Charging into Property

No ifs, buts or other political spin, the UK has a legal obligation to reduce its greenhouse gas emissions to net zero by 2050 thanks to the Climate Change Act 2008 (2050 Target Amendment) Order 2019. To achieve that, the Government has an ambitious programme. Part of their proposals include a ban on selling new petrol, diesel or hybrid cars by 2035 paving the way for our roads to be ruled by electrical vehicles (EV). However, a new fuel-free driving world will only work if we have the necessary infrastructure in place.

Deloitte UK have estimated that by 2030 there will be 7 million EVs on the road which, in turn, will require around 28,000 public charging points with a capital expenditure of around £1.6 billion between 2020 and 2030. These are big numbers. Landowners, developers and house-builders are taking them seriously and are considering how to incorporate EV charging points into both their existing developments and future projects and how it impacts the bottom line. Here are some property related considerations to be aware of:

1. The installation and operation of the EV charging points will depend on who owns and who will operate the equipment as well as the ownership structure for the land. Where the person operating the charging infrastructure is separate from the site owner, a lease will be necessary. Any lease should envisage technological and procedural changes. It should permit any necessary (and reasonable) changes to the existing infrastructure without having to approach the landlord for consent.
2. If the land is subject to a charge, the chargee’s consent may be required as well as the consent of any chargee over any superior interest in the land.
3. In 2011, permitted development rights were introduced for EV charging points in public and private car parks. For EV charging points installed elsewhere, these will generally require planning permission. That said, the majority of local planning authorities now require new developments to incorporate a level of EV charging points in their development proposals. For example, Transport for London requires all new parking spaces to include the wiring for charge points with the point to be fitted at a later date.  The Government’s “Road to Zero” strategy includes an obligation on developers to include charging point infrastructure in all new homes.
4. Where landlords are obliged to install EV charge points to improve the amenity of a multi-let estate, thought should be given to service charge – will the cost of the plant, installation and repair be fully recoverable from the tenants? Are the reserved rights under the occupational leases sufficient enough to vary the number of car parking spaces to allow for charging points? For a single-let building with parking, it is likely that the tenant would require landlord’s consent and a licence to alter – are the tenant’s repairing obligations tight enough within the FRI (full, repairing and insuring) lease? Will the tenant be required to remove the charging points at expiry or better to remain? What is the impact on rent review? Can capital allowances be claimed if the charging points remain in situ at the end of term?
5. For connections to the charging point from the electricity grid, the requirements of the distribution network operator will need to be considered – typically, wayleaves and easements for the construction and installation of cabling will be necessary.
6. Relevant warranties or evidence that all infrastructure has been manufactured to the latest technical standards should be reviewed. Landowners and developers may also be liable for assessing and managing the health and safety risks linked to charge point installation and use so it is important to check whether the location is safe and that charge points are used properly.

If you have any questions about this topic please contact Joanne McIvor or any member of Edwin Coe’s Property team.

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