Purpose

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:
 

 

Description

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.

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.

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.

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.

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

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

As
Cabinet Member for Highways and Transport, I agree 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.