Thinktank calls for sales mandate for zero-emission vehicles

An influential thinktank has urged the government to free up cash for electric vehicle charging infrastructure by forcing auto-manufacturers to increase the share of such vehicles in their sales mix via a “California-style” mandate.

In a new report, published yesterday (22 July), the Policy Exchange recommended the adoption by the UK of a zero-emission vehicle (ZEV) mandate.

Under a similar requirement introduced by the state of California in the 1990s and subsequently adopted by nine other US state, China and two Canadian provinces, an increasing share of motor manufacturers’ sales must be ZEVs.

Motor companies can also meet the mandate by buying credits from other manufacturers, the report explained.

It said imposing a mandate is a “better” than expanding existing approaches, like the Plug-in Car Grant and favourable tax treatment for ZEVs, which the report describes as likely to be “unnecessarily expensive”.

As the sale of ZEVs increases, the report warned these schemes will become increasingly expensive and will therefore need to be phased out. Combined with the fall in fuel duty resulting from the disappearance of internal combustion engine vehicles, these subsidies would “severely strain” the public finances, it predicted.

Imposing a ZEV mandate on manufacturers would free up government funding that should instead be used to expand policies that complement the roll-out of ZEVs, including support for EV charging infrastructure.

Once the ZEV mandate is in force, the Policy Exchange recommended that the government should gradually phase out subsidies for electricity vehicles, including those used as company cars.

By increasing duties on diesel and more polluting vehicles, the report said the ZEV mandate can be revenue neutral for the government, whilst giving car manufacturers’ greater confidence to invest in UK manufacturing.

But it warned that without a comprehensive policy framework, like the ZEV mandate, the UK will not be able to end the sale of new petrol, diesel and hybrid cars and vans by 2035 or earlier as the government is currently proposing to do.

The report recommended that the government and devolved administrations continue to support the competitive procurement of rapid EV charge points on strategic routes and in rural areas and support work by local authorities to roll out on-street and workplace charging infrastructure.

The thinktank additionally urged the government to offer continued support for the introduction of Clean Air Zones, which have in many cases been delayed during the Covid-19 pandemic, including by targeting EV charging infrastructure in these areas. It said the introduction of Clean Air Zones will encourage the faster roll-out of ZEVs.

SSEN recently called for the introduction of a Dutch model for the rollout of charging infrastructure, whereby network operators would work with local authorities to hold “area-wide tenders”.