The case against Britain’s Soviet-style 5-year socket plan
23 November 2021
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Another day, another brilliant wheeze for nudging the country towards ‘net zero’, the Canute-like plan of the British political establishment to direct the global atmosphere to do their bidding by controlling the choices of 0.9% of the world’s population. This time there will be a national plan for sockets. The insufficiently switched-on British masses are refusing to ditch their internal combustion engines (ICE) for battery-powered automobiles (EVs) with sufficient haste, and this can surely only be due to the difficulty of plugging them in. At least that’s the theory.
Hence, there will be an extension to building regulations, requiring all new build homes, supermarkets, and workplaces to install electric vehicle charging points from 2022, and this will also be a requirement on ‘major renovations’. This means if you decide to repair your roof, you may be required to also upgrade your fuse board, run a large cable through your house or garden, and stick a plastic panel on a wall, or build one if nothing suitable is there, to provide a utility service you are unlikely to use for nearly a decade. This will cost you between eight hundred to several thousand pounds, and when you sell your home, it may have to be ripped out as the charging technology has moved on, or there is a better way of doing low-carbon mobility, such as GMO biofuels, hydrogen fuel cells, compressed air or things not yet invented.
The intention is to increase the number of charging points by around 145,000 a year, helping build a national network of charging points and reducing the barriers to entry to the electric car market. Or rather, a psychological barrier to the decision to switch based on a lack of options for charging. The more we build the easier it gets. This, in turn, will help people prepare for 2030, when the Government intends to make it illegal to buy new petrol and diesel vehicles.
This is a bad idea. Firstly, let us suppose the Government does nothing. It is not all obvious the socket problem will not just solve itself through market mechanisms. If you want to buy an EV, or plug-in hybrid, as I did last year, you are going to buy a socket. Better, you are going to buy the one you want, suitable to the property you live in, not live with the choice imposed on you by a builder ticking a box for a civil servant. The Government is already, and in my view wrongly, subsidising this choice, by providing up to £350 in vouchers for people who can well afford to pay for these installations themselves. Like many low-carbon projects, this is a regressive transfer from the general taxpayer to the well-off. This is not a market clearly experiencing market failure, and it is arguably immoral to make those who will never own a car pay for it.
Secondly, alongside the grant, there are already a host of interventions trying to encourage the change. The price of fuel is high, and (this year at least) rising, not least because of the vast amount of tax (Fuel duty and VAT) charged on each litre put in your gas-guzzler, amounting to 50-70% of the price. Vehicle Excise Duty is already linked to CO2 emissions, acting as another nudge, with over two thousand pounds charged annually on the worst emitters. Low emissions zones, particularly in London, provide a further push through daily charges for road use, and more will follow. Like smokers, gas guzzlers more than pay for the assumed harm they do, with fuel duty alone covering more than cost of combatting climate change first estimated by Stern, something still true even after he doubled his estimate.
Thirdly. the principal barrier to electric car use is the high-ticket price of the cars. While the average cost of a new car generally in the UK is between twelve to twenty-eight thousand pounds, for EVs it is over forty thousand. Even the cheapest EVs are at the upper end of affordability compared to the average. They are not an affordable option for people who depend on transport for their livelihood and may not be the right choice in future for heavy goods transit. The cost of the socket in this equation is trivial. This will change, but it will also change if we just let the market work, rather than offering discounts for new cars. Decisions that are at any rate environmentally dubious given concerns over how we dispose of old batteries, and the general benefit of using the same vehicle for longer before retiring it.
Finally, we have been here before, and recently. The UK grand plan for smart meter rollout was characterised by politicians on a climate mission imposing silly standards and mandates on energy companies that have resulted in poor quality technology being imposed on homes. Many meters no longer work, due to changing standards. Many fall over after you switch provider. Many are not needed, given your phone can now do what the Government believed it needed special devices for only ten years ago.
The Government appears to have learnt nothing from the experience, despite highly critical reports from the National Audit Office, and many frustrated consumers, now more sceptical about the benefits of controlling their use of energy. It is already the case with EVs that even recent models cannot benefit from the type of fast-charging technology we expect to see in future. Mandating a socket now will see a massive amount of misalignment of cars with their plugs. We will once again be looking at a decade of wasteful mess due to politicians failing to understand how markets work to make innovation faster and better. Leave it all well alone and stick to cheering on the winners rather than picking them.
Hence, there will be an extension to building regulations, requiring all new build homes, supermarkets, and workplaces to install electric vehicle charging points from 2022, and this will also be a requirement on ‘major renovations’. This means if you decide to repair your roof, you may be required to also upgrade your fuse board, run a large cable through your house or garden, and stick a plastic panel on a wall, or build one if nothing suitable is there, to provide a utility service you are unlikely to use for nearly a decade. This will cost you between eight hundred to several thousand pounds, and when you sell your home, it may have to be ripped out as the charging technology has moved on, or there is a better way of doing low-carbon mobility, such as GMO biofuels, hydrogen fuel cells, compressed air or things not yet invented.
The intention is to increase the number of charging points by around 145,000 a year, helping build a national network of charging points and reducing the barriers to entry to the electric car market. Or rather, a psychological barrier to the decision to switch based on a lack of options for charging. The more we build the easier it gets. This, in turn, will help people prepare for 2030, when the Government intends to make it illegal to buy new petrol and diesel vehicles.
This is a bad idea. Firstly, let us suppose the Government does nothing. It is not all obvious the socket problem will not just solve itself through market mechanisms. If you want to buy an EV, or plug-in hybrid, as I did last year, you are going to buy a socket. Better, you are going to buy the one you want, suitable to the property you live in, not live with the choice imposed on you by a builder ticking a box for a civil servant. The Government is already, and in my view wrongly, subsidising this choice, by providing up to £350 in vouchers for people who can well afford to pay for these installations themselves. Like many low-carbon projects, this is a regressive transfer from the general taxpayer to the well-off. This is not a market clearly experiencing market failure, and it is arguably immoral to make those who will never own a car pay for it.
Secondly, alongside the grant, there are already a host of interventions trying to encourage the change. The price of fuel is high, and (this year at least) rising, not least because of the vast amount of tax (Fuel duty and VAT) charged on each litre put in your gas-guzzler, amounting to 50-70% of the price. Vehicle Excise Duty is already linked to CO2 emissions, acting as another nudge, with over two thousand pounds charged annually on the worst emitters. Low emissions zones, particularly in London, provide a further push through daily charges for road use, and more will follow. Like smokers, gas guzzlers more than pay for the assumed harm they do, with fuel duty alone covering more than cost of combatting climate change first estimated by Stern, something still true even after he doubled his estimate.
Thirdly. the principal barrier to electric car use is the high-ticket price of the cars. While the average cost of a new car generally in the UK is between twelve to twenty-eight thousand pounds, for EVs it is over forty thousand. Even the cheapest EVs are at the upper end of affordability compared to the average. They are not an affordable option for people who depend on transport for their livelihood and may not be the right choice in future for heavy goods transit. The cost of the socket in this equation is trivial. This will change, but it will also change if we just let the market work, rather than offering discounts for new cars. Decisions that are at any rate environmentally dubious given concerns over how we dispose of old batteries, and the general benefit of using the same vehicle for longer before retiring it.
Finally, we have been here before, and recently. The UK grand plan for smart meter rollout was characterised by politicians on a climate mission imposing silly standards and mandates on energy companies that have resulted in poor quality technology being imposed on homes. Many meters no longer work, due to changing standards. Many fall over after you switch provider. Many are not needed, given your phone can now do what the Government believed it needed special devices for only ten years ago.
The Government appears to have learnt nothing from the experience, despite highly critical reports from the National Audit Office, and many frustrated consumers, now more sceptical about the benefits of controlling their use of energy. It is already the case with EVs that even recent models cannot benefit from the type of fast-charging technology we expect to see in future. Mandating a socket now will see a massive amount of misalignment of cars with their plugs. We will once again be looking at a decade of wasteful mess due to politicians failing to understand how markets work to make innovation faster and better. Leave it all well alone and stick to cheering on the winners rather than picking them.
2 thoughts on “The case against Britain’s Soviet-style 5-year socket plan”
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Wow Andy, I like a lot of IEA thought pieces, but I think you are having a bad day here.
On the practicalities, no one who knows about this area thinks we will be using other fuels like hydrogen or biofuel. All surface vehicles will electrify, (to the huge benefit of the public). Once you have fitted the cabling, etc. for your 7kW charger it will be good forever, you might need a different connector or fancy a three phase supply in future, but that’s a nice to have. (Every EV can take 7kWs, they just may not be able to benefit from rapid chargers in other places. Even then cars will be replaced with newer models.)
I agree on markets delivering the best solutions in general, but only an extremist believes they don’t need regulation. I also agree on care around obsolete standards, but industry has already progressed that, and it is not what this requirement is about.
EV uptake, like solar, wind and heat pumps will drive a revolution in super cheap travel and energy unleashing amazing economic opportunity. All of the above have been accelerated by subsidies/incentives/regulation. A lot of the regulation has been inefficient and poorly targeted but not all. Without it we would not be in a position where solar energy is now the cheapest energy ever made, without subsidies.
Some small requirement to accelerate the deployment of chargepoints could well encourage people to buy EVs and that will increase the speed at which they decline in price and that super cheap, clean transport future we all want. You might think of better ways, but it seems a reasonable approach. (Similar for condensing boilers, double glazing, lighting, etc,)
The question for the IEA should be, if government has decided we need to electrify road vehicles by x date, what is the best way to regulate that change, most cheaply and harnessing market processes.
The interesting thing here Barny, is that if you are correct, and the future is predictably all EV , and further it’s going to be super cheap, the Government need do nothing, bar maintain some carbon price pressure on fossil fuel options, which as noted above are already extremely high. Market forces will do the rest.
Interfering with those signals by encouraging the provision of sockets to homes that are unlikely to have EVs is clearly both poor resource allocation and a weak nudge given the relative cost of the car to the power source. Largely it will be irrelevant to the uptake of EVs while irritating those saddled with the cost of their removals or upgrade.
And no the question for the IEA is not ‘what wise things should the Government do to meet the Government’s wise plan’, it’s also to question the wisdom, both of the plan and the proposals made.