Ofgem to ensure electric car revolution unlocks full benefits for consumers
- Our priorities will ensure electric vehicle (EV) rollout unlocks full benefits for consumers and the environment, and reduces the cost of the energy system.
- Adopting smart charging and vehicle-to-grid technology will help keep bills lower over time for consumers.
- Proposals will bring down costs of installing new electric vehicle charge points where they are most needed.
Ofgem recently (04 September 2021) set out how it will support the rollout of electric vehicles (EVs) in Britain, ensuring that the infrastructure and technology is in place for the rapidly growing number of EVs on the road, with an estimated 14 million by 2030 (1). This will include:
- Ensuring the energy network is prepared for EV uptake. Ofgem will ensure network capacity is in place to support the rollout of electric vehicles, with billions more in network investment expected to follow as part of our next network price control (2). Investment is already taking place, with £300 million approved by Ofgem in May 2021, half of which will be used to develop EV infrastructure, including rapid charge points (3).
- Making connections to the energy network easier. Ofgem is proposing to bring down costs for large users, such as electric vehicle charging stations, of connecting to the grid where reinforcement is required (4). This is an important change that will enable a greater number of people to have access to charge points where they need them.
- Maximising the benefits of smart charging. Smart charging electric vehicles at periods of low demand will enable EV owners to fuel their EVs for less, and will make more efficient use of the system as a whole, saving money for everyone. (5).
- Working to support the development of vehicle-to-grid. Vehicle-to-grid technologies will allow EV owners to earn money by exporting electricity back from their car battery to the grid when it is most needed. This will help reduce the amount of electricity generation needed at peak times. Exporting electricity through vehicle-to-grid, if combined with an uptake of smart charging, could reduce peak demand equivalent to the generation capacity of up to ten large nuclear power stations. (6). This would reduce the overall cost of running the electricity system and help keep bills lower for all consumers, including those who do not own electric vehicles
- Helping drivers switch to EVs. Ofgem will work with energy suppliers and innovators to make sure there are a range of products, services and tariffs for UK energy consumers to take advantage of. It will ensure consumer protections are updated to keep up with technological and business model change.
Launching Ofgem’s strategy to consumers at Fully Charged Live Neil Kenward, Ofgem’s Director of Strategy and Decarbonisation, said:
“Electric vehicles will revolutionise the way we use energy and provide consumers with new opportunities, through smart products, to engage in the energy market to keep their costs as low as possible.
“Our electric vehicle priorities not only provide a way to meet our climate change targets but importantly offers ways to protect consumers from rising bills, through a three-prong approach of increased use of electric vehicles, smart charging and vehicle-to-grid technology which together can help drive down costs for all GB bill payers.”
020 7901 7460
Media out of hours mobile: 07928 829894 (media calls only)
Notes to Editors
- The Committee on Climate Change’s Sixth Carbon Budget Balanced Pathway projects that the number of pure EVs on the road could grow rapidly to 14 million by 2030 from half a million in 2021.
- Ofgem will in 2022 announce its next electricity distribution price control (RIIO-ED2) expected to enable billions of pounds of investment in the local distribution networks which will help support EV charging infrastructure. This week Ofgem also announced £450 million innovation funding that will be made available over the next five years to fund big, bold and ambitious projects that help us get to net zero, including those that will help support the EV rollout.
- In May 2021, Ofgem announced £300 million for additional network investment as part of the RIIO-ED1 Green Recovery Scheme. Around half of this investment is for new EV charging infrastructure such as cabling and substations that will provide the network capacity to support 1,800 new ultra-rapid charging points at motorway service stations, tripling the number of these public charge points, and a further 1,750 rapid public charge points at other key transits and city hubs to reduce EV range anxiety and improve consumer confidence.
- Any new large electricity user connected to the distribution network – such as an electric vehicle charging depot – currently has to pay for the costs of reinforcing the local grid if additional capacity is needed. These connection costs can be particularly high where the grid currently has less capacity, and in areas where there is already a lot connected to the local grid and there is a need for more infrastructure. We are proposing to remove connection charges for these network reinforcements, and instead recover these costs through the ongoing network charges paid by all users of the distribution system. This will make it cheaper to install new EV charging stations in the locations they are needed. This change applies to the reinforcement (upgrades to existing network), but not the extension asset (new network) component of charges.
- Ofgem has already announced its decision to introduce Market-wide Half-Hourly Settlement (MHHS) which will place the right incentives on energy suppliers to develop and offer new tariffs and innovation that encourage more flexible use of energy, for example time of use tariffs, automation, vehicle to grid solutions and battery storage.
- The National Grid ESO’s Future Energy Scenarios 2021 (FES) publication identifies that V2G could provide a temporary demand reduction of between 8GW and 20GW by 2050 with up to 45% of consumers participating with V2G, depending on the future energy scenario. When combined with demand reductions from smart charging, this could be up to 32GW (dependent on the scenario) – the equivalent of 10 large nuclear power stations.
General enquiries (non-media)
If you are an energy customer looking for help and advice, including complaints about energy firms, please see our Household gas and electricity guide. Citizens Advice also provide a free, impartial helpline service across a range of issues on 0808 223 1133.
We also regularly share news and post general advice to help consumers get the most out of their energy services via our @Ofgem twitter and Facebook pages. If you have an enquiry or complaint relating to Ofgem’s policies or functions, contact us at email@example.com or on 020 7901 7295.
For all other non-media related enquiries, please visit our Contact us page.
Ofgem is Britain’s independent energy regulator. Our role is to protect consumers now and in the future by working to deliver a greener, fairer energy system. We do this by:
- Working with Government, industry and consumer groups to deliver a net zero economy at the lowest cost to consumers.
- Stamping out sharp and bad practice, ensuring fair treatment for all consumers, especially the vulnerable.
- Enabling competition and innovation, which drives down prices and results in new products and services for consumers.
For energy insights and updates straight to your inbox from Ofgem, please subscribe.
Latest News from
Ofgem protects customers of GOTO Energy (UK) Limited19/10/2021 15:15:15
GOTO Energy Limited yesterday announced they are ceasing to trade. GOTO Energy (UK) Limited supplies gas and electricity to around 22,000 domestic customers.
Ofgem appoints Shell Energy Retail Limited to take on customers of Pure Planet Limited, Daligas Limited and Colorado Energy Limited19/10/2021 12:33:00
Ofgem has appointed Shell Energy Retail Limited to take on supplying Pure Planet Limited, Daligas Limited and Colorado Energy Limited’s combined total of approximately 252,000 domestic customers and 600 non-domestic customers. This follows a competitive process run by Ofgem to get the best deal possible for customers.
Ofgem protects customers of Daligas Limited15/10/2021 10:10:00
Daligas Limited yesterday announced they are ceasing to trade. Daligas Limited supplies gas to around 9,000 domestic and non-domestic customers.
Ofgem protects customers of Pure Planet and Colorado Energy14/10/2021 10:25:00
Pure Planet Limited and Colorado Energy Limited have announced they are ceasing to trade. Pure Planet supplies gas and electricity to around 235,000 domestic customers and Colorado Energy supplies gas and electricity to around 15,000 domestic customers.
Ofgem appoints E.ON Next to take on customers of ENSTROGA, Igloo Energy and Symbio Energy05/10/2021 10:25:00
Ofgem has appointed E.ON Next to take on supplying ENSTROGA, Igloo Energy and Symbio Energy’s combined total of approximately 233,000 domestic customers.
Ofgem protects customers of failed suppliers ENSTROGA, Igloo Energy and Symbio Energy30/09/2021 10:20:00
ENSTROGA, Igloo Energy and Symbio Energy announced yesterday that they are ceasing to trade. ENSTROGA supplies gas and electricity to around 6,000 domestic customers. Igloo Energy supplies gas and electricity to around 179,000 domestic customers. Symbio Energy supplies gas and electricity to around 48,000 domestic customers and a small number of non-domestic customers.
Ofgem appoints Shell Energy to take on customers of Green Supplier Limited27/09/2021 15:43:00
Ofgem has appointed Shell Energy to take on supplying Green Supplier Limited’s (‘Green’) approximately 255,000 domestic customers, and a small number of non-domestic customers.
Ofgem appoints Octopus Energy to take on customers of Avro Energy27/09/2021 11:43:00
Ofgem has appointed Octopus Energy to take on supplying Avro Energy’s approximately 580,000 domestic customers. This follows a competitive process run by Ofgem to get the best deal possible for customers.