EV Charging Powering the Future

EV Charging – what is it?

EV charging refers to the process of supplying electrical energy to electric vehicles (EVs) to recharge their batteries. This is a crucial aspect of operating electric vehicles, as they rely on stored electrical energy for propulsion. EV charging infrastructure is a critical component of the transition to electric mobility, supporting the widespread adoption of electric vehicles and reducing dependence on traditional internal combustion engine vehicles.

Landlord considerations

There are practical implications of EV charging infrastructure being installed. The installation of EV charge points on land will involve the installation of the charger itself, potentially a booster and electricity cables to and from the charger to a substation. Therefore, landlords should consider the following before investing in EV chargers:

• Access to Power – do you have a substation located on your land that powers your existing buildings and infrastructure? If so, does that substation have capacity to cope with the demand required for the EV chargers? This will depend on the type of chargers you are installing at the property. If you do not have enough capacity, then you will need to seek to install a new substation on your land or potentially connect into a third party’s substation located adjacent to your land. If there is not enough capacity you will also have to apply and secure a new grid connection to your site, which can be time consuming and has a limited time period to effect the new connection (ie complete a substation lease) before the grid connection offer expires. Substation leases can be time consuming to agree and the costs for the electricity provider’s legal fees are often borne by the landlord or EV charge point provider. The term of such leases also tends to be at least 99 years so thought should be given as to the location of any substation compared to future development plans for the site.
• Types of relationships with charge point providers – landlords will have the choice whether to purchase their own charge points and charge for the electricity consumed via service charge to all tenants in a building or on an estate. Alternatively, landlords could choose to enter into commercial arrangements with charge point providers in the form of occupational leases or framework agreements with a simple licence. The benefit of this approach is that a landlord would not have to pay the costs of the charge points or costs of obtaining a grid connection for the charge points. The drawback for a landowner is that they will have granted an interest in their land to a charge point provider eg for 15 years of part of their car park.

Points to consider if entering into leases with EV charge point providers:

• Repair obligations – thought should be given as to the level of reinstatement required following the end of the EV charge point lease and removal of their apparatus.
• Relocation rights – landlords should consider their current and future plans for their car park when locating the EV charge points initially. Relocation rights may be agreed subject to written notice, level of redevelopment and payment of costs to relocate the charge points and any associated substation relocation/connection issues.
• Non compete/right of first refusal – given the commercial investment by EV charge point providers in new sites, they are keen to ensure their initial investment is not passed onto their competitors. The EV charge point providers therefore seek to include limitations on the landlord’s ability to grant interests to other EV charge point providers completely or require the landlord to offer the original EV charge point provider the right to tender for additional installation opportunities first.
• Rental models – EV charge point leases include a range of different revenue sharing options between landlords and the charge point providers. These include a revenue share being paid to the landlord based on the amount of electricity used by the charge point in a monthly period, a per parking bay or charge point fee or a profit rent based on the profits made by the charge point provider after costs. These models, save for the per bay, involve significant reporting obligations on the EV charge point provider to provide and the landlord to review and ensure the sums reported are agreed upon.
• Contributions to costs for the estate/building – EV charge point providers are resistant to contributing additional sums in respect of service charge or insurance rent given their contributions to landlords for the rent, revenue share or profit rent.
  Some landlords have agreed additional sums in respect of increased insurance premiums or service charge contributions eg lighting of car parks/maintenance of car parks which the EV charge point provider also benefits from.
• Obligations on landlords – EV charge point providers are keen to ensure their charge point spaces are used by EV cars and not by combustion engine cars. They often seek to include obligations on landlords to police or ensure the EV charge point spaces are only occupied by EV cars. This should be considered where landlords are not on site regularly or do not have security guards who monitor the car parks.

Tenants’ applications

Some landlords of significant single let buildings or industrial space may receive applications from tenants to install and retain EV charge points on their demise as part of their lease.

Landlords should consider the rights of occupation the EV charge point provider is being granted if the tenant is not purchasing the charge point themselves for their own use. They should also consider the term of any sub lease to an EV charge point provider and the reinstatement/removal obligations at the end of the term of the EV charge point lease (should the landlord not wish to retain the EV charge points at the end of the lease).

Landlords should also factor in the grid capacity for their estate/building and whether they require the tenant to obtain further capacity to facilitate any EV charge point installation. In particular, consideration should be given to the current occupational tenant’s power demands (excluding EV charge points) and their future/a third party future tenant’s demands. If a new substation is required to power the EV charge points, consideration should be given to the location of such a substation and whether this area will need to be surrendered from the tenant’s demise. The costs for entering into such substation lease should be borne by the occupation tenant pursuant to the terms of their lease.

We are available to answer any questions that you may have on EV charging. Please contact: