Zero Emission Mobility Industry Advisory Group - Meeting 1 - 3 December 2019

Agenda

Setting Out Group Objectives:

  • Build a bold, shared, vision of the future of Scotland’s automotive sector
  • Review and discuss Scotland’s strengths and opportunities
  • Confirm a forward plan of work to develop detailed sectoral, and cross sectoral, action plans and commitments

Scotland’s ambition and opportunity - presentation and discussion on:

  • Scotland’s relevant strengths, weaknesses, opportunities and threats
  • A vision and proposition for the sector to guide the ambition and focus of the IAG’s work

From Ambition to Action - focusing on a bus industry example, a facilitated group discussion on the nature of opportunities and challenges and the proposed approach to the IAG’s work.

IAG forward agenda and next steps - presentation and discussion on the proposed format for the IAG work programme.

Background

The meeting included a presentation of KPMG’s background research and the key themes they identified – this is summarized below.

Key themes for Scotland to decarbonise its transport sector (particularly road), focus on: electrification, hydrogen and batteries:

Electric Vehicles

  • Scotland is currently seeing significant growth in ULEV registrations, with the registration of new battery electric and plug-in hybrid vehicles having grown by 46% over the past year, compared to 33% in the rest of the UK.
  • ChargePlace Scotland is our publicly funded and coordinated EV charging network. The Network has grown from 55 charge points in 2013 to over 1,000, including over 200 50kW rapid chargers.
  • 70% of publicly available charge points on the ChargePlace Scotland network are outside Scotland’s large urban areas with 40% of the ChargePlace Scotland network serving small towns and rural areas.
  • There is a Rapid charge point per 15.6 kilometres of trunk road network in Scotland, a charge point for every 10 ULEVs licensed in Scotland and a Rapid charge point for every 50 ULEVs licensed in Scotland.
  • The Scottish public sector owns or operates over 30,000 vehicles of all shapes and sizes: a huge market and opportunity for technology innovation and Scottish supply chains. Other major fleets include bus, and various utility and service sector fleets.

Electric Batteries

  • Battery manufacturing for Electric Vehicles is not established in Scotland as a scaled industry. Scotland does, however, have a small number of companies in this sub-sector, including six battery companies with a Scottish presence and a further 11 companies concerned with battery components or battery management systems (SMS), illustrating a base from which to grow industrial capability.
  • In addition, a number of universities in Scotland (e.g. Edinburgh, St Andrews and Strathclyde) are working at the leading edge of PEMD (power electronic, machines and drives), battery chemistry and hydrogen fuel cells.

Hydrogen

  • Hydrogen is now eligible for the Renewable Fuel Transport Obligation.
  • Scotland has existing hydrogen clusters and the opportunity to develop local supply chains to service them. Scotland has already been relatively successful in lower volume niche transport sectors such as ferries and buses.
  • In addition, Scottish opportunities arise from large scale green hydrogen production for transport and energy services related to the integration of renewables and electrolysis, and the production of blue hydrogen from steam methane reforming of natural gas with CCS. There is also the opportunity to integrate hydrogen into wider energy system including provision of grid balancing services by electrolysers, and to use excess energy from wind for hydrogen production.
  • Scotland already has two hydrogen re-fueling companies selling to the UK and Europe.

Alternative fuels

  • Uptake of biofuels has been limited to date. 3% of fuel sold across UK is biofuel and the UK target is to reach 10% by 2020.
  • Scotland has three companies with biofuel capabilities, selling to the UK, EU and globally.

Scotland’s Automotive Sector

  • Scotland does not have a significant presence in the high-volume automotive industries but does have strong capabilities in a number of niche vehicle manufacturing sectors including buses, ferries, construction trucks, refrigerated trailers and other special purpose vehicles,  providing a platform for a specialist zero/ultra-low emission vehicle industry.
  • Scotland’s 14 largest automotive companies have revenues of over £1.7 billion per annum and employ over 3,500 full time staff.
  • Scottish exports in road vehicles and other transport equipment amounted to £3.5 million and £3 million in 2017 and 2018 respectively.

Scotland’s specific challenges

  • Demand for Electric Vehicles is strong, but supply and cost is influenced by OEM investments and international markets.
  • Scottish geography is highly diverse between urban areas and very rural areas. Infrastructure, initiatives and policies need to reflect regional variations across the country.

Outcomes of the first meeting

  • Prioritised problem/challenge statements discussed
  • Agreement to work activities to be conducted between meetings
  • Forward programme draft agenda agreed
  • Next steps agreed

Supplementary Papers

Pre-Meeting Letter Issued to Attendees of First Meeting

Dear Industry Advisory Group (IAG) participants,

I would like to extend my thanks for such a positive response to participating in this Industry Advisory Group. This is an extremely important initiative to help Scotland harness the economic and supply chain benefits from zero emission, sustainable mobility.

Scotland has a bold agenda for zero (CO2) emission mobility that will help establish Scotland at the forefront of markets and innovation in low and zero emission technologies and markets. The Scottish Government’s Programme for Government (PfG) published in September this year sets out the next steps on Scotland's journey to net-zero emissions and raises our ambition in light of the climate emergency we face. In particular, the Government’s vision for a ‘Mission Zero’ for Transport includes a commitment to:

  • Create the conditions to phase out the need for all new petrol and diesel vehicles in Scotland’s public sector fleet by 2030, and phasing out the need for all petrol or diesel cars from public sector fleet by 2025.
  • Decarbonise flights within Scotland by 2040.
  • Engage extensively with the bus and other sectors to explore how we can create the conditions for a transformative shift to zero emission urban areas by 2030.
  • Decarbonise Scotland’s rail network by 2035.

Alongside this agenda to decarbonise transport, the Scottish Government is focused on creating a more successful country with opportunities for all of Scotland to flourish through increased wellbeing, and sustainable and inclusive economic growth. We are also working with sectors across the economy to tackle immediate challenges such as air quality and poverty. Moreover, we aim to enable Scotland to be an open and connected nation and make a positive contribution internationally.

The potential local and global market for zero emission transport products and services is large and includes opportunities in areas as diverse as vehicle design and manufacture, batteries, motor components, recycling and integration of vehicle systems into energy systems. Scotland has considerable strengths in the automotive sector, particularly in heavy vehicles, alongside industrial and academic research capability in allied sectors such as renewable energy, hydrogen, energy storage and digital technology.

Harnessing substantial Scottish economic benefit from the growth in zero emission mobility will require a partnership approach spanning public, private and academic sectors to broaden our capabilities, funding sources, skills and facilities, alongside targeted work to break down demand-side barriers and help increase the competitiveness of Scottish companies engaged in transport and related sectors in UK, European and global markets.

We would like to use this Industry Advisory Group (IAG) to generate insight and advice from leaders and influencers from across industry to identify:

  • The challenges and opportunities facing the sectors involved in sustainable and zero carbon mobility; and practical actions that the Scottish Government, its agencies and the business community can undertake to enable innovation, growth, diversification and investment in the key automotive sector.

We aim for this group to be action focused and outcomes driven. We are personally committed to driving actions forward to deliver on the opportunities presented in Scotland. Therefore, we anticipate there will be additional work undertaken, and additional working groups, between each of the four main IAG sessions. Further detail on this can be found in this pack and will be explained in the 1st session.

We are also keen to ensure each member of the groups has the opportunity to explore topics of importance to them, therefore, we have asked KPMG to assist us structuring the sessions to revolve around key priorities to you. We will discuss this at the first meeting.

Thank you again for joining the group, we look forward to meeting you on the 3rd December.

IAG Secretariat

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Published Date 3 Dec 2019 Type Topic