The lines show the number of publicly available electric vehicle (EV) charging points in each region of the UK, per 100,000 people. London is included as an outlier. The grey bars show the number of devices installed per month for the Electric Vehicle Homecharge Scheme. It is read off the secondary axis, on the right-hand side of the graph.

October’s Chart of the Month focuses on the UK’s electric vehicle (EV) charge points. The graph demonstrates the challenges of decarbonising our roads.

Wealthy nations must reduce their greenhouse gas emissions to limit global warming. Promoting the switch towards electric cars can help to achieve this goal. Importantly, EVs enable consumers to keep the same quality of life while lowering their carbon footprint.

The problem with EVs is that they require charging. For the same selling price, electric cars cannot match the range offered by their fossil fuel counterparts. Consequently, a shift towards EVs depends on an extensive network of chargers. Now that the government has banned new petrol and diesel cars from 2030, this requirement has become even more urgent.

The UK has already made progress in introducing EV charge points. Since 2014, the Electric Vehicle Homecharge Scheme (EVHS) has installed 157,652 electric charge points. The EVHS is a government grant that provides a 75% contribution to the cost of one charge point. 

Current installation rates are far below what is needed if we are all to switch to electric cars. The grey bars show that progress has stalled: the EVHS has installed almost no charging points since April 2021.

Although the availability of chargers has increased across the UK, our chart demonstrates significant regional disparities. Wales and Northern Ireland lag behind, while London has seen the greatest increase. However, even its headline figure of 83.2 charge points per 100,000 people remains meagre compared to what is required. Lack of public charging infrastructure is a barrier to widespread EV uptake.

Unaided, the market may struggle to deliver enough charging points. Charging infrastructure is costly and requires expertise to install. Daunted by high entry costs, firms will not construct new charge points unless they are sure that they can make a profit. If not enough people drive EVs, their charge points will not earn much money. Conversely, drivers will not purchase EVs if charging infrastructure is inadequate.

The underproduction of charging points arises because of a first-mover disadvantage. Although early investment will tend to increase EV take-up, the first movers cannot fully benefit from the induced demand. Consumers who had access to the once limited supply of charge points can switch to other chargers once the market develops over time.

Traditionally, policymakers use patents to incentivise innovation by removing this first-mover disadvantage. They grant innovators exclusive access to their new market, preventing others from using their work. In this case, patents are unworkable: it would be unfair to grant a patent to charging companies, as the technology itself is not entirely new.

“Innovating” investors in EV chargers cannot reap the rewards from their “innovations”, as they are not protected from subsequent competition. Investors prefer to wait then to go first. Then, since no one wants to go first, no one invests at all.

We leave you with today’s Question of the Month:

“How can the government address this market failure? How we incentivise firms to build more EV charge points?”

Data Sources