Electric driving: accelerating or short-circuiting the grid and your investments?
The transition to electric driving is fully under way and requires a robust charging infrastructure. According to Statbel, there were 254,240 fully electric passenger cars in Belgium on 1 August 2024, an impressive 83.2% year-on-year increase. This entails significant challenges for the electricity grid and a need for substantial investments in infrastructure and technology. But there are also opportunities.
Big changes start out small
Although the current numbers are impressive, electric vehicles (EVs) still only represent a small portion of the total vehicle fleet in Belgium. According to Statbel, the passenger car fleet is dominated by petrol cars, which account for 51.4%, followed by diesel cars at 31.8%. EVs currently represent 4.2% of the total number of passenger cars in Belgium. EV charging is more expensive in Belgium than almost anywhere else in Europe, as a study by the research company Transport & Mobility Leuven has shown, with prices sometimes going through the roof at public charge points in particular. This high price for charging is stopping consumers from buying an EV.
“But the share of EVs is expected to rise significantly in the years ahead, especially given the stricter emission standards and the shift in tax benefits towards EVs,” says Anthony Sandra, Portfolio Manager at KBC Asset Management. “This growth will inevitably lead to expansion of a national network of charge points that will compete on price and on meeting demand and customers’ preferences, which in turn will contribute to wider acceptance of EVs.”
Impact on the grid
Studies predict that cities such as Brussels may well have up to 500,000 EVs by 2050. This rapid growth places a heavy load on the electricity grid. Simultaneous charging of large numbers of vehicles can lead to peak loads, especially in the evening when households’ energy consumption spikes as well. These peaks can increase the risk of overloading the grid, which may result in voltage sags or even power outages.
A question I sometimes hear being asked is whether our current charging infrastructure and pace of the roll-out of charge points will allow us to keep up with the rapid growth of EVs. An understandable concern, even if the growth in the number of charge points in Flanders is currently outpacing that of EVs. But it is still advisable to accelerate and stay ahead of the curve.
Anthony Sandra, Portfolio Manager at KBC Asset Management
Already come a long way
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“If something is good, we will definitely say so,” Sandra affirms. “The publicly accessible charging infrastructure is growing extremely quickly. Compared with the start of 2021, the number of fully public charge points had more than tripled by the end of December 2024, Flemish government figures reveal.
The large majority of the locations where drivers can charge their EV are semi-public charge points. Overall, there are now almost thirteen times as many of these charge points as there were four years ago.”
Charging capacity in the public space and at store car parks and company car parks in Flanders is boosted strongly by this growth. “In rolling out fast-charge points in its store car parks, the Belgian supermarket chain Delhaize, for example, is providing a strong example of teaming with Electra, a leading European specialist in fast-charging for EVs. This showcases how these two companies are delivering both a practical charging solution for their customers and a contribution to reducing CO2 emissions,” says Sandra.
More than two out of three cities and municipalities have already reached the targeted ‘desired’ charging capacity. Charging capacity is not expressed in the number of charge points but in charge point equivalents (CPE). The CPE number for a specific charge point depends on charging speed and accessibility. The CPE target aimed for by the previous Flemish government by 2025 was duly achieved in the summer of 2024.
“It’s not just a matter of rolling out more charge points but also of ensuring a balanced distribution across the entire country so as to avoid regional inequalities,” says Sandra. “The number of charge points in Flanders may be growing faster than the number of EVs but that does not mean we are immediately headed for an oversupply of charging infrastructure and charging capacity. Each year, the number of EVs on our roads in Belgium increases by some 200,000. Acceleration on several fronts is needed and this will require many additional investments and adjustments.”
Front-runners
“Cities like Oslo are front-runners in adopting electric mobility. With EVs accounting for more than 90% of new car sales, Oslo has learned valuable lessons about integrating EVs in the urban grid,” comments Sandra. “It’s instructive to note that Oslo’s electric grid is similar to that of Brussels, suggesting we can also achieve a smooth transition if we take the right measures.”
For us, Oslo is a textbook example of what the transition to electric driving means for urban electricity grids. It teaches us which measures are right for us as well. This is not so much about major investments in infrastructure, but rather about steering consumer behaviour and using smart technology.
Anthony Sandra, Portfolio Manager at KBC Asset Management
“Oslo’s experience shows that what is needed for preserving a well-balanced grid is not so much major investments in infrastructure, but rather steering of behaviour and using smart technology. For example, lower charging prices can steer customers that are price-conscious and don’t mind a detour to regions or neighbourhoods where there is surplus electricity at certain times or during off-peak hours, between moments of peak loading.”
“Smart technology doesn’t steer the user but the grid,” Sandra notes. “For example, ‘load balancing’ spreads charging across several vehicles to prevent the grid from overheating. Vehicles may take slightly longer to charge as a result, but in a workplace environment in which they remain stationary in the same car park for some time anyway, this will not be much of a problem for users.”
“If you enhance a smart grid with a renewable energy source and a battery, you can adjust charging to the availability of electricity in your own grid,” Sandra adds. ”Not only that, you can even capitalise on price fluctuations in the wholesale market by charging your EV and/or battery when there are electricity surpluses and prices are low. And conversely, you can use the battery for charging when there are electricity shortages and prices are high.”
”A bidirectional charging station is another smart technology – albeit currently still with a hefty price tag – that turns your EV into a home battery on wheels,” Sandra notes. “This kind of charging station can not only charge your vehicle’s battery but also get electricity back from it. That is only practicable if you have solar panels.
This enables you to store surplus solar power in your EV to be used later in various ways. To power your home, for example. This is called ‘vehicle to home’. Or to charge a phone, a laptop or another vehicle: ‘vehicle-to-load’. You can also use the ‘vehicle-to-grid’ process by returning the stored electricity to the grid. It’s best to do this at a time when demand – and therefore also the price – is higher. There aren’t all that many EVs yet that offer bidirectional charging.”
Required investments and adjustments
Adjustments to the grid will be required in connection with the energy transition. For example, the electricity grid itself needs to be enhanced and modernised to be able to cope with the increased demand and variable supply – i.e. the volatility of electricity generation from renewable sources such as wind and solar.
Grid operators already seek to incorporate sufficient buffering because not all smart technologies are equally mature. By 2029, Sibelga plans to invest more than 500 million euros in the modernisation and expansion of the grid, and Fluvius around 4 billion by 2032 in its operating area in Flanders. This involves laying hundreds of miles of new cables, building additional transformer stations and other critical infrastructure.
Ready for the electric revolution?
For installers alone, McKinsey sees potential turnover of more than 240 billion euros in charging infrastructure in Europe up to 2030. And that offers opportunities for acceleration, including in investors’ portfolios.
Anthony Sandra, Portfolio Manager at KBC Asset Management
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“By pro-actively planning and investing in smart technology, we can ready the electricity grid for the future of mobility and fully realise the advantages of EVs without jeopardising the stability of our energy supply. For installers alone, this means potential additional turnover of more than 240 billion euros up to 2030, in addition to the suppliers of smart software systems for EV fleet management, charging optimisation, smart grid systems, utilities that can launch new products, and so on. All of this offers opportunities for acceleration in investors’ portfolios,” Sandra concludes.
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The information contained in this publication is for information purposes only and should not be considered as investment advice.
