Energy Storage Research
STATE OF CHARGE
INVESTMENT OPPORTUNITIES IN EV CHARGING
Industry background research available to all professional investors under MiFID II as a minor non-monetary benefit
Government bans on new fossil fueled vehicles in many major economies are likely to drive significant growth in electric vehicles (“EVs”) over the next twenty years. This will create growth in electricity demand from EV charging. The volume of energy to be supplied creates opportunities for both supply companies and generators and the provision of charge points is already creating a new industry. However, the timing of this demand puts pressure on local distribution infrastructure. While smart charging and vehicle to grid technology offer solutions, we believe these will only be partial given likely charging behaviour and as a result there will be demand for additional grid capacity and for other solutions. These other solutions include charger located storage and distributed generation.
Key Takeaways:
• Major Source of New Load: EV charging could add up to 25% to UK peak electricity demand by 2050 if unmanaged — creating multi-billion-pound opportunities for grid-connected infrastructure.
• Public Charge Points to Multiply: CPOs will flourish as drivers increasingly demand public rapid and ultra-rapid charging, especially given that 25% of UK drivers lack off-street parking.
• Grid Reinforcement Issues: Smart charging and V2G can help — but cannot fully offset the demand spikes driven by charging habits. Local grid reinforcements will be required and these come at significant cost.
• Site Acquisition and “Grid Grab”: Securing sites with spare capacity is already competitive. Operators that lock in prime sites will gain a critical advantage as marginal connection costs escalate.
• Storage & Distributed Generation: Battery storage and distributed generation at charger sites will enable rapid and ultra-rapid chargers to operate where grid capacity is constrained. Long-duration storage options like flow batteries and hydrogen fuel cells may see increased deployment.
• Investment Opportunities: Opportunities exist across the value chain:
CPOs & Developers: e.g. Fastned (FAST NA) in Europe.
Utilities and Network Operators: e.g. National Grid (NG/ LN), SSE (SSE LN).
Storage Providers: e.g. RedT (RED LN), Gore Street Energy Storage (GSF LN), Ilika (IKA LN).
Distributed Generators: e.g. AFC Energy (AFC LN), ENGIE EPS (EPS FP), Cap-XX (CPS LN).
This is the first in a series of occasional industry research notes provided by Longspur Research as background to our issuer-sponsored research service. It contains no investment recommendations and is intended for information purposes only. For companies, we offer specialist investment research in new energy and clean technology, available to all professional investors under MiFID II.
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