Proposed decision –To seek approval to:
(i) Accept a Local Electric Vehicle Infrastructure (LEVI) grant of £12,081,000 capital from Department for Transport to support on-street electric charging point infrastructure provision subject to final review and consideration of detailed terms and conditions.
(ii) DELEGATE authority to the Corporate Director of Growth, Environment and Transport, after consultation with the Cabinet Member for Highways and Transport, and Corporate Director of Finance, to review and agree to the required terms and conditions to enter into the necessary grant arrangements.
(iii) Approve the procurement of a Charge Point Operator partner(s), who will be responsible for the installation, operation and maintenance of acounty wide electric vehicle charger network in accordance with the LEVI criteria, subject to agreed terms and conditions.
(iv) DELEGATE authority to the Corporate Director of Growth, Environment and Transport to, in consultation with the Cabinet Member for Highways and Transport, negotiate, finalise and enter into relevant contracts to implement the required contract award
(v) DELEGATE authority to the Corporate Director of Growth, Environment and Transport, after consultation with the Cabinet Member for Highways and Transport and the Corporate Director of Finance, to accept future years’ allocations of the Local Electric Vehicle Infrastructure (LEVI) grant providing funding is given on similar terms.
(vi) DELEGATE authority to the Corporate Director of Growth, Environment and Transport, to take other actions, including but not limited to entering into contracts or other legal agreements, as required to implement the decision.
Reason for the decision:
In March 2023, Kent County Council (KCC) was allocated £12,081,000 Capital funds and £720,000 Revenue funds to develop a county wide approach to EV charging by the Office of Zero Emissions Vehicles (OZEV).The grant is being provided through the Local Electric Vehicle Infrastructure (LEVI) fund to develop a county wide approach to EV charging.
Officers have engaged with the market, liaised with partner organisations, analysed the available options and have recommended an approach - set out in the LEVI Outline Business Case. A decision is required to inform whether to proceed to formally submit an application to OZEV to accept the funds before proceeding to the tender stage to procure a private sector operator(s), with a view to implementing the EV Network in line with LEVI funding criteria.
Background:
In March 2022 the Government published Taking charge: the electric vehicle infrastructure strategy[1]which outlined their intention that Local Authorities should play a leading role in ensuring equitable access to Electric Vehicle Charge Points (EVCP) in their localities.
In February 2023, the Office of Zero Emissions Vehicles (OZEV) published their regional allocation of Local Electric Vehicle Infrastructure (LEVI) funding, of which Kent County Council (KCC), as a Tier 1 authority, was allocated £12,081,000 Capital funds and £720,000 Revenue funds to develop a county wide approach to EV charging.
The focus of the LEVI fund is to help deliver a step change in the deployment of local, primarily low power, on-street charging infrastructure to accelerate the commercialisation of, and investment in, the local charging infrastructure sector.
Government commissioned forecasts set out the need for 22,768 charge point sockets across the public network by 2035 to align with the ZEV mandate.
Officers propose KCC aims to influence the installation of 5,000 sockets by 2030 and a total of up to 10,000 sockets by 2035. Full scenario planning and options appraisal are outlined in the business case.
Proposed recommendations set out in the business case have been influenced by market engagement which has helped informed proposed scale and phasing of delivery, commercial arrangements, length of contract and technical considerations.
Options:
Although KCC have delivered a range of public charging projects to date, none are at the scale required by the LEVI fund. The fund requires new contracts to be tendered to ensure the money is achieving best value.
Multiple scenarios have been considered as part of the assessment process and the recommended approach is via a concession contract:
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Description |
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Option 1: Do Nothing |
Decline LEVI finding. Existing On street Residential Charge Point (ORCS) funding can be leveraged to cover existing projects in the short term. However, OZEV have made it clear the LEVI will be replacing ORCS and it is likely that ORCS will not be available beyond financial year 2023/24, leaving a funding gap. |
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Option 2: Joint Venture |
A new business entity can be established to deliver on-street EVCPs. The associated risk is shared between both KCC and the private sector joint venture partners. Setting up a joint venture comes with its own range of risks which should be carefully considered before choosing this route. |
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Option 3: No private sector capital investment – External operator |
The local authority typically invests all of the capital costs and retains ownership of the assets. Operational responsibilities are transferred to a service provider for part of the revenue. |
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Option 4: Private sector capital investment sought -Concession |
A flexible approach that shares aspects of capital costs, operational costs, control and risk between public bodies and their chose service provider. This approach requires some public sector investment (LEVI) but is primarily funded by the private sector. The local authority has no lasting obligation to the service provider beyond the terms of their concession. |
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Option 5: Land Lease |
A land lease is a low risk-low revenue commercial arrangement where the local authority retains little control over the resulting service by leasing land it owns to a service provider. This is the least involved option for the local authority. Private sector operators are responsible for investment/liability for infrastructure, including maintenance, operation and repairs.
Since a ‘lease’ is just an interest in the property, the party leasing the land has a grant of possession of the land for a definite period and for a definite payment arrangement. Consequently, the local authority has no control over the eventual EVCP infrastructure that is deployed |
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Option 6: Own and Operate |
The own and operate model is the most involved commercial arrangement for the local authority, who pays for all capital costs, covers all operational costs and retains all ownership, control, responsibility, risk and revenue. This option would significantly reduce the scale of delivery unless KCC supplemented the LEVI grant money. |
How the proposed decision supports KCC Policy:
The project objectives will meet the below priorities in Framing Kent’s Future – Our Council Strategy 2022 – 2026.
· Priority 1 – Levelling Up Kent
· Priority 2 – Infrastructure for Communities
· Priority 3 – Environmental Step Change
The programme of on-street EVCP delivery will provide a clear link to the priorities and meets the best value objectives in Securing Kent’s Future as this does not burden KCC with any financial commitments. Initial installation costs and ongoing operation/maintenance costs will be covered by the Charge Point Operator. In addition, KCC expects to receive a new income stream from the project.
The emerging Local Transport Plan (LTP) places a key role for electrified transportation to help Kent reduce carbon emissions and as the catalyst for cleaner travel, into the future. In this respect, the evidence base for the Plan demonstrates that supporting an acceleration in the ownership and use of electric vehicles is likely to be the most impactful action KCC can take.
The LEVI project proposal is linked directly to achieving LTP policy outcomes 7, concerning improving air quality and achieving net zero by 2050 by delivering on LTP objective 7B of aiming to leave no area of Kent behind by the revolution in electric motoring.
Financial Implications:
The recommendation to deliver this project via a public private partnership using a concession contract will not burden KCC with any financial commitments.
Initial installation costs will be covered primarily by the charge point operator partner. Payments will be made in arrears following installation and commissioning of the units to mitigate forward funding risks and to allow for quality checks to take place post installation.
The capital LEVI allocation will help overcome high connection costs and to deliver in locations deemed as less commercially attractive.
The revenue LEVI allocation will be used to cover additional staff time, legal costs and specialist advice in developing the overarching EV strategy.
All ongoing operation/maintenance costs will be paid for by KCC’s chosen private sector charger point operator partner.
In addition, KCC will receive a share of revenue generated via charging sessions. Exact numbers are yet to be determined and will be dependent on utilisation across the network, but the market engagement exercise indicated that various options are available.
Decision type: Key
Reason Key: Affects more than two Electoral Divisions;
Decision status: Recommendations Approved
Notice of proposed decision first published: 19/12/2023
Decision due: 17 Jan 2024 by Cabinet Member for Highways and Transport
Reason: To allow 28 day notice period required under Exeuctive Decision regulations
Lead member: Cabinet Member for Highways and Transport
Lead director: Haroona Chughtai
Contact: Tim Middleton Email: tim.middleton@kent.gov.uk or 03000 412457 Email: tim.middleton@kent.gov.uk.
Consultees
The proposal will be considered by Members of the Environment and Transport Cabinet Committee at their meeting in January 2024.
Financial implications: Please see above.
Equalities implications: None