23 November 2023 • 2 minute read

Powering the future of electric vehicles: The global charging imperative

Download the full report Watch our launch event recording

Our new report, in collaboration with Infralogic, dissects the rapid expansion of electric vehicle (EV) infrastructure globally, highlighting how technological innovation and policy developments are creating a fertile ground for investment and growth.

Key insights from the report include:

Investment trajectory: Witness the growth from a single deal in 2018 to 83 significant transactions worth USD 21.1 billion in disclosed deal values in 2023. Discover how a conservative five-year growth trajectory could lead to a total market value that eclipses expectations to over USD 57.4 billion.
Market momentum: Expect a significant increase, with EV infrastructure investments projected to rise sharply, indicating a period of exceptional growth.
Policy drivers: Learn how supportive policies are fuelling the shift, making now the opportune moment to engage with the EV industry’s growth.
Europe at the forefront: Despite significant anticipated growth across all geographies, and the US and China remaining the largest markets by size, observe Europe's significant role as a primary destination for EV infrastructure investment within the expanding global market.
Primary risks and obstacles: Including operational and maintenance costs of charging stations, high upfront costs/financial investment requirements, sustainable business models and inadequate standardisation and compatibility between charging equipment.

The electrification of the auto industry and the rise of EVs

The electrification of the automobile industry represents a monumental and necessary shift for the transportation sector and the global economy. Several catalysts for change, from technological advancements and environmental concerns to changing consumer preferences, have crystalised a global consensus on the need to transition towards low-carbon economies worldwide. Governments, too, are taking matters seriously, with net-zero targets being announced and many countries phasing in bans on internal combustion engine (ICE) automobiles.

Transportation is a major source of greenhouse gases, accounting for 20% of global CO₂ emissions, primarily from ICE vehicles. Widespread adoption of electric vehicles (EVs) is seen as the most promising pathway to curtail CO₂ emissions, with the potential to reduce them by 80% by 2050, according to the National Renewable Energy Laboratory. The uptake of hydrogen as an alternative fuel, especially for heavy-goods vehicles, may also play an increasingly important part in the energy transition, though respondents to our survey are nearly unanimous in their belief that EVs’ role will be considerably more meaningful.

EVs’ share of the overall car market has risen significantly across all geographies in recent years. Accounting for less than 5% of new cars sold in 2020, that share almost doubled to 9% in 2021 and climbed again to 14% in 2022, according to the International Energy Agency (IEA). China contributed around 60% of global EV sales last year, and in August 2023 more than one in four cars sold in the country were electric (26%), according to CleanTechnica statistics. That market is followed by Europe, where more than one in five of all new cars sold was electric last year, and then the US, where EVs accounted for 8% of car sales.

"At Uber, we are trying to get everybody into EVs. The drivers who work on our platform don’t tend to live in the richer parts of the city and so their access to charging infrastructure is often more limited. The government subsidies and investment programmes that provide startup capital into those spaces are crucial."

Christopher Hook
Global Head of Sustainability
Uber

"We’ve seen mega growth in the industry and whilst most of that activity has been in terms of M&A and equity investment, we are starting to see project financed deals, which is the sign of a maturing market and greater appreciation of the associated revenue flows. That said, with a diverse set of business models out there, players will need to understand the different revenue streams available and target the correct opportunities with credible operating plans. This remains, for the moment, a rather fragmented sector, and we can expect to see consolidation in due course.”

Rubayet Choudhury
Partner
DLA Piper, London

Risks inevitable in new markets

Investing in still-nascent sectors inherently carries risk. Our survey respondents believe the primary risks associated with investing in EV charging infrastructure are the operational and maintenance costs of charging stations and the high upfront costs and financial investments required. In a distant third place is uncertainty in electricity pricing and energy market dynamics.

Goal-oriented industry

Our findings illustrate clearly how Europe is regarded as a world leader in setting ambitious EV adoption objectives. In February 2023, the European Commission set a target for all new cars sold in the European Union (EU) to produce zero CO₂ emissions by 2035. Meanwhile the current UK government intends for the sale of petrol and diesel-powered cars in the country to be banned by 2035.

"Major federal legislation enacted in the last two years provides unprecedented US government funding, incentives and credits to manufacturers and purchasers of EVs and equipment, batteries, clean energy projects, charging infrastructure, and related projects and activities, including approximately USD370 billion in the 2022 Inflation Reduction Act alone,”

Paul Hemmersbaugh
Partner and Chair of the Transportation Regulatory Practice
DLA Piper, Washington, DC

"In Europe, under the Green Deal and the ‘Fit for 55’ concept, a series of proposals have been made to revise and update EU legislation and new initiatives are under discussion to ensure that EU action is in line with the climate targets and the net-zero goal can be reached. However, many OEMs and Tier 1 suppliers have told us that innovation gets lost due to regulators setting too many requirements, and that they fear a competitive disadvantage in comparison to requirements set by the governments of China and Japan, though they also have ESG agendas and emissions-reduction goals."

Sylvia Ebersberger
Partner and Global Co-Chair of the automotive subsector
DLA Piper, Munich

Download the full report

In association with

About Infralogic
Our aim is to empower the global infrastructure and energy transition investment community with the tools it needs to thrive and drive our industry forward.