Charging Electric Vehicles Infrastructure in Ukraine
Presented by: Mats Lundin, Celynx AG
Starting from January 1 until December 31, 2018 comes into force the norm of the law on exemption from value added tax and excise tax operations on import into the customs territory of Ukraine and on the supply in the customs territory of Ukraine of vehicles exclusively equipped with electric motors.
Regarding this stimulating law it is logically expected the increase of the sale of electric cars on the territory of Ukraine and increase their popularity among the Ukrainian population, especially considering the growth of the price for classical liquid fuels. Representatives of electrical car manufacturers and dealers have repeatedly stated that for the development of electric transport in Ukraine there should be proper infrastructure, first of all – charging stations.
This Position Paper will only focus on infrastructure for e-cars charging, charging stations and for raising its quality.
The current state of the infrastructure of electric vehicle charging stations
According to the Schneider Electric in Ukraine the total number of charging stations for electric vehicles exceeded 1500, and according to the forecast by the end of 2018 this number will increase to 4000. The number of electric cars in Ukraine is little more than 5000, while the total vehicle fleet is about 9 million cars. According to the Association “Ukravtoprom” in 2017 in Ukraine were sold 2697 passenger electric cars (2.3 times more than in 2016), that is 3.3% of the total car sales in the country.
In Ukraine there are registered more than 6000 “green” vehicles – electric cars and hybrids. However, the country has not developed the charging stations network. It is possible to recharge on the road only in the direction of Lviv, Odesa and Kharkiv. Sometimes you may even have to book time to charge your car on some stations. There aren’t enough charging stations to get from Kharkiv to Lviv.
3. Specific features of pricing models for commercial EV charging
The most understandable and transparent pricing model for EV owners is by the kilowatt-hour because it provides a way to clearly measure the value of the service purchased by the buyer regardless of the charger and the EV brand. Under the current legal framework in Ukraine, pricing by the kilowatt-hour for commercial EV charging may be treated as a sale of electricity and therefore be subject to state licensing requirements and regulation by the National Energy and Utilities Regulatory Commission. The existing charging-station operators are forced to provide the EV charging service either on a per-minute basis or in conventional units.
Pricing by the minute for charging, as viewed by many EV owners, is non-transparent and often unfair because the EV charging rate is highly dependent upon the technical condition of the battery, and it is widely different at different stages of the charging process, i.e. the rate depends on the current battery charge level. Besides, the minute-based pricing model does not account for the actual charger capacity (oftentimes deviating from the declared values) and the capacity of the on-board inverter in the EV, which act as limiting factors during the charging process, but the cost of one minute of charging would still be the same for everybody.
Pricing model based on nominal units, which are essentially equal to kilowatt-hours, is applied by some operators only not to formally mention the kilowatt-hours and thus stay outside the regulator’s radar. This fact is another confirmation that the pricing by the kilowatt-hour is attractive to both charging station operators and EV owners.
This situation does not promote open business practices and is a stumbling block to having new players on the market because they are not willing to use ambiguous pricing models and risk being accused of avoiding licensing and regulation.
4. The increase of charging stations on the base of petrol stations.
Today the network of chargers in Ukraine consists of little more than 400 charging stations. Mainly, charging stations are installed at existing petrol stations. And the largest petrol companies are going to continue this practice – intensively increasing the number of charging stations for electric vehicles at their petrol stations:
The company “WOG” intends to increase the number of charging modules for electric vehicles from 102 (by the end of 2017) to 300. Including about 30 devices for fast recharging (supercharge). It is planned that standard charging modules will be free and for the fast ones you will have to pay. But the price will be at the level of the first cost.
Another major network “OKKO”, which started installing chargers for electric vehicles in 2012, now has 45 charging points at their petrol stations.
The network of petrol stations “KLO” still uses charging stations only for internal purposes – charging of corporate electric vehicles. The reason for this is the high cost of supercharge stations (of the direct current, which charge electric vehicle in 30 – 40 minutes) for the Ukrainian market. At the same time, the company by itself is trying to create a few high speed chargers using Ukrainian transformers (with direct current 50 kW -100 kW). The company is also planning to install 5-7 charging stations on motor roads.
The representatives of the network of petrol stations “SOCAR” (Ukraine) note that they have negotiations with several companies about installing FastCharge equipment which charges Tesla cars in 30 minutes.
The representatives of the European office “Renault” surveyed 63 stations in Kyiv, 17 in Odessa and 22 in Lviv in 2017.
5. The future development of the charging stations infrastructure
A landmark for the Ukrainian market will be the emergence of official Tesla superchargers. At the beginning of November 2017 Tesla continues to declare that its two stations will be soon opened on the highway Kyiv–Lviv.
In addition, during the preparation for the launch of official sales of electric cars in Ukraine, the company “Renault” began to install free charging stations. The Ministry of Infrastructure of Ukraine plans to hold a tender for the purchase of 50 charging stations for electric vehicles worth UAH 4.5 million. It is planned to buy charges from domestic manufacturers. These measures are aimed to develop electric vehicles market in Ukraine and stimulate national manufacturing.
On the 5th of January, 2018 the Lviv City Council approved the Concept of Electric Mobility, which envisages an increase in the number of electric vehicles to 20% by 2025, public electric transport in general – up to 40%, and municipal transport – up to 50%. In public access in the city there are 16 electric vehicles charging stations, another 23 charging stations are commercial. On the basis of this concept, targeted programs will be created for the development of key areas: the program for the development of the network of electric charging stations, the program of measures to popularize vehicles with electric motors, the program for the development of urban public electric transport.
6. In order to ensure high quality fulfilling market demand and business development opportunities in the sphere of development the infrastructure of electric-charging stations Ukraine should :
Arrange the full cycle of electric transport in Ukraine, the creation of an opportunity to buy electric transport inexpensively and also support business development.
Increase the share of electric cars in total car sales by at least 15% by 2020.
Prolong until the 31th of December, 2022 exemption from value added tax and excise tax operations on import into the customs territory of Ukraine and on the supply in the customs territory of Ukraine of vehicles exclusively equipped with electric motors, as well as charging stations.
Within the second, ten-year period, to attract strategic investors to the production of electric transport and charging stations.
Among other incentives for switching to electric transport:
free parking on public and communal parking for 15 years;
0% first registration of e-transport in the pension fund;
for business: zero VAT rate for the provision of transportation services on e-transport, zero VAT rate for the provision of electronic transport for rent, leasing.
7. In order to avoid any harmful regulation of the relationship between owners of charging stations (or charging service providers) and electric vehicles’ owners, EV charging should be interpreted as a service, and not as a supply of electricity. In logic of the Electricity Market Law, owners of charging stations (or charging service providers) must have free access to the choice of the electricity supplier. EV owners must have access to charging stations without an obligatory entering into a contractual relationship with any electricity suppliers. EUEA will soon create a working group on this issue and come forward with a more elaborate proposal.