Planning Delays Threaten UK’s EV Charger Buildout, Osprey CEO Says

There’s ample funding for charging points but not enough people to permit projects, according to Ian Johnston.

(Bloomberg) — As the shift to electric vehicles accelerates in the UK, there’s mounting concern that the country’s charging network can’t keep up.

Tesla’s Model Y was the most popular car in the UK last month, outselling combustion-engine SUVs including the Nissan Juke and Kia Sportage. Demand for EVs is steadily increasing, with some 788,000 battery-powered vehicles already cruising the country’s roads. They’re having to compete for around 70,000 charging connectors.

For Ian Johnston, the CEO of UK operator Osprey Charging Network, the limiting factor to getting more chargers installed isn’t funding —  it’s people. “We have more than enough capital,” he said in a recent interview. “The main barrier we have today is a lack of human resources in the permitting departments.”

Osprey is among companies including automakers, power utilities and oil majors building out the UK’s charging network to benefit from the transition away from combustion cars. Backed by asset manager Investec, Osprey plans to spend £100 million ($125 million) over the next two years to triple its installed base of charging connectors. They’re usually located near motorways or retail parks and the cost for drivers is 79 pence per kilowatt-hour of electricity.

Speaking at Osprey’s offices in London’s financial district, Johnston discussed the EV sector’s rapidly evolving technologies, industry consolidation and Walmart’s recent move into charging. Here are excerpts from the conversation that have been edited and condensed for length and clarity:

You installed more chargers in the first quarter of this year than all of 2022. What’s driving momentum?

We’re building bigger sites, and we’re doing this across a vast base of over 75 different landlords with diverse property portfolios that we’ve developed over the last two years. Around two years ago, the average number of chargers on our sites was about 1.6, but today the average is more than six. The site we’re launching in Devon in the next two weeks will have 16 chargers.

The charging industry has a lot of players and some of them have deep pockets. How do you stay competitive?

There are a lot of new entrants to the market and there are billions of pounds being invested. But if you look at who is actually deploying charging infrastructure at volume, you’re seeing that landowners and retailers are picking one out of a small number of players in the same basket time and time again.

I think you can expect to see some consolidation. Everyone’s looking for growth and M&A is a natural way to achieve that. At the other end of the scale, there’s a number of players that I don’t think will be here in a year’s time.

When discussing charging power, people often think that the biggest number is best. What’s the actual performance drivers are getting when they plug in?

What we’re seeing in terms of new vehicles is that their average peak charge rate is 140 kilowatts – a long way from the 350-kilowatt number advertised by some of the charging networks. What we’re seeing on our chargers today is an average charge rate of 78 kilowatts. This will increase and the technology will adapt. We have chargers that can deliver 300 kilowatts so we’re already future-proofing ourselves for at least the next three or four years.

Walmart recently announced it would install its own chargers in the US. Do you see a threat from supermarkets choosing to go it alone?

It will be intriguing to see which parts of the ecosystem supermarkets try to deliver themselves, and whether they end up coming back to the more experienced players to get white-label services.

There are the complexities of delivering the site and securing the grid, which is a challenge for supermarkets because they’ve spent the last few decades trying to reduce their grid load to cut costs. And then there’s running the network. Many run fantastic fuel businesses today, but the EV world is different in terms of payment, roaming and the technical complexities between vehicle and charger.

Is getting access to the grid an issue?

There’s a land grab for the sites and for deals, but there’s also a grid grab in getting the power available on the network. If we had a deal with coffee shop brand A and one of our peers has a deal with coffee shop B, and they’re next door to each other, it’s likely there’s only enough power to allow one of us to build a charging hub. The pace to market is therefore critical.

How has your expansion impacted your electricity procurement?

The volume of electricity that we’ll be procuring in the next 12 months is probably more than 20 times greater than a couple of years ago. That rate of growth is going to continue and makes us a different proposition to deal with for the energy suppliers. We’ve gone from being a price taker to being a significant energy user, which gives you a lot of interesting market power.

You partner with landlords on their sites, but you’re also buying land and building sites on your own. What’s the benefit of going it alone?

Where we’re buying land, the delivery of the charging site is significantly easier, because we’re in complete control of what we can build in terms of how the site is laid out and the technical deployment is a lot quicker. In those cases, we’re working with retail partners who will come into our sites as a tenant.

In terms of government support for EV charging, the big money pot is the £950 million Rapid Charging Fund. Does this help you?

We don’t need government money to build this infrastructure. We’re being held back by human resource delays. We have to jump through hoops to get planning permission, wait for grid operators to come and flick the switch at the site and wait for highways teams to approve designs for curbs. This is adding months and months to deployment.

Charging networks are ready to deploy significant capital in town-center car parks across the UK, but the reason we can’t do it is because the local authority procurement frameworks aren’t set up to take advantage of it. We need the government to remove these barriers and create the conditions where we can deploy even faster.

BloombergNEF clients can search a database of chargers deployed by operator across the globe here.

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