolute level of funding required to deliver grid connections at MSAs is lower than was the case in 2020, due to the continued evolution of the power grid. However, it remains the case that across a number of locations the cost of upgrading power is commercially unviable and requires timely and open engagement between government, DNOs and MSA operators to unlock. This consolidated approach is critical to delivering a national charging network that is fit for purpose and keeps up with the pace of demand as EV adoption increases.

January 2025